Cincinnati Public Schools (CPS) strives to provide a high-quality education for all students, while remaining fiscally responsible to its taxpayers. It's a delicate balancing act.
The district's fiscal year runs from July 1 through June 30. The financial process begins in the spring when schools and departments prepare their General Fund budgets. (These do not include state or federally funded programs such as Title 1). In late spring, the superintendent presents a consolidated district budget recommendation for the Board's consideration. By the end of June, the Board authorizes funds to be spent for the upcoming school year based on the approved budget.
State law requires that school districts operate within a balanced budget, meaning that its expenditures will not exceed cash balances.
The difficulty arises because close to 90% of the district's revenue comes from two sources — state per-student allocation and voter-approved tax levies tied to property taxes — and neither of these sources has increased with inflation. The state per-student allocation is not expected to increase in the next 5 years. The last time CPS asked voters to approve an operating levy for new money was 2000.
However, the district's costs do go up because of inflation. For example, in this current economy, homeowners will see gas and electric bills go up annually to keep up with the rising cost of natural resources. The same thing happens to expenses incurred by the school district.
Also, many additional costs are generated by state and federal mandates. For example, Ohio law requires that school districts provide the same level of transportation service to students attending private or charter schools as they provide to students attending district schools.
As a result of the stationary revenues and increasing costs, CPS often is forced to make budget cuts, which can affect the quality of education. Cincinnati Public Schools began rightsizing its budget in 2004, and, with very careful planning, has managed to keep its budget at the same amount for the past three school years. About 1,350 employee positions have been cut since 2003, a large cut for one of Cincinnati's top-ten employers.
To be responsible spenders of taxpayers' money, CPS is providing more financial data for public review. A new Finance Team, with outside experts, is looking at ways to improve the district's financial processes. This includes starting the budget process earlier in the school year to provide more planning time, providing new tools for employees to develop budgets and track spending in real time, and providing more real-time financial data for decision-makers.