Marysville schools project multi-year operating deficit despite levy; state budget and property-tax bills pose uncertainty

The Marysville Exempted Village School District board on Monday approved a five-year financial forecast that projects an operating deficit each year, even after the passage of a new emergency levy.

The forecast, presented by the district treasurer, shows revenues exceeding $63.5 million for fiscal 2025 and projects the district’s cash balance will remain positive through the forecast period but decline to about $2 million by the end of the five years. “At the end that’s about 2,000,000 dollars,” Treasurer Todd Johnson said during his presentation.

The forecast factors in new revenue tied to preschool enrollment and a $6.9 million emergency levy passed by voters in May; levy collections are phased in, with partial collection in fiscal 2026 and full collection by fiscal 2027. Johnson told the board the forecast also assumes about $577,000 in additional state funding in fiscal 2026 tied to taking on the preschool program, and about $1.2 million projected from tax-increment financing (TIF) areas based on 2024 values.

Johnson and board members repeatedly cautioned that the forecast is a snapshot with substantial uncertainty. He flagged several pending state actions that could materially change the district’s outlook: the biennial state budget still moving through the legislature, proposals to change how property taxes and valuations are calculated, and specific bills that could affect school funding. “There’s multiple issues within the Senate that could potentially impact the local funding as well,” Johnson said.

Board members and the treasurer identified particular legislative items to watch: the biennial budget deliberations, proposed limits on school-district carryover balances that could empower county budget commissions to suspend voter-approved levies, and several bills discussed during the meeting’s legislative update (including measures affecting tangible personal property taxation and school funding formulas). Jermaine (board member, legislative report) summarized the landscape of bills and budget activity and noted that some proposals could reduce local property-tax receipts or change the calculation of the 20-mill floor.

Expenditure drivers in the forecast include wages and benefits (about 89% of operating expenditures), projected healthcare increases, the addition of preschool staff (about $3.0 million in wages and benefits in fiscal 2026), an estimated $650,000 for contracted preschool transportation and about $700,000 to reinstate school resource officers in the projection. Johnson said the district assumes six new hires per year in the forecast and is modeling conservative enrollment funding assumptions.

The board voted to approve the five-year forecast and related treasurer action items. Board policy was discussed as an internal control: the district’s cash-balance policy aims for one month of expenditures in the forecast; the projection meets that goal through fiscal 2028 but drops below it in fiscal 2029. Johnson called the policy threshold an “alert” that would trigger board action such as budget cuts, levy planning or using reserves.

Board members urged community engagement with state legislators given the uncertainty in the state budget and potential legislation affecting local revenue. Several members noted the levy’s passage improved the forecast but said long-term stability remains contingent on state decisions and local economic changes.

The board vote to approve the forecast and associated treasurer items was recorded as in favor by board members present.