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District 113A Board Considers April Referendum Options, Possibility of State Takeover

Financial advisers for Lemont-Bromberek Combined School District 113A told the school board Monday that they would run out of money by July without an additional source of revenue.

 

The Board of Education for Lemont-Bromberek Combined School District 113A began discussing options for an April referendum question Monday night after financial advisers warned they would need additional revenue to meet their financial obligations in July.

According to representatives from PMA Financial, the repayment of the $5.5 million in tax anticipation warrants (TAWs) issued to Lemont High School District 210 will cause a negative balance in the District 113A education fund by June 30. Though money may be transferred from the operation and transportation funds, the amount will likely be insufficient to cover July accounts payable, advisers said.

District 113A has been using TAWs to pay its bills since depleting its cash reserves in June 2009. The district has not been able to pass a referendum in more than three decades, failing twice last year alone (the district posed a $6 million limiting rate increase in February and the issuance of $8 million in working cash bonds in November).

Since the district is currently on the Illinois State Board of Education's Financial Difficulty List, failure to raise revenue and meet its financial obligations would likely result in state intervention.

"If we are not successful in April in raising working cash to repay TAWs, we're going to have a month and we're not going to be able to pay our bills," said District 113A Board President Lisa Wright. "That is as black and white as it gets."

In order to prepare for the Jan. 18 deadline to approve a referendum proposal for the April 5 ballot, Wright asked each board member to share their thoughts on several different scenarios, which were prepared by District 113A Superintendent Tim Ricker, interim business manager Jay Tovian and PMA.

"What we put together is basically six options with two sets of questions to try to generate conversation [among board members]," Ricker said.

In making their assessments, Ricker asked board members to consider whether the board should put one or two questions on the ballot, and also what the financial priorities should be for the district.

The first proposal was for a $4.2 million limiting rate increase, which would restore all personnel cuts and academic programs within one to three years. The option would raise the tax rate approximately $0.305 per $100 of equalized assessed value, making the additional tax on a $300,000 home $290.24 in Cook County and $286.88 in DuPage County.

The board considered two other limiting rate options for $3 million and $2.43 million. The first would would increase the tax rate $0.218 per $100 of EAV, while the second would create an increase of $0.177 per $100 of EAV. Both options would also restore cuts over time, but would take longer than would the first option.

Ricker stressed that a smaller limiting rate increase would not address the issue in the state financial plan, which is to eliminate the need for borrowing. The second set of options, working cash bonds with or without debt restructuring, would eliminate the need for more TAWs, he said.

Wright asked each of the board members to share their thoughts on the options presented.

Board Member Sue Murphy said she was in favor of a limiting rate increase, as did Board Secretary Andy Taylor and Board Members John Wood and Karen Siston.

"As part of reform and part of bringing a balanced budget to the district, I would definitely like a referendum on the ballot," Murphy said. "I want permanent change. I want money to be used to restore academic programs."

Board Member Janet Hughes said she would not support putting a referendum on the ballot until the board was "open and honest" with Lemont voters. She questioned the board's financial practices, calling for a forensic audit and asking for an explanation of their inability to secure TAWs from a bank.

"We are in serious trouble if we cannot get a bank to buy our TAWs," she said. "We deserve to know what's going on."

Ricker and Tovian both offered explanations to Hughes, blaming the state's credit rating and banks' unwillingness to continue bailing out a district that cannot pass a referendum.

"The fact that two referendums have failed is a red flag for them," Ricker said. "The community's not going to support the district, why should they?"

Possibility of State Takeover

Board Vice President Kevin Doherty, who is also in favor of a limiting rate increase, turned the board's discussion to the oft-discussed possibility of state takeover.

"There is going to be a cash deficit in July, in which point we will not be able to pay bills," Doherty said. "However, I don't think we can wait until that point in time to take action."

Doherty asked Ricker what the consequences would be of a potential state takeover, and whether the board could begin working with ISBE to draft legislation for a School Finance Authority should a referendum fail to pass in April.

Districts with state financial oversight are either placed under a Financial Oversight Panel, which simply oversees district spending, or a School Finance Authority, which is a separate government agency that would exercise direct control over the district and would be able to levy a tax outside the tax cap in order to get the district to a sustainable level.

"There's a lack of ownership in the school system," Ricker said. "We've been told to avoid that like the plague."

"You've heard the phrase 'taxation without representation,' and that's exactly what [the SFA] is," Tovian added.

According to Don Weber, a representative for PMA, ISBE is keeping close eye on the day-to-day operations of District 113A, having most recently discussed the district during its meeting Dec. 16. Ricker said he would be in contact with Deb Vespa, ISBE division administrator for school business services, Tuesday, to update the state on the district's financial status.

Ricker will provide the board with a number of referendum options when it meets Tuesday, Jan. 18, at 7 p.m. in the Old Quarry Middle School LRC to vote on the final referendum proposal.

Related Topics: April 5, Ballot, District 113a, Election, Lemont Bromberek Combined School District, Referendum, and working cash bond
What do you think the April referendum proposal should be? Should there be a referendum at all? Tell us in the comments.

martin finn

7:47 am on Friday, January 14, 2011

I want to be helpful to the schools, and, I am, paying about $4100 every year to 113A in property taxes. I have no children inthe system. Further, my state tax bill just increased by 66%, which is to be used to pay back billls and debt. How wonderful. So, maybe the board should consider my family too and not just the families of the citizens with children in the school. Restore all the cuts and programs NOW, is what seems to be the message. Maybe a more measured approach is better. Maybe I could support a smaller referendum. Maybe the folks who try to get people to vote YES could have an easier time selling this. Many just vote no,reflexively, but perhaps with an education campaign which notes the difficulties of the district and the measured approach to rebuilding you could change enough minds.

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William Douglass

9:08 am on Friday, January 14, 2011

Martin,
The last referendum sought only to balance the finances. It did not seek to bring anything back that was cut. It failed. It was the referendum that you said that could support. If you didn't vote for it last time, I am just curious why not.

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William Douglass

9:14 am on Friday, January 14, 2011

I agree with your criticism of Dr. Ricker. I don't expect that he will ever sharpen his game, but he is not the issue that can be addressed right now. Many of us that support the referendum recognize that he has caused a tremendous amount of damage to the district's standing in the community.

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martin finn

12:24 pm on Friday, January 14, 2011

In November 2010, i had no knowledge of the circumstances of 113A, I was a reflexive no vote. Since, then, I have learned a bit. However I read the current position of 113A, I haven't metamorphed into a new person. I still don't want to pay (even help pay) for every basketball, flute lesson and field trip that students of 113A experience. The three r's, good teachers of these, well fine. My homework will be to find the type of expenditures of the district say 3-5 years ago, as compared to now, and, what is planned for the future.

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Mary Pollard

10:43 pm on Friday, January 14, 2011

Mr. Finn, Several speakers on Monday who supported the referendum specifically requested a focus on academic programming. I personally stated I am willing to forgo extracurriculars, band, field trips, and even fully funded transportation if we can reduce class sizes and restore academic programming. That is the position many referendum supporters that I know share. You can watch the speeches on channel 6 when the board meeting airs. Referendum supporters generally don't want "everything." They want the core academic programming and educational staff required to provide a quality, academic education that meets the need of every child.

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martin finn

7:41 am on Saturday, January 15, 2011

Ms Pollard, what you say is precisely the type of forward planning I could support. (And likely drum up support for from those I run around with who are not very sympathetic to this cause, generally). However, your words come with no guarantee and, therefore, my interpretation of how the board feels about your petition to them will be based on the level of rate increase they ultimately decide upon.

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Susan Antonoff

9:09 am on Saturday, January 15, 2011

Martin and Mary, you've just shown everyone in Lemont how we CAN work together. Martin, the BOE is proposing options at its next meeting....Sooooo important that you let them know what type of option you would consider before they vote. If you can, go to the district website and tell them. They provide their contact information there just for this reason.

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Susan Antonoff

9:24 am on Saturday, January 15, 2011

I had heard that Round Lake's taxes went up approximately $750 when the state came in, but I'll do some research to verifty that number. That's the number I seem to remember I read on a door hanger that was distributed before the last election. Chris, I guess I should have known that your name is not gender specific. I apologize if I recognized you as "she" and should have referred to you as "he".

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martin finn

10:01 am on Saturday, January 15, 2011

I must say this. This "takeover" scenario is just another example of how our lawmakers fix the system to achieve their ends. Districts should spend wildly, go broke, ask the local community for "help for the children" and if it doesn't come, the state appoints an authority that has legal carte blanche to raise all local property owners taxes. I am not fingerpointing at 113A, I'll stand by my above comments there, but, good grief, the sleaze that is an illinois (Democrat) politician. Someone tell me what to do to help bring this ruinous mentally down.

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Lynn Kroll

11:42 am on Saturday, January 15, 2011

Martin Finn - I agree wth your comment about Dr. Ricker's statement at Monday's board meeting. I found his comment about the community not supporting the schools insulting and insesitive. I guess that viewpoint blames the voting public 100% for our situation. I have heard many criticisms about school board memebers - volunteers. I have heard very little about the PAID distrcit employees who have responsibility of managing this district (superintendent and business manager). A state takeover is an incredibly rare occurence. I understand our schools could use some extra money, but there is absolutely no excuse for running a district into insolvency. Someone fell asleep at the wheel. We have a balanced budget this year - it isn't a great situation but the schools are still running. Had a balanced budget been done for the past years a state takeover would not be breathing down our necks. Can someone please explain why we invested a lot of money into Central school a few years ago only now to propose closing it? If we close it (which I do think is a shame) , I hope we have a buyer / renter in this horrible real estate market.

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Jennifer Albrecht

8:23 pm on Saturday, January 15, 2011

ok, I understand that Bruno, Susan P, Chris Jenner (even though at least two of them don't live in this town and are trying to forward their own agendas) think I'm stupid...but someone, tell me, exactly how, working with the money they had (and no referendum for the passed 40 years) someone , please tell me how the current school board led us to bankruptcy. Tell me...say,if you're making 100k a year and you do just fine in the 1980s or even the 1990s then the internet hits, then the cost of heating your house rises, the cost of gas, the cost of food, the cost of books, the cost of insurance, the cost of anything...so you really expect to survive on your 1980s paycheck in a 2000s world? With no increase in funds coming in...someone please tell me. Because in 1991, I was making 13000 a year and having little problem paying my bills...2011 is quite a bit different. How many of you out are accountable for your decisions? We (they've) done the best that they could with the resources they had. How many of you an really sit there in judgment? Really? This is our future and you guys just want someone to pay. Look at yourselves. No the whole community is not to blame. We were ALL asleep at the wheel, in every aspect of our lives. Take ownership. We are in this together and if you are all so arrogant to think it doesn't apply to you or it's (always) "someone else's fault" God help us all.

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Craig Peterson

9:19 pm on Saturday, January 15, 2011

I don't think the budget of the school district is the same as it was 40 years ago. Agreed a referendum has not been passed in 40 years, however every time property taxes go up the school districts get more dollars. Not to mention the last 10 years of residential growth in Lemont has increased the property tax basis. The district may be getting the same percentage because a referendum did not pass, but the same percentage of larger tax bills is still more. 2009 is the exception since Lemont residents have seen a substantial increase in property taxes, but the businesses are paying less, so supposedly the districts are not seeing any net increase in funds because of this. Blaming the community for the district mess is the equivalent to driving yourself to personal bankruptcy and blaming your employer for the poor raises you have received. Arrogance has nothing to do with it, it's more about being accountable for actions. Can we all do more, probably, but we all don't personally control the budgets and spending of the school district. We pay a superintendent $175,000/year to do this. The fact that there were questionable expenditures less than three years before the district is on the verge of state takeover is an embarrassment.

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martin finn

5:57 am on Sunday, January 16, 2011

It has been stated on a previous comment page here that until recently "the district paid for everything." (Despite no referundum passing). And, secondly, that the BOE/administrators could not pull back on "paying for everything" because parents of 113A students would get mad. So, Jennifer, it seems that the "philosophy" of "working with what they had" was to spend it as fast as they could so nobodys feelings would get hurt (and to be good disciples of the general public school philosophy that is, take in the money and find something to spend it on-and oh by the way we will give you some nice juicy ideas too), But really, as far as 113A, if they propose a modest rate increase which targets academic programs and brings back some teachers to et a little better t/p ratio I could support that. I like a .177-.0.2 rate hike. Let's see what they do.

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Susan Antonoff

12:47 pm on Sunday, January 16, 2011

Michele, you sound level headed. I am under the impression that your children attend 113A. After your recent post, I am interested in knowing what your thoughts are on 210 making the recent announcement that they are now dipping into their cash reserves to maintain the quality of education they are providing for Lemont students? I think that Tim Ricker's comment is being taken out of context. Though I haven't seen the actual document that contains the comment that people are up in arms about, I can only imagine that he is talking about financial support for the district's future. I don't need an apology from BOE or other admin. personnel for making tough decisions to the best of their abilities. However, I understand that other's may and perhaps an acknowledgment to those who do needs to be made.

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Susan Antonoff

8:58 am on Monday, January 17, 2011

Lynn, you asked about maintenance that was made at Central School. I might be able to help you out, that's where I spend my days. I'm not sure of everything that was done, but I do know it was time to make a decision about the asbestos tiles in the classrooms. Some tiles were beginning to show signs of cracking. For years the tiles were sealed with wax, several times a year, but that wasn't going to cut with tiles that were showing stress cracks and beginning to loosen. Choices were: Have them sealed permanently and professionally or remove them. Carpet squares were laid. At first I wasn't sure about the squares, but as they need be, they can be remove and replaced as needed. With carpeting and kids, you need to control the moisture in the air to prevent mildew. I worked at Bromberek and only areas with carpeting were conditioned. When the doors between the areas were opened, a flood gate of warm, humid air infiltrated and won the battle in creating an allergic arena filled with mold and mildew. Carpets were cleaned, but it was a loosing battle. So, air conditioning units were added. Central sits on a hill. There's a lot of shift going on. Some windows needed to be replaced. I'm thinking two reasons: They were leaking water/air and to maintain efficiency and effectiveness for the carpet and air conditioning.

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Susan Antonoff

9:26 am on Monday, January 17, 2011

Central is old. Asbestos and windows needed to be addressed. I understand how community members would question air conditioning, but in today's society, there are very few buildings that aren't. Should the windows have not been replaced to allow damage? Should we have gone the more expensive route and had asbestos removed? Should we allow the carpet to mildew? The BOE has a responsibility to maintain it's properties. How has the air conditioning impacted learning? There were days we just couldn't expect much from the students but sit when we were baking like bread in a brick ovens. Some days, I sent asthmatics to the nurse's office just to be able to breath in an air conditioned space. Other's simply had to stay home. My classroom faces McCarthy. Up until 9:30 or so, I couldn't have the windows open to let in morning air due to the exhaust from cars backed up on the street. The noise level from construction trucks hitting the sewer caps was frightful in itself. The students in my room from years past all know McCarthy is the cleanest street in Lemont. The street sweeper came across weekly working both sides of the street. There are officers stopping speeders (Go get 'em!) in the school zone, people standing outside my window to use the post box, dog walkers, motor cycles, horn honkers, fire trucks, and the occasional hefty odors of the refineries and canal, to name a few, that distracted learning with the windows open. Heck, even most senior citizens today have a window unit.

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Lynn Kroll

10:01 am on Monday, January 17, 2011

Hi Ms. ANtonoff,

Thank you for takng the time to clarify what you know about Central school. I certainly do not advocate children attending an unsafe, highly uncomfortable school. I don't think central air conditioning is unreasonable. I am fairly new to Lemont (4 years) so please excuse me if I don't know all of the school history. How long ago were these improvements made and for how much money? Were these improvements paid for in full or is there a loan out currently with acrruing interest? Was a referendum placed before the voters for Central improvements? Was clsoing Central ever considered before investing a lot of money into it? Do we now have a buyer for Central to recoup these improvement costs or if we close it next year will it be sitting vacant? Does it make sense to spend a lot of money on a very old school building only now a few years later to close it (and possibly be paying interest on thsoe improvments)? I don't know how the improvements were paid for - that is why I am asking. Thank you Ms. Antonoff for answering. I am just trying to understand the fators that contributed to our current situation.

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Susan Antonoff

2:03 pm on Monday, January 17, 2011

Lynn, I will do my best this week to find answers to your questions. Two I can answer for you is yes, we have been trying to pass referendums for years. Even before the economy was bad, the district was informing residents of the potential deficit and cash reserve spending, many chose simply not to believe it. I know I've been involved with at least 4. Central is old, but solid, and with the addition of two newer schools (RV and OQ) Central's needs needed to be met through repair, not the construction of another new building (my opinion). Asbestos and leaky windows couldn't be ignored. And, Central was never a consideration for closing until just last year. BOE members would have had to discuss that at meetings, and that discussion would have spread like wild fire among employees. I don't think there is a buyer for the property. Closing is very different than selling. I think the BOE is only considering closing. I've copied down all your questions and will post as I find out answers. There is a BOE meeting Tuesday eve. Referendum options will be discussed. You may want to prepare a 2 minute statement and present it. BOE needs to hear from as many community residents as possible to make the best decision for the community. BOE will also respond to you in writing to any questions you present at the podium in just a few days.

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Craig Peterson

10:43 pm on Monday, January 17, 2011

Susan, I believe the question that Lynn (and myself) would like to have answered is.. While Central school was in need of improvements, was the money used to pay for this actually funded for this purpose? This is partially why so many people are placing blame on the BOE & refusing to support any future referendums. If all this money was spent just a short time ago & we have not balanced a budget in 10 yrs or passed a referendum in 40 yrs due to education underfunding, how could they possible entertain the idea to make renovations on a building they now propose to close. I for one find that to be poor short term management of funding. I also can't believe that the BOE didn't have the fore site to look down the road a bit farther. I'm not saying that the renovations were not needed. It just seems to be a poor judgment call to invest what I have heard to be approx. $1 million in a building, just to close it 3 yrs later.
However in reading the article that Mrs. Pollard posted below, I do feel that her ( and others) are on to something that could generate some support for the referendum. If the BOE must spend the money allocated for funding, only in the way it was intended. I for one would be willing to vote yes at the next election. However, I would need guarantees from the BOE in the way the article suggests, that the money will be spent in this fashion.

William Douglass

10:46 am on Monday, January 17, 2011

Martin,

I appreciate what you have said. This district needs your input. I do think that there is plenty of room for agreement in what the referendum should and should not have. If the community focuses its efforts on fixing the problem, we can pass a referendum that will save this district.

If we pass a referendum, we can regain control once again. At that point, everyone must recognize that the work is far from over. Over the course of the next 2 to 3 years, the community will have the opportunity to address many of the things that led us here. We need to get ourselves in position to deal with these things and make the best decisions when the time comes.

I urge everyone to work together for a compromise solution to the problem at hand, and not let the ancillary issues overshadow what we need to do. I caution everyone against assuming that everyone who supports the referendum supports the administration or supports the way things have been done.

This financial distaster has changed the landscape. With the exception of the litigants, we all pretty much know how we got here. The real questions are how do we fix it, what are we going to do with future opportunities to correct the problems, and who is the most capable of taking us forward.

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Mary Pollard

12:21 pm on Monday, January 17, 2011

Hi readers - a letter was posted on the Patch "Letters to the Editor" section a little while ago regarding the referendum question under consieration. Take a look in case you are interested...

http://lemont.patch.com/articles/lemont-residents-weigh-in-on-district-113a-referendum-options

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martin finn

8:28 pm on Monday, January 17, 2011

I wonder what the amount of debt they are considering with the working cash bond issuance. Can't find that number anywhere. When would bond expire?

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martin finn

8:33 pm on Monday, January 17, 2011

Further, I don't know why that money could not also fund some of the same programs etc that the authors of the letter desire as oposed to a permanent increase in property taxe rates that are likely only to increase year after year as EAV rise.

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Mary Pollard

10:17 am on Tuesday, January 18, 2011

Mr. Finn,
I do not know the answer to yoru first set of questions about the bond. You can, however, email the Board directly to ask them. Their contact informaiton is on the district website.

In regards to your second, I do not know this answer for sure, but let me try... I think even if they go with a bond, they can by choice use some of the money to reinstate some teachers or cut programs, but since its only a one-time cash infusion, they cannot make any long term commitments to these reinstatements. Some will view this as a risky move, and most acknowledge this is not a long term solution.

This is why a tax increase (limiting rate) is preferred; because it is a long term solution, even though that solution may not address the most immediate cash flow problems. Further, the bond does not address the need for increased funding to reinstate and sustain academic programming in the long run; to do so the District would need to pass another referendum within a year to deal with that even if the bond passes.

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martin finn

4:17 pm on Tuesday, January 18, 2011

I have to say from reading recent reports that I am getting an itchy feeling again. Talk of a second referendum before the first has even been proposed is greatly worrisome to an overtaxed citizen like myself. Good grief, can't we get one passed then allow the BOE/administration to show some fiscal restraint and prudence before we race to the next referendum already. I realize that the parents of 113A students have strong desires for their children, obviously, as they should, but all of us paying the bills need some consideration. As I've said before, I have a family too. When a car is in the ditch, you tow it out and proceed slowly down the road, having learned from your mistake. A successful referendum (remember many have lost in a row) requires that both sides feel the other side showed them some consideration.

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Michele Russell

5:15 pm on Tuesday, January 18, 2011

This entire town will have an itchy feeling if the YES votes doesn't rule in April!
It is pretty much black and white at this point. We vote yes . This will allow us to know exactly how much our taxes will increase , we maintain control of our schools and our town stays strong and we rebuild to keep our property values strong. We will be able to vote in 4 new board members along with our YES vote to give us a fresh start.

Voting No will mean that the state comes in and raises our taxes and we will have no idea by how much until it happens. They will not mess around and it will be more than likely double or triple the increase of what the BOE is asking of us. Your property value will drop even more that it has when potential buyers investigate the we are state run and offer nothing but the bare bones for public education.

I don't like what Ricker or our school board has done over the past several years but as a community on April 5th we will have the opportunity to start fresh and maintain Lemont.

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