Promises, Promises: Why D210 Can't Rely on State Funding

Here's a neat trick: Next time you're in the company of an Illinois school official mention the General Assembly and be prepared for an earful.

For the past few years, school districts have been struggling to find ways to deal with the challenges of state aid and the budget. Yes, the money districts have come to expect is dwindling as Illinois still works its way out of the recession. But what's more frustrating to officials is that even the funds promised to them are vanishing or slow to appear in district coffers.

"My problem is with the state," said Supt. Lawrence Wyllie. "Things down there are so different than they've ever been. We're going to have to live with a different kind of state aid."

That's part of the reason why Wyllie and the D210 board of education .

We break down some of the obstacles facing districts when it comes to state aid.

What has the state done with school funding?

Cut it. Dramatically.

In 2011, Gov. Pat Quinn slashed $269.4 million for education from this year's state budget. And that, of course, has a ripple effect for the districts. Last year, D210 received about $9 million in general state aid. This school year, it will be $8.7 million and will continue to drop over the next five years.

"Can we operate with less money?" Wyllie said. "We're going to have to figure out how to do that."

If it's just less money, why doesn't the district budget for it?

One of the frustrating aspects for administrators is that they don't always know how much money to expect from the state.

During the budgeting process, the state might indicate to districts that it's only funding 96 percent of certain aid. But later, officials are told that the percentage is changed to 90 percent, said D210 board President Arvid Johnson.

What is the state's problem?

Huge deficits have caused Illinois to unofficially adopt a financial policy of paying its bills late, forcing school districts and others relying on state aid to figure out how to make ends meet in the meantime, according to the Associated Press.

Last year's state income tax increase was passed as a way to raise money to pay off the backlog of bills, but that hasn't worked out that way, Wyllie said.

As of January, D210 had yet to receive any of its promised mandated categorical funding from the state, Wyllie said. Categorical funding is the state aid that goes toward paying for programs required by Illinois.

If the money is coming, can districts cover it temporarily?

The district could see tax anticipation warrants, Johnson said, comparing the note to a payday loan that is repaid when the district receives its funding.

Although tax anticipation warrants don't have the outrageous interest rates of payday loans, they still require the district to pay for money that it should already have, Johnson said.

What about district reserves?

This is something D210 has been doing for the past few years, but it has its limits. The district has about $24 million in reserves, and school districts try to maintain at least 30 percent of their operating budget in reserves. However, D210 currently has only 24 percent. Reserve numbers also have gone down thanks to decreasing interest rates, Wyllie said.

"You build reserves for the unplanned problems," Johnson said. "You don't build reserves for the planned problems."