Tag Archives: Public Building Commission

Peoria Public Schools, Public Building Commission

PBC to D150: Get your act together and spend this money!

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The Public Building Commission is worried. They still have $30 million more in bonding capacity, and they might not get to spend it if District 150 doesn’t get its act together soon.

You may recall that the Public Building Commission (PBC) was established in 1955, but school districts used it so much in the 1980s that there was significant voter backlash, which led to the state legislature making school districts ineligible to get funding through the PBC after 1993. Well, District 150 didn’t let that stop them. In 2006, thanks to then Senator Shadid and Representative Schock, District 150 got access to the PBC once again, but only until July 1, 2011. According to a Journal Star article from earlier in the year, “any project needing funding must be significantly completed by July 2011.” And that means there’s not much time left.

Spending PBC money is a win-win for District 150 and the PBC, but not for voters and taxpayers. If municipal organizations stop borrowing from the PBC, it will cease to exist, so the PBC has to keep marketing itself to other governmental bodies. Executive secretary for the PBC James Thornton has been doing just that. For months now, he’s been trying to cajole District 150 to find a way to max out the PBC’s bonding capacity. Of course, the benefit to District 150 is they get to raise taxes for capital projects without having to get voter approval.

District 150 has a new Harrison School and a new Glen Oak School under construction, and they have done remodeling and enlargement at Richwoods, Northmoor, Lindbergh, and Kellar. After all that, they thought they had used up all their PBC bonding capacity, but surprise! Due to recent annexation, the total Equalized Assessed Value of property in Peoria went up. Since the PBC’s bonding authority is set as a percentage of EAV, its bonding capacity also increased. So now the PBC and District 150 are just looking for a project — any project — that will allow them to spend this extra money.

To hear some board members talk about it, they view it as some sort of moral imperative that they use every last dollar of bonding capacity (also known as debt) — that they take full advantage of this “opportunity” to access the PBC before the five-year window closes. Thus, they are doing back bends to try and please the PBC. That’s one of the biggest reasons why they closed Woodruff High School.

That’s no way to make educational decisions. And it’s not in the best interests of taxpayers, either.

Peoria Public Schools, Public Building Commission

District 150 finances in question

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Several days ago, I mentioned that audit reports the last several years for District 150 have been warning about inadequate internal controls. Things are no different this year, the Journal Star reports.

The internal financial review controls at District 150 are at the very least inadequate, resulting in errors, unsubstantiated account balances and generally leaves the district without an accurate day-to-day report of its cash flow, according to a letter from the district’s auditors.

I had also wondered how Cahill could keep his job with such terrible audit reports year after year. Apparently Cahill wondered that himself, according to an e-mail he wrote that the Journal Star acquired through a Freedom of Information Act request:

Cahill said he believed the [audit] letter, received from District 150 this week through a Freedom of Information Act request, would be used in calling for his termination, according to an e-mail from his District 150 account to a Chicago attorney, received through a separate FOIA request.

“The attached will be used by several board members who, I suspect, will call for my firing,” the Feb. 5 e-mail states. “What the management letter does not disclose is that most if not all the items reported have been the norm in the district for more than 14 years, according to auditors (Ron Hilton, Dennis Baily, and Helen Barrick), and cover the terms of at least three controller-treasurers.”

Interesting defense. He’s basically saying that internal controls have always been inadequate, so he shouldn’t be held responsible for their continuing to be inadequate. Not very convincing.

But here’s what really slays me. The headline for this story is “District 150’s books a mess.” But another report filed just hours before this one has the headline: “District 150: Finances in order.” This latter story is about District 150’s meeting with the Public Building Commission to assure them that the district’s finances are not a problem.

Nine District 150 representatives filled a small meeting room before the Public Building Commission of Peoria on Thursday, reassuring its members that the school district is on the right financial path.

“I want to reassure this particular body that the Board of Education immediately began taking action in January to adjust expenditures to meet those predicted revenue shortfalls,” Superintendent Ken Hinton told PBC members. “This board, this administration is completely dedicated in seeing that our school district is solvent.”

Not that this was at all necessary. PBC members appear unconcerned with District 150’s budget woes.

When asked whether the PBC has any concerns about the district’s financial solvency and the district’s ability to repay the bonds, Goldstein and Thornton said “no.” Both men also noted the commission had no concerns about Cahill’s departure.

Really? No concerns at all? The district “has projected it will have a $4.3 million deficit and possible $9 million-plus revenue shortfall next year,” and they fired their controller/treasurer, and their audit reports have been deplorable, but the PBC has no concerns? I guess if you’re an unelected body, unaccountable to the voters, you can afford to take such a cavalier attitude with property tax money.

City Council, City of Peoria, Peoria Public Schools

Circumvention of voters nearly complete

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One of the final steps toward issuing bonds through the Public Building Commission (PBC) for new public school construction will take place Monday night as the Council approves the siting of the new schools. District 150’s ability to access PBC funds was made possible by the efforts of local state representatives George Shadid (now retired) and Aaron Schock. And the reason it was made possible was blatantly to circumvent the voters.

The school board could have put a binding referendum on the ballot asking voters to approve funding for their building plans. Ask anyone at the district or your state representatives why they didn’t do that, and they’ll tell you that they believe a school bond referendum would never pass. Hence, the “need” to go around the voters and get the money through the PBC.

I have a fundamental problem with that process. You have to ask yourself why they think a referendum wouldn’t pass. Consider, for instance, that voters in communities near Peoria have recently approved similar referenda, and voters in Peoria recently approved by a large margin capital funding for library improvements. So you can’t honestly argue that a referendum would never pass.

If a referendum were to fail, it would not be because voters don’t want to make needed upgrades to schools, but because they don’t like the district’s method of “upgrading” them. In other words, voters would use the power of the purse to approve or disapprove of the district’s building plans. For instance, consolidating Irving and Kingman schools into a new primary school building next to Lincoln Middle School and Woodruff High School probably wouldn’t have garnered enough votes because the residents didn’t want to see those neighborhood schools close. Attempts to build a new Glen Oak School at Glen Oak Park would certainly not have gained enough votes because residents very loudly and clearly stated they didn’t want the school sited there.

By circumventing the voters, it not only took away the residents’ decision regarding funding, but also its influence in the design and siting of the new buildings. So when the council communication on the agenda for Monday night says, “The concerns of neighbors have been addressed in the siting process,” that’s really not true. There were public meetings, after which the school board did exactly what they said they were going to do in the first place (with the notable exception of changing the site for Glen Oak School due to a lawsuit that effectively blocked an intergovernmental agreement between the park district and school district). There were public hearings about the design of the schools after all the decisions had been made and there was no intention of changing them.

Public input was a sham because the school board didn’t have to listen to the public or win their approval. They had their construction money regardless, thanks to their being granted access to PBC funding. So they did what they wanted regardless of public opinion. And that’s why you don’t see many people attending D150 public hearings or board meetings these days. Doing so is like a broken pencil: pointless.