Ohio’s 55 county Educational Service Centers could see up to $91 million in state funding cuts over two years under Gov. John Kasich’s proposed budget that some say could hurt small, local school districts that rely on their services and force ESCs to charge more.

Montgomery, Greene, Butler, Clark, Miami, Preble, Warren and Hamilton counties have their own ESCs. They could lose up to $15 million in combined funding, according to Craig Burford, executive director of the Ohio ESC Association.

The centers work with area school districts by providing shared services such as curriculum and attendance supervisors, speech, occupational and physical therapists, school psychologists, nurses, special education and gifted supervisors and hearing interpreters.

Each ESC in Ohio would see its state subsidy reduced by 22.5 percent in fiscal year 2014, which starts July 1, and 27.2 percent in FY15 if approved by lawmakers, said Jim Lynch, Kasich’s special advisor on State Budget Communications. The state subsidy would be reduced from $35.5 million currently to $20 million in FY15.

Additionally, funds that were previously deducted and sent to the ESC to support mandated services will be returned to districts.

ESCs currently get $6.50 per pupil for such services as curriculum, gifted supervision and bus driver trainings. They also receive Supervisory Services funding for curriculum and special education.

The governor wants to eliminate those dollars flowing to ESCs and instead have them stay with local districts. Kasich’s proposal also would redirect funding for gifted services to districts and change the way ESC governing boards are structured.

By law, ESCs are not able to put tax levies before voters so most of their revenue comes from charging other districts for services, Burford said.

State Sen. Peggy Lehner, R-Kettering, favors the proposed changes.

“The ESCs are very spotty. Some of them are excellent; some of them are not,” said Lehner, who chairs the Education Committee and co-chairs the Finance Committee. “This will give everyone the opportunity to buy services from those ESCs that have the highest quality services available and I think that’s a good thing.” Those not providing the quality services “will have to step up what they’re doing or find themselves going out of business,” she added.

The Montgomery County ESC, which provides varying levels of service to all 16 school districts in the county, would lose more than $1 million over the two-year period, Montgomery County ESC Superintendent Frank DePalma said.

“We’ve used those funds to lower the cost of services to districts that they are required to provide,” DePalma said. “By cutting us, we have to then increase our costs out to the districts.” In addition to services, the Montgomery ESC also operates three locations for 253 emotionally disturbed and multiple-handicapped students.

Bellbrook-Sugarcreek Local Schools Superintendent Keith St. Pierre said he expects the ESC funding cuts would impact local districts because ESCs provide most special services needed by the district’s students. With less state funding, he expects ESCs would charge more for the services.

“That’s actually a cut to local school districts that are receiving services from ESCs,” St. Pierre said.

Burford said ESCs “play a significant role in providing support to the state in deploying initiatives and to school districts in implementing a host of federal and state mandates,” which he said isn’t reflected in the governor’s proposal. “Quite frankly, it raises questions about what supports will be in place to assist districts in addressing the myriad of requirements the administration and legislatures have placed on them in the last two years, including teacher and principal evaluations, common core state standards and assessments, the Third Grade Reading Guarantee and more,” he said.

Lynch said the governor believes ESCs provide “significant value and are a prime example of shared services working in Ohio” and that Kasich’s proposed budget encourages ESCs to “utilize new authority to provide administrative services directly to local governments, which is substantial and relatively untapped market for their services.”

Lynch added, “The governor also believes that local school districts are best positioned to determine the needs of their districts and the proposed changes will allow them more freedom in making those decisions. If a local school district is satisfied with the services they are provided by the ESC, those services can continue.”

Damon Asbury, director of legislative services for the Ohio School Boards Association, believes the impact on districts could be mixed, based on size.

For some of the larger locals, “it gives them more dollars that they can have a little discretion over how they are going to spend it,” Asbury said. “But for smaller local districts, there might not be enough money to provide some of the supervisory services and some of the other services that they’ve been getting from the ESC at a lower cost or no cost in some instances.”

The Warren County ESC employs about 350 people working in school districts across southwest Ohio in a variety of roles.

“We help school districts save dollars and increase efficiencies by creating consortium classrooms and supplying employees in areas that school districts typically do not have enough pupils to be efficient,” Assistant Superintendent Tom Isaacs said.

Butler County ESC Superintendent Jon Graft said that while the governor’s goal is to drive funds back into the classroom, he noted all the ESCs in Ohio directly serve more than 226,000 students through at-risk programming, alternative schools, special education preschools and other programs.

“That is somewhat of a misinterpretation, that by taking money away from ESCs you are bringing money back directly to students in the classroom,” he said.