The budget surplus this year in Riverside Elementary School District 96 will be much smaller than in past years. The district is now projecting an operating surplus of just under $360,000 for the 2017-18 fiscal year this year after finishing last year with a surplus of close to $2.4 million and finishing the 2015-16 fiscal year with a surplus of just over $1.8 million.
The main reasons for the smaller surplus this year are the minuscule 0.7 percent increase in the consumer price index, which limited the increase in the district’s property tax extension, salary increases and the costs of implementing a new English language arts curriculum throughout the district, according to Rob Holmes, the district’s new director of finance and operations.
Hiring two new teachers right before the start of the school year to reduce class sizes at Central School will cost the district nearly $129,000, Holmes said.
The district also recently received word that revenues from the state’s corporate personal property replacement tax are projected to decrease by almost $85,000. Before those two last-minute changes, the district had been projecting a budget surplus of nearly $572,000.
The board of education is expected to approve the final budget for the 2017-18 fiscal year at its meeting on Sept. 20.
Revenues are projected to be about $27.3 million and expenses are projected to be close to $26.9 million.
As is typical for a school district, salaries and benefits account for about 78 percent of the district expenses. According to Holmes’s presentation, which was largely based on work done by former Interim Director of Finance and Operations David Sellers, the costs of salaries and benefits to District 96 employees rose by 4.9 percent in the last five years while the district’s enrollment increased by 1.8 percent.
Revenue from local property taxes account for about 86 percent of the district’s revenues.
The district maintains very strong cash reserves and is projected to end the year with a cash balance of nearly $29 million, so the district is in a very strong financial position.
Under the new state law passed last month, the district may qualify as a district whose funding base is strong enough to permit 10 percent of the registered voters in the district to place on the ballot a referendum asking to reduce property taxes.
Such a referendum could only happen if the district funding level exceeds 110 percent of the new baseline level of what the state considers adequate funding. The state will calculate an adequacy level for each district based upon a new and complicated formula that includes many factors.
District 96 Superintendent Martha Ryan-Toye recently attended a meeting where State Superintendent of Schools Tony Smith spoke. Ryan-Toye said that Smith told administrators that it could take up to a year for the state to calculate the formula for each district.
“There are still a lot of moving parts,” Ryan-Toye said.
Next year, school districts will be able to increase their property tax extensions by at least 2.1 percent, because that is how much the consumer price index rose last year. This will relieve a bit of the pressure on revenues that school districts have faced this year.
The district’s three-year contract with its teachers expires at the end of this school year and a new contract will have to be negotiated.
“We will obviously continue to keep an eye on all of our expenses and monitor our revenues, particularly with this potential change in state funding,” Ryan-Toye said. “But most importantly we really appreciate the opportunity to be able to provide high quality education to our students.”