Strongsville Schools Take a Hard Look at Looming Fiscal Woes

Strongsville Schools Treasurer  Thursday and there wasn't much good news. 

First, there is the August 6.9 mill levy that, if approved, would keep the district on firm fiscal footing though 2015. If the levy fails, board members have agreed upon and accepted a recommendation to make another $1.6 million in cuts -- on top of $4 million already made -- for next school year, he said.

Also, if new state mandates, lower revenues or higher expenditures surface, that $1.6 million could increase. 

Parkinson also said the district could lose tax money due to the sluggish economy, surging property delinquencies and slumping home sales. 

“As I look at valuation, I see an ugly sight,” he said. 

After peaking at $3.3 billion, overall construction and development in the state has plummeted to $950 million, and it’s anticipated that figure will slide further downward. This translates to less new homes and businesses in Strongsville and throughout Ohio, which means less tax money on local and state levels. 

To compound matters, median list and sales prices in Strongsville have fallen by $17,600, from $191,000 to $173,400, and the median value of homes has dipped from $201,000 in June of 2006 to $162,000 as of this year. 

“I don’t anticipate this turning around anytime soon,” he said. “There is a lot of bad housing data coming out, and I don’t think we’re going to see the bottom anytime in the near future, which is going to impact the district’s finances.” 

The district’s $13.4 million in investments are another concern. 

“Interest rates, as I’ve indicated month to month with the financial reports, are abysmal ,” Parkinson said. “Right now, they’re sitting at .05 percent. I’ve indicated to the board that, to be perfectly honest, it makes no sense for me to do investments any more because the earnings are only $3,000 a month and, quite honestly, I could stick all the money in a checking account and the bank will credit us back the fees that we pay and I would save more money from not paying fees than I would from earning money in a savings account. 

“So basically the investments are going to be almost nonexistent until it starts making sense for the district to start reinvesting money.” 

However, he stressed that all of these financial landscapes will continue to shift and fluctuate, and more will be known at the end of next month when Governor John Kasich finalizes his two-year state budget.