Peotone 207-U School Board voted, with everyone present, on Monday to put the budget on display. In it, the district shows a more than $4M deficit.
While the board meeting itself was relatively routine, there were some questions.
Board member Ashley Stachniak inquired again as to the cost of possibly moving special education services back into the district. The district currently pays more than $40K per month to other schools to educate special needs students. Special Services Director Crystal Johnson continued to say those school expenses mostly are reimbursed but did not provide numbers. She also added the cost of that paid tuition is often not reimbursed for over a year or more.
Stachniak also inquired why dates on the bills are not listed as actual dates, and Business Manager Adrian Fulgencio said it was a good question and moving forward they could do so.
Purchasing card expenses decreased from $26K in July to $10K in August, but Stachniak still inquired if the protocols were being utilized. Fulgencio confirmed they were despite the $10K monthly expenditure.
Board member Mark Jones inquired if the policy that committee meetings be live streamed would be included in Press 119 policies. Assistant Superintendent and Defacto Superintendent Carole Zurales said the board was tied, and she reached out to then absent board member, Dawn Love for her vote. Love voted no so the policy was not updated to include the statement committing to live streams for committee meetings. Stachniak inquired if moving forward, all board members could vote by email. Zurales said that from the meeting, she gathered in this instance, because it was a tie, she should reach out to the absent board member.
New architects Wight & Co. also were approved and usage would be billed via request for proposals.
In the good news portion, Alannah Hahn and Laila Stachnik were recognized for their achievements in the Class 4A IESA state track meet. Also, the SkillsUSA team was recognized for their participation at Nationals.
The regular board meeting lasted at least 90 minutes, with the executive session. Then the committee of the whole meeting occurred.
Board member Jodi Becker was not present for the Committee of the Whole meeting.
A discussion around possibly consolidating enveloped with the new architects.
It was agreed a facilities assessment study could help the board make decisions concerning which direction they would like to take.
Business Manager Adrian Fulgencio said if operating costs for the building were explored, the cost of new construction might offset those operational costs of the older buildings and transportation costs to those buildings.
Board President Rick Uthe somewhat agreed, “Green Garden, PIC, is gone. It’s not going to exist. It’s here, and it’s almost over. We can’t have students in that building with the road right outside the door.” Uthe said he’d prefer a new building to adding on to an existing building.
Board member Tim Stoub inquired as to what the district long term debt options would be. Fulgencio answered that the district has the ability to leverage $66.4M and currently has $20M outstanding, leaving them with $46M and how far that could work for the district depended on the type of building they built.
Uthe said all options should be explored: additions, new construction, and possible consolidations.
Board member Jennifer Moe said, “I would not be in favor of the consolidation, though if new construction or additions don’t work and that forces us to have 35 kids in a classroom. I would not be in favor of not having a lunchroom or gym time.”
Stoub said he’d like to see a balanced budget at current revenue levels, if it meant investing in a long term strategy.
Moe said she didn’t see how that much could be cut from the budget. Stoub countered that there’s a possibility of operational savings – Moe didn’t think it was $2.4M. Stoub countered that it’d be even more because the district is already over by $4.2M.
Moe said she thought there were no savings when they closed Wilton Center. Uthe said there was transportation savings, and Stachniak countered that Wilton Center was half the size of PIC, and the transportation costs are greater at PIC.
Stoub also suggested looking for commercial real estate interest for PIC to possibly offset the construction cost. He also suggested selling the 27 acres on Center Road.
Stachniak suggested if they build a new building, she would like to see PES house administration, pre-school, and special education in the same building.
Board member Mark Jones said he was in favor of consolidation of PIC but wanted to see operational cost savings analysis on Conor Shaw.
The board moved on to ask the new architects to scale back the current plans for ball fields, to the tune of $4.8M, because that’s what’s available.
Stachniak, once again, reiterated she would like to see the ball field plan developed around the idea that it eventually include all sports in one location and to include the area for the FFA greenhouse.
New architects Wight & Co., left with a clear list of what the district was looking to accomplish.
Budget discussions then developed because the district is not able to take $6M in bonds as previously thought. Working cash bond issuance for the district can only be $20M and the district has already leveraged $15M, leaving them with just $5M to leverage via bonds.
In every scenario presented to pay back the bonds, there was almost little to no ability to pull anymore bonds.
Fulgencio said, “The ideal situation would be to not have to issue working cash bonds and have a balanced budget, but we’re currently not in a situation where that is the case. I think this is the end of the road here when it comes to issuing working cash bonds for a couple years. The DSEB (debt service extension base) is maxed out with either scenario. All these scenarios lead to the same result; you’ll be maxing out your DSEB for a couple years. The only way to increase that is to go to back to the taxpayers and that DSEB that was approved 20, 15 years ago just isn’t the same amount of money. You can’t buy the same amount of stuff [you could] back in the day.”
Stoub said, “The biggest concerning thing to me is that we’re only issuing $4.8M, and let’s just assume we move forward with the 4.8 because there isn’t an alternative for 26. That buys us a year, but we’re tapped. Our credit is leveraged to the max. There’s no more borrowing potential. We’re here. Fiscal cliff.”
Stoub continued, “We only have $5M left in credit available to us and our current projection for next year is we’re overspending our revenue by $5M. Which means in one year’s time, we’re completely flat broke. Do we continue moving forward spending $5M on a baseball/softball field?”
Fulgencio clarified the 2023 bonds were designated for capital improvements, but chillers or infrastructure would count.
Stachniak said, “If we don’t build those fields, we will never have the trust of the community.”
Stoub said he understood, but he sees what’s on the board. Stachniak said the spending has to stop.
“You don’t have the money to go out to dinner, you make dinner at home. We need to find cuts elsewhere, even if they’re small.” Stoub added, which do not affect students.
Board President Rick Uthe said that kind of money in cuts is staff. Little cuts here and there aren’t going to add up to $5M in a hurry.
Board member Mark Jones suggested corporate sponsorships for the baseball fields.
Fulgencio said the district’s salaries and benefits are 70 percent of their expenses. He said some of the expenses can’t just go away.
Stachniak inquired that if the district was in this “pickle” why were admin salary increases approved? Why weren’t they frozen? Fulgencio replied that it was a great question. She said the information would’ve been great to have before the vote.
Stachniak proceeded to inquire about roofing expenses, why there’s two lawn care companies, and continued to comb the bills.
Moe asked Fulgencio what he thought was the best option. Fulgencio said he’d like to see a balanced budget. “The route we’re doing isn’t sustainable. It was never meant to be sustainable. An operating tax rate increase would be ideal. That way you wouldn’t have those substantial salary/benefit cuts. Then you could still run buildings that are safe to learn in.” He continued to say that taking the cash bonds this year would only buy the district one year, but still issue the bonds.
Moe asked if Fulgencio could provide what an increase in the operating tax rate would be to residents.
Stoub jumped in and added, “We’re zero-for-three. We’re zero-for-three coming to this community and asking for money without changing what we do. So if you want to put up a prayer without changing what we do, I think we can count on it not succeeding.”
Stoub continued to say that if they looked for cuts, stopped spending on credit, and created a long term plan, maybe the district would have some footing. Everyone agreed, but Moe added she didn’t see how to cut $5M without affecting students and staff. Stoub suggested consolidation has potential.
The budget discussion will continue at next month’s committee meeting.
