Superintendent of Schools Dr. John Sparlin was contacted by State Rep. Mark Batinick today (April 18). Batinick said he contacted the state comptroller’s office and was able to confirm to Dr. Sparlin that the district should receive the first payment for FY2017 sometime next week.
Superintendent of Schools Dr. John Sparlin was contacted by State Sen. Jim Oberweis today (April 17). Oberweis said he spoke with the comptroller’s office and was able to confirm to Dr. Sparlin that the district should receive the first payment for FY2017 by the end of April 25.
Superintendent of Schools Dr. John Sparlin was contacted by Rep. Keith Wheeler today (April 17). Wheeler said he spoke with the comptroller’s office and was able to confirm to Dr. Sparlin that the district should receive the first payment for FY2017 on April 25 or April 26.
A representative from Illinois Comptroller Susana Mendoza’s office contacted Superintendent of Schools Dr. John Sparlin on Thursday, April 13, and informed him that the first payment for FY2017 will be sent within the next two weeks.
In addition, Dr. Sparlin was also contacted by State Sen. Linda Holmes. After receiving several communications from stakeholders about the district’s budget situation, she spoke with the comptroller’s office and was able to confirm to Dr. Sparlin that the first payment for FY2017 will indeed be sent within the next two weeks.
“These unpaid funds are key for the district being able to maintain a balanced budget, as required by law,” Sparlin noted. In June 2016, Illinois policymakers announced that the state would “fully fund” public school districts, but since then the term “fully fund” has been narrowly applied to only include the General State Aid (GSA) funding.
Although School District 308 is receiving 100 percent GSA funds for fiscal year 2017, it has not received any mandated categorical reimbursements (MCATs), which are owed quarterly.
“These (MCAT) payments provide revenue to our schools for things such as special education, transportation, early childhood education, free and reduced-priced lunches, and more,” Sparlin wrote.
Delays in MCAT payments have had serious repercussions for District 308 and other districts. “Payment delays cost school districts money, including the loss of interest earnings and potentially trigger the need for short-term borrowing and additional interest costs. MCAT delays have created cash-flow problems for our district,” Sparlin wrote.
To date, the delay in MCAT payments has resulted in an $11 million shortfall in School District 308’s budget.
“If education is to be a priority in Illinois, funding for it must be a priority as well. I urge you to disburse the funds that have already been earmarked for District 308 so that we will be ‘fully funded’ with both GSA funding and the disbursement of MCATs as promised,” Sparlin urged.
To see Dr. Sparlin’s letter in its entirety, click here.
Interview with Assistant Superintendent for Business Services Ali Mehanti
Mr. Mehanti has served District 308 as the Assistant Superintendent for Business Services since 2015.
Q: Can you explain the levy? What is it? How does it work in terms of helping the district pay costs?
Mehanti: A levy is the amount of money a school district certifies to be raised from a property tax – the request. Every year, school districts have an ability to levy based on the CPI (Consumer Price Index). The most recent levy reflected a 0.7 percent increase. Property tax dollars help fund 49 percent of our district’s budgeted expenditures and are the second biggest source of revenues for our district, so it’s important to capture the increased dollars to help pay for our expenditures.
Mehanti: Property taxes account for 49 percent of our operating budget as I have mentioned in the previous question, and general state aid accounts for 39 percent. The rest comes from federal funds (4 percent) and the remaining 8 percent comes from other local sources such as student fees, food service sales, facility rental, local fees, textbook fees, and corporate personal property replacement tax.
Mehanti: Including the efficiencies created by the new boundaries and a drop in projected enrollment for next year and by maintaining class sizes, our projected deficit for 2018 will be $3.5 million. That deficit will grow to $8.5 million in 2019. This is without any changes from the state in its funding formula. We were initially projecting a $7.3 million deficit for FY2018, but through maintaining efficiencies, redrawing boundaries, a projected drop in enrollment, and other cost reductions (salary freeze for the administrators, eliminating some administrative, teacher and support staff positions, reducing field trips, and energy usage) we were able to save about $3.8 million, which brought the $7.3 million deficit to about $3.5 million for next year.
Mehanti: Yes, the calculation uses the current state formula projected at 100 percent of general state aid (GSA)
Mehanti: Our operating budget is currently $190.5 million. Next year, with the adopted budget cuts, the projected FY18 budget will be $193 million. The budget has an upwards trend each year due to an increase in fixed and variable costs. Some of them are salary increases tied to bargaining contracts, benefit increases (such as health insurance), workers compensation and property liability insurance. Other potential increases are the cost of utilities, transportation, building repairs and maintenance.
Mehanti: About 75-80 percent of a typical school district’s budget is tied to salaries and benefits. Our budget is closer to 83 percent of salaries and benefits; our cuts in non-personnel costs inflate the percentage of salaries and benefits. The salary and benefits are not high; our per-student operational cost is $3,000 lower than the state average, which includes salaries, benefits and everything else related to personnel and operations. The percentage of our budget allocated to salaries and benefits is a little higher compared to a typical school district because we don’t have a lot of dollars allocated to non-personnel costs, which includes purchased services, supplies, and capital outlay.
Mehanti: I wouldn’t say it is a good thing to reduce non-personnel costs. We currently don’t have a big technology and capital budget to upgrade devices and make necessary infrastructure changes. We have a total of 26 buildings, including 22 schools, and we don’t have a large capital improvement budget that we can use for sealcoating our parking lots or laying new asphalt, for instance. That’s why we issued $14 million in bonds to fund capital infrastructure and technology projects. While we don’t have an infrastructure budget, we still have infrastructure needs. The reason we can’t increase that budget is the lack of a new revenue stream in our operating budget.
Mehanti: The state of Illinois has shortchanged District 308 over $80 million. They started prorating our GSA from fiscal year 2011, which accounted for more than $21 million. Although GSA has been fully funded at 100% this year, the state hasn’t paid any mandated categorical (MCATs) payments to our district, which accounts for almost $15 million. We had also applied for the capital development grant back in 2004, which would have given us $49 million in additional one-time revenue. We still hope to receive that grant one day, which we can utilize to cover our operational needs.
It is a known fact that the current state funding formula is flawed as it doesn’t provide enough state revenues for our district. Our GSA used to increase every year because property values were declining, but now the trend is going in another direction as property values are not going up. As property values continue to increase, our state funding will decline. The state has stated that we can capture those lost dollars through tax levy, but District 308 is a tax-capped school district, so we can only levy based on increases in the CPI. In the most recent levy approved by the Board, the CPI increase was only 0.7 percent, so that limits our revenues to only a .7 percent increase. The CPI increase that we will be using for next year’s levy is 2.1 percent. However, there have been proposals in Springfield for a property tax freeze. If that happens, we won’t be able to capture those additional dollars. There is currently a House Bill 2808, which addresses the current flawed funding formula. If this bill passes, our district will get a significant increase in state dollars.
Q: In terms of teacher and administrative salaries, where do we fall among districts in the state?
Mehanti: The average annual salary for administrators in Illinois is $103,000 dollars. We’re at $81,225 for administrators. Based on the 2016 Illinois Interactive Report Card, the average annual salary for teachers in Illinois is $63,000, and our teachers make an average of $53,000.
Q: Why should parents be concerned about the budget?
Mehanti: Parents should be concerned about the budget because we are in a dire situation. Our state funding will decline and our GSA based on our five-year projections will continue in a downward trend due to the flawed funding formula as well as declining enrollment. As enrollment drops, we receive fewer dollars and, as property values increase, we will continue to see fewer dollars due to the lack of GSA. So, our revenues are decreasing for the next four to five years, and our expenditures will continue to grow because we have bargaining contracts with teachers and support staff that have increases tied to them. The cost of utilities and transportation will also increase slightly.
Q: Why should people who don’t currently have children in school be concerned?
Mehanti: Community members should be concerned because schools drive the property values of houses. If we don’t have sufficient programs for kids and adequate resources, people are not going to move to communities within the district and that could create a decline in the housing market. When people choose to move to a different city, one of the many important reasons they pick a particular community is because of the school district.
Q: What can parents and the community do to help?
Mehanti: District’s 308 issue is the lack of revenues. As far as our expenditures are concerned, our budget per pupil is the lowest compared to our surrounding school districts and even lower than the state average. There is no room left for more cuts without impacting the classrooms and programs. We need to continue to press our legislators to fix the funding formula. If the state doesn’t get its act together, then unfortunately it will come down to two things, cut expenditures or raise revenue. Cutting expenditures will impact classrooms and raising revenues will impact the property taxes. I wish there were a magic formula that could solve our problems without any support from the state.
See previous story here.
Oswego, Ill. (January 23, 2017) — The Community Unit School District 308 Board of Education was updated with academic and fiscal data summary snapshots during the state of the district meeting last week.
The three-hour meeting included a lengthy discussion after financial data scenarios outlined budget outlooks that show the district faces a $7.4 million deficit which will increase to more than $13 million the following year without expenditure reductions or debt relief. The projections also showed District 308 revenues staying flat in the future year due to a flawed state funding formula. District 308 receives 39% of its revenues from the state, which has been an unreliable source of funding. The event was open to the public and streamed live. It can be viewed here.
Board President Matthew Bauman said the information and presentations give a clear picture that helps the board and community stay ahead of key issues like the budget challenges the district faces, which he cautioned may not be resolved with reductions alone.
“The decisions we are faced with must involve our community. Our village leaders and parents need to be aware what is occurring and what reductions must take place in order to balance our budget.” he said. “And, together with the board, the district, and the community, we’re going to have to decide: Is it all going to be reductions, or is the option going to be to have an operating tax rate referendum. But, to accomplish this, full transparency is required.”
The academic presentation led by Dr. Lisa L. Smith, Executive Director of Teaching and Learning, gave a profile summary of student academic data while highlighting trends, comparisons, and assessment information from the past five years. To see the presentation, click here.
“The information and data shared shows that our students and schools consistently perform higher than the state averages,” said Superintendent of Schools Dr. John Sparlin. “Even in the shadow of the current fiscal challenges, we continue to be strong academically. This is a testament to the commitment and hard work by our teachers and staff in District 308”
The fiscal presentation led by Ali Mehanti, Assistant Superintendent for Business and Operations, featured budget projections, financial scenarios, and operational comparisons. To see the presentation, click here. Additional forecast data and information can be found here.
The Board of Education will host a public forum this evening Monday, January 23, from 7-9 p.m. in the cafeteria at Thompson Junior High School located at 440 Boulder Hill Pass in Oswego. The event is free and open to the public, and will be streamed live on the district website.
With critical decisions to be made regarding the budget, Bauman encourages parents and the community to attend the board forum to have their voice be heard.
“We are looking at a $7.4 million budget reduction going into the next fiscal year and beyond. We are going to have to talk about programs and cuts, and the community needs to know, so, when they hear this information, it may give them clarity to better understand the way the district is moving,” he said. “The forum can provide answers to questions they may have while giving them a lens to the reason ‘why’ because finances play a huge part in the choices we ultimately must make.”