Finance Committee Meeting

4 Monday, June 16, 2025 Finance Committee Meeting Round Lake Area School District - CUSD #116 Board of Education Round Lake High School Library 6:00 PM 800 High School Drive Round Lake, IL 60073 Phone: 847-270-9300 1. MEETING OPENING Subject A. Call Meeting to Order Meeting Jun 16, 2025 - Finance Committee Meeting Category 1. MEETING OPENING Type Procedural File Attachments Subject B. Roll Call of Committee Members Meeting Jun 16, 2025 - Finance Committee Meeting Category 1. MEETING OPENING Type Procedural File Attachments 2. APPROVE MEETING MINUTES Subject A. Approval of Meeting Minutes Meeting Jun 16, 2025 - Finance Committee Meeting Category 2. APPROVE MEETING MINUTES Type Action, Minutes, Procedural Recommended Action Motion to Approve Finance Committee Meeting Minutes of April 21, 2025 and May 19, 2025. Minutes View Minutes for May 19, 2025 - Finance Committee Meeting File Attachments Finance Committee Meeting (Monday, April 21, 2025) minutes.pdf (78 KB) Motion & Voting Motion to Approve Finance Committee Meeting Minutes of April 21, 2025 and May 19, 2025. Motion by Kevin Devera, second by Annette Negrete McGinley. Final Resolution: Motion Carried Yes: Annette Negrete McGinley, Kevin Devera 3. FINANCE COMMITTEE DISCUSSION ITEMS Subject A. Tes Parents' Meeting (Bennett) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract The administration proposes adopting the Tes Parents' Meetings scheduling tool across all PK-12 schools in Round Lake Area Schools CUSD #116 to address current inconsistencies and inefficiencies in parent-teacher conference scheduling. The proposed annual cost is $15,862.00. Feedback from the Finance Committee is being requested to inform implementation planning. Background Historically, schools within the district have used a variety of tools and methods to schedule parent-teacher conferences. This lack of standardization has led to inconsistent practices, confusion among parents, and inefficient use of staff time. In response, the administration has reviewed available solutions and identified Tes Parents' Meetings as a unified, districtwide tool to streamline the scheduling process. Administration has spoken with representatives of McHenry High School District regarding their implementation and utilization of the Tes Parents' Meeting tool. Their administrative team spoke of the ease of use and strong shift in parent engagement during conferences since its implementation. Sample communications to staff and parents were also provided by the McHenry team. Request The administration proposes adopting the Tes Parents' Meetings scheduling tool for use across all PK-12 schools in the district. We are seeking feedback from the Community Engagement Committee on this proposal before finalizing implementation plans. Rationale Standardizing the parent-teacher conference scheduling process with Tes will: Improve consistency and clarity for families, especially those with children in multiple schools. Reduce administrative burden on school staff. Provide a professional, user-friendly interface for scheduling. Strengthen communication and engagement with families, aligning with district values. Considerations Contract Duration: 12-month initial term starting July 1, 2025. (noted as 01/07/2025 as Tes is out of the UK) Implementation: Training and communication will be necessary to ensure a smooth transition for families and staff. Feedback Loop: Continued evaluation of effectiveness and user satisfaction will be critical in year one. Payment Terms: Tes is out of the UK and would not agree to adjusting the payment terms from Net 30 to Net 60. Administration will ensure that a purchase order is entered well before the July 1 implementation date to ensure that payment requests are entered into the first Board packet of the month so that payment may be made within the 30 day time period. Student Data Privacy Considerations In consultation with legal counsel, we have reviewed the student data privacy implications related to contracting with Tes for use as a scheduling tool for the 2025–26 Parent-Teacher Conferences. Although the agreement with Tes does not meet all technical requirements under the Student Online Personal Protection Act (SOPPA)—specifically lacking certain mandated provisions in its written agreement—the contract appears to comply with both the Illinois School Student Records Act (ISSRA) and the Family Educational Rights and Privacy Act (FERPA). Tes’ Terms of Service and Data Processing Agreement include assurances that align with the “school official” exception under FERPA and ISSRA, such as limiting data use to the performance of contractual obligations and ensuring the right to request deletion or return of data. These provisions provide sufficient grounds for data sharing under ISSRA/FERPA without the need for parental consent. It is important to note that the only data being provided to Tes includes the student’s name, the parent or guardian’s name and contact information, and the student’s schedule, including teacher names. No academic, disciplinary, health, or personally sensitive records are being shared. While SOPPA compliance is not fully met—meaning the agreement lacks certain required statements, including an express designation of “school official” status—the legal risk is considered minimal given the limited scope of data involved and Tes’ commitment to data security. However, their terms do not include indemnification for data breaches and may be altered unilaterally by the vendor. Given the limited and non-sensitive nature of the data being shared, the vendor’s alignment with ISSRA/FERPA standards, and the practical safeguards in place, we recommend proceeding with the Tes contract for parent-teacher conference scheduling. We will continue to monitor Tes’ data policies and remain prepared to reassess should state requirements or vendor practices change. Connection to Strategic Plan This proposal supports the district’s strategic goals in: Social Emotional Development Develop programs that engage students, parents, staff in educational process Parent, Community & School Partnerships Continue to utilize a wide variety of effective communication vehicles for both internal and external communications; look for opportunities to enhance. Funding The annual subscription fee of $15,862.00 would be covered through District funds, as a newly requested budget assumption for the 2025-26 school year. Recommendation Administration recommends the adoption of the Tes Parents' Meetings scheduling tool for districtwide use and requests feedback and support from the Finance Committee to inform next steps in planning and implementation. File Attachments Tes Agreement.pdf (63 KB) Subject B. School Facility Safety Bollards (Lamping) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion The Finance Committee will discuss potential safety bollard needs at school facilities throughout the District. File Attachments Subject C. FY26 Resolution Regarding the Designation of Depositories and Signatories (Ambs-Soule) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract - Board of Education Policy 4:30, Revenue and Investments, requires the Chief Investment Officer to establish a list of authorized depositories, investment managers, dealers, and brokers based on creditworthiness, reputation, minimum capital requirements, qualifications under State law, and a demonstrated history of public fund transactions. This list must be reviewed and approved by the Board annually. Illinois School Code 105 ILCS 5/8-7 requires that school boards designate one or more financial institutions, situated in the State of Illinois, to serve as depositories for district funds under the custody of the School Treasurer. https://www.boardpolicyonline.com/?b=round_lake_cusd_116&s=776520 https://www.ilga.gov/legislation/ilcs/documents/010500050K8-7.htm Background - Each year, the Board of Education must formally designate financial institutions authorized to hold District funds and identify those individuals who may sign on behalf of the District for all financial transactions. These designations ensure compliance with State statute, Board policy, and industry best practices related to public fund management, and allow for the secure investment and disbursement of funds. Request - Administration seeks Board approval of the attached Resolution to designate authorized depositories and account signatories for the 2025-2026 fiscal year, consistent with Illinois law and Board Policy 4:30. The resolution names the financial institutions currently utilized by the District and formally authorizes the Chief Financial Officer (School Treasurer) and Superintendent to act as signatories. Rationale - The annual designation of depositories and signatories ensures: Legal compliance with Illinois School Code and Board Policy Continued access to critical financial services and investment vehicles Protection of district funds through verified and approved custodial institutions Proper authority for the disbursement and transfer of public funds Considerations - All named depositories have a demonstrated record of working with public entities and meet necessary regulatory and capital requirements. The resolution includes language to indemnify the School Treasurer and her sureties from liability in the event of a depository failure. Copies of required bank statements and compliance documentation will be obtained as stipulated. Connection to Strategic Plan - Theme E: Securing the Future Potential Cost Breakdown & Funding Source - There are no direct costs associated with this resolution. Financial services and investment-related fees are embedded within the District’s operational budget and reviewed as part of annual financial planning. Recommendation - The Administration is seeking review and support from the Finance Committee in recommending that the Board of Education adopt the Resolution Regarding the Designation of Depositories and Signatories for the Fiscal Year 2025-2026 as presented and authorize Administration to execute all associated, necessary documents. File Attachments Draft 2025 0707 FY26 Resolution for Depositories and Signatories.pdf (118 KB) Subject D. FY25 Investment Report (Ambs-Soule) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract - This report provides an update on FY25 interest income trends and offers strategic recommendations for the future treatment of interest earnings in the District’s financial planning. Background - Interest income has played a critical role in the District’s budget stability over the past two years. FY25 has experienced a surge in earnings compared to previous years. However, reliance on this revenue source carries inherent risk due to volatility in interest rates. Request - No immediate action is required at this time. This report is for information and long-term financial planning purposes. Rationale - Interest rates have declined by a full percentage point since the beginning of FY25. This trend is expected to continue, introducing the risk of decreased revenue from investment accounts. For example, the total year-to-date interest income for FY25 from the SBOTL MaxSafe account alone is approximately $1,756,474, compared to only $126,287 in total interest income across all accounts in FY22. These drastic fluctuations underscore the need for a strategic shift in how interest earnings are used. While they have recently helped offset general fund expenditures and supported a balanced budget, this approach is not sustainable in a lower-rate environment. Considerations - Moving forward, it is recommended that interest income not be relied upon to fund operating expenditures. Instead, the District should treat investment returns as a reserve mechanism, earmarking interest income for capital project savings. This would allow the District to: Avoid program cuts in the event of declining rates; Be proactive rather than reactive in financial planning; Use interest income strategically for long-term capital needs instead of short-term operating gaps; and Align investments with the District’s strategic plan strategy to maintain a balanced budget and build reserves while planning responsibly for future capital expenditures. Connection to Strategic Plan - Theme E: Securing the Future Potential Cost Breakdown & Funding Source - No cost is associated with this change in strategy. It is a reallocation of how future interest income is applied within the overall financial plan. Recommendation - The Administration is seeking review and support from the Finance Committee in recommending that the Board of Education support a phased transition in financial planning practice, where interest income is no longer considered a stabilizing source for the operating budget. Instead, interest earnings should be allocated to a reserve for future capital project needs, allowing the District to respond to economic changes without jeopardizing instructional or support programs. File Attachments FY25 Investment Report.pdf (186 KB) Subject E. FY25 GASB 87 & GASB 96 Fund Balance Transfer (Ambs-Soule) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract - Administration is seeking approval from the Board of Education for a fund balance transfer from the Educational Fund (Fund 10) to the Debt Service Fund (Fund 30) to cover the principal and interest portions of lease and subscription obligations recognized under GASB 87 and GASB 96. This action aligns with state accounting guidance and supports accurate financial reporting for capital lease and subscription liabilities. Background - Governmental Accounting Standards Board (GASB) Statements No. 87 and No. 96 require school districts to recognize lease agreements and subscription-based information technology arrangements (SBITAs), respectively, as long-term liabilities with associated principal and interest payments. GASB 87 applies to lease agreements for the right to use capital assets. GASB 96 applies to SBITAs, such as software subscriptions and cloud-based service contracts that meet capitalization criteria. Although these obligations have historically been budgeted and paid from operating funds such as the Educational Fund, ISBE accounting guidance requires that principal payments be reported in the Debt Service Fund (Fund 30). This necessitates a permanent fund balance transfer to align with correct fund classification. Request - Administration requests approval to transfer $2,802,221.07 from the Educational Fund (Fund 10) to the Debt Service Fund (Fund 30). This transfer represents the principal and interest portions of lease and subscription-based IT payment obligations incurred under GASB 87 and GASB 96. Rationale - This fund transfer aligns with state accounting standards and allows the District to comply with GASB 87 and GASB 96 reporting requirements by appropriately classifying lease and SBITA payments in the Debt Service Fund. Additionally, this fund transfer supports transparent and accurate financial reporting while alligning with ISBE’s Uniform Financial Accounting Requirements and recommended account coding. Considerations - • This transfer is a reclassification of existing budgeted expenditures and does not increase total expenditures. • No additional tax levy is required. • Board approval is required for permanent fund balance transfers. • A resolution is attached to formalize this action and will be included in the District’s audit file. Connection to Strategic Plan - Theme E: Securing the Future Potential Cost Breakdown & Funding Source - Lease Amount Funding Source 2025 Apple Lease $ 1,604,600.30 Educational Fund → Debt Service Fund (via transfer) 2023 Apple Lease $ 654,520.50 Educational Fund → Debt Service Fund (via transfer) 2021 Apple Lease $ 214,814.98 Educational Fund → Debt Service Fund (via transfer) 2023 Finalsite Lease $ 199,464.00 Educational Fund → Debt Service Fund (via transfer) 2024 Welcome Center Lease $ 128,821.29 Educational Fund → Debt Service Fund (via transfer) $ 2,802,221.07 Recommendation - The Administration is seeking review and support from the Finance Committee in recommending that the Board of Education adopt the Resolution Authorizing Fund Balance Transfer Pledged for the Payment of Principal on GASB 87 Leases and GASB 96 SBITAs, transferring $2,802,221.07 from Fund 10 to Fund 30 as presented and authorize Administration to execute all associated, necessary documents. File Attachments DRAFT 2025 0707 FY25 Resolution Authorizing Fund Balance Transfer to Fund 30 for GASB 87 and GASB 96.pdf (119 KB) Subject F. FY25 Capital Projects Fund Balance Transfer (Ambs-Soule) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract - Administration is seeking Board approval for a one-time fund balance transfer of $4,831,000 from the Education Fund (Fund 10) to the Operations & Maintenance Fund (Fund 20), followed by a transfer of $4,831,000 from Fund 20 to the Site & Construction Fund (Fund 60), to support upcoming capital projects that are beyond the routine scope of Operations & Maintenance but do not qualify for bond financing. Background - The District has identified capital needs aligned with strategic facility improvements that are not bond-eligible and must be funded locally. To support these one-time expenditures, a transfer of available fund balance from the Education Fund is proposed. Given that school code restricts direct transfers into the Site & Construction Fund from Fund 10, the transfer must flow through Fund 20 in compliance with legal requirements. Request - The administration requests Board approval of two fund balance transfer resolutions: Transfer of $4,831,000 from Fund 10 to Fund 20. Transfer of $4,831,000 from Fund 20 to Fund 60. These transfers are not tied to specific vendor contracts at this time but will enable the District to proceed with capital improvement bids and procurement aligned with Board-approved priorities. Rationale - The proposed transfers are authorized under 105 ILCS 5/17-2A and 105 ILCS 5/20-5, which govern interfund transfers and appropriate uses of the Site & Construction Fund. Additionally, the District's Board Policy 4:10 – Fiscal and Business Management grants the Board the authority to act on all interfund transfers as part of its financial oversight responsibilities. The transfers will be documented in accordance with Illinois State Board of Education (ISBE) requirements. Considerations - These are one-time transfers and not part of a recurring strategy. The use of Fund 60 for capital projects ensures transparency and appropriate tracking of capital expenditures. Connection to Strategic Plan - Theme E: Securing the Future Potential Cost Breakdown & Funding Source - Total Transfer Amount: $4,831,000 Initial Source: Fund 10 (Education Fund) Final Destination: Fund 60 (Site & Construction Fund) Funding Use: Capital projects as outlined in the Facilities Master Plan or previously discussed with the Board Recommendation - The Administration is seeking review and support from the Finance Committee in recommending that the Board of Education adopt the Resolution Authorizing Fund Balance Transfer and the Resolution Authorizing Fund Balance Transfer, transferring $4,831,000 from Fund 10 to Fund 20, followed by a transfer of $4,831,000 from Fund 20 Fund 60, as presented and authorize Administration to execute all associated, necessary documents. File Attachments DRAFT 2025 0707 FY25 Resolution Authorizing Fund Balance Transfer to Fund 60.pdf (101 KB) DRAFT 2025 0707 FY25 Resolution Authorizing Fund Balance Transfer to Fund 20.pdf (99 KB) Subject G. Resolution Authorizing Interest Transfers to Fund 60 (Ambs-Soule) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract - In accordance with Illinois Administrative Code and Board Policy 4:30 – Revenue and Investments, the District may transfer interest earnings from certain funds into the Site & Construction Fund to support long-term capital improvement initiatives. Interest income transfers do not require a public hearing but must be authorized by Board resolution. Background - Interest income accumulates in various district funds throughout the fiscal year. The Illinois Administrative Code (23 Ill. Adm. Code 100.50(d)) allows interest earned in any fund to be transferred to the fund most in need, provided such transfers are approved by Board resolution. The Site & Construction Fund is the primary fund used to finance capital improvements, building renovations, and infrastructure upgrades. Transferring interest earnings into this fund supports district goals and ensures efficient resource alignment. Request - Authorize the Chief Financial Officer to transfer interest income earned in legally eligible district funds into the Site & Construction Fund (Fund 60), as necessary, based on year-end surpluses, cash flow, and fund balance considerations. The resolution will establish maximum allowable transfer amounts per fund, with actual transfer amounts finalized prior to fiscal year close. YTD As Of 05/31/25 Maximum Transfer Educational $ 921,040 $ 1,100,000 Operations & Maintenance $ 254,123 $ 300,000 Transportation $ 452,777 $ 500,000 Working Cash $ 41,693 $ 75,000 Totals $ 2,040,930 $ 2,525,000 Rationale - This flexible approach provides the CFO with authority to evaluate year-end fund balances and operational needs prior to executing transfers. This ensures fiscal responsibility while maximizing support for capital projects. Considerations - Transfers will not exceed the maximum limits authorized in the resolution. No transfers will occur from restricted or grant-funded accounts. Actual amounts transferred will be reported as part of the annual financial audit. Connection to Strategic Plan - Theme E: Securing the Future Potential Cost Breakdown & Funding Source - There is no additional cost associated with this transfer. Funds remain within the district’s overall financial system and are reallocated to support capital needs. Recommendation - The Administration is seeking review and support from the Finance Committee in recommending that the Board of Education adopt the Resolution Authorizing Interest Transfers to Fund 60 authorizing the Chief Financial Officer to transfer interest income from eligible funds into the Site & Construction Fund up to the specified maximum amounts as presented and authorize Administration to execute all associated, necessary documents. File Attachments DRAFT 2025 0707 FY25 Resolution Authorizing Interest Transfer to Fund 60.pdf (100 KB) Subject H. 3 Year Registration Fee Report (Ambs-Soule) Meeting Jun 16, 2025 - Finance Committee Meeting Category 3. FINANCE COMMITTEE DISCUSSION ITEMS Type Discussion Abstract - This report summarizes student fee assessments, waivers, collections, and outstanding balances for Fiscal Years 2022-2023, 2023-2024, and 2024-2025. The data reflects districtwide registration, course, technology, athletic, and other optional school fees. The purpose is to provide visibility into year-over-year trends and the financial impact of student fee collection and waivers. Background - Round Lake Area Schools assesses student fees annually to support instructional materials, technology devices, extracurricular activities, and other services. Fee waivers are available for qualifying families under ISBE guidelines. The district has consistently monitored collection patterns and waiver volumes to maintain equity and fiscal responsibility. With the transition to Skyward, collection data is now more transparent and efficiently tracked. Request - This item is presented for informational purposes only. No Board action is requested at this time. Rationale - Monitoring student fee trends allows the District to evaluate the effectiveness of communication strategies, equity in waiver distribution, and the financial impact of outstanding balances. The data also informs future adjustments to fee structures and supports fiscal planning for education-related expenses. Considerations - Key data points from the three-year summary include: Total Fees by Fiscal Year Fiscal Year Assessed Waived Collected Outstanding 2022-2023 $1,268,105 $528,401 $529,495 $210,210 2023-2024 $1,240,252 $790,293 $311,198 $138,761 2024-2025 $1,278,450 $768,809 $291,276 $218,365 The assessed fee total remained relatively consistent year to year. The percentage of waived fees increased significantly in FY23 and FY24, reducing the net collectible revenue. Collections peaked in FY23 before dipping slightly in FY24, due in part to timing and waiver expansion. Outstanding balances remain steady, emphasizing the need for improved collection supports and early outreach. The Technology Fee ($50) remains the single largest assessed fee across all grade levels, with High School fees consistently forming the largest portion of assessed and collected totals. Connection to Strategic Plan - Potential Cost Breakdown & Funding Source - Student fees collected are deposited into the Education Fund (Fund 10) and offset operational costs tied to instructional materials, technology services, extracurriculars, and student programming. The cost of waived fees—totaling over $750,000+ in each of the last two fiscal years—represents foregone revenue that would otherwise support these expenditures. Recommendation - This item is presented for informational purposes only. No Board action is requested at this time. File Attachments 3 Year Registration Fee Report.pdf (210 KB) 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Subject A. 2025 Contract Renewals Meeting Jun 16, 2025 - Finance Committee Meeting Category 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Type Information File Attachments Annual Purchases and Contracts (2025) - May 2025.pdf (133 KB) Subject B. BMO PCard Report - April 2025 Meeting Jun 16, 2025 - Finance Committee Meeting Category 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Type Information Attached for review is the April, 2025 BMO PCard Report. File Attachments APRIL 2025 BMO PCARD REPORT.pdf (131 KB) Subject C. BMO PCard Report - May 2025 Meeting Jun 16, 2025 - Finance Committee Meeting Category 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Type Information Attached for review is the May, 2025 BMO PCard Report. File Attachments MAY 2025 BMO PCARD REPORT.pdf (107 KB) Subject D. Treasurer's Report - April 2025 Meeting Jun 16, 2025 - Finance Committee Meeting Category 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Type Information Attached for review is the Treasurer's Report - April 2025. File Attachments Treasurer's Report - April 2025.pdf (1,718 KB) Subject E. Treasurer's Report - May 2025 Meeting Jun 16, 2025 - Finance Committee Meeting Category 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Type Information Attached for review is the Treasurer's Report - May 2025. File Attachments Treasurer's Report - May 2025.pdf (2,046 KB) Subject F. Review Contracts Less than $1,000 Report Meeting Jun 16, 2025 - Finance Committee Meeting Category 4. FINANCE COMMITTEE INFORMATIONAL ITEMS Type Information Background The Administration proposed and the Board of Education agreed on December 2, 2019, that contracts executed for an amount less than $1,000.00 could be communicated via a monthly report during a Board of Education meeting. Contracts Less than $1,000.00 School/Department Entity Purpose Date of Event Cost Business Department Scribe To help create Standard Operating Procedures for other staff in the district. July 8, 2025 $708.00 Recommendation - There is no recommendation at this time. The information in this document is for communication and informational purposes only. File Attachments 5. ADJOURNMENT OF MEETING Subject A. Adjournment of Meeting Meeting Jun 16, 2025 - Finance Committee Meeting Category 5. ADJOURNMENT OF MEETING Type Procedural The meeting was adjourned at _______ p.m. File Attachments