U-46 finalizing major projects for 2016

Elgin Area School District U-46 officials are prioritizing infrastructure improvements to be completed this school year, officials said Friday.

The district's $507 million 2015-16 budget includes $13 million for capital projects, funded through the sale of bonds last school year. The district borrowed $40 million through debt restructuring to fund building maintenance and capital projects.

"We will make the list public in about a month," said Jeff King, chief operations officer.

This year's budget also includes spending $6.7 million for leasing 87 new buses that are in operation now and from $1.5 million to $3 million for new computer equipment. Work also will be done to finish upgrading the wireless infrastructure districtwide.

"There are 17 or 18 schools that need to be completed to get them to 100 percent," King said. "We are working on making sure every area in the school buildings is accessible."

District officials took a conservative approach to this year's budget, taking into account uncertainties with state funding due to the budget impasse.

Property taxes make up 64 percent of the budget, while state funds account for 29 percent, and federal grants make up 7 percent.

The state is about four months behind on paying its bills and owes U-46 about $7 million to $8 million in reimbursements for transportation and categorical payments for this school year, King said.

The district should receive four quarterly state categorical payments - covering expenses such as transportation and special education.

"We only budgeted for three (quarterly payments of) categoricals ... in anticipation that there would be potentially some revenue that we don't receive," King said.

Officials also are anticipating a reduction of roughly $10 million in general state aid payments this school year; the state is expected to fund 92 percent of what the district is owed under its funding formula.

Last school year, the state withheld 13 percent, or more than $14 million, in general state aid from U-46.

King doesn't expect there will be a deficit by the end of this school year, but whether state revenues will come through remains a major unknown. A potential pension cost shift from the state could throw a wrench in the planning, if school districts are asked to contribute more to decrease the state's pension burden, officials said.

Total revenues for this year are expected to increase by $7.5 million, while expenditures are projected to increase by $20 million, of which $7.5 million is earmarked for salary increases.

In actuality, officials anticipate spending only $3 million more on salaries this year.

"We actually allocated an additional $4 million to salaries, but we haven't hired those people," King said. "We're going to hold off on many of those hires that may be called for or needed to comply with the goals of the strategic plan."

The district's strategic plan is yet to be finalized and may not happen until year end, so "that money won't be expended at this point," he added.

King could not say what new employee positions may be created per the plan.