Audit: Fund Reserves Continue to Decline
The accounting firm Lauterbach & Amen LLC presented the annual audit for the year ending June 30, 2021. The firm reported that the district is in sound financial health, however, the fund balance continues a recent trend, posting a small decline for the year.
Board policy states that the district is to maintain a fund balance -- the district’s savings account -- between 50-75% of annual revenues. The balance is below that benchmark for the second year in a row. Increased spending due to the pandemic, increased pension liabilities, falling interest rates and a lower Consumer Price Index (CPI) rate, which drives annual revenue increases, are impacting the bottom line.
Chief School Business Official Jessica Donato noted that the district will be evaluating future spending priorities and monitoring revenue growth.
State Library Grant to Boost Meadowbrook Collection
Each year the district applies for an Illinois School District Library Grant, rotating the funds among the four schools. This year, Meadowbrook librarian Monica Benz is applying for a grant to be spent on print and digital items.
The grant will be used to purchase materials that align with Standard #4 of the Illinois Standards Aligned Instruction of Libraries: “Appreciate literature and other creative expressions of thoughts and ideas and pursue knowledge related to personal interests and aesthetic growth.” Last year, Northbrook Junior High School received $1,555, which was used to purchase eBooks, digital audiobooks and paper books.
Estimated Tax Levy Tied to 1.4% CPI
Each year, the district files a tax levy request with the Township Assessor for funds that will be applied to the following year’s budget. For 2021, the district is requesting $40,205,000. This represents a 4.99% increase over the previous year, according to Chief School Business Official Jessica Donato.
State law restricts school districts’ year-over-year property tax levy to no more than the CPI or 5%, whichever is less, plus new property growth in the district. The state law is commonly referred to as the tax cap law. The CPI, or inflation rate, is a measure of price changes in consumer goods and services set by the Bureau of Labor Statistics. The December 2020 CPI of 1.4% is used for the 2021 levy calculation.
Chief School Business Official Jessica Donato said the revenues from new development are the only other source to increase the amount of property tax revenue that the district receives. The district must over-estimate the levy increase in order to capture all potential new property growth, which is why the request is always higher than the CPI. The township assessor determines the actual amount paid to the district after all property is assessed. Property taxes provide about 86 percent of the district’s total revenues.
Last year, the tax levy request was $37.4 million but the district actually received $37.2 million because of the tax cap law.
The board will approve the levy at its Dec. 14 meeting.