Last week as the Riverside Elementary School District 96 Board of Education unanimously approved a budget for the 2017-18 fiscal year that projects a surplus of $351,430 for the current fiscal year, some school board members expressed concerns about the fiscal trajectory of the district.
The $351,430 surplus this year is a steep reduction from the budget surpluses the district has run in the past few years. Last year, the district finished the year with an unaudited budget surplus of nearly $2.4 million. The year before, the district ran a surplus of just over $1.8 million.
“I’m very concerned about the trajectory we’re on,” said Jeff Miller, the president of the District 96 Board of Education.
Miller said if costs continue to increase as they have in recent years, the district could soon be deficit spending. District 96 continues to be in a very strong financial position and is projected to end the 2017-18 school year with reserves of nearly $29 million, which is more than the almost $27 million the district plans to spend this year on operations.
The district’s revenues, 87 percent of which come from local property taxes, remained essentially flat this year, increasing by just under $105,000. That was because the district, like all school districts in Cook County, can only increase its tax levy by the rate of increase in inflation or 5 percent, whichever is less. The Consumer Price Index, which governs the tax levy, increased by only 0.7 percent. Next year the district will be able to increase its tax levy by 2.1 percent.
Salaries and benefits, which are the major costs for any school district, increased faster than revenues. Most teachers in the district received raises of 1 percent in base pay for this year, the minimum raise allowed for in the teachers’ contract which expires next year.
Teachers also advance a lane on the salary schedule each year, which boosts their salaries. The 16 experienced teachers who are off the salary schedule received raises of 2.25 percent this year.
The district is spending nearly $16.3 million this year on salaries compared to just over $15.4 million last year. Salaries and benefits account for 80 percent of the district’s expenses, according to Rob Holmes, the district’s director of finance and operations.
District 96 also spent heavily to implement a new English, Language Arts (ELA) curriculum. The cost of new ELA curriculum, including materials and training, amounted to just under $368,000.
The district also is spending nearly $40,000 more than last year on new workbooks to accompany a new elementary school math curriculum introduced last year. Combined, the district is spending nearly $700,000 more this year than last year on curriculum supplies and purchased services.
The new ELA costs are mostly a one-time expenditure and the costs of supplies and purchased services are projected to decrease by nearly $300,000 next year, Homes said.
“We didn’t have, necessarily, the infrastructure of staff that was needed,” said board member Shari Klyber. “But I think it’s time that we really consider where we place people and when and how, because that staffing is vital, but it’s extremely expensive. We need to think about class sizes.”
Expenses increased by nearly 8 percent this year as the district is projecting operating expenses of nearly $27 million this year compared to expenses of nearly $24.9 last year.
Not all school board members were so concerned about the shrinking budget surplus.
“Some of the surpluses in the past were a bit excessive for a public bodily to continually get,” said board member Lynda Murphy. “For me, ideally, we would be taking in what we spend.”
Murphy and board member David Barsotti said that they would not be uncomfortable with occasionally running operating deficits.
“I don’t necessarily think deficit spending is bad,” Barsotti said. “The trajectory is what’s concerning. … There were some significant changes made in the last couple of years which caused us to increase spending. I’m not raising the alarm bells yet.”
The school board will face some substantial capital costs in upcoming years as it seeks to improve its playgrounds and decides what to do with the land next to Ames School, which it purchased last year.
“This board hasn’t even talked about how we’re going to pay for that yet,” said Rich Regan, the chairman of the board’s finance committee. “We have no idea yet, because we don’t know what the scope of the project is yet. When you have those unknowns, you preserve the reserves as best as you can.”