1. 2-13-13

2. Since we last met The district has been in contact with our state representatives. The district has been in contact with the Illinois State Board of Education. The district has been in contact with other school districts in our similar situation.

3. What have we learned? Representatives have worked hard to study our situation. $35,000 came in last week from our Early Childhood Block Grant (Pre-K) We did not expect these payments for months. Getting answers from the state is difficult.

4. State Concerns for the District Pension Reform-Is still a hot topic. We believe that pension reform will happen. The original bill will not have the cost shift to the district, but a bill later on will include the cost shift to districts. What will happen to rural schools? No answer has been received at this time At this point, it is survival of the fittest!

5. Illinois State Board of Education Mark Mullen, financial consultant for I.S.B.E. has been in the district twice to look at the financial picture of the district. He believes that the Illinois State Board of Education annual budget recommendation for education will not make it pass the governor. The I.S.B.E. has asked for full funding for General State Aid. The state funded us at 89.17% this year. His prediction for next year is 80% funding for G.S.A. This will cost the district around $100,000.

6. Future Outlook I cannot guarantee that all these moves will work for long term stability, but it is a start. When the state continues to cut funding, we find ourselves further behind. The district must balance a budget from here on out. State is looking to cut General State Aid payments to 80% or lower. That will cost the district between $70,000 to $100,000.

7. School Districts Many school districts our size are looking at cuts. Oblong, Red Hill, and Neoga are all looking at cuts. Noble is looking to annex into the Olney School District. Everyone is looking for ways to reduce spending and are looking at Reductions-In-Force.

8. Where are we? Timeline Out of money in March or April. Looking to Tax Anticipation Warrant money to get us through August. ($800,000) Will probably need to explore the use of Working Cash Bonds to operate in the 2013-2014 school year.

9. Tax Anticipation Warrants Tax anticipation warrants are issued in expectation of the collection of taxes and may be issued to the extent of 85% of the total amount of taxes levied. The warrants must be repaid, upon the receipt of tax moneys by the district and bear interest at a statutory rate.

10. What is a bond? A bond is written certificate or evidence signed by the president and clerk of the school board to pay a specific sum of money. A bond represents a general obligation of the district. Taxes in an amount necessary to pay principal and interest due each year are extended by the county clerk without regard to the tax rate.

11. How do bonds work? Generally: The board will pass a resolution at a school board meeting to solicit for bonds. The board will have a bond hearing. There is a thirty day petition period for the bonds. This means any person in the district may circulate a petition to place the bonds up for referendum.

12. Bonds The petition of bonds must be signed by registered voters. If the petition is signed by 10% of the registered voters then it goes on the ballot. The question to allow the bonds then will be voted on in the March 2014 election, if a special election cannot be held sooner. A simple majority vote passes the bonds.

13. What does this mean for the district? When the tax anticipation money runs out we are basically out of funds, until we can tax anticipate again. The only option is going to the bank to take out a line of credit. The banks will not loan money to a school district who cannot guarantee re-payment. When the school shows a zero balance and cannot make payroll, the state will be called.

14. Financial Oversight Panel The Illinois State Board of Education would take over the finances of the district and make decisions on behalf of the district. They would choose a three member oversight panel made up of people outside of the school district. We do not want a Financial Oversight Panel in Palestine Cairo Financial Oversight Panel East St. Louis Financial Oversight Panel Hazel Crest School Finance Authority North Chicago Financial Oversight Panel North Chicago Independent Authority Proviso Financial Oversight Panel Round Lake School Finance Authority Venice Financial Oversight Panel

15. How do we keep away from this? We have to make cuts. These cuts are unpleasant and we will let go of dedicated people who work in the Palestine School District. We then must have the ability to bond money to use when we cannot tax anticipate money. We must balance a budget.

16. Reduction- In-Force A Reduction- In -Force (R.I.F) is a decision of a school board to decrease the number of teachers employed or to discontinue some particular type of service. The Board will have a hearing on the Reductions –in- Force in early March. The Board will then review the information that is presented at the hearing. The board can choose to act on the Reduction- In-Force at the March Board Meeting. Teachers then can be recalled back by the board if there services are needed.

17. Projected Reductions Elementary Teacher Special Education Teacher Social Science Teacher Mathematics Teacher Physical Education Teacher English Teacher Band Teacher Music Teacher Looking not replace: Business Teacher Art

18. Extra-Curricular Cuts Junior High Sports Baseball Softball Scholastic Bowl Track High School Sports Golf Scholastic Bowl Track

19. Recommend to stay if funded by outside groups School cannot fund these sports. Junior High Basketball Girls $6,297 Basketball Boys $5,294 5 th & 6 th Grade Basketball $2,625 High School Football $9,169 Basketball $9,871

20. Overall I know that the recommendations only bring more questions than answers. The board is looking for input as we go forward. If you have questions, please come down to the microphones on the floor. State your name and the question that you have. If you do not want to come down, please call or e-mail me at 586-2713 or jsornberger@roe12.netjsornberger@roe12.net