Fund balance, surplus not the same

Something happened one week ago that thankfully happens every two weeks: I got paid.

It is always nice to see the balance in my bank account spike every payday.

But now, just one week later, that money is largely gone. I spent most of it on rent, while the rest went toward groceries, gas and recreation.

A week from today, I'll get another paycheck. My bank account will balloon again, and the process will start all over.

Something similar to what I've just described happens in a school district and in any organization that takes in revenue and then spends it on daily necessities.

During the last few months of teacher contract negotiations, officials and board members in Huntley Unit District 158 have accused the teachers union of distorting the above situation to misrepresent the district's financial health.

The Huntley Education Association has repeatedly asserted that its contract proposals would not force District 158 to deficit spend.

While the union has declined to provide documentation to support this claim, union officials in July suggested the district has been accumulating large surpluses.

"The district is running up surpluses in their budget," union spokeswoman Britt Crowe said. "We feel that that's because they're not paying us competitive salaries."

When the district countered that Superintendent John Burkey has already had to cut spending from this year's budget, Crowe replied, "The facts are in the public documents."

In the weeks since that flap, District 158 officials have said the union is using the wrong facts to assert its proposals would not require deficit spending.

Let's go back to the example I started with. What would be a reliable measure of my financial health? The large (well, relatively) balance on paydays, the smaller balance after I pay my rent or something in between?

District 158 officials say the union has been erroneously using the district's balance on its payday (when the district gets cash, not its employees) as a measure of the district's financial health.

But as district officials point out, that seemingly large sum of cash is used up in a matter of months on salaries, electricity, gas and all the other expenses required to run a large school district.

The most reliable measure of District 158's financial well-being is whether it has a budget surplus or deficit and how large that surplus or deficit is.

A budget surplus is a school district's expenses for a school year subtracted from the district's total revenue that year - not a district's fund balance at any given point.

District 158's operating surplus in the most recent year available, the 2006-07 school year, was $3.4 million, not $16.4 million - the district's year-end fund balance that year.

But I don't know if the district is right in claiming the union's interpretation is wrong because so far, union officials have been mum on what their interpretation is.