Ohio Revised Code 5705.391, amended in 1997, requires school districts to file a Five-Year Forecast for the General fund with the Ohio Department of Education. Ohio School districts are the ONLY governmental entity in Ohio that is required to provide or attempt to forecast revenues and expenditures for a five (5) year period. For instance, the state of Ohio only estimates its budget for a 2-year biennium period. Northeastern Local Schools gets roughly 44% of operating funds from the state of Ohio. It is clear that projecting district resources for five (5) years would be a daunting challenge even in a stable economy, but adding in the recent difficulty along with the fact that the state of Ohio, a major provider of our operating resources, only projects out two (2) years at a time and it becomes extremely challenging. Nevertheless, the board and Administration work closely for months at a time and on an ongoing basis to estimate, project, and adjust forecasted revenues and expenditures in its five (5) year forecast.  

The five (5) year forecast must be filed with the Ohio Department of Education by November 30 and May 31, in each fiscal year (school district fiscal years are July 1 through June 30) and end June 30^th . Current school district five (5) year forecasts are available for all school districts in Ohio at the Ohio Department of Education.

Five-Year Forecasts

The five (5) year forecast filed in May of each year is the beginning point and chief planning tool at a macro level for the following fiscal year’s budget. Generally, in April of each year, the Treasurer’s Office prepares budget estimates of the past couple of years' expenditures in detail to all the Building Principals and Department Directors so they can begin preliminary work on a detailed line item budget which is the baseline of financial accountability. Meetings may be held on budget training and budget hearings on the total combined budget. The finished document is typically done in late May or early June, the Administration manages the budget within the expenditures in the object line of the detailed five (5) year forecast estimates of expenditures. In this way, the budget never exceeds the five-year forecast. This helps establish the current and long-term (up to five years) resource planning of district resources. The public, Board of Education and Administration can use this annual budget tool to understand the financial position of the District in the short term, HERE AND NOW, while the five (5) year forecast which drives the annual budget gives them a level of control over the long term resources of the district.   Please review the Appropriation Budget document with an eye on the present – this fiscal year.   

The budget, which should be balanced to the five (5) year forecast, builds the spending plan for the current fiscal year operations. The tools used to report short-term financial operations are: 

• SM12 – a monthly report to review revenues and expenditures budget versus actual down to the monthly level and year-to-date variance levels. We use this report and will be posting the report monthly. The treasurer’s office has adjusted the monthly number to reflect the estimated timing of the revenue or expenditure in the current fiscal year. The Treasurer’s Office explains monthly any significant or material variance from estimates. 
• Appropriation Budget – the tool to determine needs and match to available resources. The target at the present time is resource allocation to address building and department needs across the District. We use the appropriation (expenditure) budget because the Board and Administration have greater control over increasing or decreasing these resources as necessary. Revenues are not as easily controlled because over 44% of those come from external sources beyond the district.  
• The last piece of the short-term financial picture is the current fiscal year within the Five Year Forecast.  The Appropriation Budget will be the projection of the first year in the forecast. The Major Key: We have tied the Board and Administration's short-term planning to the five-year forecast. 

The Five-Year Forecast, as noted above, the Ohio Department of Education has mandated the reporting of a five-year forecasting model that draws the road map of the general financial direction of the district. Northeastern Local School District involves the Administration in planning the larger picture (Staffing and Capital Needs) over a five-year period. The Five (5) Year Forecast model and detailed “Notes to the Five-year Forecast” in detail addresses the assumptions made to generate the numbers. The accuracy of the predictions are key to providing a stable educational program to our students. Levy projection, renewals, and needs are also very important factors in the long-term plan. The largest issue that a reader of our Five (5) Year Forecast must take into consideration is the outside factors affecting the finances utilized within the system. We use due professional care in estimating all resources in the forecast. Therefore, the budget and thus all of our operating plans that sit on those estimates are as good as we can humanly make them, but to some extent, there will always be variances. That is why each month, we report to the Board and Administration what those current year variances are and how they may, if at all, affect the longer-term projections of the district. 

Five-Year Capital Plan 

The District has three available funding sources for the Capital needs, the Permanent Improvement Fund, the 034 Building Maintenance Fund for the new buildings, and the General Fund. Every year during the budgetary process the administrators can request items to be considered to be funded from these sources. Every other year we update the Capital Plan with new requests or deleted items no longer needed. The FY19-23 Capital Plan was a tool to plan and assess the needs from the principals and departments as we prepare to move into the new building. The major capital needs and major costs items new assessed and updated to prepare a financial plan around the upgrades – Roofs, Asphalt, Sidewalks, HVAC, and buses carry large dollar amounts. A quarterly report of actual Capital Expenditures is prepared and available on the Permanent Improvement Fund Revenue and Expenditures page.