Oregon School board to consider $1.2M budget cut

4/9/2008

More than a month after they supported a new tax levy and only a few days before their school board plans to make major budget cuts, Oregon City Schools parents, teachers, and administrators expressed frustration with a state tax situation they feel has left them powerless.

Superintendent John Hall is up in arms about a state house bill passed in 2005 to encourage major businesses to invest in Ohio.

State House Bill 66 was designed to, over the course of several years, phase out personal tangible property taxes on the value of business equipment and inventory - through which some school districts such as Oregon receive significant funding.

Lawmakers theorized lower taxes would make investment more affordable for businesses and make Ohio more competitive with other states, but Oregon Schools Treasurer Jane Fruth said the bill will also result in the district losing more than $7.5 million in tax revenue over the next few years.

"It's taking money the corporations used to have to pay and they're throwing it back on the local tax payers," Mrs. Fruth said. "The state created a situation that is very tough for us right now."

The school board will vote Monday night on budget cuts recommended by Mr. Hall, which will include laying off teachers in an effort to save $1.2 million next school year.

The school board recently informed Sandra Frisch, superintendent of Lucas County Educational Service Center, her agency's services would be phased out to save money. The measure would save about $300,000 and likely prevent some layoffs, according to school board President Eric Heintschel.

"The number of teachers let go will be less than the 13 that's been previously reported," he said.

During a recent interview, the superintendent declined to reveal what he would recommend to the board.

"There's still some tweaking I have to do," he said.

The district's budget cuts will come less than two months after voters supported a new 5.9-mill levy that will generate about $3.5 million a year and cost $181 per year for the owner of a $100,000 home.

Still, fourth-grade teacher Mary McGill said she was not surprised by the cuts.

The mother of four is the head of Clay High School's Academic Boosters, a parent-teacher organization.

"It was very well publicized before the vote that cuts would have to be made," she said. "Our union officials and also our administrators had been very open."

Mrs. McGill agrees the state's school funding system is to blame, not the school district.

But the budget cuts, she said, will not affect the quality of education.

"Some of the bus routes are going to be changed and have been changed," she said. "Field trips, that will be changed, things like art and music. Those are the kinds of things affecting their overall school day."

The $7.5 million figure school officials have cited in terms of lost revenue does not include money allocated to the district through the state's Commercial Activities Tax, which was also passed in 2005 to make up for revenue lost as a result of State House Bill 66.

Mrs. Fruth said Oregon Schools is scheduled to receive $4 million this year generated by the CAT tax, which she said gives the state direct control over money that was controlled by local government in the form of personal tangible property taxes.

She points out that although it was designed to "hold harmless" local school districts by replacing lost property tax revenue, the CAT tax collects money at a 2004 revenue stream that does not cover the cost of business in 2008.

"There's just no revenue growth for us at all, none," she said. "And unfortunately our revenue expenses just continues to rise. The only place we can go is to the tax payers, which creates a problem for everybody."