Report Shared at February 9, 2017 Board Meeting

This is a BOE Presentation, February 9 2017 c¬†that was shared in open session at the regular February school board meeting last evening. ¬†More than 70 people were in attendance, and there was several different pieces of information that were shared, as well as even more background material from the meeting that was shared February School Board Meeting at the district’s online school board meeting presence.

Geneseo Schools have a long tradition of excellence in academics, athletics, arts and activities.  The combination of declining state revenues, as well as increasing costs of mandates, and community desire to offer an extremely comprehensive educational program for a district of our size, has created financial challenges that leave the Board with some very difficult decisions.  Hopefully this report helps make the context of where we are and what options exist easier to understand.

What happens since Chicago Public Schools students have returned?

There were many questions asked during, and after, the Chicago Public Schools strike.  How might this impact downstate schools?  Part of the most recent debate regarding pension reform has surrounded folks in Chicago, particularly their Mayor, upset that they have to contribute to downstate teacher pensions, but downstate taxpayers are not subsidizing the Chicago educator pensions.

Here is an article you may find interesting that takes a stab at speculating what we may see following this strike.

Possible Cuts (Even Deeper) to School Busing Reimbursement

This is an article shared by Dr. Brent Clark, Executive Director of the Illinois Association of School Administrators:



Executive Director of the Illinois Association of School Administrators

Remember when we walked three miles to school every day, uphill both ways through snow, sleet, hail and torrential rain? School children in Illinois may soon return to those good old days. The bad news is we no longer live in “Leave It to Beaver” times and safety is the overarching reason for public schools to continue providing bus transportation for students.

The yellow school bus may become an endangered species in Illinois considering the 42 percent cut to state funding for public schools transportation in the past three years and the ominous clouds forming over the state’s education budget for next year. No one can argue with the emphasis on maintaining funding for the classroom, but the ability to safely transport children to school remains a basic fundamental of educating students.

From a purely political standpoint, cuts to school transportation clearly have far less impact in Chicago than they do downstate where many school districts cover more than a hundred square miles. Even in the state’s largest cities, the path to school often includes railroad crossings or busy highways, not to mention child predators.

There are those who believe it’s the responsibility of parents to get their kids to and from school. Setting aside the fact that many families depend on both parents working full time, there are logistical factors that make parents dropping their children at the school door virtually impossible in many school districts.

Most schools were not designed for hundreds of vehicles dropping off children; most were designed with lanes for relatively few buses. Factor just 30 seconds for a parent to pull up, say goodbye and drop off their children. How long would that process take for just 100 cars? 200? 300? Also consider the safety concerns with that much traffic while children are arriving or departing school.

From an overall economic perspective, the cost of bus drivers, fuel and insurance is less than the fuel cost for hundreds of vehicles making that daily trip.

The notion that local districts should shoulder more of the transportation costs ignores the fact that local taxpayers already pay a portion of the transportation bill. The state already has cut General State Aid to schools, and leaders in the House and Senate are talking about shifting the state’s portion of pension costs for teachers to local districts. Illinois already ranks among the nation’s highest in local school funding and among the lowest in state funding for public education.

The Illinois State Board of Education (ISBE) has proposed changing the formula for transportation from the current reimbursement formula to an “efficiency” formula based on either per-student or per-mile funding. Recognizing that this is an attempt by ISBE to retain at least some funding for transportation in the current political and economical atmosphere, this would be a paradigm shift in funding that would result in “winners” and “losers” among school districts. Still, it is something that should be carefully considered if it rewards efficiency.

The ISBE proposal also allows for school districts to charge parents a fee to transport their children and ISBE data indicates the cost for transporting one child for a year averages about $500. Realistically, what school board would want to assess such a fee on parents who already pay school taxes? Districts could not even assess the fee on families whose students are enrolled in the free-and-reduced lunch program, a growing population in many districts.

Certainly districts should look at all feasible options to lower costs — and most districts have been involved for years in cost-cutting initiatives like bid purchasing, contract bargaining and shopping for the lowest insurance costs. Districts that have not already done so may need look at more of a mass transit business model. For example, door-to-door service may need to be replaced by establishing bus stops at strategic locations. In some districts, that could result in fewer buses, fewer miles and fewer drivers.

There was a recent story about a school district in Missouri (Bayless School District near St. Louis) that eliminated its bus transportation two years ago only to see 150 students move to neighboring districts that provide bus transportation. The district actually ended up losing more money in state aid than the bus transportation cost. The story underscores how important school transportation is to parents.

The yellow school bus long has been a fundamental, vital part of our public education system. It is not a luxurious benefit for children or parents. It remains the safest, most efficient way to transport our children to school.

(Brent Clark is the executive director of the Illinois Association of School Administrators, a statewide association of more than 1,700 members. Clark was a teacher, coach, principal and superintendent at Belleville prior to becoming the head of the IASA.)

Governor’s Budget Message on Wednesday

Governor Quinn will deliver his annual budget message on the 22nd in the Capitol.¬† A few weeks ago he highlighted some of his ideas to help turn the State around during his “State of the State” address.¬† It goes without saying that legislators and governmental agencies alike are expecting a very austere and challenging road ahead.

One of the major fiscal matters to be addressed is a potential reform of the state pension systems.¬† Earlier the Governor indicated that he would like to see a shifting of the “normal costs” of the Teachers’ Retirement System (TRS)¬† onto the responsibility of the local school district.¬† This burden to the state, approximated at $800 million, also has a shift supported by the Speaker of the Illinois House and the President of the Illinois Senate.

It is unknown at this time whether or not this new funding requirement would be paid directly from a District’s educational fund, or if a new tax levy would be created to apply to local taxpayers.

It is estimated that this burden would be 8.9% of the district’s annual TRS payroll.¬† For the Geneseo Schools, this amount to be sent to the Retirement System would total just under $880,000 annually.¬† For reference, this would require approximately a $0.28 increase per $100 Equalized Assessed Valuation or an additional $237 per year in taxes for the owner of a $250,000 home.¬† This is also the annual equivalent of the salaries of approximately 18 certified teachers, or 75% of all administrative costs, or the entire athletic budget, including transportation for athletics.


Governor’s Diplomacy?

After slashing nearly $90M from the budget this summer that would have reimbursed school districts for state mandated transportation costs, the Governor had raised hope that during this November legislative session, the General Assembly would be able to re-examine mechanisms to reinstate at least a portion of this reimbursement.   Instead work today in Springfield did not result in anything remotely close to that.

The General Assembly did approve budget changes late this evening that are meant to avert the seven state facility closures and nearly 2,000 layoffs that Quinn announced in September.

Under the new plan, the facilities would remain open through the current fiscal year, paving the way for the governor’s plan to close some state facilities in what he describes as a slower and more deliberative manner.

“[The legislation] will enable us to create a sensible, reasonable, responsive and effective plan for moving people from state operated facilities into the community,” said Rep. Barbara Flynn Currie, who sponsored the budget plan in the House. Currie, a Chicago Democrat, said the proposal would not put state spending over the caps set with the income tax approved in January.

The plan combines money from the governor’s budget vetoes with cash transferred from various state funds and Medicaid reimbursements brought in from the federal government. The total amount of dollars shifted would be more than $270 million, and a strategy called “churning” is projected to bring in an additional $136 million in Medicaid dollars from the feds.  Just over $200 million is slated to keep state facilitates open. Additional money would be spent on human services and other programs that Quinn and some lawmakers did not want to see cut in the budget that was approved in the spring, including:

$30 million for mental health programs.
$4.7 million for programs to combat homelessness.
$8 million for indigent burials.
$28 million for substance abuse programs.
$33 million for Monetary Award Program grants for college students.

Opponents voiced frustration over the funds that were not restored. Rep. Roger Eddy, who is a school superintendent in Hutsonville, said it was “unfair” that money for transportation, which has been drastically cut in recent years, was not restored when state law requires schools to provide transportation.  Eddy, a  Republican, said the transportation cut hits downstate school districts harder than Chicago districts, which are mostly represented by Democrats. Eddy said downstate legislators agreed to shift money from funds for spending that did not end up in the final bill. “That money wasn’t used exactly the way we thought it was going to be used.” The plan passed with no debate in the Senate.

Kelly Kraft, a spokesperson for Quinn‚Äôs budget office, said Quinn is working to avoid all layoffs announced under his original closure plan. However, she said the state might have to work out agreements with unions for employees who have already been laid off. (Note no discussion of any ideas of how to reduce the local impact on these transportation costs.¬† In fact, officials from the Governor’s Office have stated that busing students is a local problem and should not be the State’s responsibility.¬† This is another example of an Unfunded Mandate.)
“That, I think, was a great victory for the public that we are able to have adequate human services,” Quinn said. “Think back [to] last summer of how dire this was. We were able to, I think, rescue the people of Illinois from a budget disaster.”

Republican Leader Christine Radogno, who called the session a ‚Äúmixed bag,‚Äù said Quinn should have been more actively involved in the tax plan. She said when the two chambers battle over an issue, as they have tended to do recently, Quinn should work to diffuse the situation and find a compromise. She said a deal was not reached today because of “a failure of leadership.”¬†¬† A Failure of Leadership appears to be a recurring trend politically, at both the local and national level.¬† We will continue to work as diligently as we can at the local level to grow our quality programs and do what we can to serve students appropriately.

Pension Reform?

Pension reform is of great interest to the public, business sector, General Assembly, school boards, and TRS members.  Among the public and media throughout the State of Illinois, and those in the General Assembly, there appears to be a common misperception that pension obligations for State employees (and the pension system itself) are main factors in the deteriorating financial condition facing the State.  The facts show otherwise.    The following information serves to debunk many of the popular myths regarding the condition of the Teachers’ Retirement System (TRS) and its impact on the financial condition of the State of Illinois.

Prior to reviewing the following myths versus facts, we believe it is important the following facts regarding the condition and operation of TRS be stated:

●                  Current Assets Р$37.1 billion

●                  Revenue in FY 2010 Р$6.8 billion

●                  Benefits to be paid in FY 2012 Р$4.5 billion

●                  378,288 TRS members,  with 171,000 active members

●                  Average pension Р$46,452

●                  A current TRS member contributes 9.4% of his/her salary to TRS

●                  TRS has not ever missed a pension payment to any annuitant

●                  The State of Illinois has not made its required payments to TRS.  Thus, TRS has a significant unfunded liability that it has carried since at least 1953

Pension reform in these economic times is worth discussion, but any reform must be done based on  common sense facts and actuarial data.  Decisions based on perceptions with out facts of law and actuarial data are at best dangerous , reckless, arbitrary, and capricious.  Successful, long-term pension reform requires careful study of facts, actuarial data, and outcomes to avoid unintended consequences that would ultimately cost MORE for the taxpayers of the State of Illinois.

Expectations for 2011-12 General State Aid

General State Aid payments are based upon a complex formula that integrates our Equalized Assessed Property Values, our Average Daily Attendance from the year before, and the amount the General Assembly establishes as the “Foundation Level”.¬† As our enrollment has declined over the past many years, and as our property values have increased, this decreases the amount of reimbursement that we realize from the State of Illinois.¬† The Fiscal Year 2012 General State Aid (GSA) calculations have been finalized and will be prorated at 95 percent, which will significantly impact the final two GSA payments.

To give you an idea of the increased burden on local taxpayers within District 228, here are some figures that you can share at coffee or the dinner table:

In the 2007-08 school year the District received $6,924,298.  In 2010-11, the District received $6,277,519.

In the 2011-12 school year we have been told our allocation will be $5,599,653.  This is $677,866 less than the previous year and $1,324,645 less than we received four years ago.  The Board of Education has prudently worked to utilize some available short-term borrowing and has worked to reduce personnel and material resources while trying to avoid disrupting programs to the greatest extent possible.

We recognize the importance of residents of our school communities letting our elected officials in Springfield know that many of the mandates in place  do not promise great returns, and when coupled with the increasingly negative burden on the local revenue contributions spell a gloomy future for our children.

It is the Board’s goal to continue to maximize achievement and provide the best learning environment possible— that’s what our children deserve.¬† But it is becomingly increasingly difficult to provide a 21st century education that our children need, on an 18th century school funding system.