State Funding Overview

Every two years, Ohio lawmakers approve a new state budget. The budget is introduced in stages, beginning with the Governor’s proposal (see what the Governor proposed below in the 3/20/25 update) and moving through both chambers of the legislature before a final version is signed into law.

We are currently at the House-Introduced Version of the budget. 

Similar to the Governor’s proposed budget, the House version increases public dollars for private and charter schools along with the state’s voucher program. (See the 3/20/25 update below for more details.) Likewise, many of the policy changes that would impact schools are also the same. (e.g., a statewide ban on student use of cell phones in school is in both proposals.) 

Where the House version differs significantly is its proposed language to restrict how public schools manage their funds – including local dollars voted for and paid for by district property owners.

The House budget proposal imposes a cap on public school district cash balances to 30%. This type of restriction (never before done in the state’s history of school funding) would significantly impact our district’s ability to plan long-term and maintain financial stability.

What Is a Cash Balance and Why Does It Matter?

A school district’s cash balance is like the fuel tank in a car. It holds the reserve funds that keep the district running smoothly, especially when the road ahead is uncertain.

Districts can only refill the tank when voters approve a new operating levy because state law (House Bill 920) prevents voted local dollars from rising with inflation, and revenue from the state has been flat for decades in Mariemont City Schools.

But expenses for things like healthcare, staffing, utilities, and supplies continue to rise, even when revenue stays flat. This creates a natural funding gap over time.

The cash balance, funded through voter-approved levies, is what closes that gap. It bridges the difference between flat revenue and the growing costs to operate our schools.

Maintaining the cash balance as a financial planning tool is not just about keeping the engine running; it’s about making sure we don’t stall out when the unexpected happens.

Mariemont City Schools has a long history of strategic and transparent financial planning. Our model prioritizes consistency, predictability, and stability for residents and students.

A key part of that strategy is not just how we save but how we use our cash balance as a planning tool.

We don’t wait for the tank to hit empty before taking action.

MCSD uses the 20-25% cash balance mark (roughly three months of expenses) as a trigger to begin planning for the next levy. This ensures we have adequate time to inform the community, forecast needs, and avoid disruption to school operations.

The graphic below shows how we monitor our reserves like a fuel gauge, using the 20-25% mark as our signal to begin planning for the next levy.

This forward-thinking approach and strategic use of our cash balance has allowed Mariemont to maintain high-quality services, handle unexpected facility needs like roofing or HVAC without additional funding requests, and have strong financial standing without placing undue burden on taxpayers year after year.

As a result of strategic use of the cash balance, our district can:

• Refuel and request operating levies only every 4-5 years

• Keep levy amounts modest, typically under 6 mills

• Support staffing, programming, and safe, well-equipped facilities for students

• Manage unexpected expenses and changes in state funding

• Build community trust through fewer surprises and fewer ballot asks.

What the Proposed Cash Balance Cap Would Do

The House budget proposes a new state budget rule limiting the amount of cash reserves public school districts can hold.  Districts must return any reserves exceeding 30% of their yearly expenses to the local taxpayers. 

This proposal is being sold as a property tax reduction, but it isn’t—especially in communities like ours that get minimal state funding and want and expect high quality schools. Sure, taxpayers would see a lower property tax bill for a year or two, but that bill would quickly increase with the need for additional operating levies every 1-2 years to keep the school district running.

Here’s what the proposed cash balance cap would really do:

• Reverse the outcome of Mariemont’s recent voter-approved operating levies by requiring the district to return $5.6 million, effectively wiping out the results of the last three levies.

• Force the district to spend down its cash balance faster than planned.

• Eliminate the district’s ability to be prepared for unexpected expenses and plan for the long term.

• Trigger the need for new levies every 1–2 years, starting as early as FY27, creating financial instability for both the school district and local taxpayers.

The charts below show the difference between MCSD’s financial outlook with and without this proposed limit. If it passes, our district would enter what we’ve historically considered a “caution zone” almost immediately. At Mariemont, when our tank hits a quarter full, the gas light comes on, and we make a plan so students never feel the impact and we can maintain the excellent schools our community deserves and expects.

The Bottom Line for MCSD 

If this version of the bill passes, the new normal will likely be requesting operating levies every 1-2 years, and the risk of not being able to keep excellent staff and maintain effective programs and services will be real.

While this would mark a stark shift from Mariemont’s long-standing financial model, it would not result from mismanagement or overspending. It would be the direct result of state-imposed limits on how we can save and plan.

No organization can sustain flat revenue, rising costs, and limited reserves while maintaining high-quality outcomes. In the long run, this proposal would create more instability for schools, staff, students, and taxpayers.

Recent News/Media Reports about School Funding in the State Budget:

Ohio schools, parents concerned as lawmakers debate voucher and public school funding

 

Why Ohio districts are pushing back against House school funding, property tax plan

Vouchers for Ohio private schools score double funding over public schools

 

Ohio school leaders say GOP plan for 25% cap to trigger tax refunds could cost districts $5B

 

Ohio House GOP budget proposal slashes public school funding

How to Contact our State Legislators & Governor:

 

Senate

Catherine Ingram - Mariemont, Fairfax, Columbia Township

Louis Blessing III - Terrace Park

House

Sedrick Denson - Mariemont, Fairfax, Columbia Township

Rachel Baker - Terrace Park

Jean Schmidt - Terrace Park

Governor

Mike DeWine

For over 100 years, Ohio’s school funding system has evolved through legislation, court rulings, and state budgets. Yet, one fact remains unchanged: Local taxpayers carry the burden of funding public schools.

Despite Ohio Supreme Court rulings declaring the system unconstitutional, the state does not have a long-term solution. While the 2021 Fair School Funding Plan aimed to improve funding, the reality remains the same; districts like Mariemont continue to receive less state support year after year, making frequent levies a necessity to maintain the high-quality education expected. 

How Ohio’s Schools Became Reliant on Local Taxpayers

Did you know? 
Ohio has the most school levies of any state in the nation. 

Why? 
The system built through a century of legislation, court rulings, and state budgets has resulted in a school funding system that requires frequent local levies. Without local levies, programs and opportunities would shrink and jeopardize the high quality of education the Mariemont City Schools community expects.

How? 

• Ohio law (House Bill 920, 1976) prevents school districts from receiving additional voted revenue as property values rise. As a result, schools must repeatedly ask voters to approve new levies just to maintain current services.

• The state’s share of per-student funding has declined over time despite court rulings urging the legislature to implement an adequate funding formula. 

What’s Happening Now: 2025 Ohio Budget Proposal

The governor’s state budget proposal further reduces funding for public schools while increasing taxpayer-funded subsidies for private and charter schools. 

The 2025 budget proposal artificially lowers the state aid to public schools by changing only one side of the equation. 

In addition, not all students in the 2025 budget proposal receive the same level of state funding for their education, regardless of the quality or performance of the public schools in the area. 

Same Student, Different Funding 

Meet Molly Mariemont. If she stays in Mariemont City Schools, the district receives just $2,000 per year in state funding. But if Molly Mariemont enrolls elsewhere, the state contribution to the private school or charter school she attends skyrockets

The Details: How Ohio Determines Voucher Funding 

• 90% of Ohio’s voucher program students in the 2024-2025 school year are not qualified as “low-income.” 
• 17% of the scholarships last year were awarded to families in the top 8.4% of wage earners in the state making over $200,000 annually. Scholarships to these families totaled $11 million last year. 
• All families, regardless of income, qualify for at least a partial scholarship, which is determined on a sliding scale (seen in the chart below).

Impact on Mariemont City Schools

For Mariemont City Schools, the reality is clear and consistent. As state funding declines, the burden falls more and more on local taxpayers through levies.

Under the governor’s 2025 state budget proposal, Mariemont City Schools is set to lose nearly $1 million over the next four years. And this number could get even larger if the state adds additional reductions in future budgets.