Lake Villa SD 41 Community Engagement Committee FINANCIAL PRESENTATION

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1 Lake Villa SD 41 Community Engagement Committee FINANCIAL PRESENTATION

2 Current Financial Picture LAKE VILLA SCHOOL DISTRICT 41 IS A TREMENDOUS VALUE FOR TAXPAYERS.

3 Spending Compared to Surrounding School Districts $16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 Operational Spending per Student District Comparison District 41 is one of the most fiscallyconservative districts in the region. $- Big Hollow 38 Lake Villa 41 Antioch 34 Gavin 37 Woodland 50 Gurnee 56 Fox Lake 114 Millburn 24 Grayslake 46 Emmons 33 Series1 $9,165 $10,089 $10,623 $12,110 $12,808 $12,812 $12,992 $13,096 $13,428 $14,391 Source: Lake County Financial Data Report

4 Spending Compared to State Average $16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 Operational Spending per Student District 41 is one of the most fiscallyconservative districts in the state. $2,000 $ Lake Villa SD 41 $7,215 $7,803 $7,834 $8,598 $8,783 $9,718 $9,626 $9,976 $9,611 $9,707 $10,089 IL State Average $9,907 $10,417 $11,197 $11,537 $11,664 $11,842 $12,045 $12,521 $12,821 $12,973 $13,799 Source: Illinois Report Card

5 Tax Rate Compared to Surrounding Districts Zion ESD 6 Millburn CCSD 24 Beach Park CCSD 3 Antioch CCSD 34 Grayslake CHSD 127 Gurnee SD 56 Lake Villa CCSD 41 Woodland CCSD 50 Grass Lake SD 36 Fox Lake GSD 114 CHSD 117 Total Tax Rate Our tax rate is projected to continue to decrease, especially as we pay down debt. Gavin SD Fremont SD Grant CHSD Source: 5Sight/Annual Financial Reports

6 District 41 Financial and Board of Education Recognitions IL State Board of Education Financial Profile High Financial Profile Score Every Year Since 2003 IL State Board of Education Recognition Earned Highest Financial Recognition Status 11 of Last 14 Years IL Association of School Boards Recognition We are wise stewards of the financial resources granted to us by our taxpayers. Received School Board Governance Recognition Each Time Eligible Past 5 Years Source: Illinois State Board of Education: Illinois Association of School Boards:

7 District 41 Credit Rating Aaa Aa1 Aa2 Aa3 A1 A2 A3 District receives "A2" rating from Moody's in 2001 District 41 Moody's Bond Rating History Moody's upgrades the District to "A1" in 2007 District receives "Aa2" rating from Moody's in 2010 and gets affirmed at same level in 2013 Our credit rating has been upgraded by Moody s three times since 2001.

8 Current Capital Spending OUR CONSERVATIVE APPROACH TO SPENDING MAKES IT CHALLENGING TO MAINTAIN AND IMPROVE OUR INFRASTRUCTURE.

9 Capital Spending Compared to Surrounding Districts Grant CHSD 124 Fremont SD 79 Gurnee SD 56 Grayslake CHSD 127 CHSD 117 Grass Lake SD 36 Zion ESD 6 Antioch CCSD 34 Fox Lake GSD 114 Millburn CCSD 24 Woodland CCSD 50 Beach Park CCSD 3 Lake Villa CCSD 41 Gavin SD 37 Dollars Spent on Capital Outlay Actual per Pupil $ $ $ $ $ $92.18 $83.45 $72.32 $35.03 $ $1, $1, $1, $2, Our district invests the 13th least in infrastructure out of the 14 districts in our region. $0.00 $ $1, $1, $2, $2, $3, Source: 5Sight/ Annual Financial Reports

10 Operation and Maintenance Expenditures SALARIES AND BENEFITS $345,226 SUPPLIES AND MATERIALS $542,701 REPAIRS AND PURCHASED SERVICES $770,794 CAPITAL OUTLAY $209,978 OTHER $4,826 Source: D41 FY Budget At this rate, it will take 50 years to fund and complete our immediate facility needs.

11 Fund Balance Historical and Projections: Operating Funds We have built up our reserves by 19% since Source: 5Cast D41 FY2019-FY2023 Projections

12 Millions Fund Balance Historical and Projections: Operation and Maintenance Fund FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 $3.0 $2.5 $2,155,666 $2.0 $1.5 $1.0 $1,006,189 $0.5 $0.0 $2,031,040 $869,233 $2,215,135 $1,106,269 Source: 5Cast D41 FY2019-FY2023 Projections Projected Year-End Balances O&M Fund $2,377,647 $1,424,566 $2,793,213 $1,843,479 $2,666,630 $1,683, Operations & Maintenance $2,143,892 $2,133,928 $2,102,481 $2,047,597 $1,122,505 $1,129,871 $1,081, FY End Balances % of Expenses Fund Balance w/o Early Taxes $1,008,038 $1,973,499 $915,082 We used reserves to cover $3 million in necessary facility projects this summer. This is a short-term solution. We need a long-term approach towards investing in the future of our schools.

13 Current Debt Service Situation WE HAVE A UNIQUE OPPORTUNITY TO INVEST IN OUR SCHOOLS WHILE LOWERING PROPERTY TAXES.

14 Debt Service Spending Compared to the Region Woodland CCSD 50 Grayslake CHSD 127 CHSD 117 Grant CHSD 124 Gurnee SD 56 Lake Villa CCSD 41 Fremont SD 79 Millburn CCSD 24 Beach Park CCSD 3 Gavin SD 37 Fox Lake GSD 114 Antioch CCSD 34 Zion ESD 6 Grass Lake SD 36 Dollars spent on Debt Service $100,088,280 $92,717,263 $79,977,949 $58,754,610 $51,480,353 $35,124,852 $30,743,539 $28,905,441 $28,133,617 $19,231,585 $17,168,212 $17,145,462 $11,593,019 $1,248,670 $0 $20,000,000 $40,000,000 $60,000,000 $80,000,000 $100,000,000 $120,000,000 These bonds funded the construction of Martin & Thompson schools. Source: 5Sight/ Annual Financial Reports

15 Expiration of Current Taxpayer- Approved Referendum Bonds Our bond debt is scheduled to be paid in full in 2019.

16 Space Under Debt Limit as Bonds Are Paid Off Tax Year Calendar Year Principal Payments EAV Assumptions (assumes 3% growth) 6.90% Statutory Debt Limit Total Outstanding Debt Net Debt Limit ,838, ,731,268 35,171,457 7,273,650 27,897, ,412, ,023,206 36,226,601 5,434,670 30,791, ,636, ,773,902 37,313,399 3,021,800 34,291, , ,997,119 38,432, ,000 38,047, ,707,033 39,585,785-39,585, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773, ,918,244 40,773,359-40,773,359 Retiring debt affords us an opportunity to look towards the future of our school district. $ 7,273,650

17 District s Facility Needs Facilities assessment identified urgent life safety needs, necessary improvements, and investments into 21st century learning. Source: STR Partners Capital Plan Update June

18 Financing Opportunities FUNDING SOME OR ALL OF THESE PROJECTS IS POSSIBLE AT A RATE LOWER THAN OUR CURRENT BOND RATE

19 Cost to Taxpayers for $10M in New Bonds Current Proposed $10M Current New Debt Debt Service 2019 Projected Debt Payments Impact on Tax DSEB + Referendum Less: Total $231,900 $231,900 Year Referendum Debt Service Cap I Debt Service Home' Home ,067,278 5,067, ,342, ,046 (440,046) 5,342, ,595, ,050 (480,050) 5,595, ,553,150 1,553, ,553,450 1,553, ,551,950 1,551, ,552,250 1,552, ,548,750 1,548, ,552,000 1,552, ,551,750 1,551, ,552,875 1,552, Invested in Schools: $10 million Savings for Taxpayers: $529/yr avg Total $ 16,005,019 $ 13,336,271 $ (920,096) $ 28,421,194 $ 2,239 $ 1,737 Bond Proceeds: 10,000,000 $ Average Current Debt Payment $746 All-in True Interest Cost: 3.656% Average Proposed Debt Payment $217

20 Cost to Taxpayers for $10M in New Bonds Existing Debt Service Invested in Schools: $10 million Proposed $10M New Bonds Savings for Taxpayers: $529/yr avg

21 Cost to Taxpayers for $30M in New Bonds Current Proposed $30M Current New Debt Debt Service 2019 Projected Debt Payments Impact on Tax DSEB + Referendum Less: Total $231,900 $231,900 Year Referendum Debt Service Cap I Debt Service Home' Home ,067,278 5,067, ,342,704 1,340,029 (1,340,029) 5,342, ,595,037 1,461,850 (1,461,850) 5,595, ,897,150 3,897, ,895,750 3,895, ,900,150 3,900, ,895,875 3,895, ,896,500 3,896, ,899,625 3,899, ,899,875 3,899, ,897,000 3,897, ,895,625 3,895, ,900,125 3,900, Invested in Schools: $30 million Savings for Taxpayers: $201/yr avg Total $ 16,005,019 $ 41,779,554 $ (2,801,879) $ 54,982,694 $ 2,239 $ 5,452 Bond Proceeds: 30,000,000 $ Average Current Debt Payment $746 All-in True Interest Cost: 3.818% Average Proposed Debt Payment $545

22 Cost to Taxpayers for $30M in New Bonds Existing Debt Service Proposed $30M New Bonds Invested in Schools: $30 million Savings for Taxpayers: $201/yr avg

23 Cost to Taxpayers for $45M in New Bonds Current Proposed $45M Current New Debt Debt Service 2019 Projected Debt Payments Impact on Tax DSEB + Referendum Less: Total $231,900 $231,900 Year Referendum Debt Service Cap I Debt Service Home' Home ,067,278 5,067, ,342,704 2,048,154 (2,048,154) 5,342, ,595,037 2,234,350 (2,234,350) 5,595, ,836,250 4,836, ,832,950 4,832, ,835,250 4,835, ,837,500 4,837, ,833,250 4,833, ,836,125 4,836, ,835,625 4,835, ,836,375 4,836, ,833,000 4,833, ,835,000 4,835, ,836,750 4,836, ,832,875 4,832, ,832,875 4,832, Invested in Schools: $45 million Savings for Taxpayers: $70/yr avg Total $ 16,005,019 $ 67,136,329 $ (4,282,504) $ 78,858,844 $ 2,239 $ 8,792 Bond Proceeds: 45,000,000 $ Average Current Debt Payment $746 All-in True Interest Cost: 4.061% Average Proposed Debt Payment $676

24 Cost to Taxpayers for $45M in New Bonds Existing Debt Service Proposed $45M New Bonds Invested in Schools: $45 million Savings for Taxpayers: $70/yr avg

25 Summary of Financing Options Whatever path we take forward will result in a tax decrease for property taxpayers. Referendum Amount $10,000,000 $30,000,000 $45,000,000 Average Annual Decrease in Payment -$529 -$201 -$70 for $231,900 home value Bond Maturity (Repayment Year) Length of Bonds Until Maturity 10 years 12 years 15 years

26 The community will determine our path forward. WE ARE ENGAGING THE COMMUNITY THROUGHOUT THE REMAINDER OF 2018 TO DETERMINE YOUR VISION FOR OUR SCHOOLS OVER THE NEXT DECADE.