A proposed state bill that would allow school districts to explore new revenue streams by earning profits on facilities, services and merchandise does not sit well with some local officials.

The bill — introduced Feb. 3 by state Rep. Mike Henne, R-Clayton — would amend current legislation and allow Montgomery County’s 16 school districts to pilot the new program, possibly as early as the 2013-14 school year.

Henne said the bill could expand to other school districts outside of Montgomery County, other counties or the entire state.

“It’s not going to fix the school finance issue,” Henne said, “but if that keeps a couple more teachers in the classroom for a while and it helps their budgets, it’s another tool in the toolbox.”

The educational committee will not have a hearing on HB 444 until after the March 6 primary, said Henne, who was approached by Vandalia-Butler City Schools Treasurer Dan Schall with the pilot plan idea.

Besides relying on taxes, donations, and state and federal aid, the bill would allow districts to earn profits off a variety of services, including rentals of classes to selling school merchandise — such as T-shirts, hats and sweatshirts — above costs.

“We’re not in the business of selling T-shirts in order for us to teach classes,” said Arnol Elam, Franklin City Schools Superintendent. “I’m not sure how that fits into the mission of the schools. We exist to teach and learn. If we start an enterprise business, that’s one more thing we take away from the mission of teaching and learning.”

For the next two years, operating funds for Ohio schools have been cut nearly $780 million in state funding.

As of now, a new approach to paying for Ohio’s public schools will not be complete until 2013, leaving school districts across the state to grapple with their budgets in the absence of a predictable school funding formula.

“I’m always open to ideas of any kind that changes our ability to increase our revenue,” Monroe Superintendent Elizabeth Lolli said. “This is an idea where you aren’t taxing your community anymore. That’s where Ohio needs to get to — alternative ways to fund schools appropriately that don’t put the burden on the homeowner. There’s only so much a homeowner can afford and pay right now.

“But as small as we are right now, I don’t know if (HB 444) would fill in the gap in the state funding losses that we’re suffering.”

When Butler and Warren county schools rent out their facilities (classrooms, auditoriums, gymnasiums), they charge only what it costs to cover expenses, such as utilities, custodial services and supplies.

Middletown Superintendent Greg Rasmussen said generating revenue from facilities would be a “balancing act” because those facilities are paid for by taxpayers.

“No doubt we’re all facing revenue challenges,” he said. “It’s a creative suggestion, one that probably is worthy of some thought and some trial and error to see how it works.”

Schall said if the bill passes, he projects Vandalia-Butler could eventually generate 1 percent of new revenue of its total $35 million annual operating budget, which would be $350,000.

“Right now, in order to balance the budget, school districts only have two options — raise taxes or make cuts,” Schall said. “That’s a no-value proposition for the community.”

Under the current law, only booster clubs — notably marching bands and athletic teams — can make profits off merchandise, concessions and other activities.

Henne said HB 444 would allow school districts to charge beyond what it costs them to operate a particular venue, class or service.

“The amount of money our boosters and Tempo Club make goes back to the program and kids,” Fairfield Superintendent Paul Otten said. “It’s not like those groups are lining their pockets. They’re spending it on kids, and we would, too. If we were to take over their responsibilities, they wouldn’t generate the money they need to support our kids, and I don’t see that as something that would be a benefit to the district.”

Although the bill is in its early stages, if it passes, it would allow Montgomery County school districts to implement it within 90 days of passage.

“It’s a good idea to at least explore and see if there are possibilities,” said Barbara Shaner, associate executive director of the Ohio Association of School Business Officials. “We encourage our members to try to come up with ideas on their own, be creative and think outside the box. The folks at Vandalia Butler did that, and we’re happy to work with others who’d like to try.”

Staff writer Marc Katz and the Associated Press contributed to this report.

Contact this reporter at (513) 755-5113 or steven.matthews@coxinc.com.