District 65 Board Re-iterates Support for Foster School to Staff
I support Foster School but I don't see how this is feasible
District 65 Staff today received the following email from the Board President, reaffirming his and the Board’s support for Foster School. I wrote about the Board’s discussion the other day.
Dear District 65 Community -
On Tuesday the District 65 Board of Education held a special meeting to discuss Foster School within the context of the district’s. We know our financial landscape has changed since the approval of the new school design in January. As public stewards, we believe it is our responsibility to engage in an open, transparent dialogue.
The board reaffirmed its commitment to Foster School. School construction is well underway and we are fully supportive of this as a necessary investment, which we believe will benefit generations of Evanston/Skokie students to come. Foster School will provide a community school for up to 600 students in one of Evanston’s most densely populated areas. For over 60 years, children in this community, mostly students of color, have experienced a disproportionate share of the burden in integrating our schools.
Questions regarding finances
The board has received a number of questions about whether Foster School makes financial sense. I want to be clear that the construction is not the reason for the structural deficit or the district’s broader financial challenges. It's not an either-or-situation as some in the community have suggested. The district has had a structural deficit for years and that is the issue that must be addressed to provide the necessary stability for this district and community. Although efforts have been made to solve it, approximately $13.2 million in reductions are required before the start of the next school year. If Foster School was canceled or paused, over $10 million in reductions would still be required.
We share in Dr. Turner’s desire for ensuring strong fiscal systems, structures, and processes are in place. As District 65’s governing body, the board is committed to having transparent, frequent conversations about reducing the structural deficit as a regular public meeting agenda item.
Questions regarding capital needs
It is no secret that there are many aging buildings in D65 which need over $188 million in repairs and improvements. The district's average building age is 77 years, greatly outpacing the anticipated average life span of 50 years. Having a state-of-the-art facility in a centralized location will allow for greater flexibility as the District addresses declining enrollment and the substantial capital investments needed to update our buildings.
Change is difficult; I recognize that. I can’t promise these conversations will be easy, but I can commit, personally and on behalf of my board colleagues, to being forthcoming and thorough in our updates as this project moves forward.
Thank you for your partnership and support.
With gratitude,
Sergio Hernandez, Jr. - el/he/him
Presidente de la Mesa Directiva/School Board President
Distrito Escolar 65 de Evanston/Skokie-Evanston/Skokie School District 65
I have a lot of thoughts about this, but let’s talk about the money situation. It’s bad. Like, really bad.
Money, or Lack Thereof
You can view Cordogan-Clark’s budget document from January of this year. The approximate costs are about $42 million for construction and about $6 million for non-construction. This includes a $4.1 million budget for contingencies. As of August 2024, the District publicly reported they had about $40.9 million in the lease certificate funds.
A full commitment to continuing Foster School is not cheap:
Roughly $6 million dollars in additional construction costs out of operating funds. According to Dr. Grossi, these costs would reduce the District’s funds to 70 days of fund balance reserves, 20 days below minimum levels established in board policy 4:22.
Annual payments of $3.25 million for 18 years to pay for financing. Hernandez noted this in his email that if they paused the school, it would reduce the current year deficit from $13.2 to $10 million (see below)
A year ago, I would’ve suggested that the District probably had enough money to pull this off - but two years in a row of surprise budget deficits functionally drained the reserves. I even wrote about this in 2023, after the first surprise deficit.
If you want to really blow your mind at how bad District 65 is at budget projections, look at these numbers. This includes capital funds:
In 2022-23, Dr. Horton projected a surplus of +$274,886. They finished the year with a budget deficit of -$7,433,228. Dr. Horton left at the end of this year.
In 2023-24, Interim Superintendent Dr. Turner projected a surplus of +$276,020. They finished the year with a budget deficit (expenses - revenue) of -$19,718,182. (That number is -$10,319,000 when excluding capital funds)
In 2024-25, Dr. Turner projects a deficit of -$13,120,000
So, where is this money going to come from to build the school? Your guess is as good as mine - Dr. Turner, Dr. Grossi, and the to-be-hired Structural Deficit Reduction Consultant plan will present their findings in a January meeting. If the Board has decided that pausing Foster School is not an option, then they will have to find $3.25 million for this year’s payment, along with another $6 million to finish construction on top of the $10 million deficit that exists already. The District took opposition to my language regarding bouncing checks, but this doesn’t look good.
As Dr. Grossi pointed out in September, they are in violation of their own policy (4:22). It’s unclear if they will have to hold a vote to suspend this policy or not. I personally believe that if this board wants to commit to this project, as they have suggested, they ought to suspend this policy.
Until then, work continues at the site. According to Cordogan-Clark, the last round of bids were due on 10/15/2024. You can view the most recent specs here.
I’m a big supporter of the idea of a school in that location .. but frankly, I don’t see how they can complete this building. Where is the extra $6 million coming from? How are they going to fund the $3.25m for this year, much less the next 17 years? If you have ideas, please leave a comment and maybe run for School Board.
This statement by Sergio on behalf of the Board makes no sense:
“It is no secret that there are many aging buildings in D65 which need over $188 million in repairs and improvements. The district's average building age is 77 years, greatly outpacing the anticipated average life span of 50 years. Having a state-of-the-art facility in a centralized location will allow for greater flexibility as the District addresses declining enrollment and the substantial capital investments needed to update our buildings.”
If I have $100, and I need $80 to fix up my dilapidated schools, if I spend $50 on a brand new school, I don’t have enough money left to fix up my old schools. Right?
Sergio is patently wrong. It might not be the “cause” of the structural deficit today but it is certainly going to add to it. This statement gives me zero hope this board will be able to figure out how to reduce the budget by $15 million a year when they don’t even see how a new school contributes to expenses. Further what about the huge financial risk of finishing on time and on budget?
The fact that are board isn’t able to acknowledge that the school adds a $3 million annual cost to debt plus adds around 10 million of projected costs needed to be paid in 2025 that are not covered by lease certs and could be used for something else - this is basic finance. If you can’t understand it, step aside. You are spending taxpayer money that was never approved by taxpayers. This is NOT a sunk cost!