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School District 202’s tentative budget for 2013-14 is balanced by a feather and with a wary eye on Springfield. Chief Financial Officer William Stafford and Deputy CFO Mary Rodino presented early figures to the Board at the June 10 meeting. Mr. Stafford said the revenue estimates are “conservative” and warned that the State of Illinois could reduce its funding further and could impose additional costs on school districts.
Total revenues for 2013-14 (FY2014) are projected at $77,756,000 and expenditures at $77,492,000, leaving a surplus of about $250,000. While the total expenditures show a 2.9 percent increase over the 2012-13 (FY 2103) budget, operating expenses, pegged at $68 million, are 3.3 percent higher than FY 2013.
Property taxes make up 85 percent of the District’s operating revenues, said Mr. Stafford. Next year the District anticipates $58 million in property tax revenues for operations, a 4 percent increase over this year. General State Aid is projected to be reduced by about $200,000 from FY 2013, because of a proposed 11 percent reduction at the state level.
Categorical State Aid – grants from the state for specific needs and programs such as special education personnel, transportation and bilingual programs – is expected to be just over $2 million, a 1.78 percent decrease from the present fiscal year.
Federal funds, however, are expected to increase by about 1.4 percent, to $2.3 million. These are for the most part No Child Left Behind funds and food-subsidy funds.
State-imposed tax caps limit the District’s levy to the amount of the increase in the consumer price index (CPI) or 5 percent, whichever is less. Because the District’s fiscal year is not aligned with the calendar year, revenues from the levy come in semi-annually but from different tax-year levies.
Although City officials have discussed retiring one of the tax-increment financing districts early, no anticipated revenues from TIFs are included in the tentative budget.
To do more with less – which seems to be the mantra for next year – the District will continue its values-based budgeting, said Ms. Rodino. Instruction is the top priority, which includes “maintaining a reasonable student-teacher ratio and avoiding layoffs when possible,” she added.
Ms. Rodino said operating costs were lowered somewhat by reductions in overtime and in the amounts of postage, supplies and food purchased; from energy savings by having a four-day week in summer school; and from a 4 percent reduction in purchased services and other contract reductions. The District also entered into contracts to hedge the cost of electricity.
Operating costs are projected at $68 million – a 3.3 percent increase over the previous year, said Mr. Stafford; the increase is tied primarily to increases in salaries and benefits. “Salaries represent 65 percent of the budget and fringe benefits are at 9 percent. This means 74 percent of the budget is personnel cost related,” Mr. Stafford said.
Salaries, which are for the most part determined by labor contracts, are projected at $44.5 million, an increase of 5.2 percent over the FY 2013.
Health insurance payments, the District’s “largest benefit expense” according to the budget document, are projected to increase by 5 to 7 percent for the next fiscal year. The total cost of benefits is projected at $6.1 million, an increase of 2.57 percent.
The increase in salaries includes the addition of four positions: a reading specialist, a job coach, a fine arts chair and a special education position, said Ms. Rodino.
The cost of tuition for ETHS students to attend alternative schools will rise by about 1.3 percent next year. That and other factors are prompting administrators to consider creating an alternative school at ETHS.
“I’m very proud that we have a balanced budget, when two-thirds of the schools in the state [do not],” said Board member Jonathan Baum. “Both the education fund and the operations and maintenance funds are balanced, but they are balanced to the penny – and that makes me nervous, given the uncertainties that we are facing.”
“We do budget our revenues conservatively. We really can’t afford to be massively over [in expenses]. There is some wiggle room – about 2 to 3 percent,” said Mr. Stafford.
Doug Holt said he would like to see the student/teacher ratios – “to see if it is stable.”
Mr. Baum said he thought alternative schools were “for behavior problems – not special education.”
“Not necessarily,” said Superintendent Eric Witherspoon; “we use different placements.”
Aid to school districts from the state could be reduced even further, said Mr. Stafford. In addition, the pension mess has not been resolved. A plan floated last summer and still not fully resolved is to shift the “normal” cost (the annual contribution) of teacher pensions to the school districts. This would add another $125,000 per year over a phasing-in period of 18 years. If there is no phase-in, the increase could be as much as $2 million.
The public hearing on the budget is scheduled for Sept. 9, and the Board is expected to approve the budget on Sept. 23.