Financial Presentation March 2017 Aurora City Schools Financial Presentation March 2017

$34.4 Million Operating Expenditures

Two Expenditure Categories Account for 93% of the District’s Expenditures Salaries and Benefits 86% Purchased Services 7%

Increases in Base Pay-Aurora Staff School Year Increase on Base 2011-2012 0% 2012-2013 2013-2014 .75% 2014-2015 1.0% 2015-2016 2016-2017 1.25% 2017-2018

$34 Million Operating Revenue

Three Revenue Sources Account for 94% of the District’s Revenue 1. General Property Tax 68% 2. State Student Aid 17% • $6,000 per Student Core Funding FY17 • Aurora has a 20.2% State Share • Aurora receives $1,212 per Student 3. Property Tax Allocation 9% • Real Property Tax Rollbacks on Levies before August 2013 • Included TPP Reimbursement prior to FY17

There are Two Types of Millage Inside Millage – Unvoted – Aurora has 5.6 mills of Unvoted Millage – Revenue grows with increases in valuation Voted Millage – HB 920 (1976) Limits revenue to the amount generated when the levy was initially approved

Example   50 New Homes x $300,000 Average Cost = $15,000,000 $15,000,000 x .35 (assessed value) = $5,250,000 increase in valuation $5,250,000 x .0056 = $29,400 additional tax revenue

Levy Cycles   For districts like Aurora, with a high reliance on local property taxes to fund operations, there is little opportunity for annual revenue growth without voters passing additional levies. As expenditures grow faster than revenues, maintaining cash balances becomes unsustainable without adding new revenue from additional levies. This is called a levy cycle.

Expenditure and Revenue Growth

Revenue and Expenditure Growth with New Levy

Issue #4: Levy Issue-May 2017 5.9 mill operating levy (Continuing) $207 per $100,000 of valuation; Will generate $3.7 Million Mill – A unit of taxing measure equaling $1 for every $1,000 of assessed valuation (35% of value). Last new operating levy money was November 2012 Aurora has an strong record of levy passage. Last failure in 2007– guard against the “It’ll pass, it always passes” mentality. November 2007 Yes- 1,897 No- 1,998 March 2008 Yes- 3,348 No- 2,950 November 2012 Yes- 4,568 No- 4,346

A Proud Tradition of Academic Excellence Our district is a leader in academic excellence and financial efficiency! Designated “America’s Most Challenging High Schools” – Washington Post, “America’s Top High Schools”- Newsweek Magazine, & “Gold Medal School” - U.S. News & World Report. ASCD performance index score ranks our district in the “top 1-2%” of all public school districts in Ohio while our costs are in the 21st percentile.

A Proud Tradition of Financial Efficiency Ohio Auditor of State Award- Six consecutive years! Energy Star Certificate- U.S. Environmental Protection Agency Over $500,000 in energy savings in past five years.

Have We Tightened Our Belt? Implemented Pay to Participate Fees. Eliminated 7th & 8th grade boys and girls soccer, softball and baseball teams. Eliminated Technology Integration Position Eliminated Secretary Position Eliminated $90,000/Yr. Maintenance Contract

Aurora’s Outstanding Results Are An Economic Value DISTRICT District Pupil/Administrator Ratio District Expenditure Per Pupil AURORA 211/1 11,319 Revere 204/1 13,110 Hudson 182/1 12,966 Chagrin Falls 176/1 13,412 Brecksville/Broadview Hts. 174/1 11,936 Solon 168/1 13,866 Kenston 158/1 12,304 Westlake 157/1 13,271 Bay Village 154/1 12,242 Kent 133/1 14,034 Beachwood 125/1 21,165 West Geauga 91/1 12,711 Rocky River 79/1 12,520 The larger the #, the better the ratio. We have an admin for every 211 students, where Solon has one for every 168 Solon’s $2,547 per student is actually over 7.5 million dollars per year in additional expenditures

Economic Value!! District Expenditure per Child Difference in Total $’s/Year AURORA $11, 319 Solon $13, 866 $7.4 Million Hudson $12,966 $4.8 Million Beachwood $21,165 $28.5 Million Kenston $12,304 $2.8 Million Chagrin Falls $13,412 $6.0 Million West Geauga $12,711 $4.0 Million Took the difference between the amount spent and multiplied it by 2,900 students

What Has Changed? Less State Support 2011- 27.8% 2016- 25.1% 2017- 23.0% State Average- 45.7% This is a revenue issue, not a spending problem. Loss of state revenue due to the rollback and then elimination of TPP

Tax Bill- Comparable Districts District Name 2017 Tax Bill Per 100,000 North Olmsted (North Olmsted schools) $3,088 Bay Village (Bay schools) $2,982 Chagrin Falls (Chagrin Falls schools) $2,642 Rocky River (Rocky River schools) $2,550 Mayfield (Mayfield schools) $2,541 Bainbridge Twp. (Kenston schools) $2,441 Orange (Orange schools) $2,346 Strongsville (Strongsville schools) $2,303 Solon (Solon schools) $2,295 North Royalton (North Royalton schools) $2,253 Brecksville (Brecksville-Broadview Hts. schools) $2,237 Copley Twp. (Copley/Fairlawn schools) $2,230 Twinsburg Twp. (Twinsburg schools) $2,187 Hudson (Hudson schools) $2,170 Stow (Stow-Munroe Falls schools) $2,158 Beachwood (Beachwood schools) $2,095 Aurora (Aurora schools) $1,873

Where do my Property Taxes Go?

Most Common Questions 1. Will we ever see taxes decrease? Yes- As more houses are built, each homeowner sees a small reduction. Also, just this past December 1.52 mills came off the tax roles. 2. Didn’t we just pass a levy? Yes- we have 3 (5-Year) levies- 2 operating and 1 permanent improvement that are renewed every 5 years. 3. We have $7 Million; why do we need 5.9 mills? Due to inflationary measures we are currently in deficit spending. Levies do not generate more revenue over the years. Thus, revenue stays flat and expenses continue to increase. Current rollover ranks us in bottom ¼ of all districts.

Cuts Due to Levy Failure Eliminate 1 School Resource Officer (SRO) Increase Athletic Pay to Participate Fees Eliminate Board AP Test Contribution Personnel- Eliminate 5 Employees Supplementals- Elimination of several supplemental positions Eliminate Field Trips Reduction in Professional Development Budget

Communications Strategy This levy is necessary due to the state cuts in funding. This revenue is essential to maintain our current academic programs. Levies are a fact of life for Ohio school districts. The current public school funding structure in Ohio means that virtually every school district throughout the state must return to voters for financial support on average every three to five years. We will be transparent with all the facts and figures as they are presented in all of our materials. These dollars are necessary for use to maintain our district performance and meet all of the accountability measures.

Key Campaign Messages This is a revenue issue, not a spending problem. The majority of the revenue generated by the levy will be used to prevent a deficit and will prevent reductions in academic programing. Protect the value of your home. Financial need for the levy. We are now in a place where we need to replace those state dollars. Superior student achievement. Consequences of a levy failure. Continued fiscal responsibility. We are not adding staff, programs, etc.. If the levy fails there will be cuts- still being finalized with the board- the personnel will be informed in March

Let’s Maintain Our Excellence May 2nd, 2017 5.9 mill operating levy