DANVILLE – The Danville school district is lucky to have healthy fund balances to help cover a $2.43 million budget deficit that's projected this fiscal year, officials said Wednesday.
But because uncertainty in both state and local funding continues, they said they must be very cautious when it comes to everything from union negotiations to restoring programs and positions that were cut earlier this year. And if the funding situation doesn't improve, they're prepared to make deeper cuts in the future.
"We cannot sustain repeated years of deficit budgets," Superintendent Mark Denman said, adding the state is "in the midst of a financial crisis that has really been unmatched since the Great Depression. We have to be very aware of the situation we're in throughout the year. We don't want to put ourselves in jeopardy."
Denman's comments came after school officials unveiled a proposed spending plan for the 2010-11 fiscal year, which runs through June 30, 2011.
School board members voted 5-0 with two members absent to put the proposal on display for 30 days. It's available at the superintendent's office in the Jackson Building, 516 N. Jackson St., and on the district's website at http://www.danville.k12.il.us.
Board members will vote on whether to adopt the proposal at their Sept. 22 meeting.
Under the proposal, the district would spend a little more than $65.85 million and bring in a little less than $63.42 million in revenue, leaving a deficit of a little more than $2.43 million.
The education fund – which pays for most salaries and day-to-day expenses – would spend nearly $53.16 million and take in only $51.54 million in revenue, creating a deficit of about $1.62 million.
"It's not as pretty as the budgets have been in the past," business and finance director Heather McKiernan said, adding the district is projecting significant cuts in reimbursements for "categoricals" such as special education and transportation, which the district must provide. She added that on July 1, the district's transportation fund started the fiscal year $436,801 in the red, and it could end the year with a $1 million-plus shortfall.
While the state aims to maintain the per-pupil foundation level at $6,119, McKiernan said, there's no guarantee all of the money will come through.
"We didn't receive all of our last payment," she said. While a state payment of more than $1 million just arrived, she said, the state still owes the district $3 million in general state aid and grant funding from the previous fiscal year.
In addition, McKiernan said, property tax and corporate replacement tax revenues are expected to decrease.
Although more than 40 positions were eliminated this year, Denman said, the proposed budget will allow the district to maintain all of its regular education programs and services.
"Every extracurricular activity and all elective courses, they're still here," he said, adding some classrooms will have more students, however.
He added the district was able to reinstate some preschool staffers, including several on Wednesday, which will make about 140 or 150 seats available this year. He said more seats could be added if the promised funding comes through.
Denman also said the budget will allow the district to address some of its aging buildings.
"If they're not addressed, our ability to carry on will be put in jeopardy," he said.
Denman added that the district's finances must not be put in jeopardy either.
"I wish we had a better scenario for our negotiations," said Denman, who pledged the district will work hard to reach an agreement with the Danville Education Association. Talks resume with a federal mediator Monday.
"I very much appreciate our staff. Our staff is what makes our school district. However, we have to be completely honest about the situation, and we have to exercise caution in the future."