Batavia Unit School District 101 appeared on the state’s Financial Watch List for schools this year, not due to budget problems, administrators said, but because county tax payments arrived late, making the district appear to have few reserves.
Woodstock School District 200, which has been placed on the list twice, was removed for the second time this year. But school officials aren’t rejoicing. They expect the cash-strapped school district to be on the list again, maybe as soon as next year.
And North Chicago Unit District 187, which has such severe financial problems that it came close to shutting down last fall, showed up on the list for the fourth time. The district faces close scrutiny from the Illinois Board of Education and must submit a balanced budget to the agency each year.
The three school districts, with financial problems that range from mildly annoying to critical, illustrate the spectrum of reasons why districts appear on the state board’s 6-year-old watch list.
The watch list was first released in 1988 by the state Board of Education as a barometer of the general health of schools statewide. It was designed to keep the public informed about school districts with shaky finances, giving citizens time to demand corrective action from school officials.
And in some cases, the watch list serves as a critical first step that sets in motion a system of financial reviews by the state Board of Education that could ultimately lead to a takeover of a school district with continued financial problems.
The most troubled schools-which number more than a dozen statewide and include North Chicago and Round Lake District 116 in Lake County; Mt. Morris District 261 and Meridian District 223 in Ogle County; and East St. Louis District 189-eventually must file long-term financial plans that are certified by the state.
But some local school officials, legislators and tax watchdog groups aren’t sure the watch list is an accurate measure of the financial state of a school district.
Although there’s no dispute that troubled school districts such as North Chicago and Round Lake should be on the list, there are a number of districts like Batavia that complain of being caught by technical foul-ups such as late payments from the state or county.
For other districts, such as Woodstock, which are hampered by continued dwindling revenue from property tax caps and reduced state funding, being on or off the watch list does not lessen their financial challenges.
“I wouldn’t be surprised if we show up on the list again next year,” said Woodstock 200 Assistant Supt. Ray Reynolds. “We’re losing money from taxes and from state aid.”
Illinois Board of Education officials are among the first to acknowledge that the watch list isn’t perfect, that some school districts hop on and off the list as they meet or miss the state’s broad financial criteria. But they do view it as an important litmus test.
“The watch list doesn’t tell all, we’ve never said that it did. It’s a preliminary warning system,” said Gary Ey, the state board’s assistant superintendent for school finance.
More Top Picks String Lights
“It’s not perhaps as exciting as high school basketball ratings, but it’s a different type of scoring,” Ey said. “We’ve kind of encapsulated it for the public to ask questions of the schools boards (such as) is there a risk that the district could fall into serious financial difficulty?”
A statewide taxpayers organization suggests the list is designed to give mismanaged school districts an excuse to persuade constituents to support raising property taxes.
“I believe it’s a public relations ploy on the part of school districts to try to generate sympathy so they can increase property taxes,” said Dennis Constant, executive director of National Taxpayers United of Illinois. “There’s a tremendous amount of waste and corruption. I think taxpayers have to take this list with a grain of salt.”
A school district is placed on the list if its year-end balance from four major funds-education, operations and maintenance, transportation and working cash-is 5 percent or less than the total revenue collected in those funds during the year.
This year, 145 of 932 school districts that operated statewide during the 1992-93 school year, made the list-up 30 percent from last year, when 111 of 946 districts were on it.
The Chicago Public Schools system is not on the list because it operates under a separate financial oversight system, the Chicago School Finance Authority.
The increasing number of schools on the watch list is likely to continue, officials say, as districts grapple with property tax caps, and reduced and delayed payments from the state. And some districts may never be able to get off the list.
Riley Community Consolidated School District 18 in unincorporated McHenry County near Marengo; Elgin Unit School District 46; Aurora East Community Unit School District 131; and Central Community Unit School District 301 in Burlington; were among the districts that blamed either the tax cap, late and smaller state payments or late tax bills, or a combination of those factors for their placement on the list.
The 4,700-student Woodstock District 200 was removed from the list for the second time, but district administrators say their financial picture has not improved, it just hasn’t gotten worse.
The district has adopted a balanced budget for the last three years, but has not had a 5 percent balance because funds were needed to accommodate the 200 to 300 new students a year, Reynolds said.
“If you don’t get worse over a couple of years, you come off. Our position hasn’t changed,” he said.
Ey said if a district that’s been on the list improves its finances, but still doesn’t reach the 5 percent balance, it could be removed from the list. He added, however, that 14 severely troubled districts have remained on the list since its inception.
“They’re in a financial vise. They’re caught in a time warp,” he said.
Officials from several southwest suburban school districts said that they do not consider their placement on the watch list as a sign of trouble.
Fairmont School District 89 in Will County, for example, made the list, but officials there say they are in good fiscal shape.
Supt. Paul Rundio said the 430-student district pulled itself out of the red when it passed a bond proposal in April for $550,000. Now, he said, administrators in the elementary school district view their placement on the list as proof of early detection of money problems.
“I think it’s to our credit,” Rundio said. “We saw a problem coming last year and we addressed it.”
Plainfield School District 202 administrators said they have been on the watch list for the last two years for a variety of reasons. But they do not consider themselves seriously at risk, either.
Assistant Supt. James Waldorf said the 64-square-mile district, which serves 4,000 students, is still reeling from financial difficulties due to an August 1990 tornado that razed the district’s high school. Meanwhile, he said the district has been growing rapidly in the last few years-primarily in residential areas.
“We’re basically a residential school district as opposed to commercial and industrial,” Waldorf said. “It’s very difficult for us to maintain a budget that keeps you off the watch list.”