Treasurer warns CPS cash reserves are tight; board discusses levy options and school‑income tax
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Summary
Treasurer Augustine told the board cash reserves are declining and the district must align spending with revenue. Trustees pressed administration about special‑education funding, possible unclaimed reimbursements, and strategies for new operational revenue; administration outlined five‑year levy scenarios and a school income‑tax option as longer‑term solutions.
Treasurer Augustine opened a detailed budget briefing that framed the district’s short‑term constraints and long‑term revenue choices.
The treasurer presented a draft revenue target described in the presentation as “6 34.2” and a multi‑year forecast. He displayed a cautionary cash‑balance slide and warned, "we don't have cash reserve to dip into," noting the district’s local fund balances have declined in recent years and that permanent‑improvement and other restricted funds are limited in how they may be used.
Slides showed the major drivers of spending: salaries and benefits as the largest category, rising costs to serve students with disabilities, transportation and utilities in purchase services, and growth in central support for school operations. Administration also said federal education funding was preserved in recent legislation, but the headroom is modest and cannot replace a structural local revenue solution.
Trustees pressed for a review of whether student‑service classifications and diagnostic coding left reimbursement unclaimed. Vice President Moffitt and others asked whether the district is "leaving money on the table" by not claiming additional eligibility codes that would generate higher state or Medicaid reimbursement. Administration said student‑services reviews occur annually, noted reimbursement lags (Medicaid school program claims may have a two‑year lag) and agreed to present a targeted follow‑up and additional detail for the budget conversation.
On revenue strategy, Augustine walked trustees through two broad approaches: a five‑year new‑money levy (leveling projected five‑year needs into an annual ask) and a school‑district income tax (traditional or earned‑income form). The treasurer emphasized that recent property‑tax reform and changes to the "20‑mil floor" have flattened future property‑tax growth, making regular new‑money votes more likely. He described basic mechanics, disclosure changes for ballot language (carryover percentage and market‑value statements), and timing constraints for putting questions on November ballots.
Board members emphasized communications and asked the administration to link any levy ask to concrete, visible projects or outcomes that will resonate with voters. Several trustees said they prefer early decisions to allow time for public education about the ask; one trustee suggested combining operational and capital strategies (e.g., using unvoted debt for near‑term capital while aligning longer‑term operational asks to strategic priorities).
Next steps: administration will return to the board with scenario modeling, more detailed fiscal implications, and requested follow‑ups on special‑education coding and potential areas to maximize federal and state funding.
