In our previous article, we discussed that the district relies heavily on local property taxes as a result of the State’s limited contribution toward the district’s operating cost, and that the district’s financial stability depends on the renewal of two temporary operating levies. Combined the temporary levies make up 28% of the district’s operating revenues. Generally speaking, the total operating revenues have been around $23 million for the past few years. The district has maintained solid control over their expenses during the same time frame.
To have a balanced budget, the district must spend less than it brings in each year in taxes and state funds. Lakewood has had a balanced budget for the past eight years. Limited increase to expense growth was the primary contributor of this outcome. Typically, Ohio school districts experience annual increases in spending more than 3% per year. Lakewood has averaged a spending well below the norm.
There are many expenditures a school district must spend money on including classroom supplies and materials, utilities, maintenance, fees, etc. The most significant however is the cost of personnel and their associated benefits which include health insurance. For Lakewood Schools, 76% of the district’s annual operating are related to personnel cost. Purchased services are the next highest expense items at 14% of the district’s budget.
The fact that staffing, benefits, and health insurance largely drive the district’s cost to operate, maintaining control over these costs are key to financial stability. Lakewood’s Chief Financial Officer’s continued efforts to control costs in this area has steadied spending of taxpayers’ money and lead to a solid and balanced operating budget.
As a result of the District’s financial management and current financial standing, the community will not need to provide any (new) additional money (taxes) to operate the schools beyond the renewal of the current emergency levies.