BASSC will return $2.7 million to member districts

The special services cooperative of St. Clair County on Wednesday approved returning $2.7 million to member school districts and also approved charging nonmember districts more for its services.

Jeff Daugherty, executive director of the Belleville Area Special Services Cooperative, told the executive board that splitting the money among the districts would leave the cooperative with about $1.5 million, comparable to cash on hand.

The recommendation to divide the fund balance among the member districts passed unanimously. The amounts range from just more than $8,000 to St. Libory Consolidated District 30 to nearly $430,000 to Belleville District 201.

The amount the district will see in its individual reserve account was decided by the district’s average daily attendance and equalized accessed valuation. Matt Klosterman, District 118 superintendent and a member of BASSC’s finance committee, said “sheer volume” means that larger districts get more.

O’Fallon District 203, which will be leaving the cooperative at the end of the school year, will have just more than $220,000 in that reserve account. Superintendent Darcy Benway said the district intends to use that money to pay down its bonds obligation of $253,196; leaving about $32,000 remaining.

Brian Arteberry, chief school business official with BASSC, has a draft for each district with suggestions of how to cautiously use the money. While the money in the individual accounts would pay off the debt service obligation for 19 of the 24 districts, and the cooperative is recommending they consider that action, it’s not necessarily the best action for everyone.

Mascoutah District 19, for instance, could pay the estimated debt and still have more than $177,000 in reserve. Superintendent Craig Fiegel said the district is leaning to paying down the debt over time.

“Essentially the bond is like a mortgage, it can be paid at any time,” he said. But unlike many home mortgages, there may be a penalty for paying the bonds early.

“With bonds they are guaranteed over periods of time,” Fiegel said. “They’re not callable over a certain period of time because you’ve promised to pay interest.”

Belleville’s high school district doesn’t have the money to pay off its entire debt certificate, nor is it interested in trying to, said Assistant Superintendent Brian Mentzer.

“In our case, I think the most fiscally responsible thing is to hold it in escrow,” Mentzer said.

He said the district would likely use the reserve account as “pressure relief.”

“Potentially, we are going to utilize that fund balance to help offset some of our costs on bills that we get from BASSC,” he said.

Daugherty told the executive board that putting $2.7 million into individual reserve accounts would keep $1.5 million in the BASSC fund balance.

He said the finance committee, which met four times in the last three months, suggested that $2.7 million be placed in individual reserve accounts for each districts to use as they decide.

“You could use it for the debt schedule, for other costs that maybe are higher than anticipated. I would caution that maintenance of effort needs to be maintained,” Daughterty said.

The other Belleville district will likely use the reserve to pay the debt service, District 118’s Klosterman said.

“We’ll just use the remaining for tuition payments when we get billed,” Klosterman said. “When it’s gone, it’s gone.”

Klosterman said the district expects to avoid maintenance of effort issues by not adding services.

“Maintenance of effort would be a challenge if we added social workers and a teacher, increasing the amount we’re spending on special education students,” Klosterman said. “So the following year we would have to spend an equal amount.”

“But if we use it to pay the remaining bond ... then that’s not increasing maintenance of effort,” he said.

Higher fees for nonmember districts

The board also took the finance committee’s recommendation to increase costs to nonmember districts.

Daugherty said there are two or three non-member districts that are using the cooperative’s services this year. Those districts are using both instructional programs, such as the Pathways school on the BASSC campus, and related services, which include audiology services at the district schools.

Non-member districts, which next school year will include O’Fallon 203 among the five public districts in St. Clair County not in BASSC, will see the cost per student double at Pathways and Instructional Programs. Non-member schools also would pay 33 percent more than member districts for the related services.

He said before the meeting that the efforts of O’Fallon Township High School to leave the cooperative “probably contributed” to the committee’s recommendation.

“I think we would have gotten to the same point,” he said, because member districts have contributed to growing assets and infrastructure and non-member districts do not. Daugherty said there has not previously been a billing differential between member and nonmember districts.

Benway, the O’Fallon 203 superintendent, said by email on Wednesday that “OTHS does not intend to use BASSC for any services after this school year, so the non-member cost is not of concern to us at this time.”

On Wednesday morning, a district representative asked about the disparity between doubling the cost for programs like Pathways, but increasing other services by 33 percent.

“We felt doubling related services would be fairly exorbitant,” Daughterty said, adding that the instructional programs had infrastructure that member districts had paid to build and non-member districts were getting those services without prior contributions.

“It was important to help out districts ... but don’t run off business either,” he said.

In other business

The BASSC executive board accepted three resignations, and also hired a program assistant, a paraprofessional for Pathways school, and five paraprofessionals for the autism programs.

This story was originally published February 17, 2016 at 12:54 PM with the headline "BASSC will return $2.7 million to member districts."