Education, Local News

D233 will use its reserves account for capital projects

The District 233 school board agreed to make changes to its reserve fund policy that will allow it to spend down excess cash on-hand to fund capital projects at Homewood-Flossmoor High School.

The board has been discussing the possibility of a board policy change that stipulated the district retain enough cash to cover 10 months of expenses which acts as the district’s saving account. After several years of discussion board members agreed unanimously at their meeting Tuesday, Feb. 20, to approve the policy change. The board will now keep six months in reserves. The state mandates at least three months in reserves.

Reducing the reserves by about $20 million doesn’t mean the board will spend all the money at once, said Superintendent Scott Wakeley. 

While the policy change took effect immediately, Wakeley said it is expected that it will take about four years to reduce the fund. The board has a host of projects that have been prioritized and it will likely work through that list.

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The board earlier agreed to use $3.3 million in reserve funds to cover improvements to the fashion design, interior design and culinary programs in H-F’s North Building. 

In 2023, Chief School Business Official Lawrence Cook did an assessment of reserve funds at nearly 20 school districts throughout Cook County. He found most districts had four to six months in reserves. None had a policy mandating 10 months. 

No one could remember why the District 233 board set a 10-month policy, but it possibly was to offset reduced state funding or answer the once proposed shift for teacher pensions away from the state and onto school districts. The state has improved its school funding and there has been no mention of a pension shift in at least five years.

When board members reviewed the proposed policy change during a Committee of the Whole meeting in January, they asked Cook to include safeguards that would limit what the board would spend the reserve funds on, and what steps should be taken if the reserve fund dips below the six-month target. Those revisions were reviewed by an attorney and by the Bloom Township School Treasurer Bob Grossi who handles District 233 investments and incorporated into the revised policy.

Board President Gerald Pauling said the amount of study and review that has gone into this policy change is what made him comfortable in approving it.

“At six months we are distinguishing ourselves in the State of Illinois,” he said, adding that even dropping from 10 to six months “our reserves are healthy.” 

Tax abatement

The board unanimously agreed to abate taxes after it was notified District 233 would receive an additional $1,867,352 in school funding for the fifth year as part of the state’s Property Tax Relief Grant. 

When the state put in place an Evidence-Based Funding Formula in 2018, it comprehensively changed the way Illinois funds schools by providing more money to under-resourced school districts. It shifts payments from a general dollar amount per student to a formula that takes into account the percent of taxes funding local schools. 

With that change, the state also attempted to level the tax burden between wealthy and poorer school districts. It set up the Property Tax Relief Program to help meet the new funding formula. H-F was classified as a property tax heavy district and qualified for the tax relief program. 

By accepting this latest grant, H-F board members agreed to abate $1,910,159 in taxes for two years.

“It’s a big deal that we’re doing this,” said member Steve Anderson who chairs the board’s Finance Committee. He said it speaks to the school’s level of finances and how H-F manages its resources.

Wakeley said the grant program is optional, but the District 233 board has always accepted the abatement policy.

Building work

The board approved a contract for $744,484 with JF Chiatello Construction of Dyer, Indiana, for G-building and C-3 area roof replacement over the summer. The board also approved a $536,215 contract with Precision Control Systems for a new boiler plant replacement project at G-building.

Jim Patterson, director of operations and maintenance, said the boiler project will remove about 300 feet of hot water piping stretching across the South Building roof from the main boiler system in the north end to the G-building. The project will convert the heating source to a standalone boiler system in G-building.

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