“We are in the middle of a state and a national recession that is affecting governments throughout the nation,” said William Stafford, Evanston Township High School chief financial officer, when he introduced the mid-year budget review for District 202 to the School Board on Jan. 27. However, Mr. Stafford said, “We are in good financial shape, so we’re not going to be affected any more adversely than any one else.” Mr. Stafford also said the District was slated to benefit from the proposed federal stimulus package currently being reviewed by the government. “But we have to deal with the reality,” he continued. “We have to have current revenues and current expenditures match.” Mr. Stafford told the Board that a few areas were of particular concern. One is interest income. “We were making between 3 and 4 percent last year. The current money market rates are about … 1.5 percent. It’s the economy. The rates are just down; that’s going to affect us.” Another issue is the corporate property replacement tax. “That’s a function of dollars we get as part of the income tax mix,” said Mr. Stafford. “Surprisingly, those dollars … will hold this year. That will affect us in next year’s budget. We get about $2 million dollars [a year] in that. I think that’s going to significantly decrease next year, and in budgeting for next year we’re going to have to take that into account.” The most serious issue that Mr. Stafford outlined is the significant drop in the Consumer Price Index (CPI), which guides the tax levy. Under state property tax caps, school districts, with some exceptions, may increase property taxes by the lesser amount: 5 percent or the increase in the CPI. “For 2009, it’s 0.1 percent,” said Mr. Stafford. “That’s a real problem. That’s a problem for all school districts. Last year it was 4.1 percent. The lowest it’s ever been [since the CPI and the tax caps came in 1989] is 1.6 percent.” The District will receive the revenues from the 2009 levy in two installments in calendar year 2010. Because of the way the County calculates the installment payments, however, the 2009 levy determines the amount of property tax revenues the District will collect in fiscal year 2010-11. “We know what’s coming two years out,” said Mr. Stafford. “PMA Financial, who does our long-range forecast … is updating their analysis. We’ll be getting that in another week. We’re going to go over that and come back to you in a month or so and just continue this conversation.” Amidst the bad economic news, Mr. Stafford said there was some potential good news. He said the federal stimulus package includes money slated for school districts for Title I funds, construction and special education. “The tentative package for 2009 has District 202 getting about $92,000 in Title I money, $340,000 in construction money and about $340,000 in special education money,” Mr. Stafford reported. “For [2010] the numbers are similar. Is that going to happen? I don’t know.” Mr. Stafford said he was in contact with Dave Davis, grant coordinator for Congresswoman Jan Schakowsky. “He is monitoring [the stimulus package] for us. We’ll see where that goes.” Board member Omar Khuri requested that the PMA analysis be shared with the Board. Mr. Stafford responded that it would be, and that the projections would be out as far as 2014. Mr. Stafford presented the following revenue and expenditure percentages for the first six months of the fiscal year: Education Fund: Revenues are on target at 43.52 percent. The property tax revenues are slightly below last year’s collection rate, but additional distributions are expected from the county. Expenditures appear to be right on schedule at 46.69 percent of budget. Slightly greater expenditures occur in the second half of the fiscal year, so being below 50 percent of budget for the first half of the fiscal year is important. Operations and Maintenance Fund: Revenues are above last year’s pace (63.4 percent) due to the reimbursement of capital expenditures that occurred from the CIP fund. The expenditures are 50.89 percent. Mr. Stafford said there may be higher than expected energy- and snow-related costs in the second half of the year. Bond and Interest Fund: Revenues are at the expected level (48.59 percent). The expenditures are mainly completed for the year, as debt payments have been made and are within budgeted levels. Transportation Fund: Revenues are slightly below last year (29.55 percent), mainly due to delayed state aid payments. Expenditures are slightly below last year’s pace at 11.1 percent, at acceptable levels, but will increase as the year progresses, because vendors do not start billing until halfway through the year. IMRF & Social Security Fund: Revenues are at 49.79 percent, which is above last year’s pace, mainly due to the allocation of corporate property replacement taxes. Expenditures are at 50.15 percent; slightly higher than expected. Capital Improvements Fund: The fund has expended $5,755,019 to date. Most of the money was spent on the new athletic fields, the art gallery and the new CAD Lab. The total amount that is allocated for capital improvements this year is $10 million. Working Cash Fund: Revenues consist of interest income, which will be recorded in February. The expenditures are the bond proceeds that were issued there and transferred to the capital fund. Fire Prevention and Safety Fund: Expenditures to date are $191,092. The remainder of the $1.5 million will be expended mainly over spring break and later this summer, when school is not in session. These are bond funds that are used for Life-Safety capital projects throughout the building.