Members of District 200’s Community Finance Advisory Committee turned down the possibility of incurring debt to fund countless capital maintenance projects spanning the next decade at Oak Park and River Forest High School. Committee members met Feb. 3 via Zoom and discussed debt-based financing options that the school board and district administration have mulled over in recent months.
In that time period, school board members and administrators have tussled over the issue of incurring debt to pay for the district’s renovation projects, which among many things include roof repairs, field restorations and updates to bathrooms and plumbing and drainage systems. Some of that work may be combined with the district’s five-phase Imagine OPRF capital improvement projects. Phase 1 of Imagine OPRF, which sought to refurbish the high school’s south cafeteria, student resource center, welcome center and library, began in June 2020 and is set to wrap up by 2023. The first phase, which cost roughly $36.1 million, was funded through the district’s cash reserves. The district’s school board has yet to finalize or approve plans for Phase 2, where the project will center on the high school’s aging athletic facilities.
As district administrators looked ahead to the next 10 years, they presented the board with a list of financing options, one of which included incurring debt. That meant the district could choose to issue a debt certificate or a debt service extension base (DSEB) to fund the costs of future projects. Debt certificates often rely on the school district’s general operating funds to pay back the borrowed money, while DSEB bonds lean on tax levies, impacting residents. DSEB bonds can be issued without a taxpayer referendum to help fund capital projects, according to school documents.
During the Feb. 3 meeting, committee members cited the district’s healthy cash reserves, which amounts to about $96 million, and agreed on the need to prioritize, list out and learn more about the school building’s needs. The committee initially met Jan. 18 but was in violation of the Open Meetings Act, as the agenda was not posted on the district’s website. The district released a brief explanation, saying it made an error and did not catch it in time prior to the Jan. 18 meeting. The meeting, however, was still recorded and can be found on the district’s YouTube channel.
In an interview with Wednesday Journal, D200 school board member Tom Cofsky, who sits on the advisory committee, pointed to the district’s fund balance policy as part of the reason why the committee advised against considering taking on debt. One key part of the policy states the district should aim for an overall fund balance between 25% and 75% of operating cash flows, and currently, the district is “north or above” those targets, Cofsky said.
“Incurring additional debt at this time is not in line with that policy,” Cofsky said to the Journal, adding the committee also talked about revising the fund balance policy, especially when it comes to debt management. Cofsky said the policy, as it stands, centers only on the fund balances and provides little guidance on handling debt.
Cofsky told the Journal that in some ways the conversations surrounding the financing of the high school district’s major maintenance plans somewhat lean into a “cart gets ahead of the horse” situation. Board member Kebreab Henry, who also sits on the advisory committee, told committee members and administrators during the Feb. 3 meeting that he would have a better grasp on the district’s finances once he understands exactly what funds are tied to the projects, including any changes to Phase 1 as it nears completion next year.
“Right now, it’s not clear,” he said. “It’s a lot of assumptions for me.”
The school board was slated to vote on the debt options during a Feb. 24 meeting, but Cofsky said that may now change based upon the advisory committee’s stance.
“The [committee’s] recommendation needs to come back to the board, and then the board needs to take it into consideration in terms of if there is any action required,” he said.
From Cofsky’s perspective, there needs to be more conversation before a decision can be reached.
“What needs to happen going forward – and I’m not exactly sure on the timing – is that we need to have a clear, forward view of what our needs are,” he said. “We need to match that with what our resources are and say, ‘OK, we need to spend this much money over this much time to do this kind of work for our students.”
“And, then we have this money available that we can earmark to that, and then we have to say, ‘What’s the gap?’ And how do we need to engage our community? I go one step at a time, and I know people like to get ahead of themselves, but that’s the process that I see.”