District 34: Finance group sees $2.6 million shortfall in upcoming budget

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Updated: February 20, 2012 8:33AM

A citizen’s group with financial experience believes Glenview’s School District 34 will create $16 million in deficit spending by 2015-16 if budgeting remains the same.

Tasked with quantifying the district’s future budget issues, the Citizen’s Finance Advisory Committee stated in a report that $2.6 million in cuts would need be made to balance the 2012-13 budget.

However, the district would still be in the red for the future, while keeping at least 30 percent in total fund balances, or cash reserves, through the 2016-17 school year, the report stated.

Since 2002, School Board 34 has maintained at least 30 percent fund balance or more. The State Board of Education has recommended 25 percent for public schools.

The advisory committee presented findings that included another solution — reducing the budget by $1 million every year from 2012-13 to 2016-17, resulting in a $4 million reduction.

Doing so also would keep the budget balanced within the 30 percent threshold.

The district has a $68 million budget, showing a $2.4 million deficit — the first spending gap in six years. The district also has $37 million in fund balances, which is about 50 percent of this year’s total budget.

Based on economic factors, such as the Consumer Price Index, district employee compensations and local, state and federal revenues, the advisory committee also projected fund balances will dip below the 30 percent to 19 percent in 2017 if nothing was done.

“The big picture here is that we are expected to keep deficit spending unless changes are made,” said district spokesman Brett Clark on Thursday.

District administrators, school board members and Nan Ross-Meridith, union president of the Glenview Education Association, also participated on the Citizen’s Finance Advisory Committee.

“We need to make decisions and provide this information to the school board. We want to continue having people in the community be a part of this process now and in the future,” Clark said.

Typically, the 30 percent balance allows a school district enough cash flow through the year without having to short-term borrow.

In the end, committee members determined the best financial solution was balancing the budget by 2015, as well as achieving the 30 percent balance in cash reserves.

“To meet this objective requires about ($4 million) in deficit-reduction actions by (2016),” stated the report.

Under large expenditures, the report estimated teacher salaries would increase based on CPI 1.5 percent in 2013, 3 percent in 2014 and 2.5 percent in 2015 through 2017.

Depending on the percent increases agreed upon in a contract, teacher salaries could accumulate to between $4.5 million to $14 million by 2017.

Teacher contracts expire in June, and negotiations are under way.

At 8 p.m. Feb. 6, financial information from the Citizen’s Finance Advisory Committee and Budget Alignment Advisory Committee,on which 44 school employees and residents participated, will be presented to the District 34 School Board for further consideration.

“The board will be listening for understanding that night,” said Board President Chris Northwick.

The public meeting is at the Administration Building, 1401 Greenwood Ave., Glenview.

Northwick also said reviewing district finances were at the “top of the list” of the board’s work schedule.

“Our plan is listen to administrators, staff and community in figuring this all out. Our administrators will be working hard to find ways to move forward,” she said.

In early December, the Budget Alignment Advisory Committee released a report on all school jobs, programs, services and mandates for tentative re-budgeting and divided them into three levels.

Budget changes to Level A school jobs, programs and mandates in the district’s 2009 strategic plan were seen as “little if any.”

Those functions were director of special education, two school psychologists, principals and union president of the Glenview Education Association, among others.

Level B was considered “medium” changes for budgeting, and they included, for example, gifted testing, teachers for English Language Learners in grades kindergarten through eighth, instructional coaches and sixth- through eighth-grade social workers.

Looked upon as room for “a lot” of changes, the only Level C function was information technology facilitators, of which the district has one for each of its eight schools.

Another list of levels A, B and C functions were provided in the report under current practices.

On the C list for a lot of changes were pre-kindergarten and field trip transportation, learning resource director and life skills instruction, among others.

The committee’s report was the first in a five-step process, during which the data will be analyzed among school administrators, school board members and the community.

On Feb. 27, the board is scheduled to vote on final budget matters.

“A lot of eyes have been in on this process, so far. Ultimate decisions will come from the board, but it will not be made in a vacuum,” said Gerald Hill, district superintendant.

A video of District Deputy Superintendant Michael Nicholson explaining why the Budget Alignment Advisory Committee was formed and its full report can be viewed at http://www.glenview34.org/board/baac/.

The Citizen’s Finance Advisory Committee full findings and assumptions can be viewed at www.glenview34.org, which also contains “worst case scenario” information.

The online report will be updated.

In approving the 2012-13 budget, in September the school board cut $600,000 from the administrative budget.

Trustees also OK’d increase in class size that saved another $700,000 in salaries and benefits.