Harsh reality: State's IOUs to school districts adding up

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Harsh reality: State's IOUs to school districts adding up

As state woes continue, officials worry about shortfall – and that major program, staffing cuts will have to follow

Some area students will have to forgo field trips this semester and make do with old textbooks and computers instead of getting new ones.

Some teachers may have to miss out on training seminars that are out of town.

Beyond that, area school officials said Illinois' financial crisis has had little impact on students despite the fact the state owes them hundreds of thousands and, in some cases, millions of dollars in late payments.

However, they said, that's likely to change. If they don't get more of the money they budgeted for this fiscal year and some idea of what the funding situation will be like in the coming year, deep cuts to staffing and programs will be just around the corner.

"It's a crisis," Champaign Superintendent Arthur Culver said.

And as a result, school officials said, they'll be forced to make decisions based on the bottom line, not what's best for students.

"We can't say we're going to be giving an education based on quality," Urbana Superintendent Preston Williams said. "It's based on dollars. That's the reality we're faced with."

In the 2010 fiscal year, which began July 1, 2009, the state has made the twice-monthly general state aid payments to local districts on time, thanks in part to federal stimulus money that will be gone June 30.

But superintendents, some of whom get anywhere from 40 percent to 55 percent of their revenue from the state, said they have received little or no money for mandated "categoricals" such as transportation and special education, as well as early childhood block grants, textbooks and career tech education.

The state comptroller's office has a backlog of 15,230 unpaid vouchers from the Illinois State Board of Education totalling $613.51 million, spokeswoman Carol Knowles said earlier this week.

"We've been able to bring that down significantly," Knowles said. She said the total was $1 billion in December, but the comptroller released millions for transportation and special education this month.

That's money local districts should have gotten in September, school officials pointed out. Without it, they still have had to provide transportation, special education, early childhood and other services and pay for it on their own.

Effects will get more direct

"We open our doors, go pick (students) up, bring them home," Fisher Superintendent Barb Thompson said, adding that most people don't yet see the effect of the payments that haven't been made.

But, she said, "We're impacted already. It's a matter of trying to keep the cash flow coming ... for bills that would be paid (with state money)."

School districts have used their cash reserves to pay those bills. They've also tightened their belts.

At Potomac Elementary School, Superintendent Jamie Dorsey suspended field trips.

In Danville, administrators called for a "modified" freeze on spending for most staff development, travel and supplies.

"We need to be careful because we're unsure of where we're going," Superintendent Mark Denman. "We want to be prudent. ... We have a fund balance, but it could go very quickly."

"We're taking a real close look at materials and supplies, transportation, reimbursement for staff professional development, field trips," Georgetown-Ridge Farm Superintendent Gary Irwin said. "We haven't had to deny anyone anything up to this point. But our reserves are running out. ... If the state doesn't move forward with its obligation, the next step is rather drastic. We have to look at where we would cut staff, cut programs. It could get rather deep. They could be sweeping throughout the district."

Knowles couldn't answer if and when more grant funding – late or otherwise – would be disbursed.

"We're trying to make as much progress as we can," she said, adding the state's total backlog is $5 billion. "When you have a backlog as large as the state of Illinois has, it makes it very difficult to pay bills on time. ... We'd like to pay every bill as soon as it hits the door, but unfortunately, we're not able to do that."

And, she said, that will become harder this spring. That's because the state took out $2.25 billion in short-term loans last May and August, and it must begin repaying them in March, and all of the money plus interest must be paid by June.

Worse times ahead?

Even more worrisome than this year's late payments is what will happen next year, school officials said.

The state board of education's proposed 2011 budget would maintain this year's general state aid levels. It also would fund early childhood education and others programs, which were cut 10 percent this year, to 2009 levels.

However, "the board has recognized a cut to education is possible in 2011," Spokeswoman Mary Fergus said.

School officials can't help but wonder how the state will be able to make general state aid payments once the stimulus money ends. And they have been getting no information from the state.

"It makes it impossible for us to plan" Culver said. "We don't expect to hear anything from the state as to what to expect ... until late summer.

"That's the worst part of it all," Irwin said. "We're in total limbo. It's not fair to the folks who work here, and it's not fair to the children. We're going to continue to do the best we can. But right now, it's hard to be optimistic."

Because they don't know, school officials are having to plans for create best and worst-case scenarios.

Jobs in jeopardy

"It's not going to be business as usual for school districts," said Gene Logas, the Champaign school district's chief financial officer. "The cuts that are going to have to be made will be deeper and for a longer period of time than in the past."

Since most of the cost of education is personnel expenses, they said, it's inevitable that they will have to look at staff cuts. If districts must cut staff, they have to notify them in March.

"When the state is unable and unwilling to say what they're going to give us next year, the natural inclination is to be conservative and make cuts," Logas said. "It's possible that more people will lose their jobs next year than perhaps is necessary, if we're forced to make cuts without adequate knowledge."

Even if the financial situation is better in the fall, "We've lost all those good people, and you'll never get them back," he said.

Williams said he has heard that superintendents should consider the worst cuts they've had to make in staff, and plan to double it.

Culver said his district will have to cut every grant-funded position and more. Besides personnel, school administrators will have to take a close look at any service that isn't mandated and consider whether they can afford to continue it.

Everything – cuts in services and programs, fee increases and charging fees for services that are now free – is on the table, said Culver, who said his district will begin looking at how it will make $2.5 million in cuts when the school board meets Monday night. Other districts will follow suit in February.

"Unfortunately, we're approaching the time when class sizes are going to go higher than we'd like them to," Culver said.

Champaign will consider whether to continue summer drivers' education classes, he said. Urbana will look at its minority enrichment programs designed to increase academic achievement, and summer school, Williams said.

Daly noted that districts are mandated to provide preschool for children who need special education services, but not for those who are considered "at-risk."

In the Gibson City-Melvin-Sibley district, Superintendent Chuck Aubry and his board soon will be looking at cutting summer school programs.

The Armstrong school district may have to cut the number of away softball and baseball games in half, and the grade school's cooperative athletic program altogether, said Superintendent Bill Mulvaney.

"I don't think the kids would be very happy," he said, adding they are the real losers. "In this time of Race to the Top to meet standardized testing, school districts like ours, which have continued to not make (adequate yearly progress), have to try to make these higher goals and now funding is cut in half. It's trying to balance keeping staff intact so you can meet your academic responsibilities and yet being able to keep your doors open.

"It's very frustrating," he continued. "We elect these people in Springfield to shepherd us, and they're doing a horrible job of it. It's hard to do any long-range planning. There's no way to do that with the messages that are sent from Springfield."

BIG BILLS

Amount the state still owes area school districts as of the past week.

Armstrong-Ellis: $91,854
Armstrong High School: $89,094
Bismarck-Henning: About $152,000
Catlin: $207,339
Champaign: $2,527,042
Danville: $3.02 million
Fisher: $100,510
Georgetown-Ridge Farm: about $400,000
Gibson City-Melvin-Sibley: $339,673
Gifford: $18,321
Heritage: $107,946
Hoopeston: About $600,000
Jamaica: $170,000-$190,000
Ludlow: $20,305
Mahomet-Seymour: $859,406
Oakwood: $352,155
Paxton-Buckley-Loda: $367,774
Potomac Grade School: $42,391
Prairiview-Ogden: $244,599
Rantoul City Schools: $457,344
Rantoul Township High School: $189,430
Rossville-Alvin: $80,000
St. Joseph: $203,204
St. Joseph-Ogden High School: $95,084
Thomasboro: $57,357
Unit 7: $317,882
Urbana: $2,175,119
Westville: $558,277

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