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By SHERYL DeLONG
Daily Globe News Editor
SHELBY — The Shelby City School District was officially released from fiscal emergency Thursday morning. At a special meeting of the Shelby City Schools Board of Education on Wednesday evening, the Shelby Fiscal Commission and members of the State Auditor’s Office came together to terminate the district’s financial red flag, after reviewing proof the schools are back in the black.
Unice Smith, from the office of the Auditor of the State of Ohio, Division of Local Government Services, and her assistant Laura Brown, gave a presentation of the district’s financial forecast.
Brown went through a statement of revenues, expenditures and changes in fund balances of the general fund for the fiscal years ended June 30, 2005 through 2007, actual, and for the fiscal years ending June 30, 2008 through 2012, as forecasted.
Figures show total revenues for 2005 were $14,458,000, while expenditures were $18,828,000; revenues for 2006 were $15,924,000, while expenditures were $17,308,000; revenues for 2007 were $17,783,000, while expenditures were $17,938,000. Revenues for 2008 are forecasted to be $18,710,000, with expenditures projected as $18,001,000; revenues for 2009 are forecasted to be $18,295,000 with expenditures projected as $18,190,000; revenues for 2010 are forecasted to be $18,257,000, while expenditures are projected as $18,266,000; revenues for 2011 are forecasted to be $18,515,000, with expenditures projected as $18,897,000; and revenues for 2012 forecasted to be $18,482,000, with expenditures projected as $19,171,000.
Superintendent Bryan Neff explained that in the last three years of the forecast, the district will be operating under deficit spending.
“When property tax issues are passed as renewals, they are not allowed to grow - the millage decreases in order to keep them at the same value,” Neff said. “Some levies that are renewed have been on for a long time. Operating costs continue to increase, while the money we take in from those levies stays the same.
“The plan to eliminate deficit spending would be to go back to the voters in a few years,” Neff said. “Because we can’t really say where school funding will be at that time, we can’t say for sure if that’s what we’ll need to do.”
Brown highlighted revenues under the headings of general and tangible personal property taxes, income tax, unrestricted grants-in-aid, restricted grants-in-aid, property tax allocation and all other revenues including open enrollment, extracurricular transportation, interest on investments, miscellaneous fees, rentals and abatements. She also included other financing sources, such as insurance and FEMA monies awarded after the Flood of 2007. Expenditures Brown went over included personal services (salaries and wages), employees’ retirement and insurance benefits, purchased services, supplies and materials, capital outlay, debt service, liability insurance and awards, and operating advances/transfers out.
Smith then went through a booklet prepared by Auditor of State Mary Taylor, outlining the Shelby School District’s fiscal emergency termination. She explained the district has a two year window from the time of termination to implement completely each of the auditor’s recommendations. Of the 28 recommendations to be met by the district for release from fiscal emergency, 15 have been implemented, nine are in the process of being implemented, and four have not yet been implemented. Smith said she was confident that the next time she reviewed the district’s accounting methods, all recommendations would be complete.
“Because this meeting began at 6 p.m., and the auditor’s office is now closed, the Shelby City School District will be officially terminated from fiscal emergency on the morning of May 1, 2008,” Smith said amidst applause.
Neff thanked the community and the city for their support of the schools, the current and previous administration, the SEA and SASS unions and their representatives, and the Fiscal Planning and Supervision Commission.
“In 2006, we had a deficit of $3.2 million and asked to be placed into fiscal emergency,” Neff said. “Thanks to the community’s passage of the income tax levy, and extensive cuts made to expenditures and staffing, in January, the board passed a resolution requesting a release from fiscal emergency.
“We felt the pinch everywhere,” Neff said. “But with careful spending and a capable treasurer, we were able to make our way back. Through the heartache and pain, the entire community came together.”
Neff went on to highlight the accomplishments of the students attending Shelby City Schools, triumphant and successful in academics, athletics and the arts despite the funding crisis.
“Things are moving along, even though we’ve had to cut back,” Neff said.
Board President Randy Terman expressed his sincere appreciation for everyone involved in the recovery process and Boardmember Bruce Briggs thanked the community wholeheartedly for passing the income tax levy.
Mike Watson, chair of the Fiscal Commission, took his place at the podium.
“It’s been a real pleasure working with these people,” he said of the Commission members. “We’ve all worked collectively and cohesively for the betterment of this district. Unity was vital to its recovery.
“Although we see a positive cash balance at the end of the Five Year Forecast, I would suggest you keep your sights on that line for the next five years,” Watson said.
 Shelby Fiscal Planning and Supervision Commission Chair Mike Watson thanks the community for its support of the district during its financial crisis.
“My department is very much aware of the sacrifices made by staff and administration, of the support by the community... and we’re very aware of the sacrifices the children have made and the decisions the school board has had to make,” Roger Hardin, Funding and Fiscal Support Officer for the Ohio Department of Education, said. “Ladies and gentlemen, your work here is done.”
Watson read a resolution that officially disbanded the Commission.
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