Budgeting errors put DuPage County School District in distress

Nestled in a leafy, thriving strip of suburban DuPage County, Center Cass School District 66 in Downers Grove appears at first glance to exemplify the best in public education.

The neighborhood boasts three neat and modern school buildings, enthusiastic teachers known for their academic rigor, and great personal attention for its 1,100 students in kindergarten through eighth grade.

But the district’s severe financial difficulties led to this fall in severe budget cuts, including reducing the number of teachers and building caretakers, eliminating all after-school and athletic programs, reducing bus routes and shortening of the school day.

“We’re doing an education triage,” said teacher Jake Little, who taught social studies at District 66 for 18 years. “The needs of students are so much greater than they were years ago. … We have students reading five grades below, and we don’t have the resources for the interventions and the attention they need.

Now, weeks away from the Nov. 8 midterm elections, teachers, administrators, parents and school board members in District 66 are urging voters to support a property tax hike after years of low assessments. taxation and problematic budgetary practices that plunged the district into crisis.

The financial crisis hitting District 66 has been brewing for years, officials said, and can be attributed to the district’s relatively low tax rate and equalized assessed value, or EAV, which is the value assigned to a property. by the township assessor’s office.

Local revenues are calculated using the local tax rate multiplied by the EAV of the community within the school district boundaries. Of DuPage County’s 30 K-8 school districts, District 66 ranks in the bottom third for tax rate, EAV and revenue, officials said.

Additionally, with very little industry in the area, 90% of the district’s property tax revenue comes from homeowners, with only 10% of its budget coming from state and federal funding.

While the district’s finances are audited annually by outside agencies and monitored by the Illinois State Board of Education, one reason the district’s financial difficulties have not been disclosed earlier is how taxes are collected in DuPage County.

Unlike Cook County, where districts receive their property tax revenue at the start of the school year when the funds are expected to be used, districts in DuPage County receive money in late May or early June for the fiscal year beginning July 1.

District 66 included these taxes in its year-end report for the fiscal year ending June 30, an accounting practice that makes the district’s fund balances healthier than they are. And instead of rolling the funds over to the new fiscal year, the district used those revenues to pay for current-year expenses, a practice that began as early as 2014, District 66 officials said.

The practice had for years painted an inaccurate picture of the district’s health, failing to acknowledge growing deficits and depleted reserve funds, said District 66 board member Chris Esposito.

While the early use of taxpayers’ money isn’t illegal, “it’s a practice that causes all kinds of problems, as we see here,” Esposito said.

The school district has hired new auditors, slashed $2 million from its budget over the past two years, and issued tax anticipation warrants to cover payroll, “which is a fancy way of saying payday loans.” , Esposito said.

“It’s not mismanagement of funds. We don’t have the funds,” said Esposito, who urged voters to attend the October 12 District 66 school board meeting to learn more about the referendum issues.

When District 66 Superintendent Andrew Wise took the helm in July 2020, at the height of the COVID-19 pandemic, he was impressed by Cass Center’s “great teachers, community, and wonderful kids.”

But he found his financial situation troubling: additional revenue was needed to operate, facilities were deteriorating, technological infrastructure was failing, the district’s financial profile with the ISBE had dropped, and the district lacked three to six months of reserves.

“What has happened is that the cost of educating students now includes funding for security and technology. … So much has changed in the past 30 years, and the district’s rising revenue has not caught up with the rising costs of raising a child,” Wise said.

“It was a perfect storm, and if it had been noticed sooner, we would have alerted people sooner,” Wise said.

Voters rejected an earlier request this summer to raise the district’s property tax rate. This fall, voters are being asked to raise the rate from $2.14 per $100 of a property’s assessed value to $2.55.

If approved, it would mean a 19% increase in the Cass Center District post property tax rate on a homeowner’s property tax bill, up from a 24% increase the district requested when of a referendum in June.

For a home worth $300,000, a resident can expect an increase of about $377 per year, or $31 per month, officials said.

If the referendum fails in November, officials said, the district will face deeper cuts for the 2023-24 school year, including potential cuts of eight additional teachers, closing school libraries, removal of programs that are not mandated by the state. like art, music, music and foreign languages ​​- and the extra stop of bus lines.

Nonetheless, some opponents of the district’s referendum proposal say the solution is not to raise local property taxes, but to consolidate District 66 into one of DuPage County’s neighboring districts. In addition to Downers Grove, Center Cass District 66 serves students living in Darien, Woodridge, and unincorporated DuPage County.

“When you look at the state of Illinois, we’re probably the worst in the country when it comes to too many school districts and too few schools in each district,” said Eric Gustafson, councilman for Ward 6 in Darien. .

Gustafson said taxpayers would benefit from consolidation by reducing the number of directors, which he said would significantly reduce the funding needed for payroll.

“The money should be spent on the kids,” Gustafson said, adding that his own three children “got a really good education in the school district.”

“My main question is, ‘Where did all the money go?’ “, did he declare.

But Wise said consolidating school districts “would raise the district tax rate more than what’s proposed with the referendum.” The tax rate in nearby Woodridge School District 68 is $4.34 per $100 of equalized assessed assessment, nearly double that of District 66, Wise said.

Consolidation would also cause the district to lose local control of its decision-making, he said.

A spokeswoman for the Illinois State Board of Education said District 66’s Financial Profile score of 3.45 out of 4 for 2021 qualifies the district for financial review, a designation reserved for districts that score between 3.53 and 3.08. Those who score 3.07 to 2.62 are put on financial warning, while those between 2.61 and 1 are on financial watch.

“The profiles examine five key indicators of financial integrity: fund balance-to-income ratio, expense-to-income ratio, days on hand, percentage of short-term borrowing capacity remaining, and percentage of remaining long-term borrowing capacity,” ISBE spokeswoman Jackie said. Matthews said in a statement.

Some supporters of the District 66 tax rate increase referendum have expressed concern that the state could “take control” of the district, as it did with School District 187 in North Chicago in 2012. This district just got the go-ahead from the ISBE to transition from a state-appointed board to a locally elected school board.

But District 66 appears to be a far cry from that fate, because a district’s financial profile score is different from the criteria the state uses to trigger a financial takeover. If a district meets the criteria, it must first submit a financial plan to the state. The state appoints a financial oversight committee only if it determines the district has not followed its plan, according to Matthews.

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Elizabeth Uribe, a community group volunteer with the Save Center Cass School District 66 and mother of a kindergarten and second-grader in District 66, said passing the referendum in November was key to preserving the district’s reputation as a destination school system.

Despite major budget cuts this fall, the community is coming together to support students, including hosting a community 5k run on Friday afternoon for members of the cross-country team, whose season was canceled this fall due to budget cuts.

“I think it was a really tough decision, with the district cutting after-school activities, but it energized the community,” Uribe said.

“Children are underserved, and the only things left to cut are hurting our children,” she said.

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