School Budget Crisis Question & Answer

 

Jeff Fritchnitch

Per a conversation earlier what percentage or responsibility, by the constitution, does the state have in covering educational cost?
To my knowledge, the State is required to pay 51% of the education fund needs to each school district in the State.

Has the State of Illinois ever been able to fully meet that required amount?
Not to my knowledge.  But I was told by a veteran superintendent two years ago that 36% was the highest percentage paid.

What is the amount on average that is met by the State of Illinois?
Somewhere in the neighborhood of 20%

How is the shortfall met?
Local property taxes, which has been the major point of discussion from superintendents to legislators for the last 5-7 years.  Unfortunately, education has always found a way to make ends meet, with small increases from the State annually.  A few years ago, the Education Funding Advisory Board (EFAB)was created and provided some quality proposals to the State Board of Education and also to the State Legislators, but, their proposal has also fell upon def ears. They have implemented portions of the EFAB proposal, but not to the extent that it has had a positive impact on school funding and most importantly equitable funding.

What is the projected outlook as to when the State of Illinois might begin missing state aid payments?
From the meetings that I have attended, school districts can anticipate no money General State Aid payments from the State after March 2010.

How much will the school district be shorted once the State of Illinois fails to meet payments?
We will be short April, May and June General State Aid payments that would total $428,085.27, plus no Reading Improvement Block Grant which is $10,163.00, plus no Safety Block Grant of $3,192.00, plus no Transportation reimbursement which totals $141,840.00  and to date we have not received any Special Education reimbursement which totals, $112,479.00  for a grand total of $695,759.00.  There are other commitments we anticipated for this year that was budgeted, but have been told no grants will be paid (textbook loan)

How will that shortfall affect day to day operations of the district?
Fortunately, we currently have funds available to meet all obligations for this school year.  However next year, we are being informed that we won’t receive GSA for next school year will be even more of an issue as a result of the State’s budget issues.  I have also been informed that discussion have taken place that would fund schools at the 2003 GSA funding level.  It will be tough to make balance a budget reverting back to 2003 funding levels, but something is better than nothing; I hope we get something.

Will the district be forced to make educational cuts? (re: not offer high end classes)
The district is going to be making some decision with regard to academic and extra-curricular cuts.  The district is reviewing its staffing options for both certified (teachers and administration) and non-certified (cooks, custodians, teacher aides, secretarial, transportation) personnel and possible reduction in force.

Will those cuts require a reduction in teacher staff , administrative, or non-certified positions?
As mentioned before, yes, all staff is being considered for RIF.

Does the district estimate the number of teaching positions that might be lost, due to loss in state aid?
At this point, we don’t know an exact number of possible positions to reduce; due the State not being able to provide any information on funding for next year.

How will those positions be determined?
The administration and Board of Education will be making some difficult decisions at the January 18th Board meeting.  At this time the Board’s focus is to maintain the best quality education possible for all students in the district and they are reviewing options for that to occur.

Will class size increase?
Possibly, that is option depending on the grade level; however this decision hasn’t been made at this time.

Has the district made any concessions with the education association to try and save teaching positions? (This might be a board question) re: salary cap or freeze
I have personally met with the Altamont Education Association leadership and have had discussion regarding possible options to retain teaching staff, and those discussions are ongoing.

What was the associations response to those concessions? (again maybe board question)
This question would be best answered by the Association, Mike Delaney President.

Provided the concessions were accepted how might that effect the teaching situation? (again maybe board question)
Not known at this time

Is there a possibility that spring athletics could be cut?
We will continue ALL programs this year.  There is the possibility that for next year, many extra-curricular programs could be at risk of not being able to be supported.  That said we are looking at options to be able to sustain our extra-curricular programs, which might have a cost per student per activity fee.

If so would it be all sports or just certain teams?
The Board of Education and Administration have not made this decision at this time, but all extra-curricular activities are being reviewed which would include non athletic activities such as band, chorus, FFA, Student Council, etc. and athletics.

One question that would be on residents minds would be.  How can the district build a $300,000 track and then cut track?
At the time the district made the decision to build the track, there was no concern regarding State Funding for schools.  However, since this past August the State has made it clear that their financial situation has fallen to the point that supporting of schools is a major issue.  As mentioned above, I have a proposal for the Board of Education that would include a participation fee for all students involved in activities to offset costs for extra-curricular programs.

Do you see any possible solution to the State of Illinois financial situation?
As I stated before, the Education Funding Advisory Board has put together a plan to deal with the issue of State’s fiscal responsibilities to school districts, however, due to continued personal politics in Springfield, many of the proposals have not been agreed upon and/or implemented.  It seems odd that we spend resources and time on an Advisory Board, and then not to act upon their proposal.

Do you think the State of Illinois will be able to come up with the miracle money to continue to operate?
For the first time in our State’s history, I think the legislators are in a real jam…Personally, I don’t think there is any money that will appear to take care of this disaster. 

Is this isolated or do all districts face the same shortfalls?
All public schools are dealing with the funding issue.  There a few districts in the State that have reserves and they will not be impacted as much as many of the small rural districts that don’t have a stable, consistent tax base, or reserves, and who knows how long (how many years, 1, 2) will this budget deficit impact public education.

How long has the district been planning for this crisis?
I have been discussing this issue with the Board since September 2009.  We wanted to make sure that we follow the issue and be prepared for the worst case scenario.  I commend the Board of Education for their concern and patience as this issue has evolved during the course of the past few months.  As far as planning, we are still planning however, RIF notices have to be submitted and we are now under a timeline to abide by the RIF notification guidelines.

What do you personally think might be the outcome to some of the districts that have not planned for the financial crisis?
We might see some districts who cannot financially support themselves borrow money to stay open, others may have to close and consolidate with other districts.  This may not happen next year, but could happen over the next two to three years.

Could you explain how with State of Illinois woes predicted can the district continue to spend hundreds of thousands of dollars on technical equipment and upgrades?
The smart boards and computers for the students and teachers that have been purchased and installed this year; that money is from the Enhancing Education Through Technology grant that the district wrote for and received and is guaranteed money.  We anticipate at this time that we will continue to receive the grant for the next two years, which is a great advantage for our district.

How can the district afford to put in security cameras and special locks on all the doors?
The technology equipment that has been installed has not been paid from the Education Fund.  We have a Risk Management Plan that the Board amended to include the purchase and installation of the security cameras, door systems and increased lighting outside of both buildings.  The equipment was purchased from the Tort Fund which a year and a half ago the district’s auditor informed me and the Board that we had accrued $121,000.00 and that we must spend down those funds.  The security equipment was purchase from the Tort Fund. 

Does the district really need the added lighting and security equipment at the buildings?
In my opinion I would say yes; not for the sake of “catching” students doing something wrong, but for liability.  The added lighting and security cameras assist us when someone makes an accusation that they were injured or a vehicle was damaged while on school property.  Insurance coverage continues to climb, especially if you have claims, therefore the Board decided that spending the excess Tort funds on this equipment was going to assist in eliminating false claims against the district, and also secure the students and staff during the school day.

Could that money being spent be put into the educational fund?
No. Tort funds are levied in the tax levy annually. The district’s risk management plan identifies what can be purchased with Tort funds.  I would anticipate that in the next two years, pending no significant increases in insurance costs, we will not have to levy as much in the Tort fund and that would help us to maintain our current tax rate or possibly even cause it to go down.

What kind of Federal funds and/or State of Illinois, does the district have and how are they used?
This question could take me a day to answer, but we receive Federal grant dollars in the form of Title I, II, IV and V.  We also get some reimbursement from the Federal government for Special Education, and Lunch Program.  As far as the State, we are supposed to get General State Aid, lunch reimbursement, Transportation Reimbursement, special education reimbursement, and in the past textbook grant, reading improvement grant, however, none of these have been paid this year with the exception of general state aid.

Can money be transferred from one fund to another to meet shortfalls?
Yes; A one time transfer from one fund to another is allowed or an inter-fund loan can also be accomplished, but an inter-fund loan must be repaid within the same fiscal year. 

On an estimate what is the cost to keep the buildings with heat and electric daily or monthly?
The average annual cost for natural gas is about $60,000.00 and annual average cost for electricity is about $115,000.00. These numbers fluctuate based upon weather, heat in the summer, fall, and spring, and cold during the winter months.

However, we have a 50 year old boiler in the older section of the high school which is not the most efficient system, due to age, and mechanical make up.  That is one reason that the Board was looking into replacing with a geothermal system this past fall. However they felt that it was too costly at this time to address that issue, when we have serious roofing issues on the high school building where significant leaking is occurring each time it rains.

What is going to be the first priority of the school district? re: education, sports, required classes, classes just to meet AYP, high end classes, etc.
Education is the highest priority.

How as an administrator do you handle the stress and pressure of knowing you are going to have to release teaching staff?
I have great respect for each and every employee and the job that they do to transport, feed, assist, teach and administer the students of Altamont school district. It is very difficult making decisions that impact employee’s livelihood.  It is never easy, but it is part of the job, but it is not the part of the job that I enjoy.  I spend a great deal of time pondering and working to make sure I am making the best decision and recommendations to the Board of Education while looking out for the community, students, and employees. 

Is there any projections as of yet for next year?
To date, I have submitted three proposals to the Board of Education.  The regular Board meeting on January 18, 2010 will most likely have some decisions made as to the direction the Board will go regarding reduction in force, educational cuts, and extra-curricular program cuts.

 

Jeff Higgs

What is the amount of state aid on average that is met by the State of
Illinois?
somewhere around 20%.

Has the state in the past during your tenure been short or late on
payments?
yes.

How was the district able to handle the shortfall?
through use of cash on hand and cuts.

What is the projected outlook as to when the State of Illinois might
begin missing state aid payments?
no sure answer,could be as early as april.

Has the board held special meetings to discuss the shortfall?
no not yet just at regular meetings.

Has the state board of education sent any information to the local board
as to how to handle cuts and what to expect?
some but knowone at this point in time knows what is going to happen.

How much will the school district be shorted once the State of Illinois
fails to meet payments?
could be as much as $700,000.

How will that shortfall affect day to day operations of the district?
for the rest of this year watch spending closely and use of cash on hand. for next year there will have to be cuts.

Will the district be forced to make educational cuts?
not sure what cuts will be made at this time, but everything is on the table.see above.

Will those cuts require a reduction in teacher staff, administrative, or
non-certified positions?
not sure at this point in time.

Does the district estimate the number of teaching positions that might
be lost, due to loss in state aid?
knot an exact number at this time.

Has the district made any concessions with the education association to
try and save teaching positions? re: salary cap or freeze.
they have been invited to be involved monday night.

Is there a possibility that some athletics could be cut?
this year no. as i said earlier everything is on the table for next year.

One question that would be on residents minds would be. How can the
district build a $300,000 track and then cut track?
see jeffs answers from last week.

Do you see any possible solution to the State of Illinois financial
situation?
budget cuts and more rev.

Do you think the State of Illinois will be able to come up with the
miracle money to continue to operate?
not sure but i do not think any thing will be done until after the feb election.

Is this isolated or do all districts face the same shortfalls?
all state funded schools from the u of i on down.

How long has the district been planning for this crisis?
sept of 09

What do you personally think might be the outcome to some of the
districts that have not planned for the financial crisis?
i think that everyone is putting a plan in place.

Could you explain how with State of Illinois woes predicted can the
district continue to spend hundreds of thousands of dollars on technical
equipment and upgrades?
see jeffs answer from last week.

Does the district really need the added lighting and security equipment
at the buildings?
see jeffs answer.

Is the district looking to spend extra money on a new roof at the high
school?
we have a problem with the roof and are looking for ways to solve the problem.

Will the taxpayers be hit with additional tax levy's or a referendum for
funds the roof?
probily would look at extending some bonds.

Could that money being spent be put into the educational fund?
no.

What other issues is the board looking at with building up keep?
normal maintance.

What is going to be the first priority of the school district?
education, sports, required classes, etc.

Is there any projections as of yet for next year?
not at this time.

 

 

David Delaney

1. If the district is forced to make educational cuts where would the Altamont Education Association suggest those cuts be made? (Re: not offer high end classes)
At the beginning of the current fiscal year Altamont C.U.S.D. had on hand fund balances exceeding two million dollars; $983,212.00 in the education fund, $393,459.00 in the operations & maintenance fund, $156,312.00 in the transportation fund, and $473,008.00 in the working cash fund, for a total of $2,005,989.00. This is money that was on hand before state aid and property tax payments came in. The Altamont Education Association (AEA) believes that even with slow state payments this year, our district is in a good financial position. With fund balances as healthy as these are, AEA believes it is a little premature to contemplate limiting educational opportunities for our students.

2. If the district is forced to make athletic or extracurricular (re student council, FFA or Band) cuts where would the Altamont Education Association suggest those cut be made? (re: not offer those options or maybe charge fees)
When you talk about making cuts to programs you are talking about limiting educational opportunities for our students. AEA does not support cutting any programs.

3. Would the sponsors or coaches of those activities be willing to not take a stipend?
We are not in favor of “volunteer” coaches. Coaches and sponsors work hard for the stipend they receive.

4. If district cuts require a reduction in teacher staff, administrative, or non-certified positions how does the association feel those cuts will be determined?
We find it frustrating as teachers and parents to be talking about cuts in programs for our students in the same year as an expensive duplicate position was created by the administration and the Altamont Board of Education. This position was created in direct violation of the contract between the AEA and the Altamont Board of Education.

5. Does the association have an estimate as to the number of teaching positions that might be lost, due to loss in state aid?
It is unclear at this point that there will be any loss of state aid. The state has been slow to make their payments this year, and the state does need to get its financial house in order. We are hopeful before the next school year they do just that so there will be no loss in programs.

6. If forced to reduce staff how will teachers handle a possible increase in class size?
As your readers know, Altamont’s schools are blessed with a caring, dedicated, and professional group of educators. While everyone knows that smaller classrooms lead to an increase in student achievement, Altamont’s classroom teachers would meet this challenge as we do all challenges, with kindness, professionalism, and a sincere desire to see our students succeed.

7. Has the district made any concessions with the education association to try and save teaching positions? re: salary cap or freeze
The district has not made any concessions, nor have they asked the AEA for any.

8. What has been the association’s response to those concessions?
Again, the district has not made any concessions.

9. According to the contract the association will earn over $105,000 in added salary and benefits this coming year. Is the association willing to take a freeze and not accept an increase if it would save two to three teaching positions?
Of course, we can’t conduct a negotiation through a newspaper. We have a collective bargaining agreement in place with the Altamont Board of Education bargained in good faith. Both parties are obligated by law to uphold the agreement. While we are not in favor of a freeze, we are always willing to sit at a table with the Board of Education and listen to any and all proposals.

10. Provided the concessions are accepted how does the association feel those concessions might affect the teaching situation?
There have been no concessions offered by the Board of Education or by the AEA so I couldn’t speculate on the impact of something that does not exist.

11. Several teachers are close to retirement or eligible for retirement. Have they considered taking that option to help younger teachers keep their jobs?
Retirement is a very personal decision. Each individual has their own reasons for either continuing to work while eligible for retirement, or retiring. However, I’m sure each eligible teacher has considered it.

12. Do you see any possible solution to the State of Illinois financial situation? Do you think the State of Illinois will be able to come up with the miracle money to continue to operate?
We are hopeful that the State will get their financial house in order. Several local groups, legislators and other stakeholders have joined the Responsible Budget Coalition. We hope their work will result in an improvement to the State’s finances.

13. How long has the association been planning for this crisis?
We have been monitoring the district and state’s financial situation throughout this school year.

14. What do you personally think might be the outcome to some of the districts that have not planned for the financial crisis?
It is enough to try to keep track of what our district is doing without worrying about other districts. Hopefully all school districts and their students will be fine.

15. Does the association think, with State of Illinois woes predicted, the Altamont district is spending money wisely?
We believe that there are some areas where the district has not shown the type of moderation one would expect from a district planning for a financial crisis.
• At the last board meeting Mr. Fritchtnitcht announced that a new laptop computer had been ordered for each board member so that the board meetings could be “paperless”. If the district is in financial trouble, they should not be purchasing 7 laptop computers solely for school board members. We are also concerned that “paperless” board meetings could possibly hide information from the public.
• This year the district installed surveillance cameras in the hallways of our schools. This security system cost the district over $100,000.00. This is a purchase that makes no sense if the district is approaching a crisis.
• The new electronic key system was installed this year. I don’t know how much it cost, but the old keys and locks were already paid for.
• This year new grade reporting software was installed at both the grade school and the high school. It’s a nice system, but why spend the money if the district is trying to save?
• This year a special, duplicate teaching position was created by our district for one of Tri-Point school’s ex-principals. This person was recruited by the district, and was given extra duties by the administration outside the collective bargaining agreement. For these extra duties he was paid a stipend exceeding $25,000.00 (above his regular teaching salary). The extra duties were a duplicate of duties performed by Mr. Strange. Mr. Strange’s stipend is about $950.00. The district paid enough for this duplicated position to pay for a teacher’s salary. Also, since the individual involved is often out of the classroom at meetings, a sub is often needed to perform his duties. This has added extra cost to the position.
• The Board of Education will soon be taking bids on the construction of new bleachers at the new track, along with the pouring of additional concrete for the bleachers. This is to be paid for by a $200,000.00 bond issue. AEA believes it is irresponsible to take on more debt if future funding is in question. We think that if the district is contemplating elimination of some educational opportunities for our students that we should not be building bleachers and pouring concrete.

16. Does the association think money being spent could be spent more effectively?
It is frustrating to be hearing about possible program cuts because of a lack of funds, when there are plenty of funds for board member computers, cameras, key FOBS and new administration positions.
The association had recommended that the district not fill an administration position that will be vacant next year. We proposed that the position could be manned by existing administrators. The position was filled a few days after, in spite of our suggestion

17. What is going to be the first priority of the Altamont Education Association? re: education of Altamont students, sports, required classes, teacher raises, or benefit packages?
Altamont’s teachers always place education of students first. That is what is most frustrating for us as we see money being spent on unnecessary projects while the district is contemplating cutting programs.

18. How as president of the AEA do you handle the stress of knowing several of your colleagues might be released?
I am hopeful that no one will be released.

19. Do you think the board has worked in good faith with the association to try and remedy the possible shortfall?
The board has made no proposals to the association. Some discussions have taken place in closed session, but no meetings are planned.

20. Would you like to add anything else?
I would like to encourage parents and taxpayers to come to the next Board of Education meeting that is to be held February 8th at 7:00 p.m. in the Board room at Altamont High School. If you can’t be at the meeting, call a Board meeting with your concerns and comments. Decisions that will impact your child’s educational opportunities will be made at this meeting. Bring your questions and comments and get involved in the process.