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The Examiner U-46 News Feed

No U-46 budget due to lack of state income data


By Seth Hancock
  The School District U-46 administration did not present a tentative budget for Fiscal Year 2018 despite planning to at the Board of Education meeting on Monday, June 19.
  Although recent action at the state level may give the district a better idea of what to expect, at the June meeting Jeff King, chief operations officer, said U-46 did not know what to “put in for revenue from the state.”
  “In May we said we would wait until a later date to bring you back hopefully a more solidified version of a budget,” King said. “Unfortunately we can’t do that because frankly we’d be guessing.”
  With concerns over what the district may get in terms of revenue from the state, King presented some options that could occur: Eliminating all equipment spending ($9 million estimated), reduce school and department supply budgets by half ($4 million), hiring freeze and reduction in non-union personnel ($1 million), reduction in purchased services ($1 million), closing all swimming pools ($500,000), eliminating activity buses ($100,000) and future talks of closing schools.
  U-46 CEO Tony Sanders said this was “worst case scenario.”
  Last year the district estimated it would get four categorical payments from the state which King said “didn’t end up being a great plan” and “we will not end the year with a positive fund balance this year.”
  King also said that the possibility is there that the district would need to get a tax anticipation loan which he said is “basically a payday loan” with higher interest rates. Board member Phil Costello said: “I suspect you’ll be standing in a long line of school districts.”
  At the meeting, four people spoke out during public comments to oppose the option to close swimming pools. Board member Jeanette Ward asked the administration to get public feedback before such an action and asked if it would be allowed to seek corporate donors to help keep the pool open to which Sanders said: “That would be allowed…. It would have to go through the board for an approval process.”
  Board member Melissa Owens asked where the purchased services reductions would come from and King said “consulting is one of the biggest one in there.”
  Board member Sue Kerr asked about if the elimination of activity buses would include athletics to which King said: “Once school gets out, we’re done. We take you home and we’re done.”
  King said the $100,000 savings on activity buses was a “conservative estimate” and added: “I’d say if the choice is we close our buildings at Christmas or we bus kids to athletic events, that’s a conversation we need to have.”
  Right before the budget discussion, the administration presented a five-year capital and equipment plan for maintaining the district’s infrastructure, providing current technology and maintaining vehicles.
  The administration wants to increase operation and maintenance spending from $15 million a year to $25 million.
  Citing a study on building life cycles that stated that a “building should be abandoned” after 50 years, King said the district has 27 buildings, or 43 percent, that are over 50 years old. Sanders later said “sometimes our size can be overwhelming, and sometimes our age can be overwhelming” citing the 125-year anniversary of Washington Elementary School.
  Kerr asked about the decision making process for closing a school, and Sanders said “the challenge is always the boundary issue.” King estimated the cost of replacing a school of being between $10 and $15 million and said it would need a referendum.
  Ward later noted that she lives in a 50-year old house and “I don’t think necessarily saying that a building is 50 years old is a reason to abandon it.” King said he “wasn’t advocating abandoning” those buildings but wanted to give perspective.
  To fund this plan King presented some options including new debt, tax levies, depletion of district reserves, reallocating funds and leasing technology and vehicles.
  On maintaining the district’s vehicle fleet, King estimated an annual cost of $4 million. Noting the previous discussion, which was nixed in closed session without any public discussion, on possibly outsourcing part of the district’s transportation, Ward said: “Bus outsourcing would have helped some of this, alleviate some, not only by saving us some money but also some of the buses would not have been our responsibility.”
  Board member Traci Ellis “we wouldn’t be having this kind of conversation right now” had the board approved a $50 million debt option back in 2016 which King agreed. The administration sought that debt a year after the district added $40 million in debt despite wide public disapproval, and the administration’s reasoning at the time was only because it was “zero- to low-interest” with the nation’s taxpayers paying for the majority of the interest.
  That bond option never came up for a board vote.
  Ward also raised the district’s expansion in operations this past school year as she said: “This might look a little different if we had not expanded operations greatly with full day kindergarten.”
  King claimed he didn’t “think that would have made a difference in this, I mean $4 million.” The district’s selling point for adding full day kindergarten district-wide was that the district would receive more funding from the state with it, and King said: “If we were to get state funding next year, most of that will come back through state funding.”
  However, Ward noted the additional salaries asking “well, it’s 55 additional FTE (full time employees) right?” Sanders said “that was the estimate. It didn’t end up being the full 55,” but the administration didn’t have the exact number.
  Ward also noted the funding from the state on the initial costs of the expansions “it was a 17-year payback,” and King said “if that’s what the number I gave you, then yes.”

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