Financial projections released at last month’s D58 school board meeting included some assumptions that haven’t been part of the local scenery for some time. Namely, a two- to four-percent decline in existing EAV through 2012.
The projections don’t see a turnaround until 2013, when existing EAV is predicted to rise by three percent following dips of two percent in 2010 and 2012 and four percent in 2011.
The assumptions reflect a housing market that is a far cry from its heyday of double-digit appreciation. Of course, it remains to be seen whether the predictions will materialize and also whether local property tax bills will reflect the decline.
District administrators furnished EAV and other assumptions to PMA Financial Network, which presented the information February 8. The district’s Financial Advisory Committee also provide input into the numbers.
On the plus side, the district will benefit from about $20 million in new property EAV this levy, Controller Jim Popernick said. “The new growth is a very nice feature, but the reality is that even though EAVS have slowed and the consensus is they will go down in 2010, it doesn’t mean revenues will go down.
“The tax cap protects school districts. I’m not going to provide a gloom-and-doom scenario when our past history says that never happens,” Popernick said.
“Moving forward, basically the district can run a balanced budget based on normal revenue streams and normal expenditure patterns,” he said. “When building the budget, we have some flexibility. We can react to outside forces. We can make cuts, evaluate programs and reduce program, supply and equipment budgets.”
While the EAV numbers may be of particular interest to homeowners, D58 like other school districts, is keeping a close eye on how much state aid is forthcoming.
D58 receives $3 million to $4 million in categorical aid and $1 million to $2 million in general aid. If Springfield can’t solve its financial problems, categorically aid is likely to be cut, Popernick said. Categorical aid is earmarked for special education and other mandated programs, which means proportional cuts aren’t possible.
“For all school districts, 2010-11 will be a tough year,” he said, noting that districts are also dealing with the effects of last year’s historically low 0.1 Urban Consumer Price Index . The 2010 CPI-U is back up to average at 2.7 percent, he said.
Fortunately, the district has a cushion in its Medical Reserve Fund as a result of savings realized when it changed health plans and revamped its benefit schedule. Following two years in which expenses were reduced by five percent, the district is projecting 15 percent reduction resulting in $900,000 in savings next year.
D58 also aims to maintain an overall fund balance of eight to 12 percent, or $4.4 million minimum, he said.
I think it is time to find a way out of the Federal and State education boondoggle. I have said it before and I will say again. We need to fund our school districts with PROPERTY TAXES only. Then we need to fire the Feds and State and tell them they can keep their mandates. Then we can fund “in real time” our school districts budgets. The government has proven to be unreliable when it comes to making payments to the school districts. It’s the only way to truly fix the educational system.
I actualy agree with this Chad. Keep the gov’t out of our schools. They were doing better before they got involved.
School boards are FAR from being “government”. They may be elected, but they are far from government. They don’t get a pension or pay. For as critical as I am of the local school boards at times, I trust they have the best interests of the district at heart. That is what we need, not government regulation and redundancy. Just think of how many government bureaucrats there are. I mean what do these state and federal board of eds do anyway besides collecting huge paychecks.
John….Chad and Well… are advocating local control. D.C. doesn’t know what is right for all children. It cannot accurately assess, anticipate or allocate the proper resources for the individual.
We all agree that local elected officials are preferred. If D.C. knew what they were doing the last 40 years since the Dept of Ed., American children would be at the top, instead of the bottom of developed nations.
Except for new property EAV, declining EAV is irrelevant for the budget unless it causes the max levy rate per 1000 to be reached. The budget squeeze lies in the possible failure of the planned govt payments (as noted in the article). It is also aggravated by a flawed operating financial structure that has a mismatch of revenue and expense growth. When this happens in the private sector companies adjust their budgets to match their revenue. In the public sector we get the opposite, warnings and requests for “necessary” tax increases.
WARNING: Thread hijack ahead!
Just curious what our local elected officials and Water Commission members think of this recent story, pro or con: http://bit.ly/cwKWId
Editor’s note: I wonder, too. I know what I’ll be doing this afternoon.
I know this isn’t D58 related but the education thread is closed so I hijacked this one…
For those of you who think the federal and state education departments have been doing a good job…U-46 in Elgin is laying off over 700 teachers and staff to fix a $44 million short fall in their budget.
When will people learn. BIG GOVERNMENT = Big waste of time and money!
We need to kick the government out of our education. We will save money, keep jobs and educate our kids better than any fed could.
Mr. Walz, I am getting off topic. Did you see the recently Time Magazine article on the Social Security? (Going along with your theme of big government spending out of control.)
Earl,
I did not. If Time is running the story I am not sure what kind of wieght I put behind it. They are like TMZ these days! LOL