On Monday night, the board of education accepted a 149-page financial report on the spending that occurred during the 2009-2010 academic year at Niles Township High School District 219.

In the nearly 150 pages of numbers, charts and graphs (which accompany this article), there is plenty to dissect about the way money dictates and reflects the school district.

More than 4,800 students from Lincolnwood, Skokie as well as parts of Morton Grove and Niles attend either Niles North or Niles West high schools. They make District 219 one of the largest school systems in the North Shore.

Write it in chalk or put it in ink: Money makes the school go round for the students and faculty. Here’s a breakdown of some of the information from the report.

Funding brackets

School funds are broken up into two camps: governmental funds and fiduciary funds.

The first refers to the money used for “essentially the same function as reported in governmental activities in the government-wide financial statements,” and is organized into eight brackets:

• Educational fund
• Operations and maintenance fund
• Tort immunity and judgment fund
• Transportation fund
• Municipal retirement and Social Security fund
• Working cash fund
• Debt service fund
• Fire prevention and safety fund

The second camp, fiduciary funds, are maintained for the “benefit of parties outside the district” and therefore are kept separate because the money cannot be used in district programs.

Spending habits

Last year, more than half of District 219’s spending went to the educational fund, which tallied up more than $90 million in total expenditures, a 9.4 percent increase from the previous year.

“Teachers are the biggest driver of our decision-making,” Paul O’Malley, the assistant superintendent for business services at District 219, said in an interview with Morton Grove Patch on Tuesday.

“Of all the money we spent, 58 percent of it went to the educational fund, which pays for teachers and support staff salaries,” he added.

Within the educational fund, $53.7 million was spent on "instruction" or salaries in the 2010 fiscal year, compared with $51.2 million in 2009. "Support services" accounted for $24.1 million in 2010 versus $22.8 million in 2009. 

"I think the entire system is very unclear as to how the system divvies out the money spent in classroom versus everything else," said Bruno Behrend, the director for the Center for School Reform at The Heartland Institute.

"Clearly they’re adding support services under [the] educational fund, and that's one area where they hide an awful lot of administrative expenses," he added.

The next highest expenditure came in the operations and maintenance fund. The more than $13 million spent represented a 2.6 percent increase from the previous year.

The working cash fund--at 18 percent of the total government fund balance--is the most liquid financial resource and is used for loans to other school funds to maintain cash-flow requirements, according to O’Malley.

Cash on hand

For the fiscal year that ended June 30, 2010, District 219 had more than $127 million in its total undesignated fund balance, which is discretionary money “available for spending,” according to its Comprehensive Annual Financial Report. The balance is about $20 million more than in the 2008-2009 financial year.

“The money we have in reserves allows us to be stable when a late distribution of taxes is collected,” said O’Malley. “It is what we are able to do to maintain the cash flow, which is how we pay pretty much everyone.”

Jim Szczepaniak, the communications director for the district, explained that state law dictates the way cash moves among different funds.

“A member of the public may ask why are we building a new swimming pool at the same time as considering teacher cuts. The answer is, we are limited by law; we cannot use money from the capital fund to pay for the education fund,” he said.

Szczepaniak also mentioned District 219’s “Recognition” designation by the Illinois State Board of Education, which assessed the school system’s financial health at the highest category possible, as it has since the fiscal 2005.

For the financial profile score, the district earned a score of 3.9 out of 4.0 for fiscal 2010. Of 868 profiled, 604 school districts received the “Recognition” label.

“It’s very easy for a well-funded and property-rich school district to point to those designations as proof they are doing a good job,” said Behrend of the Center for School Reform.

“I would question that designation, not necessarily to say it’s not true, but because it really doesn’t tell us very much,” he added

Behrend pushed the point further:

“The district spends [at least] $110 million last year and has $127 million a year in savings. This represents massive overtaxation and quite frankly, warrants a large tax abatement for every district property taxpayer.”

According to the financial report approved on Monday, property taxes account for nearly 80 percent of district's revenue, or almost $120 million out of nearly $151 million in total revenue. 

In the spring of 2004, voters in District 219 passed a referendum to bump up the educational property tax rate from 1.2991 to 1.5291, or by 23 cents, according to the report. There have not been any additional referendums since then.

Nearby, New Trier Township High School District 203 has also released its comprehensive financial report, noting that it is "extremely dependent upon tax revenues, which account for 82.0 percent of total revenues." For the fiscal year that also ended June 30, 2010, revenue for the total government funds rang up at $111 million, with $89.7 million derived in property taxes.

"Clearly one of the most challenging things is being able to answer things in a simple fashion because it is a very complex system that we have," District 219's Szczepaniak said of the combination of factors, such as property tax funds, statutory law and historical information, which influences spending. 

Check back on Friday to find out what District 219 spends on pizza, taxis and students. To read Part 1 of our series, click here.