Akron Public Schools continues to face a bleak financial future, said new Treasurer Wayne Bowers, with the prospect of asking voters to pass another levy to sustain operations, maintain fiscal viability and avoid a looming state takeover.
Even with a new levy, jobs are likely to be cut.
This school year, Akron’s public school system, which educates around 19,000 students across 46 schools, is projected to outspend its revenue by more than $10 million, Bowers told school board members during a recent presentation.
If nothing changes, the school district will exhaust its cash reserves by 2028. Two years later, it could have a negative cash balance of more than $159 million.
“I understand what,” Bowers said of the state of the school district’s finances. “Now it’s time for me to dig into the why — why these numbers say these things? What’s behind all of that?”
The simple answer is that the school district’s spending outpaces its revenue, but there’s more involved than spending habits. Decreasing student enrollment, declining state funding and broad cuts at the federal level have already affected programs in Akron schools.
This financial situation is not unique to the Rubber City. In fact, APS is in better financial standing than its public school counterpart in Cleveland. Urban districts across the state are struggling to remain in the black after state lawmakers reneged on the funding formulas in the Fair School Funding Plan, which was passed in 2021 under the promise of more equitable funding.
The state’s school voucher program, which is being challenged in court, worsens the financial situations of public schools by siphoning off tax dollars that follow students attending non-public and charter schools.
Last year, Bowers said the district lost upwards of $20 million to vouchers.
Suggested Reading
What’s the outlook for Akron Public Schools’ finances?
Akron Public Schools estimates it costs about $114 per day to educate a student — with 77% of that money coming from a variety of non-resident tax revenue streams.
In 2021, it cost less than $90 per day to educate a student.
Meanwhile, Bowers said the school district annually loses about 1% of its student population — about 200 students. Some students leave for voucher schools; others attend other public school districts through open enrollment; some families move out of the district.
For example, in 2021, APS had 19,938 students enrolled, according to Bowers’ presentation. Four years later — this fall — that number has fallen to 19,036. By 2030, using historical trends, the district projects the student population is estimated to drop below 18,000.
“Those choices that they have out there — charter schools and vouchers, homeschooling — … that just skyrocketed this year,”Assistant Treasurer Todd Adkins said.
The district will submit the five-year forecast to the state in coming months, and the state will review it. The forecasts can be amended at any time, so if Akron’s administration makes changes that positively impact it, the district can resubmit the forecast.
The school district’s finances were buoyed a bit after voters passed a levy last November, the first time the schools had asked taxpayers to directly support them in 12 years. Then, former Treasurer Steve Thompson said the district would avoid spending its cash reserves until 2028.
Are there options to improve district finances?
A silver lining, according to Bowers? The district has a bit of time before the forecast becomes a crisis.
The district is working on a plan administrators hope to finalize around Christmas before notifying staff of cuts. It’s also undergoing a performance audit by the state, which Bowers said will help evaluate staffing levels.
Staff reductions could impact every type of job in Akron schools, from teachers and secretaries to administrators and maintenance workers.
Staffing expenditures comprise the largest portion of Akron’s budget — about 81% is dedicated to salaries and benefits. That’s more than $315 million annually.
“We kind of sort of believe we’re pretty lean as it is,” Bowers said. “We’re going to be digging in on all this stuff … along with every single number, and figure out, is this correct? Are we accurate with this projection, or how does this compare to other districts?”
Another option the district will evaluate is consolidating its footprint, which means closing schools.
Included in the budget considerations is the rebuilding of a combined Miller South School for the Visual and Performing Arts and Pfeiffer Elementary on the site of the now-demolished Kenmore High School. The project is paid for through general fund cash, remaining Community Learning Center construction funds and a $40 million loan through the state. Costs for the project have risen sharply over time, forcing the school district to reconsider previously planned aspects of the school.
A new North High School is on the horizon too, after voters approved a construction bond to raise $85 million, repaid over 37 years, alongside the operational levy last November. Since that project will be paid for by the bond issue, it is unlikely to have a direct impact on cash reserves.