“What I showed this evening was a big piece of the $88 million that was mentioned is $50 million in the working cash bonds that have been sold. And so some of the questions we have been getting are what’s the plan for spending that $88 million? And the $50 million we have talked about pretty extensively. That’s to cover most of the structural deficit over this school year as well as the next two,” Unit 5 Chief Financial Officer Marty Hickman told Cities 92.9.
Hickman spoke with us after Wednesday night’s school board meeting during which he had made a presentation trying to clear up misunderstandings in the community regarding Unit 5’s budget situation as it relates to the district’s referendum on the ballot on the 23rd.
Approximately another $18 million is also “in the working cash bonds and that is part of, the word I use is emergency reserves, because we don’t really have large fund balances in our education fund, operations fund and transportation fund,” Hickman said. “So I showed that cash flow projection how our revenue comes in yearly in the spring and summer. And we are spending that down through the year and in the spring time most of our funds actually are out of cash so we have to get the money somewhere.”
Hickman continued, “Right now we have that money in the working cash fund which is good. We can loan it to the education fund or wherever we need it instead of borrowing, which years ago the district would have to do that. Pretty much every year in the spring we would have to borrow money just to pay the bills until the tax revenue came in.”
School Board candidate Mark Adams also attempted to clear up misunderstandings in a three minute talk he gave during public comment before Hickman’s presentation. Adams rhetorically asked questions and then answered them himself with information from the Unit 5 website. Following are some of those questions and answers;
Q. Will the Equalized Assessed Value (EAV) that has increased over the last couple of years and continue to increase take care of the deficit.
A. No. In fact the EAV has increased steadily but it will not increase to the point where it will take care of the deficit alone.
Q. What about TIF funds? Aren’t we supposed to get millions of dollars from that?
A. No. At best we will get $1.5 million in all funds including Uptown and Rivian.
Q. Are Rivian property taxes included in these estimates?
A. Yes.
Q. How many Administrators does Unit 5 have compared to the average?
A. We have 211 students for every 1 administrator which is much higher than the state average.
We also spoke with Superintendent Kristen Weikle and asked her questions that the community has been asking. First we talked about new subdivisions.
Weikle told us, “While there has been talk and some decisions about new developments occurring, we don’t actually start receiving any tax money until those homes and apartment complexes are complete. And as there will be additional revenue we don’t know exactly what those dollars will be yet. And in addition to that we are also going to more than likely have students who will be enrolling in our schools which does come at additional cost to the district which will come right away whereas the revenue comes later.”
Reality is that Unit 5 will likely not see any increased revenue from subdivisions platted today until 2025 and probably not until 2026. And that timing is critical. Right now Unit 5 has a plan to get through the 2024/25 school year if their referendum passes. If it doesn’t their situation becomes even more dire. And that’s the reason Unit 5 is making cuts now. If they can’t pass a referendum they want to be able to extend the $50 million in working cash bonds out a few more years beyond 2024/25.
The Unit is not ignoring large developments like Carden Springs. ” We determined four other schools that students may go to depending on what availability there may be in those schools,” Weikle told us. “Should that school (Prairieland Elementary) be full then we have four other schools students could go to.”
The situation is similar when we consider Infinity Pointe Subdivision. “It is the same thing as Carden Springs,” Weikle said. “We made that area an open attendance area and again based on space and availability for students, they may go to Parkside Elementary or they may go to open attendance schools.”
We asked about TIFs and were told that they have been figured into Unit 5’s forecast. But the timing again is problematic.
Hickman explained, “Uptown Normal is the biggest one and the one that is going to start providing revenue the soonest which still is not until calendar year 2028.
