U-46 officials projecting higher revenues, expenses

Elgin Area School District U-46 is projecting $20 million more in revenue in fiscal year 2015, and $13 million more in expenditures, officials said last week.

The district's administration is proposing a $488 million budget of expenditures for the 2014-15 fiscal year. Revenue is anticipated at $487.7 million, essentially making it a balanced budget.

A public hearing on the proposed budget is planned for 7 p.m. Sept. 15 before the regular school board meeting. The board is expected to adopt the budget Sept. 29.

Officials are anticipating roughly $3.5 million in additional property tax revenues this year and about $1 million more in federal revenues.

However, the largest piece of the roughly $20 million in additional revenues - $13 million - is a projected increase in General State Aid receipts.

"The main reason for that increase is part of that formula takes into account the equalized assessed valuation," said Dale Burnidge, U-46's director of financial operations. "With property values declining, we see an increase in money for General State Aid. The total that we are expecting to get is about $98.9 million."

Last year, the district received about $86 million in state aid but was expecting much more.

The state hasn't had enough money to fully fund school districts, shortchanging U-46 roughly $36 million in state aid receipts over the last four years, Burnidge said.

"This year we are losing about $12 million or so," he said.

Burnidge said the district could see further reductions in state aid and funding for categorical grants - which could include such expenses as transportation, and special education, gifted, bilingual and early childhood programs - if lawmakers do not extend an income tax increase set to expire Dec. 31.

"There is no way for us to tell (how much)," he said. "They could delay payments to the school districts, or they could prorate (state aid) down further."

Officials also are concerned about the possibility of a court challenge to the state's new pension reform legislation that could result in a cost shift requiring school districts to contribute more.

Expenses also are going up, with the new teachers and support staff contracts resulting in $4 million more being paid out for salaries and benefits. Officials said they saved some money in overall health insurance costs and employees are paying higher deductibles and copays as a result.

"The district's cost hasn't increased as much as it would have," said Jeff King, chief operations officer. "Average increase is between 9 and 12 percent. Ours has averaged below 3 percent for the past four years."

About $12 million more is being allocated in this year's budget for building maintenance and equipment purchases. The total allocation for capital expenses is $27.7 million. Last year, it was about $15 million.

Officials said they have been deferring maintenance work over the years and need to catch up.

"We have over $200 million in deferred life safety and maintenance costs," King said. "We spend anywhere between $10 million to $20 million a year in capital improvements and maintenance."

Expenses also are higher this year because the district has expanded its all-day kindergarten, dual language, early childhood and gifted programs. Aligning curriculum to new learning standards, and technology upgrades - such as expanding wireless access and replacing old computers - also contribute to expenditure increases, officials said.