After adding more than $3.1 million to its reserve fund during the last fiscal year, school administrators in Forest Park are bracing for what could be a dramatically different outcome this year.
A preliminary budget proposal for District 91 elementary schools reveals the schools could see a deficit at the end of the current fiscal year in June 2010. Assistant Superintendent Ed Brophy said he expects his projections to change by the time the board adopts a budget next month, but the reality is that tax revenues could remain flat.
“The bottom line is the expenditures are budgeted on paper to be up $2 million,” Brophy said. “The revenues will still cover expenses, I’m just not putting as much into reserves as I would like to.”
As of mid August, Brophy is estimating the district’s expenses will outpace revenues by more than $102,000.
“The normal increase in tax revenues is not going to be there, number one,” said board President Frank Mott, “and the costs of running the district continue to go up.”
Mott said that for several reasons he’s not overly concerned with the projections. Last year’s budget called for $15.79 million in spending, but the unaudited year-end total was slightly more than $14 million.
Within the proposed budget, Brophy said he expects to make some reductions.
The way in which tax referendums support spending would also suggest that Forest Park’s schools are approaching a period in which it will be harder to put money into reserve accounts. Upon winning support for a tax increase in 2004, District 91 has been stockpiling money. In theory, those millions could be used to offset small deficits until it becomes necessary to ask voters to approve another tax rate increase.
Lastly, the economy has taken a serious toll on the Consumer Price Index – used to cap the tax levy. That figure is expected to be a scant .1 percent.
“It’s not unexpected given the cycle of referendums, given the economy, the housing market and the CPI,” Mott said of the potential deficit. “We’re getting to the break even point.”
In comparison to last year’s projected budget, the district is looking at an 11 percent increase in expenses. The projected spending increase balloons to more than 20 percent when put next to what was actually spent during the previous fiscal year.
Meanwhile, Brophy’s early numbers call for $57,330 less in tax revenue.