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District 202 Chief Financial Officer William Stafford painted a familiar but not very desirable picture for the School Board at its Finance Committee meeting on Jan. 24. The District is spending according to budget this year, Mr. Stafford said, but the State of Illinois is past due in its payments, property taxes are coming in late and the Consumer Price Index (CPI) is projected to be low again, which places a limit on future potential property tax opportunities.
The meeting was just a precursor to the one to be held on Feb. 14, but there will likely be no rosy Valentines then.
“We will have to make budget reductions for FY 2012,” Mr. Stafford said. “We’re working on the magnitude of that right now. We were not able to make projections until the consumer price index came out in December. The CPI we’re looking at is 1.5% which is an issue. Generally the projections run between 2.5 and 3%. This (1.5%) is a very low number. It doesn’t keep pace with our contracts,” he continued.
Late state payments and property tax delays have cause havoc for the District in terms of expected revenues.
“Three years ago we were making interest income of about a half a million a year,” Mr. Stafford. “That’s down to about $100,000 to $150,000 that we’ll get this year.” Mr. Stafford explained that when property taxes are delayed as they have been this year, the District has to use the working cash fund instead of the education fund to pay payroll, and as a result, not as much interest income is earned.
Mr. Stafford outlined the plans for the budget planning process for FY 2012. “We’ll develop a reduction strategy for our February meeting and we’ll develop a list of possible revenue enhancements,” he said. “We want to make sure that we have those strategies discussed when we have time to reflect on the future before we have to put a final budget together.”
Board members had no questions but Board member Deborah Graham commented, “I’m sure there will be plenty next month.”