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On June 10, the Finance Committee of the District 65 School Board reviewed a draft tentative budget for its fiscal year ending June 30, 2014 (FY ’14). Operating revenues are projected at $105.2 million, up 2.8 percent over the prior year. Operating expenses are projected at $104.3 million, up 2 percent over the prior year. 

The operating budget has a surplus of $900,658, said Kathy Zalewski, comptroller for the District. The District plans to prepay $750,000 in expenses in FY’14 that become due in FY’14, so the surplus after those prepayments will be about $150,000, she said.

Ms. Zalewski also presented revised financial projections that show a surplus of $91,851 for FY’15, and then deficits of $2.5 million in FY’16, $4.1 million in FY’17 and $5.8 million in FY’18. The projections do not include any amount on the expense side for the possibility that the State legislature may shift teacher pension costs to school districts.

Revenues

On the revenue side, the District is projecting that the property tax revenues it collects for operations in FY ’13 will be $81.3 million, up 4.3 percent over the prior year. Property taxes make up about 77 percent of the District’s operating revenues.

State and federal grants, which account for 16 percent of the District’s operating revenues, are expected to be about $18.2 million, about $70,000 less than last year. Local revenues are expected to be $450,000 less than last year, primarily due to the District’s election to take two TIF payments from the City in FY’13 rather than one each in FY’13 and FY’14.

Expenses

On the expense side, salaries are pegged at $73.3 million, up 1.8 percent over last year. Employee benefits are projected to increase to $15.3 million, a 1 percent increase. Ms. Zalewski said the cost of medical insurance was budgeted to decrease by 3 percent and the remaining benefits to increase by 5 percent. Salaries and benefits, together, account for 84 percent of the District’s operating expenses.

Some key assumptions are that the District’s enrollment will increase by 144 students to 7,171 students (not including Park and Rice schools or pre-K students) and that staff will increase by a total of 15.5 positions.

Assistant Superintendent Ellen Fogelberg gave a breakdown of the eight new teaching positions: five teaching positions are being added to accommodate increased student enrollment; one teacher will be added to teach students with a disability in a new self-contained classroom; and two bilingual/special education teachers will be added to address the needs of bilingual students with disabilities. The cost to add these teachers is about $450,000, said Ms. Zalewski.

The draft budget also builds in the cost of six new assistant principal positions.  By adding six assistant principals, the District would be able to reduce two PBIS coordinators.  The net cost is about $500,000, said Ms. Zalewski. See article below.

Next Steps

The Board is scheduled to approve a tentative budget in August and then to approve, after a public hearing, a budget in September.