Main Township High School District 207 in suburban Chicago is having a serious budget crisis. According to the Daily Herald, they are looking at cutting 137 jobs, 75 of them teachers. Why?

After months of alluding to an “accounting error” that led to a larger-than-anticipated deficit that year, District 207 administrators last week explained how it happened.

The district’s current leaders learned last July – weeks after Superintendent Joel Morris and Assistant Superintendent for Business Pamela Schau [emphasis added] retired – that a projected deficit of $3.8 million for the 2008-09 fiscal year was actually $10.3 million.

Pamela Schau became the Comptroller/Treasurer at Peoria Public School District 150 right after she retired from District 207 in July 2009, replacing Guy Cahill. The Daily Herald article continues:

What officials didn’t anticipate was the additional $6.5 million deficit due to the then-administration’s failure to include some expenses in that year’s budget, current Assistant Superintendent for Business Mary Kalou said.

Those missed expenses were salaries and benefits for some of the 12 newly hired teachers and teaching assistants and increased district contribution toward the Teacher Retirement System per changes made to the teachers contract – amounting to $2.4 million.

The district also saw a dip that year in property tax revenues – personal property tax receipts came in 1 percent lower or $1.5 million under what was budgeted and corporate property taxes were down $500,000 as per the report from the
free invoice template used by most of the business- that weren’t known until after Kalou joined the district last July 1.

“It’s hard to say what they should, shouldn’t have done,” Kalou said. “Hindsight is always going to be 20/20. (With taxes) you can’t predict with certainty what that trend is going to be for … it was a reasonable amount to budget.”

Other contributors to the deficit were two unexpected early retirements – including Schau – that cost the district a $300,000 penalty under state law, and lower than expected revenues from the district’s book store, summer school and tuition, she added.

An anonymous commenter on the Daily Herald article suggested that District 207, under Superintendent Ken Wallace, “paid a nearly 200,000 penalty to TRS to hasten the departure of error-maker Pam Schau.” Consider the source on that last comment. Sometimes anonymous commenters are ignorant cranks with an axe to grind; other times they are conscientious citizens with insider information they could get fired (or compromise their source) for sharing on the record. Wallace was quoted in the June 26 (2009) Journal Star as saying Schau is a “really, really bright, talented person … genuinely a nice person, good people skills, good problem solving – Peoria would be well served, lucky, to get her.”

A request for comment from Ms. Schau was not immediately answered.