As school board members get ready to approve a 2015-16 budget, Flossmoor District 161 is starting the academic year in good fiscal shape, its chief financial officer said Monday.
The proposed budget includes a $403,467 surplus. It appears that general state aid from Illinois is going up by about $700,000. The all-important education fund – from which teachers are paid and vital classroom expenses financed – actually declined in the new year, thanks to an influx of younger, less expensive faculty members.
Still, what’s happening on the state level presents reasons for concern about the financial future, said Frances LaBella, District 161’s assistant superintendent for business.
With no end in sight, the struggle between Illinois Gov. Bruce Rauner and the General Assembly has left the state without a complete budget for the new fiscal year. As a result, LaBella said, there is no way of knowing the exact amount of state aid the schools will receive.
Also, she said, lawmakers and the governor’s office continue to discuss new legislation that could negatively impact District 161 and other school systems.
House Bill 4272, introduced last month, would shift the full cost of teacher pensions to school district beginning July 1, 2016. The proposal calls for no phase-in period. If passed, it would likely cost District 161 an additional $1.1 million starting next year, LaBella said.
LaBella said she is also concerned about proposed legislation to freeze property tax bills. Rauner has called for the temporary tax freeze as part of his economic turnaround plan for Illinois. However, LaBella said such a freeze, if passed, could mean that District 161 would not be able to access property taxes from the Meijer superstore in Flossmoor, scheduled to open next spring.
Overall, Monday’s budget outline shows a school system that remains financially healthy, with sufficient support from local taxes, state aid and federal grants. The proposed budget has been on display in the district’s administrative office in Chicago Heights since the start of August. There will be a public hearing on the budget at the Sept. 14 school board meeting. After that, the board is expected to formally approve the document so that it can be forwarded to the state by the end of the month. District 161 will set its levy in October, a necessary step so that it can receive property tax dollars from Cook County.
The budget, as presented by LaBella, shows overall revenues of $31,267,523 and expenditures of $30,864,056. The overwhelming majority of district revenues — $22,273,624 – comes from local taxes. Projections show the state providing $6,439,066. But that amount is still an increase from last year, when state funding came to $5,442,957. LaBella said the increase is due to a change in the state’s formula for “prorating” aid to local districts. Last year, state aid in District 161 was prorated at 89 percent and that number has gone up to 92 percent for 2015-16.
Education fund expenditures in the new budget have declined to $23.98 million from last year’s figure of $24.70 million. LaBella said that is largely due to the retirement of veteran teachers in the district and the hiring of new faculty.
“We have a lot of young teachers,” she said.
Earlier this year, LaBella predicted that District 161 was facing a fiscal shortfall of about $200,000 and the deficit could go as high as $1 million if there were problems with state funding. The school board took steps to trim programs deemed non-essential from the budget; that resulted in savings of about $650,000.
School board members said Monday that they are pleased with the positive numbers in the proposed budget but also concerned about legislation that may be coming out of Springfield.
Board member Christine Marks said one local legislator, Will Davis, D-East Hazel Crest, is a co-sponsor of the bill that would shift responsibility for pension payments to suburban school districts. Marks said District 161 needs to let local lawmakers know the board’s position on legislation that would have such a negative impact on school finances.
“We have to let our representatives know that they need to support responsible legislation that is favorable to our district,” she said.