HSD 152 approves $36.8 million 2027 budget and plans major capital spending

Harvey School District 152 approved its fiscal year 2027 budget Sept. 14, with approximately $36.8 million in planned expenditures and $33.42 million in projected revenue.

The spending plan calls for the district to use about $3.38 million of its accumulated fund balance, largely as it increases spending on capital projects. The gap between revenue and expenditures was planned rather than the result of an unexpected shortfall, said business official and superintendent Dana Nichols. 

“Our expenditures are exceeding the revenues [by] approximately $3.5 million, and that was intentional for us, to be able to build our capital fund, so we can continue to work on the capital improvement projects that we have scheduled for this year and next year,” said superintendent Dana Nichols.

The big picture

The district projects approximately $6.87 million in capital outlay during fiscal year 2027. Capital spending is expected to increase by about $3.29 million compared with the previous fiscal year and accounts for most of the district’s overall increase in expenditures. Total spending is projected to increase approximately $3.52 million from fiscal year 2026.

Salaries make up the largest share of the budget at approximately $17.1 million, or 46.5 percent of expenditures. Purchased services account for $7.5 million, or 20.4 percent, followed by capital outlay at $6.87 million, or 18.7 percent.

Benefits are budgeted at approximately $3.83 million, or 10.4 percent of expenditures. Supplies and materials account for about $1.12 million, while tuition and other costs total approximately $380,000. 

According to Nichols, compared with fiscal year 2026, salary spending is expected to increase by approximately $671,000 and benefits by $266,000. Purchased services are expected to decrease by about $491,000, while materials spending is projected to fall by approximately $324,000.

FY2027 revenue outlook

Evidence-based funding from Springfield remains the district’s largest source, providing approximately $20.01 million, or 59.9 percent of projected revenue, she said.

Federal grants are projected at approximately $4.17 million, followed by real estate tax revenue at $3.85 million, state grants at $3.06 million and other local revenue at approximately $2.34 million. 

The district expects overall revenue to increase by only about $68,000 compared with fiscal year. Evidence-based funding increased by approximately $181,000, while state grant revenue declined by about $42,000 and federal grant revenue declined by approximately $190,000.

FY2027 spending outlook

Although expenditures exceed projected revenue, HSD152 expects to maintain a substantial fund balance, Nichols said. The district began fiscal year 2027 with approximately $41.22 million and projects ending the fiscal year with about $37.83 million after accounting for revenue and expenditures. The district’s fund balance has grown over the past several years, from approximately $27.4 million in fiscal year 2022 to a projected $37.8 million at the end of fiscal 2027.

Nichols said the projected ending balance represents approximately 12.3 months of reserves. “If we were not to bring in any additional revenue, if there were any issues where we didn’t receive our EBF, we would be able to keep our doors open; we would be able to make payroll for 12.3 months,” Nichols said. 

Overall revenues are down from 2023, where the district brought in $43.9 million. But that was expected, in part, because pandemic-era aid, which HSD 152 used to make capital infrastructure improvements, has expired.

Illinois law requires school districts that do not have balanced budgets to submit a deficit reduction plan, outlining strategies to remedy the matter within three-years. But the size of the fund balance exempts the district from having to submit a deficit reduction plan, according to Nichols, “because [the] fund balance is strong enough.”

Adjustments

Several figures changed between the tentative and final budgets. Officials updated the beginning fund balance after receiving final numbers and increased projected evidence-based funding after receiving the district’s final allocation. 

The district also added funding for parking lot work and adjusted the budget to account for Teachers’ Retirement System penalties officials said were connected to flex benefits in the teachers’ contract. “We added in additional funds for our parking lot so we can get those parking lots resealed,” Nichols said. “And then we received some major TRS penalties that we were not expecting.” 

The final budget is scheduled to be submitted to the Illinois State Board of Education by Sept. 30.