Will Your School Open This Fall? Superintendents Talk State Budget Crisis

The Illinois General Assembly has until the end of June to pass a budget that includes state education funding, but local school district superintendents aren’t holding their breath.

They’re busy trying to keep district programs, services and quality education intact if millions of dollars in state aid aren't delivered.

For now, there is no state appropriation for K-12 education funding. For the second consecutive year, the state legislature ended its spring session without passing a state budget.

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Chicago Public Schools CEO Forrest Claypool warned state lawmakers that CPS and other Illinois school districts won’t open for the 2016-17 school year if Gov. Bruce Rauner and the Illinois General Assembly don’t agree on an education budget.

The Illinois State Board of Education requires school districts to keep a reserve fund with a minimum balance of 25 percent, which should be enough to pay expenses for three months in an emergency. Some school districts reserve enough money to cover a year’s worth of expenses.

What does this mean for your school district? Patch.com contacted several suburban superintendents to find out.

Elmhurst Community Unit School District 205:

Superintendent David Moyer said Elmhurst Community Unit School District 205 plans to open schools in the fall, even if state funding isn’t available.

He said revenue for the district is 90 percent local, and general state aid accounts for about $7 million in annual revenue.

“At this point the District has adequate reserves and believes it can maintain operations until the September property taxes are in,” Moyer said.

For now, things are business as usual in the district, but the administration is keeping a close watch on the budget situation. The district has “adequate reserves to bridge some time,” Moyer said.

Those reserves are not currently being used in light of the state budget crisis, but the district anticipates the reserves will decrease over the next several years, especially if there are changes to the state funding formula, changes in pension costs or freezes on property taxes.

It may be necessary to reexamine the budget and to possibly trim some areas for the 2017-18 school year.

The state doesn’t yet owe District 205 any money, but Moyer said they don’t expect to receive their June payment of about $1.2 million.

Community High School District 99

District 99 also relies on property taxes for funding, with about 7 percent — $6.1 million a year — of the total budget coming from the state, said Jill Browning, the district’s director of communications.

So far, the state has paid the district about $5 million of this year’s promised $6.1 million.

The community’s strong property tax base “would help us to keep our doors open — and protect our quality programs and services we offer to students,” Browning said.

She said District 99’s operating reserves are less than 3 percent, which is not enough to absorb a lack of state funding in the 2016-17 budget.

The district is preparing to reduce expenses by $1.1 million next year through restructuring, staff reductions via natural attrition and cost cutting on purchased services and supplies.

“Scaling back our educational coaching is the most significant program change we made affecting next year,” Browning said. “The reductions and changes we are making will allow us to continue to maintain the student-to-teacher ratio of 21.8 to 1.”

The district is keeping a close eye on property tax trends, possible shifts in pension costs and the consumer price index.

“We continue to remain conservative in our approach to financial management, which is more important than ever given the amount of uncertainty at the state,” Browning said.

Downers Grove Grade School District 58

District 58 has sufficient reserves to open this fall if state funding is not available, and it could complete next year without any external borrowing, said James Popernik, controller for the district.

The district’s total budget for next year is $65 million, with about $4.5 million to $5 million dollars from state reimbursements.

Popernik said the state budget stalemate adds uncertainty to the district’s financial picture, it causes cash flow problems despite reserves and the district has to constantly monitor its finances along with the state’s activity.

“Our district is in a relatively strong financial position, but it causes us to take pause and wonder if they’re going to give us any money,” he said. “We can’t really react until we know the specifics. There’s a lot of uncertainty. It puts a dark cloud over every year.”

The district is finishing the school year with the state owing it $800,000, and at the end of the district’s last fiscal year, the state owed $1 million to District 58.

No capital projects have had to be delayed or scrapped yet, though the district annually spends about $300,000 on projects such as asphalt or playground improvements.

“If we were to lose $4 million or $5 million, the dominoes will start to fall, and we would have to prioritize where we would eliminate those $4 million or $5 million worth of expenses,” Popernik said.

He said next year’s budget is pretty much in place, and any action on the state’s part will be phased in and taken into consideration for the 2017-18 budget.

Hinsdale Township High School District 86

The budget stalemate has created some uncertainty in the budget process, but District 86 schools will definitely open in the fall, said Superintendent Bruce Law.

With grant money and local tax revenue, the district’s budget is $100 million, and the state would contribute $1.7 million — so about 1.7 percent of the district’s budget.

Law pointed out the property tax revenue the district receives in May is for the next fiscal year, beginning July 1. So districts that may not open without a state budget likely rely less on local property taxes than District 86 does.

“We could be squeezed toward the end of the fiscal year if our state funding is cut $1.7 million, not at the beginning, unless we made adjustments to spending along the way,” Law said.

The district is not currently using cash reserves to cover for the lack of state funds.

No District 86 programs or instructional costs have been cut or suspended, and no capital projects have been canceled or postponed. However, the district will make adjustments throughout the year, if needed, to stay in the black.

Community Consolidated School District 181

District 181 will certainly open on time in the fall, said Superintendent Don White.

“While not receiving general state aid and other state funding will have a detrimental impact, we do not receive enough, on a percentage, to make a really large difference as compared to other districts,” White said.

He said the district has not had to dip into reserves, but it will likely have to use fund balances until the state finds a budget solution, or the district could be forced to reduce services such as programs and employees.

White also mentioned the district’s “very high credit rating,” which could be affected if the district has to use reserves.

“It would be very unfortunate that the state financial situation could cause us to lose a great credit rating, which could have a negative impact on our ability to borrow money at the very best rates,” White said.

Community support has offset the lack of promised general state aid, though White said it may not be able to continue bearing the burden of an increasingly tight budget.

Major work supported by local resources has been completed in the district, but without a state education budget, more local money will be required for projects and services. State aid is needed to move forward with projects identified through the district’s comprehensive facility plan.

Lyons Township High School District 204

Lyons Township High School will be able to open in the fall, said Superintendent Timothy Kilrea.

Up to this point, the state budget impasse has not affected the district’s educational programs or operations, and it hasn’t caused the district to use cash reserves.

“However, as things continue, we're going to have to take a real hard look as to how we adjust how we do business without impacting kids, which will be difficult,” Kilrea said.

State revenue is roughly $4.2 million of District 204’s budget. Kilrea said for fiscal year 2016, the state owes the district about $75,000 for general state aid and $604,000 for mandated categorical reimbursements.

A lack of state assistance means the district may have to make adjustments to avoid using money from reserves on a regular basis.

“We will be opening our doors in the fall,” Kilera said. “We are closely monitoring how things are transpiring in Springfield while keeping focus on the students, where it belongs. But we will need to respond if any significant changes come out of Springfield that will impact our revenues.”

LaGrange School District 102

District 102 schools will open their doors this year, though the district could have to do some short-term borrowing while waiting to collect property tax revenue, Superintendent Kyle Schumacher said.

“Not ideal, as I would hate to be paying interest on short-term loans due to not having the necessary revenue from the state,” he said.

Though District 102 is putting a referendum on the November ballot, that’s not a result of the budget stalemate as much as “years of proration and underfunding from the state has limited our long-term abilities,” Schumacher said. “The budget stalemate has made it impossible to do any short-term or even long-term planning with any real accuracy.”

The district’s transportation programs have been cut back because of the reduction in transportation reimbursements from the state, so parents will have to pay for transportation — a result of several years of state reductions.

No capital projects have been planned for this year, and overall, budgets have been reduced with limited impacts on District 102 students.

District 102 usually receives four payments each year. Schumacher said the district has received some of the final payment for this year but is still waiting for Outplaced Special Education and Personnel Reimbursement and the Transportation reimbursement.

Read more from Patch about the state of other suburban school districts: 

• Suburban Superintendents Weigh Options for Next School Year Amid State Budget Crisis
• Superintendents Anxious About IL State Budget Impasse
  
  

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