Dear Tiger Families:

As I previously wrote to you, on December 13, 2022, the Twinsburg City School District received written notification from the Ohio Department of Education that, based upon our FiveYear Forecast, the District faces an approximate $2 million deficit in Fiscal Year (FY) 2025. Because of that projected deficit, the District is designated in a "Precautionary" financial state as public school districts are not permitted to operate with a deficit. The Ohio Department of Education required the District to submit, by February 28, 2023, a written plan to address this deficit. Unfortunately, the revenue the District once received through Tangible Personal Property Tax/CAT Tax has now been totally eliminated. In Ohio, House Bill 66 (HB66) was the legislation that eliminated the tax businesses paid on Tangible Personal Property (TPP). The original legislation set forth that the State of Ohio would reimburse school districts for several years the amount of lost revenues. A tax once under local/county control was eliminated and was replaced by a State collected Commercial Activity Tax (CAT). The District received the last of those funds in FY22. Ultimately, the Twinsburg City School District lost approximately 30% of the current budget and is now faced with significant fiscal challenges while the State of Ohio keeps the CAT tax money in the State’s General Fund. Please refer to my weekly update of January 15, 2023 for additional information regarding the District's financial situation. During the month of January, we were also informed by the ODE that the District was expected to not only address the deficit in FY25, but also the deficits in FY26 and FY27 as well. Obviously, this meant that the reductions in expenditures would need to exceed $2.1 million. Ultimately, the reductions in expenditures are noted as $2,898,000. in this plan. Three specific areas were identified to address the deficit: The generation of additional revenue; cost avoidance, and additional efficiency measures. It was important for us to look at every facet of the District in the development of this plan. On February 15, 2023 Treasurer Mrs. Julia Rozsnyai and I presented the proposed Expenditure Reduction Plan to the Board of Education.  The Board, in turn, voted to approve the plan.

 
Obviously, when asked to address deficits of -$2.1 million in FY25; -$13.5 million in FY26; and -$27 FY26; and -$27 million in FY27 as noted on our District's Five Year Forecast, we will be required to reduce the ranks of our employees. This is a very difficult and troubling statement to make as every member of our staff is important to our students, to our District, and to our community. I am deeply troubled by the emotional and financial impact these decisions will have upon colleagues who have been nothing but supportive of our school family. Further, I am deeply troubled by the thought that we will lose the very people who support our students, especially given how frail many of them are both academically and emotionally, as we move forward through the pandemic. We have not specifically defined where the reductions in staff will occur as we continue to review ways to be least impactful to our students. However, the dollar amount has been set and thus, we know what is expected as far as these reductions are concerned. As we move through the remainder of this school year, the various tenets of this plan will be further defined. I realize that everyone wants to know the details now. Please know that the work of further refinement is complex and needs to be done in a thoughtful and deliberate manner. As always, I will provide updates and remain transparent in this matter.

As we worked to develop the Expenditure Reduction Plan, state legislators crafted House Bill 1.  House Bill 1, introduced by Representative Adam Mathews, would enact sweeping reforms to the state’s income tax and, to pay for that change, drastically modify Ohio’s property tax system. This top priority legislation would make several changes, including:

Based on a preliminary review of state tax data, the elimination of the 10% property tax rollback for schools will decrease school budgets statewide by an estimated $805 million. If enacted, this bill will significantly and negatively impact our District’s already fragile financial situation.  The District would have no other choice than to seek additional support through the passage of a levy to address the further reductions in state aid. I encourage you to stay close to the discussions being held in Columbus regarding House Bill 1. Further, I respectfully request that you advocate for fair funding for our school district as well as for all public school districts in Ohio by reaching out to our state legislators:

Representative Bill Roemer:  [email protected]

Senator Kristina Roegner:   [email protected]

Thanks for your continued support of our Tigers,

Kathi Powers, Superintendent