The Opp City Schools system is preparing to face budget challenges brought on by a recent decline in enrollment coupled with a decrease in state funding, officials said during the board of education’s regular meeting Tuesday.

Linda Banks, chief financial officer for OCS, said a decline in student enrollment has contributed to a shortfall in funds that will likely be seen during the 2015 fiscal year. In April, Banks told board members they would likely be looking at a loss of $245,000 in FY 2015, which has a budget of $7.4 million.

“We’ve lost about 60 students, and with a shortfall in the foundation fund, we will likely have to go into reserves a bit,” Banks said Tuesday, adding that the school board should be able to easily weather the storm because of reserve funds built up over the years.

“We still feel like this is very manageable,” Banks said. “Especially with the $890,000 we’ve added over the last four or five years. We have the money to get through this year and hopefully by (fiscal year) 2016 we will see state funding pick up and enrollment will level off.”

Banks said the system lost 62 students over the course of the 2012-13 school year. The loss of students, from 1,324 to 1,262, also cost the system state funding for three teaching positions.

Enrollment is up in some areas, Superintendent Michael Smithart said Tuesday, reporting that children in kindergarten have increased to around 100 for the upcoming 2014-15 school year. This time last year, Smithart acknowledged the decline in overall student population and said transfers played a big role.

“Our loss in enrollment is essentially transient students, with estimates at about 50 students total,” Smithart said. “It’s peculiar in that there are very few local transfers. By that, I mean transfers within a 25-30-mile radius. At the high school alone, we have sent records to 10 different states. Obviously the economic situation is taking its toll. Our base student population is pretty steady.”

Banks said, as of the end of June, the school board had a total balance of $4,723,108.92, up $402,511.02 from September 2013. The general fund is currently operating with $3,189,046.49 in total local funds and the OCS is sitting on a four-month reserve.

As for the decline in student enrollment, since the 1996-97 school year, OCS has seen a drop in enrollment, from 1,659 students to 1,263 in the 2013-14 school year, a loss of 396 students, according to the state department of education.