Ohio’s public schools are bracing for a financial catastrophe. Recent analysis shows that close to 10% of the state’s school districts will experience severe financial strain by the end of the current fiscal year. By 2030, that number is projected to jump to over 63%.
Districts facing budget shortfalls have limited options. They can seek voter approval for property or income tax levies, charge higher student fees for activities like sports and music, or cut expenses through layoffs and program eliminations. When districts can’t solve the problem on their own, the state steps in with oversight and control.
Ohio’s three fiscal distress levels
The state uses a three-tier system to classify school district financial health: fiscal caution, fiscal watch and fiscal emergency.
Fiscal caution is the first warning stage. Districts must develop a plan to cut costs and avert a projected financial crisis in coming years. They typically must lay off staff and eliminate services…