How state budget dispute pinches local schools

SPRINGFIELD - Across the suburbs, school officials are putting final touches on their back to school budgets, a task made more complicated by the fact that millions of dollars in state funding remain stuck in a political limbo at the Capitol.

The state's temporary budget deal expired at midnight and Illinois begins August with no budget and no authority to spend money on anything from education to payroll.

"We'll be alright for now. But if it goes much longer, it will be a concern," said Elgin Area U-46 School Board President Ken Kaczynski. The state's second largest school district has relied on the state for nearly 30 percent of its funding in recent years. A meeting is scheduled next week to discuss the implications if the state budget is delayed further.

""It could throw all the planning out the window if for some reason we have to go out and borrow money," he said.

For now, the general consensus across the suburbs, if not the entire state, is the lack of a budget is more of an inconvenience or irritation than crisis. Indeed, suburban schools by and large rely on state funding the least of any schools in the state, instead getting the bulk of their dollars from local taxes.

Schaumburg Elementary District 54, for example, plans to draw just 15.2 percent of its $195 million budget from state sources. With $95.8 million in reserves, the district could weather a protracted state shutdown, if it comes to that.

Nothing so drastic is envisioned today. State police will continue to patrol the highways, prisoners will remain under watchful eye, and all state employees have been asked to continue showing up with a promise they'll be paid once there's a budget.

"With your cooperation, the people who count on state government will experience no inconvenience," Blagojevich said in a letter to state employees Tuesday.

But the situation could become calamitous if lawmakers don't strike a deal in the coming days. On Aug. 8, payroll for nearly 4,900 state employees needs to be processed along with more than $170 million worth of payments to public schools. Within weeks, the number of unpaid employees could grow by tens of thousands and state payments to myriad entities doing business with the state would be stopped.

"Nothing should shut down (today)," said state Sen. Terry Link, a Waukegan Democrat. "If we get passed the 8th or 9th, that's a real crucial time."

In recent days, Blagojevich asked lawmakers to approve another temporary budget to cover August, but that option's been rejected, for now.

House Speaker Michael Madigan, a Chicago Democrat, said progress is being made on a full budget. He declined to elaborate, but offered a reminder that when this situation has played out in the past, everyone ended up getting paid.

So there's nothing to worry about, Madigan was asked.

"I'm not going to say that," he replied.

The request by various state officials that employees continue working should keep projects and programs running for now. Lake County officials said Monday the state had informed them several road projects in the county would be shut down today because of the budget situation. The list included a widening project on Butterfield Road and Buffalo Grove Road bridge replacement at Indian Creek.

However, a spokesman for the governor's budget office said Tuesday work would continue, and Lake County officials said they also were informed the projects would not be shut down.

Still, for those who rely on the state for funding, the situation is increasingly frustrating. A budget deal was due May 31 and the overtime session is now headed into its third month and no one knows for sure how much funding schools or anyone else will get in the final deal.

"It's really been a monkey wrench," said Ken Arndt, superintendent of Dundee Township's Community Unit District 300. Last year, the state sent his district $947,000 twice a month. This year's first payment is jeopardized by the budget stalemate.

"You'll see a lot of school districts going into deficit spending if this continues," Arndt said. "We don't have that type of cash flow to cover expenses for six to seven weeks. Some districts in the area might, but that's certainly not us."