Questions about finances

I don’t know about you, but every time the topic of money (levies, tax abatement, fund transfers or anything else to do with finances) comes up in board meetings, I feel like a secret language is being used which I do not fully understand (is it Elvish? Klingon?). I mean, I can look up the terms and understand the words that are used, and by doing so, I can slowly chip away at the information that is presented. But by no means would I say that I have a clear picture. Having asked several questions and finding myself still perplexed, a friend suggested I just put the questions in a blog post and see if anyone else can provide some clarity. Or at least commiserate. *grin*

 

This first question I have asked many times over the past few years; can a Unit 4 5th grader present the finance information to the community? Whether it be in the context of a public hearing of a new budget or abatement, I want to know if a 5th grader can not only understand the information, but then also communicate it back out to the community in a language and style that is easy to digest. A few years ago I chatted with Matt Foster and developed a sample Sankey chart of the FY14 budget – for me, visualization helps a lot. This is just one step towards better understanding. I have also asked that jargon like “levy” and “abatement” not be used to explain “levy” and “abatement”.

 

On the topic of levies, I have queried board members about how the district settles on a tax levy amount (the “ask”). From what I gather, the district attempts to make an informed, educated guess about how much money is coming in via the tax rolls, and sets a levy amount that they know to be slightly over the amount they think they can take in an effort to “capture” any new taxes. The reason they submit a guess is that the Champaign County Clerk ultimately decides what the tax levy will be (based on the EVA, or “economic value added”), and due to an unfortunate timing of events, entities that levy taxes, by law, must submit their levy amounts even though the amount of money collected by taxes is not known until several months later. So in essence, levying entities in a “home-rule government” (Unit 4, MTD, Forest Preserve, etc – Parkland is not constrained by “tax caps” or PTEL, as a counter example) either declare some artificial maximum tax rate that will later be tuned down by the County Clerk, or if they set an amount that is less than the maximum, they “lose” the difference when taxes are actually collected. It’s all pretty stupid – I don’t know who wrote the laws that muck things up like that. But this brings me to my second question: why not just always levy for one billion percent? (Yes, 1,000,000,000%) Or choose some other completely arbitrary number that will always be “maximum”. Because in the end, no matter what number the district settles on, they always want it to be some (at the time) unknown “maximum”. It seems to me that this would at least make things a bit less confusing – you just basically skip all the nonsense and tell the County Clerk to assign the highest number possible. Until the laws change. (I settled on 1B% because it is absolutely ludicrous – it reflects the silly dance we do every year)

 

And finally my last question for today. What role do the various funds (ie, Fund 60, Fund 61) have, and when money is moved from one fund to another, exactly what is the intended purpose? I believe there is a document on the Unit 4 website that describes some of the funds, but at this time I cannot find it. More importantly, when there is a public hearing, currently all the documentation is presented in “State Form”, a format that is sent directly to the State for legal purposes. It is exceptionally hard to make sense of, and I have no idea why monies are moved from one fund to another.

 

I had the privilege of speaking with Gene Logas several times when he was the CFO at Unit 4; after one of those chats, Mr. Logas published several informative and helpful documents that are still listed on the “Finance department” section of the Unit 4 website, in particular, “Where Does All the Money Go?” and “Property Tax Lesson“. I applaud the district for going through the trouble of putting check registers, yearly budgets and many other pieces of information on their website. This is an excellent step towards transparency! The next step is helping taxpayers understand the information.

Board agenda tonight and Coffee with the Superintendent (not tonight)

For the Coffee with the Superintendent – from the Champaign County Chamber of Commerce:

http://champaigncounty.org/events/eventdetail.aspx?EventID=853


Date: 9/30/2014
Time: 8:00 AM TO 9:00 AM

Champaign County Chamber of Commerce
303 W. Kirby Ave.
Champaign, IL 61820

Event Description:
The Champaign Unit 4 School Board recently voted to ask voters for $149 million to remodel Centennial High School and build a new Central High School. As part of our efforts to provide the most up-to-date information to our members about issues in the community, the Champaign County Chamber of Commerce is hosting a coffee with Unit 4 School Superintendent Judy Wiegand. This is your chance to have your questions about building a new Central High School and remodeling Centennial High School answered.

This event is complimentary to all Chamber members.

Please contact Caryn Isenhower at caryni@champaigncounty.org or call 217.359.1791 to register.


 

I mention this because I had a great (but brief) email chat with President & CEO Laura Weis; I was very impressed with the approach the Chamber is taking towards collecting data/information about the upcoming November referendum and their strident desire to listen to the concerns of Chamber members. If you are a Chamber member, I encourage you to take advantage of this opportunity.

 

Slightly interesting round up of topics for tonight’s board meeting – under New Topics:
A. Enterprise Zone Recertification: Tom Lockman
B. Presentation of Tentative FY15 Budget: Matt Foster
C. Administrator & Teacher Salaries Reporting: Ken Kleber
D. April 2015 School Board Election – Calendar of Events: Tom Lockman
E. Master Facility Plan: Matt Foster

 

Only item #C has an attachment, and about 15 pages to flip through. I recompiled the attachment into a one-sheet spreadsheet which is much more friendly. I’ll post that tomorrow.

 

This morning I seent a note to the board and administration about item #A – from what I have read and researched of Enterprise Zones and Tax Increment Financining, there is an absurd lack of accountability in these programs. Even the US Government’s own Office of Accountability is unable to conclude if these programs are truly effective at spurring growth (http://www.gao.gov/assets/100/96577.pdf). My email urged the board and administration to be very careful and if they decide to move forward with this partnership, to do so with the insistence on proof of economic growth, and with a long (20-year) view in mind.

 

I have looked over the budget (item #B) from previous board meetings, and I am still trying to wrap my head around it. Mr. Foster suggested I read “Essentials of School Finance“, which I am trying to work my way through. In the back of my mind, I still wonder how we are going to work in the CFT-negotiated salaries from last year, not to mention the “in kind” administrator raises. I am also trying to understand our Debt obligation – the most recent FAQ mentions the Debt Service and how the district can sustain a bit more debt with no worries. But…. is that wise? I just do not yet grasp the bigger picture in this context.

 

I don’t have my spreadsheet in front of me (#C), but I believe the average teacher salary was about $47k and the average administrator salary was about $85k. Plus, I was surprised to see that we have over 20 “Assistant Principals”, but only 18 schools (counting IP and Novak).

 

Who is running for the board in April? (#D) 🙂

 

For #E, I am looking to see if the Master Facility Plan has changed much from the last time they presented it (July 28th). Strange that they did not put it (the new one) up on boarddocs by now.

 

In the Consent Agenda, one and only one item. 🙂 David Hohman has attached a zip file with an Application for Recognition – for all elementary schools. Two apparently do not have paraprofessionals, but that was the only difference I could find. Not sure what that means, either.

 

UPDATE: Here is the spreadsheet of salaries:

2014 EIS Salary Benefits Report 09-16-14

requesting feedback on Budget visualization

I have been fascinated by data visualizations, and at the same time frustrated with spreadsheet presentations of the budget. So I combined the two into one, and came up with a Sankey Chart visualization of the FY14 Budget. Note that this is a rough draft, and just a chart of the summary data.

NOTE: If you click on the chart below, it will take you to the live site where you can interact with the elements a little bit.

sankey_chart_unit4_budget_summary

April 28th Special Meeting agenda

I know folks are getting excited (insert alternative adjective as desired) in regards to a Spalding site. Keep your hats on, here are the “action” portions of the agenda for Monday:

  • 7. Reports: New Business
    • A. Suits and Ties Project: Dr. Judy Wiegand
    • B. Youth Assessment Center: Orlando Thomas
    • C. Master Facility Plan: Matt Foster This item has files attached
  • 8. Action Agenda: New Business
    • A. Resolution to Prepare a Final Budget for FY14 and Approval to Hold a Public Hearing on Such Budget on June 9, 2014: Matt Foster This item has files attached
    • B. 2014-15 Regular & Special Board Meeting Schedules: Dr. Judy Wiegand This item has files attached
  • 9. Consent Agenda
    • A. 2014-15 Elementary English Language Arts Adoption: Trevor Nadrozny This item has files attached
    • B. K-12 Health Adoption: Cheryl O’Leary This item has files attached
    • C. Acceptance of Contract for Sale of Marquette: Matt Foster This item has files attached
    • D. Bid: Auditing Services for FY14, FY15 and FY16: Matt Foster

 

 

Suits and Ties was really awesome. If you haven’t seen the video yet, go check it out!

http://www.youtube.com/watch?v=D7vNEl4Br0w

One very interesting thing is that this video has gone viral, and you can find links to it on many many different websites. Reading through the comments on various websites, there is an interesting cross-section of responses; the vast majority give high praise and kudos to those involved. But some take a more cynical approach.

 

The Master Facility Plan sounds like it might address one of the things I need to vote for the referendum, but unfortunately Unit 4 has chosen not to post the plan at all, so we can’t read it. Hopefully it will be posted later. I don’t get why they don’t post it prior to the meeting. Note the the “District Facility Committee” and the administration “have done a lot of work”, yet there are no minutes or even meeting agendas that would give us a single clue.

 

Final Budget and obligatory “public hearing”. I always chuckle to myself when I hear about these “public hearings”. Maybe they used to be different, but all the public hearings I can remember last about 30 seconds. I think we need a few classes on “particpatory budgets” – and don’t worry Board Members, I don’t see a “participatory budget” happening in the context of a Board Meeting. At all. *grin*

 

money and the state budget

There is a syndicated article in the NG today talking about how the state intends to chop ONE BILLION DOLLARS out from Education. Doing the math, right now the unbalanced budget has $13.2B set aside for Education, but we have to subtract out a massive $5B for pensions which brings it down to $8.2B for everything else in schools. Divided by 3862 public schools in the state of Illinois, that averages to roughly $2M per school or about $3993 per student. Unit 4 receives a little over $15M from the state (FY2014 state budget form) for the Educational Fund(*), which comes out to $1623 per student (9383 total students). Ironically, according to ISBE Superintendent Christopher Koch, the “statutory amount set for general state aid” per child is $6119. Which is obviously meaningless and a sad joke. There is a ton of talk about “pension reform” and I have not figured out how the proposed “balanced budget” of chopping $1B will affect pensions. If we assume the worst-case scenario where pensions are left alone, that brings the money for Education down to $7.2B, or $1.86M average per school ($3505 per student); for Unit 4, an oversimplified guess would put the cut at $2.1M (total down to $13.3M), or $1421.6 per student.

Unit 4 has a $103M budget(*), and Gene Logas and the rest of the Finance team has placed us in a really well-padded financial position. Except we are cutting into that buffer space with additional raises for both teachers and administrators over the next three years due to the contract negotiations last year.

* UPDATE NOTE: The total Unit 4 budget is $138,853,108 – I am focusing on the Educational portion of the budget from which teachers are paid (among other things).

It is quite unclear how Gov. Quinn’s promise to protect Early Childhood Learning will play into this picture. I am not smart enough to figure that out. *grin* If you are, or if you know of someone who is, please pitch in.

All this to say that I am quite confident Unit 4 will be fine for the next few years, but we have to be diligent and very careful with how we plan our future. My sincere hope is that all stakeholders can come to the table to exercise “community involved planning” to dream up ways we can maximize our dollars.

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this might pinch a little

Whenever my ex-dentist used to say that, I cringed and prepared for an excruciating pain. And oh did it hurt! I learned later, after that dentist had left for “other opportunities”, that he had been doing the procedure wrong the entire time, and the new dentist demonstrated the same procedure with me hardly noticing anything. Still I was scarred, and those false words of promise buried themselves deep inside me.

You can hear the same empty mantra from elected officials. Taxes go up and “its for the kids”. Surely every single tax dollar that is sucked out of our wallets is used for mutually beneficial and good things. Right? Why are you looking at me like that?

While I will focus mostly on the schools, I am going to blame two distinct groups of people; 1) officials, leaders, legislators, policy-makers and every other cherry chum that sees taxes as free money, and 2) you and me and everyone else who lets them get away with this inexcusable atrocity.

Let us take a little spin down TIF lane. TIF, Tax-Increment Financing, sounds innocuous enough – or perhaps, more realistically, vapid and vacuous, as it doesn’t really say much of what it is doing. Read the rest of this entry »

If only good words were enough

I don’t usually pay attention to what is happening outside Champaign. However, I have subscribed to “Voices for Illinois Children”, and today’s topic was about Gov. Quinn’s State of the State speech. Below I quote a small snippet relevant to Education:

http://www.nbcchicago.com/blogs/ward-room/illinois-quinn-state-of-state-text-242613351.html

In the last five years, we’ve been getting the job done on education reform. Parents are now empowered with a report card on their children’s schools. Teacher evaluations have strong benchmarks. And performance is prioritized over tenure. In fact, our reforms have become a model for the nation.

Governor’s Birth to Five Initiative

But our unfinished job on education starts where it matters most: in early childhood.

Study after study has shown that high-quality early childhood education provides the best return of any public investment we can makemore than $7 for every dollar invested. That’s why our state invests in programs serving our at-risk children, from birth all the way to kindergarten.

Since I’ve taken office, I’ve always fought to preserve early childhood education from radical budget cuts. And we found a way to invest $45 million to build early education centers in high-need areas such as Dolton, Kankakee, and Cicero.

 

Voices4Kids advocate and Huffington Post writer Emily Miller points out that since 2009, the early childhood block grant has seen a reduction of about $80 million. Not exactly encouraging news. While the proposed 2014 budget retains the 2013 levels for the early childhood block grant, the fiscal future of our state is extremely bleak.

 

I have asked some follow-up questions of Voices4Kids and Ms. Miller – I hope to circle back here and update you with what I learn.