U-46 board reviews tentative budget for next school year
The Elgin Area School District U-46 school board Monday night reviewed a first draft of a $534.6 million spending plan for the 2018-19 school year.
The tentative budget includes nearly $17 million in increased spending from the previous year largely due to salary increases.
It is based on the previous education funding formula and does not take into account the state's new evidence-based funding formula, which consolidates and replaces five grant programs: general state aid; special education personnel, services and summer school; and English learner education.
"We still have a number of unknown factors," said Dale Burnidge, director of financial operations. "We are still waiting for the state to give us our calculation for what our portion for revenue will be."
The fiscal year 2019 budget anticipates receiving four quarterly payments in state categorical funding, which includes money for transportation. However, the district hasn't yet received the third quarter payment for this school year, he added.
Other unknowns that could affect the district's budget include potential property tax freeze legislation and a pension cost shift making school districts pay the current state share of teacher pensions, which could cost U-46 up to $24 million yearly, Burnidge said.
Officials are estimating a $6.5 million increase in property taxes for next school year and a proposed property tax levy increase of 2.1 percent for tax year 2018, payable in 2019. Tax year 2017 revenue, payable in 2018, was levied at 2.1 percent. They also propose abating the same amount of taxes for tax year 2018 as the previous year - $3.9 million.
Revenue estimates for the 2019 fiscal year include $309.2 million in taxes - an increase of $5.8 million from the previous year - and $156.5 million in evidence-based funding, which amounts to $35.8 million more than was received through the previous funding formula because the new formula includes some categorical funding. Subsequently funding for categoricals is expected to go down to $24.6 million, a $4.4 million drop.
"Evidence-based funding increased our revenue by $22.3 million in fiscal year 2018," Burnidge said.
Under expenses, officials expect annual salary increases based on contractual agreements, adding 14 full-time employees - guidance counselors and assistant principals for middle schools, and assistant principals in larger enrollment elementary schools.
Health insurance costs also are projected to increase 7 percent, as well as increases in pension, Medicare and Social Security equal to salary increases. Officials also anticipate spending $5.7 million to purchase new buses next year.
"All of our funds, we currently show a $12 million surplus for the year," Burnidge said. "Operating funds ... we have a $10.2 million surplus."
School board member Jeanette Ward said she doesn't agree with increasing the tax levy for next year and would rather see additional state education funding be used to pay down the district's debt.
"I would like to see us keep it flat or decrease it, which was supposed to be the point of increased state funding," she said.
Board member Melissa Owens said evidence-based funding really is meant to be invested into improving educational services.
"The evidence-based funding was specifically designed to bring underfunded districts up to adequacy," she said. "It allows us to get more money into the classrooms. It allows us to get more services to the students."
A final budget will be presented for approval at the Aug. 20 school board meeting.