Blazing New Trails - Connexions

The Social Justice Implications of the Deteriorating U.S. Economy on Public Schools 277
taxpayers who reside in property-rich districts”(Carr vs. Koch, 2010, p.2). While the
Homewood-Flossmoor District is located in the south suburbs near Chicago, and Cairo is the
southernmost community in Illinois, both have a large majority of minority and low-income
students. While the plaintiffs, as current and former educators are filing the complaint with
students in mind, they hope to overthrow the current Illinois school funding system by
highlighting the disparate impact upon taxpayers.
School District Financial Health in Illinois
For several years, the Illinois State Board of Education has generated a Financial
Profile for each of the 869 school districts in the state. This profile analyzes the following five
ratios and generates a score and fiscal health rating for each school district. The five
indicators were:
1. Fund Balance to Revenue Ratio. This indicator reflected the overall financial strength
of the district. It was the result of dividing the ending fund balances by the revenues
for the four operating and negative IMRF/SS funds. Operating Funds are the
Educational, Operations and Maintenance, Transportation and Working Cash funds.
2. Expenditure to Revenue Ratio. This indicator identified how much is expended for
each dollar received.
3. Days Cash on Hand Ratio. This indicator provided a projected estimate of the number
of days a district could meet operating expenditures provided no additional revenues
were received.
4. Percent of Short-Term Borrowing Ability Remaining. Districts often incurred shortterm
debt due to several factors (i.e., delays in receipt of local revenues, etc.).
5. Percent of Long-Term Debt Margin Remaining. A district often incurred long-term
debt for major expenditures such as buildings and equipment. (School District
Financial Profile, 2009)
After calculating these ratios, ISBE generated a Financial Profile Designation for each district
based upon the following score ranges:
Financial Recognition (3.54–4.00)
Financial Review (3.08–3.53)
Financial Early Warning (2.62–3.07)
Financial Watch (1.00–2.61). (School District Financial Profile, 2009)
Based upon these financial calculations for the 2008–2009 (FY09) school year, of the
869 school districts in Illinois, 550 achieved Financial Recognition, 203 were placed in the
Financial Review category, 77 were designated as Financial Early Warning Districts, and 39
were targeted for Financial Watch (School District Financial Profile, 2009). In the most
extreme cases, the ISBE may appoint a financial oversight panel to actually take over and run
the most troubled districts. Currently, five school districts operate under ISBE appointed
oversight panels. These districts are Cairo, Hazel Crest, Proviso Township, Round Lake and
Venice. These districts are spread geographically throughout the state, with three being in
northern Illinois, one in southwestern Illinois, and the fifth in deep southern Illinois.