Blazing New Trails - Connexions

280 CRITICAL ISSUES IN SCHOOL IMPROVEMENT
The 2008–2009 fiscal analysis completed by the Colorado Auditor and Legislative
Audit Committee, based upon the six categories above showed that of Colorado’s 178 school
districts, 43 had one or more warning indicators, based upon state determined negative ratings
in the six categories listed above (Fiscal Analysis of Colorado School Districts, 2009). An
analysis of these 43 districts identified 28 districts with one warning indicator, 13 districts
with two warning indicators, one district had three warning indicators, and one district had
four warning indicators (Fiscal Analysis of Colorado School Districts, 2009). Perhaps not
surprisingly, the district with three warning indicators was Branson Reorganized District 82 in
Las Animas County, which had the lowest per pupil expenditure that year. The 43 districts
with warning indicators exhibited a total of 61 indicators among the 6 categories, with most of
the warning indicators occurring in the operating margin (OMR) and in changes in the fund
balance (CFBR) (Fiscal Analysis of Colorado School Districts, 2009). The changes in the
fund balance category shows that the districts with a negative rating in this area were
spending down their district reserves. While this could have been intentional in some cases, it
was more likely that this was done out of necessity, due to financial stress.
As might be anticipated from the smaller discrepancies between the higher and lower
spending school districts in Colorado, the 12 th annual Quality Counts study conducted in 2008
showed Colorado with better scores in the areas of its “Wealth Neutrality Score.” Whereas
Illinois scored 43 rd out of 50 states, Colorado scored 37 th . When comparing the actual
spending needed to bring all students to the median level, Colorado ranked 22 nd compared to
Illinois’ 40 th place ranking.
DISPARATE FISCAL IMPACT ON LOWER INCOME DISTRICTS
It has been confirmed that both Illinois and Colorado have disparate school funding
regulations, with Illinois’ system being the less equitable of the two systems. Thus, the normal
impact upon students in the districts with a heavier reliance upon state aid is a smaller
expenditure upon each pupil than in those districts with a larger tax base (Fritts, 2008). While
this situation is unfair in normal economic times, it is exacerbated in times of economic stress.
When increases in general state aid are held to minimal levels, or when state aid is reduced, as
is now being suggested, the consequences can be dire for poorer districts. While there is and
will be a negative impact upon the property-rich school districts, they are more able to survive
the economic difficulties which ensue from state financial reductions. Therefore, when
districts with little or even moderate reliance upon general state aid are forced to make major
reductions, then it can be assumed that the less fortunate school districts are facing major
financial stress. The fiscal situation in Illinois has been in a downward spiral for several years.
One indicator of this is the growing number of districts in financial trouble as indicated by the
previously mentioned financial watch list. In FY09, 29 school districts were on the state’s
financial watch list, which is the most severe category. This was an increase of 7 districts over
the FY08 total of 22 school districts (Boyan, 2010). In a related indicator, 44% of Illinois
school districts were expected to overspend in FY09, compared with 40% in FY08, and
32.5% in FY07 (Boyan, 2010). This shows a clear trend in a negative direction for those
school districts, especially since Illinois school districts have been required to operate with
balanced budgets, beginning in 2006. A major reason for the deficit spending by some school
districts is “…the state owes schools $894.2 million in unpaid bills. That could reach $1
billion by the end of the school year” (Boyan, 2010, p.1).
Due to the continuing decline in Illinois’ financial situation, many Illinois public
school districts have been forced to make major reductions in their budgets. A number of