Lingering D-65 Financial Crisis Is Lesson In Fiscal Mismanagement

Op-Ed from Angela Blaising, candidate for Evanston/Skokie School District 65:

On April 4th, 2017, Evanston residents overwhelming voted to pass the first property tax referendum in support of District 65 schools since 1986. Referendum proceeds raised property taxes by about $500 a year for the average Evanston taxpayer and proceeds totaled $14.5 million per year in additional tax revenues for the District. The District said the Referendum was necessary to boost fund reserves while providing valuable resources for classrooms and curriculum, keeping class sizes low and funding necessary projects such as deferred capital improvements. The District's warning in 2017 to taxpayers was that massive cuts would be needed to balance the budget if the Referendum did not pass, as much as $8.8 million over the immediately following two years.

Yet, less than four years later, the District 65 Board has announced the budget is once again in crisis and this time the projected reductions are even larger. The Board recently announced that $12.9 million would need to be cut over the next three years with 35% of those cuts focused on instruction.

This is unacceptable, and worse, it was avoidable. The District would like you to believe that Covid and revenue collection are the culprits for the budget crisis.

But that’s not the big problem—overspending is.

Expenses were growing at 3.9% annually when the Referendum passed and were expected to continue growing at a rate between 3.3% to 3.8% from 2018 to 2021. But in actuality, the District’s operating expenses increased from $121 million in fiscal year 2018 to $134 million in fiscal year 2020….that is an alarming 11% increase in just two years. Total fund expenses for the same period increased nearly 15%.

District 65 made several egregious financial mistakes:

• Negotiated a new teacher contract that locks in minimum annual increases far ahead of current inflation.
• Allowed a new administration to hire 11 new fulltime hires outside of instruction including several brand new administrative positions. There is currently yet another administrative position posted for hire called “Talent Development Specialist” while reading interventionists are getting laid off.
• Spent over $500,000 on potentially unnecessary PPE including hospital grade gowns prior to forming the medical advisory committee announced in January.
• Instituted expensive and unnecessary curriculum changes costing nearly $200,000.
• Grew “Purchased Services” (a catch all that includes consultants, travel, conferences and transportation spend) 64% in four years.

These miscalculations have set our district on a very dangerous path. Only 50% of the District’s student returned to in person learning in February. As a result of the delayed path to a reopening and inability to provide spots to all students electing in-person learning, almost 500 students have left the district with more departures continuing thus further worsening an already precarious financial position. This decline is on top of an already projected future enrollment decline.

D65 MUST IMMEDIATELY:

• Myopically focus on planning a full safe reopening of schools now in accordance with CDC recommendations, not next fall. Immediately create room for every child that elects in person learning. The only thing that will stop the bleed of students is to prove the District can operate an in-person schooling model NOW that can accommodate all students on as close to a fulltime basis as possible.
• Protect classroom spend from planned budget cuts.
• Immediately freeze all discretionary spending and plans to hire more consultants to a launch a multi-year redistricting plan during a time of unstable enrollment.
• Provide a transparent plan for use of the $3 million that will be coming from ESSER II. In a January 6, 2021 letter, the Illinois State Superintendent of Education said this in connection with the announcement of ESSER II: “To mitigate learning loss, consider a longer school year, before-after-school programs, and summer learning opportunities. Begin planning now to reimagine the school calendar and expand the school day to ensure students receive every opportunity to grow”

On April 6th, Evanston residents will have the opportunity to elect four new members to the District 65 School Board. We need new voices at the table to hold our administrators accountable—and give all of Evanston’s kids the education they deserve.

Angela Blaising

Angela Blaising is currently the VP of Capital Markets at Hyatt Hotel Corporation and an Evanston resident running for D65 School Board. This year marks her 25th year as a finance professional having spent the majority of her career working as a fiduciary for institutional real estate owners. She earned her BBA from the University of Michigan and her MBA from New York University.

This release was produced by Angela Blaising. The views expressed here are the author's own.