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Waukegan officials warn of ESSER cliff, uncertain federal and state categorical aid; planning ‘B and C’ scenarios
Summary
District staff told the board that one-time federal ESSER funds have been spent strategically and that uncertainty over future Title and other categorical grants could force program changes; officials said they are developing contingency plans and monitoring federal/state developments.
District finance and program staff told trustees at the Aug. 5 budget workshop that uncertainty in federal and state categorical grants — including the expected end of most ESSER funding — is a primary fiscal risk for FY26 and beyond.
Miss Polk, business-office staff, described the district’s prior use of ESSER dollars as “strategic,” saying the district used one-time funds for nonrecurring expenses to avoid building ongoing personnel costs the district could not sustain after federal support ended. “We maximize the use of that ESSER money,” Polk said, noting a recent federal audit of ESSER spending found no findings for the district.
District staff listed several federal- and state-funded streams with unclear FY26 status, including Title I, Title II, Title III, Perkins/CTE and multiple school-improvement or targeted funds. At one point a slide of grants showed several line items with zeroed-out or “application not yet open” amounts; staff cautioned the board that those figures are not final. Mandy (last name not given in the transcript), a program administrator present for the discussion, said the state typically releases ESSA- and Title-related designations and related planning-year dollars in September or October.
Why it matters: many schools and programs currently rely on categorical grants to pay for non-TRS personnel or targeted supports. Finance staff said they try to place positions in grants that can be reduced without a districtwide certified-staff TRS (Teachers’ Retirement System) liability. Nonetheless, losing or shrinking grants would require “tough decisions” about target areas, and staff said the superintendent is directing the executive team to prepare specific contingency scenarios.
Contingency planning and measures: staff said they are meeting weekly to examine staffing efficiencies, review multiyear versus one-year contracts for savings opportunities, pursue alternate grants and revenue sources and consider reprioritizing expenditures around the district’s strategic goals. “We are talking about plans B and C,” a member of the executive team said. Staff said they will continue communication with legislators and monitor executive orders that could change the administration of federal grants.
Ending: staff did not propose program cuts at the workshop. They asked the board for time to continue scenario planning and to provide updated grant-allocation information as federal and state grant announcements arrive; several board members asked staff to provide a list of categorical grants that may be at risk as soon as practicable.
