Homewood District 153 School Board members Monday approved the 2016 budget of $28.5 million in operating costs.
Revenues, however, are only $23 million. The board will be able to balance its budget to using money from the bond issue it passed by special referendum in 2011, and transferring money from various accounts.
One of the major culprits of the revenue dip has been a drop in property values caused by the 2008 recession, according to John Gibson, chief school business official.
The district’s ability to raise revenue is extremely limited because of property tax caps the state legislature imposed in 2006. Under the law, taxing districts can only increase costs to a maximum of 5 percent or the Consumer Price Index (CPI), whichever is less. This year, Gibson estimates the district may get a 1 percent increase because CPI is so low.
“If property values continue to decline over time, we eventually won’t be able to get all the tax revenues. Fortunately our decrease last year was only 3.5 percent,” Gibson said, “so we anticipate that over the next few years we’ll see an increase in the EAV (equalized assessed valuation). At the very least, as long as the rates don’t drop too much more we should be good for another couple years.”
The district’s primary expenses are paid from four major operating funds totaling $22 million—education, which includes salaries; operation and maintenance; transportation; and working cash. The referendum funds went in to working cash.
The non-operating funds are for specific purposes—Bond & Interest Fund; Illinois Municipal Retirement Fund (IMRF); Life Safety Fund; Tort Fund; and Site Construction Fund.
The district’s major repairs this summer, including a new roof at the James Hart Junior High building and smaller projects throughout the district, were financed by a $3.5 million bond issue.