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West Clermont Words

Five Year Forecast

Five Year Forecast

by Dan Romano, Treasurer and CFO
West Clermont Schools

Financial Forecast Shows West Clermont “House” in Good Shape

Have you ever driven past a house you used to live in? Or better yet, the elementary school you attended? Did they look different than what you remember? Time and unforeseen circumstances can certainly change a person, place or thing. The same is true for the budget of a school district. 

West Clermont Schools Board of Education recently reviewed and approved the district’s five-year forecast. This forecast is intended to engage school administration and the community in long-range planning and discussions on financial issues facing the district now and/or in the future. Just as a storm could knock down a tree at your old house or time can make the paint peel on your elementary building, so too can state funding or a global pandemic impact the district’s budget. Developing a five-year forecast is as much an art as it is a science. We do our best based on the information and data that are currently available. 

I am happy to report that as of today, our five-year projections are on target with previous forecasts and show a positive cash balance through June 30, 2026. I’d like to recognize our community for the part you play in helping us achieve this. Thank you to our residents for your support of our May 2020 emergency levy and your continued support during an unprecedented time. Thank you to our teachers and staff for your commitment to our students. Thank you to our Board of Education and leadership team for your strong focus on our financial commitments and for keeping students at the center of every decision. 

Currently, property tax revenues are West Clermont’s largest source of revenue at 55%. Following a reappraisal cycle in 2020, property values increased by $164 million. Reappraisals will occur again in 2023 and while projections indicate that values will once again increase, this is an unknown that could have a future impact on our budget. 

The next largest revenue stream for the district comes from the state and makes up 36% of our budget. The goal of the new Fair School Funding Plan is to provide more equitable funding to schools across the state. The amount West Clermont Schools is receiving based on this plan, however, is frozen for FY22 and FY23 to funding levels that go back to 2019. If it were not for a provision that guarantees our district a minimum funding level of 2019, the new formula would reduce revenue to the district by more than $1 million. Looking further up the road to the next state funding cycles, our district is at risk of losing state dollars. Hard to believe, but this is true even if the state legislators choose to increase funding to the state’s education budget.   

Our spending over the last two years reflects the promise we made to our community in 2020. We have maintained our current level of services and with the one-time allocation of federal ESSER relief funds (approximately $14 million) we are able to initiate our Onward and Upward program investing in our people, programs and processes.

The most significant impacts on our budget in the short term will be inflation, workforce shortages, and the uncertainty of enrollment growth. All of these can have an immediate impact on the budget leading to adjustments that may impact class size, programs and operations.

We will continue to be prudent in our decisions and good stewards of the resources provided to us. With continued support of our community, parents and staff we are maintaining a focus on improving student performance and outcomes.

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