SAUK VILLAGE | Community Consolidated Schools District 168 has the potential to develop serious financial problems in coming years because it is so reliant upon Illinois state government for its funding.
Bloom Township Treasurer Rob Grossi, who also oversees the finances of the elementary school district, presented the School Board with a five-year projection of its finances, while warning school officials of the need to keep a close eye on their budgets for the upcoming school year and in the future.
The district is in the process of putting together a budget for the 2013-14 school year that will be reviewed in August and likely given final approval in September.
Grossi said the revenues and expenditures for this school year likely both will total just under $19 million. “You’ll be right at about a balanced budget for this year,” he said.
He said that during the school year that ended in June, federal funding for the district was about $150,000 more than anticipated, and most expenditures were slightly less than budgeted for.
“The district did a good job of keeping its spending under budget,” Grossi said.
But the problem area is that last year, the district received 51 percent of its funds from state aid and another 12 percent from state grants, which means more than three/fifths of the budget was from the state. Illinois has its own financial problems and in recent years has been cutting the percentage of money it provides to school districts.
Last year, and again for the upcoming year, the state provided school districts with 89 percent of the money they were eligible for under the state aid formula. Grossi said the district would have received an additional $1.1 million if they had received all the money they were eligible for.
If the state had followed through on a threat to reduce the percentage to 81 percent, that would have been an additional $800,000 for District 168.
“We’re vulnerable because our budget depends on what happens at the state level,” Grossi said. Local property taxes provide another 21 percent of the district’s funding, while 14 percent comes from the U.S. government.
Grossi told district officials they have an advantage of a $15 million surplus in their bank accounts, compared to the $7.1 million that ought to be kept on hand to ensure the school district can begin classes come August.
But in coming years, the surplus is likely to decline to the point where the district will barely be able to maintain that $7.1 million level. Grossi said expenditures are likely to increase by 1.7 percent per year through 2018, while revenues are likely to increase by only 1 percent.
“This is a trend the Board of Education is likely to address,” he said, while adding the district may have to consider approving deficit budgets in the next few years in order to survive.
Although School Board President Sharon Davenport said that is an option not likely to occur.
She said of school district Superintendent Al Travaglini, “he’s in a tough spot, because the board has mandated him to have a balanced budget.”