Batavia schools to save mall money for repairs, reserves
What does a school district do when informed $1.7 million is coming its way?
“Repair buildings” and “build up savings account” were the choices made by the Batavia school board this week.
The district is getting that money from the surplus left over in a tax increment financing district fund for the Chicago Premium Outlets mall and several industrial sites near Kirk and Butterfield roads in Aurora. The TIF district is due to expire in January.
The TIF district used property taxes to make improvements that raised the value of the property, instead of sending those tax increases to the school district and other taxing bodies. Money left over in the fund is being distributed.
The Batavia school district already received $572,000 in November, and expects checks in 2012 and 2013, according to an agreement it approved Tuesday with the city of Aurora.
The school board decided that half of that money should be devoted to capital projects, such as roof repairs. The district has a list of about $7.5 million worth of such things, said Kris Monn, the district’s assistant superintendent for finance and operations.
The rest will be saved in the education and working cash funds. Monn said that would enable the district to stop using so much of its May and June property tax receipts in the current fiscal year. Property tax payments are due May 1 and Sept. 1. As payments roll in, the county starts sending the district checks in May. Currently, the district has been using 48 percent of its first checks on bills for that fiscal year, but it would be more fiscally appropriate for that money to be used in the next fiscal year, Monn said. The school district’s fiscal year begins July 1.
Monn said Batavia doesn’t have a policy on how much to hold in reserve. Some school districts set a certain percentage, or set a goal of not borrowing money via tax-anticipation warrants.
Monn expects that the district may have to issue tax-anticipation warrants next spring to meet its bills. The district would have to pay interest on the loan, and would repay them with those first property tax payments.