How much is the District 65 budget?
In FY17, the annual budget totals $125 million and supports instructional and operational goals. For the past 15 years, the district has submitted a balanced operating budget.
Doesn’t the state give the district funding per pupil enrolled?
Yes. District 65 receives General State Aid (GSA) payments from the State of Illinois. District 65 spends $14,150 annually per student; however, GSA funding only provides approximately $600 per student. In addition, GSA payments have been reduced or pro-rated from 89-92% by the state for the last several years. GSA makes up around 4% of District 65 revenue.
How has student enrollment impacted the district's budget?
District 65 has faced significant growth in enrollment over the last ten years. Since the 2006-2007 school year, enrollment has increased by 22% (1,420 additional students). As a result, the budget has grown to support the increased staffing and expanded programming required to ensure the needs of all students are being met.
How did we get into this financial crisis?
District 65 has faced a structural deficit for many years, which means the costs have consistently been higher and grown faster than revenue. Over the past seven years, the district has made $10.8 million in reductions to balance its budget. Future deficits are projected to be very large and the district will no longer be able to balance its budget without taking further action. As a result, there are two options for moving forward - making continued painful reductions (approximately $8.8 million over the next two years alone) or increasing revenue through an operating referendum.
What are the current financial projections?
The district is currently projecting annual deficits starting at $5.1 million in the 2017-2018 school year and increasing to $24.4 million in the 2024-2025 school year. Through 2025, the cumulative total amount of these deficits is $112.3 million. Click here to view detailed financial projections.
I keep hearing about a structural deficit? What does that mean?
A structural deficit occurs when expenses grow faster than revenue. The district’s revenue growth is limited by state and federal formulas and regulations. Due to a slow economy, the district has experienced several years of lower-than-projected revenue growth (+1.9% per year). Yet, expenses continue to grow at a faster pace (+3.9% per year). Until revenues and expenses are even and grow at the same pace, a structural deficit will continue to exist.
WHY CAN’T THE DISTRICT USE MONEY FROM ITS FUND BALANCE (SAVINGS ACCOUNT) TO ADDRESS THE DEFICIT?
It's not recommended to use the fund balance to fund ongoing operations, especially when the fund balance is already low. Also, fund balances in certain funds can be restricted. Further decreases can impact the district’s bond rating (making it harder to get loans) and increase borrowing costs. The fund balance may also be considered a “rainy day” fund in the event of unforeseen maintenance or instruction costs (e.g., roof damage from a storm). Additionally, the fund balance is used to pay bills until property taxes are received.
Are the deficits caused by high administrative spending?
Administrative expenses account for 4% of the overall District 65 budget. Historically, between 64%-77% of Illinois districts have spent more per pupil on administration than District 65. Over the past seven years, the district has funded increases in instructional spending by making reductions in other areas, including administration. From 2010-2017, instructional spending has increased from 43% to 52% of the overall budget, while administrative spending has decreased from 5% to 4%.
I hear that the district pays a lot on consultants. Is that true?
In FY16, the District spent $366,669 on consultants which is less than half of one percent (0.3%) of the operating budget. This amount does not include consultants who are fully funded by state and federal grants. The largest portion of consultant spending is on activities that support teachers, principals, and students. This includes support for instructional leadership teams, school climate teams, work to further promote equity in our schools, and clinical consultations for students with special needs. in.