Hinsdale High School District 86 is on solid ground financially at present board members were told last week, but the path ahead is less clear.
At the district’s Sept. 8 committee of the whole meeting, Chief Financial Officer Josh Stevenson gave updated numbers for the 2022-23 spending plan (excluding capital projects) of $129.3 million, with $129.4 in projected revenue, and a forecasted surplus of just under $200,000.
Although revenues are projected to dip slightly from FY 2022, corporate replacement tax proceeds are estimated to increase $54,000 to $3.44 million. The taxes are paid out to local taxing bodies by the state.
“We had a more conservative number in the tentative budget, but based on the projection we received from the Illinois Department of Revenue and the actual July payment that we received, I think we’re in a very good position, benefiting from the high replacement tax and our energy contract being locked in for this year,” Stevenson said.
He said the budget reflects the lingering impact of the pandemic, when the cancellation of activities and travel greatly reduced expenditures. It’s yet unclear how lasting those adjustments will be.
“This year we’ll obviously keep an eye on those line items and see whether they truly do normalize back to pre-pandemic, or if there’s been a permanent shift in some of the utilization in these areas,” Stephenson told board members. “And these areas could potentially be areas that we can look at for reallocations of funds for the next year’s budget.”
He was also pleased to report that health insurance costs seem to be holding steady.
“Potentially we could have a flat renewal, which would be pretty great in an environment where everything else seems to be escalating very quickly,” he said. “(Insurance costs) have been tracking well below target.”
Going forward, however, Stephenson anticipates increases, notably in the area of transportation. That expense is forecast to grow from $4.8 million last year to $5.1 million this year.
“The concern I think I have with transportation going into next year is I think we’ll continue to see some upward pressure on the wages and guaranteed hours for drivers,” he said. “I imagine that we could see another large increase. There’s not a lot of control we have in this area.”
The capital equipment line item will rise from a little under $1.3 million in 2021-22 to just over $3 million this year due to the purchase of new equipment and classroom furniture. But that increase will be offset by a drop in funds needed for the nearly complete Transition Center renovation and for contracted services related to referendum projects.
Speaking later as part of his five-year financial forecasting report, Stephenson said expenses are expected to increase down the road.
“And if you couple that with, if replacement tax normalizes and drops $1 million or $1.5 million, that could put us in a position where there’s a significant squeeze with decreasing revenues and increasing expenditures, and you’re forced to make some more difficult decisions in order to balance the budget,” he said.
The board will hold a public hearing on the budget at its Sept. 22 meeting before taking action on its adoption.
