The Downers Grove Grade School District 58 Board of Education reviewed the proposed 2016-17 budget during a Budget Workshop on Monday, Aug. 22. District 58 expects the Board to vote on and approve the proposed budget at the Sept. 12 regular Board Meeting, at which time a Budget Hearing will be held. View the tentative budget.
2016-17 budget planning:
Assistant Superintendent for Business/CSBO David Bein reported that the proposed budget is generally balanced with $64.9 million in revenues and $65.1 million in expenditures.
Bein noted that the final budget could slightly differ, depending on the District’s final enrollment numbers and possible changes in state grant funding. However, he does not anticipate any substantial changes.
“We are carefully monitoring our enrollment and considering if any additional staffing changes will be required,” he said.
Bein said that the District annually prepares its budget by analyzing the District’s needs and priorities. The budget also accounts for slight fluctuations and unexpected needs that could arise.
Bein also pointed out that the District sometimes underspends its budget in certain categories, resulting in cost-savings. For example, during the 2015-16 fiscal year, the District re-evaluated its 1:1 device hardware needs and determined that the devices did not need replacement, which saved the District more than $330,000 in Educational Media Services, the budget category that encompasses the District’s technology costs.
Finally, Bein noted that the District increased its employee health care premiums by 5.5 percent this fiscal year, which should bring additional revenues into the Medical Reserve Fund. The District also switched health care providers during the last fiscal year, which is anticipated to help stabilize rising costs as well.
Future budget concerns:
Bein shared with the Board three major budget concerns that District 58 may face in the coming years.
The State General Assembly has ongoing discussions regarding property tax freezes, pension cost shifts and changes to the General State Aid formula.
Since District 58 receives nearly 89 percent of its funding from local sources, a property tax freeze would affect the District’s revenues. In addition, a shift in pension costs would require the school district to spend significantly more of its local funding on pensions.
In recent years, the State has proposed different changes to the General State Aid formula. Each proposal negatively affected District 58, with some projecting annual cuts of $2 million in general state funding to District 58. These discussions are still ongoing.
Tackling possible future capital projects:
Considering these budget concerns, Board Member Elizabeth Sigale asked how the District could allocate funding for large projects, such as school additions, should the need arise.
Bein said there exists three possible ways the District could obtain such funding.
The first, and most probable, option is for the District to take on long-term debt. He cautioned that the District is limited in the amount of long-term debt it can accumulate, due to the State’s debt service extension cap, a law that limits the amount of debt payments that school districts can repay each year. This limit affects the amount that District 58 can borrow and can make it a challenge to repay large debts in a timely fashion.
Bein said that the District could also reallocate its current funds, although that can be challenging as it would require large reductions in other areas. Within the current limited revenues and expenditures of the District, that would be extremely difficult to accomplish. Finally, the District could seek a referendum in order to procure additional funding. He noted that these options were less probable.
The board discussed how some large maintenance projects, such as roof replacements, will be needed to maintain the aging schools in the coming years. These projects, which can be costly, may also require long-term borrowing, reducing the availability of borrowing for projects such as building expansions.
Budget Hearing
The District 58 Board of Education will vote on the proposed 2016-17 budget during the regular Board Meeting on Monday, Sept. 12 at 7 p.m. at the Longfellow Center, 1435 Prairie Ave.
District 58 Board of Education members include: John Cooper, president; Doug Purcell, vice president; Roberta Diehl; Christopher Heppner; Sallie Lupescu; John Miller; and Elizabeth Sigale, with Dr. Kari Cremascoli, superintendent; and Pam Osika, board secretary.