Forest Hills School District expects its General Fund spending to exceed revenue by fiscal year 2029, according to a five-year financial forecast Treasurer Alana Cropper presented to the Board of Education on Aug. 19.

The General Fund covers about 80% of the district's total budget. The forecast projects a $4.1 million surplus in FY2027 and a slim $611,593 surplus in FY2028.

After that, the math flips.

By FY2029, the forecast shows a $3.6 million deficit. By FY2031, the annual shortfall grows to $10.7 million.

No levy appears in the forecast's disclosure table through FY2031, and the district said in a Sept. 8 summary that it does not anticipate needing one "in the immediate future." But the same statement acknowledged that the projected cash-balance decline "will play a role in future conversations around school funding."

Why revenue is flattening

The core problem is property tax revenue, which makes up 52% of General Fund income. Ohio's House Bill 920, a 1976 law, requires county auditors to lower school tax rates as property values rise so that voted levies produce roughly the same dollar amount year over year. The district's residential tax rate sits at 29.07 mills for tax year 2026.

The result: real estate tax revenue is projected to grow an average of just $296,748 per year through FY2031. Over the prior five years, that figure averaged $2.9 million per year. Overall General Fund revenue is forecast to grow 0.56% annually, compared to a historical average of 5.44%.

Expenditures, meanwhile, are projected to climb 3.83% per year. Salaries make up 60% of General Fund spending and are forecast to grow 3.59% annually. Benefits, at 24% of spending, are projected to rise 5.05% per year.

FY2026 beat projections

Cropper's presentation also covered the fiscal year that ended June 30, which came in ahead of projections. Actual revenue beat the February forecast by $613,759, driven largely by Tax Increment Financing (TIF) payments. Expenditures came in $750,720 under budget. Together, those variances added $1.36 million to the ending cash balance.

Board Vice President Jason Simmons asked Cropper to explain TIF funding during the Aug. 19 meeting. Cropper said most of the district's TIF arrangements run through Anderson Township, which represents about 56% of the relevant improved value. She told the board at the meeting that Anderson Township has generally "held them harmless" in almost all TIF agreements, meaning the district is protected from losing expected revenue.

Cash reserves shrinking

The forecast projects the district's days of cash on hand will drop from 146 in FY2027 to 67 by FY2031. The ending General Fund cash balance is projected to fall from $42.5 million in FY2027 to $22.4 million in FY2031, a decline of about $16 million compared to FY2026.

State policy adds uncertainty

Property tax reform at the statehouse adds another variable. Gov. Mike DeWine signed five property tax reform bills in late 2025, including House Bill 186, which caps growth in school district 20-mill floor revenue to the rate of inflation. WOUB reported that the state estimated HB 186 would provide $432 million in credits to homeowners for tax year 2025 and $608 million for tax year 2026.

In May, Board Member Jeff Nye told the board that the Forest Hills Council, a group of PTO representatives and support organizations, had discussed concerns about a separate proposal to eliminate property taxes in Ohio entirely. A new governor takes office during FY2027, and the district said the state budget process that follows could significantly affect forecast projections.

The board approved the forecast 4-0, with Board President Wendy Strickler, Simmons, Nye and Erin Walczewski voting yes. Jeremy Ward was absent.

The next forecast update is scheduled for February 2027.