Palatine Dist. 15 board approves $151 million budget

Palatine Township Elementary School District 15 will rely on reserves to pay for a $4 million deficit, a plan that triggered a heated back-and-forth between the superintendent and one school board member.

A divided board approved the $150.8 million budget for the 2014-2015 fiscal year.

Before the 4-3 vote, board member Scott Herr explained his decision to boycott a group photo celebrating a good governance award from the Illinois Association of School Boards.

Herr said the board has "significant gaps" in effective governing. He added he has a responsibility to "protect the financial assets."

Superintendent Scott Thompson told Herr his obligation is to "make sure the education is the best possible in the community (and) being fiscally responsible doing that. It's not always about finances."

"Our organization is really going in a good, positive direction and we get mired in adult issues that don't really focus on kids," Thompson said of the photo snub.

Herr later said the comments were offensive.

"I have demonstrated time and again that I have a very wide view of this community, a very broad view," said Herr, drawing applause from the audience.

"I believe it, but I don't believe that's the way you act," Thompson responded.

Herr voted against adopting the budget along with two other board members: Manjula Sriram and Gerard Iannuzzelli. All three also refused to join the group photo.

In June, the district's financial planners put the shortfall at $3.6 million. Last October, the number stood at $1.1 million - before the board approved spending more on capital projects.

"It's like a roller coaster," Iannuzzelli said of the forecasts.

Since June, the district hired a handful of additional teachers based on the final number of students enrolled in schools, Thompson said. On the revenue side, the state also cut Medicaid reimbursements to the district, adding to the projected deficit.

Thompson stressed the district has built up its fund balance over the last five years - by roughly $8 million - to cover unforeseen costs.

By June 2015, the fund balance is expected to fall to $50.8 million, or nearly 34 percent of the district's operational budget. An informal board policy calls for at least 25 percent.

But Herr said the district should trim its expenses to balance the budget.

"We really have a flawed budgeting process," Herr said in an interview. "I feel it's extremely important to start the year with a balanced budget. We're setting ourselves up for failure."

The board generally earmarks $3 million for capital projects. Plumbing repairs and other work at aging schools will push the number to $4.76 million.

Herr said he's OK with using the reserves to pay for the extra $1.8 million in capital projects. Filling the remaining gap would require 1.5 percent in cuts - a "drop in the bucket" from the $151 million in expenses, he has said.

But administrators say the budget is a fluid document. Thompson noted the district should finish the 2013-2014 fiscal year with a $972,727 deficit, down from an earlier estimate of $2.2 million.