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“What happened this year with transportation costs was unprecedented.”

So says District 65’s Chief Financial Officer Raphael Obafemi.

Obafemi and Business Manager Kathy Zalewski told a school board committee on Wednesday that rapidly escalating transportation expenses are a major component of an unanticipated $4 million deficit wrapping up the current school year. A $600,000 surplus had been projected.

Chief Financial Officer Raphael Obafemi and Business Manager Kathy Zalewski at Wednesday’s D65 school board committee meeting.

While District 65 has enough money in reserve to cover the shortfall, board members wondered why expenditures are exceeding revenues by such a surprising amount.

“I hope we build in a $4 million buffer in case we see this again,” said board member Joey Hailpern.

“Had we seen this coming?”

Obafemi said that a transportation increase had been incorporated, “but we didn’t think it would go to this level.”

“It snuck up on us,” Obafemi explained. “We didn’t think it would be this bad.”

Besides higher costs for driver salaries (needed to attract employees in a tough post-pandemic market) along with increased fuel expenses, Obafemi said the district often had to use taxis to transport special needs children, often one child per vehicle.

He said the bus company usually handling special needs transit, Compass, has agreed to buy six new buses, which will be far more economical to use.

“But we couldn’t do that in the middle of the year,” he noted, because ordering buses takes time.

Most students who ride the bus use yellow buses from vendor Positive Connections. The cost for those services went up from $3 million to $4.3 million.

The committee also recommended full board approval of a 10% increase in contract expenses for Positive Connections next school year.

While the short-term transportation prognosis is rather expensive, district officials say bus costs should come down considerably once the 5th Ward School opens in 2025.

That’s because the school system will redistrict to have more walkable, neighborhood schools, with less need for busing.

“The 5th Ward School is not just a symbolic building,” said Hailpern, “but rather a big part of the financial future” in helping to reduce transportation costs.

In fact, transportation savings have been projected to cover the $40 million dollar cost of the new school over a number of years.

Higher bus costs are not the only reason for the $4 million shortfall.

“We are feeling inflation in every level of expenditures,” said Zalewski, including the cost of temporary employees due to staff shortages, computer software, and capital construction projects.

Zalewski said that a balanced budget for school year 2023-24 will be presented later this summer.

The total projected expenditures for the current (2022-23) operating buget is now $161.2 million.

Jeff Hirsh joined the Evanston Now reporting team in 2020 after a 40-year award-winning career as a broadcast journalist in Cincinnati, Ohio.

Join the Conversation


  1. This is a political institution through and through. For any of us in a competent organization (such as a business), these excuses/justifications for these completely foreseeable overruns are completely unacceptable.

    I cannot wait to see how the 5th ward school forms “a big part of the financial future.” I’m guessing it’s not going to work the way Mr. Hailpern envisions it. Will he be surprised again?

  2. June 2023 end of a ‘school year’ budget- a $4 million deficit has just
    ‘snuck up’ he himself states, on the Dist 65 “CFO”. A terrible lesson/example
    for students here if there is no consequence for poor job performance
    regarding irresponsible finance planning (using all 9 Wards tax money). What
    is the salary we didn’t neglect to pay this CFO?

      1. Although the CFO is ultimately responsible for the budget, in D65, it is the Business Manager (current salary, including benefits paid by the District: $190K) who handles all budgetary functions, including projections.

  3. An expected $600,000 surplus to a $4M shortfall is a swing of $4.6M. The article states that the increase in yellow bus costs is the culprit. The increase in yellow bus service went up by $1.3M. How many kids are taking taxis to school to account for the other $3M ??

  4. Is District 65 in a crisis? Seems like half the teachers at Lincoln Elementary are leaving due to dissatisfaction with leadership. Very concerning trends….This happening elsewhere?
    Note, I’m staying anonymous out of concern for my child…I’m told that leadership holds grudges and I don’t want my comment to impact my child.

    1. Lincoln lost their principal and assistant principal last year—-my grandkids went there and very much appeared both were quite popular and and well respected administrators—-my observation shows D65 teachers and administrators work a few years building up a good rep and then bolt, no denying there’s a high turnover rate at D65…As for the buses?—-I didn’t know anyone who rode a bus to school when I attended Dewey and Nichols—-kids walked to school—-my parents would’ve laughed if we asked for a ride—-the schools remain geographically situated with overwhelming majority of kids being able to walk to school—-check how full the buses are when they arrive to school, most don’t even look half full from what I’ve seen—-kids need to walk to school and it’s the city’s responsibility to insure the kids safety—-many of the buses could and should be eliminated

  5. Time for a new CFO and a new Business Manager. Deficits like this just don’t sneak up on you. “It snuck up on us,” Obafemi explained. “We didn’t think it would be this bad.”

    Both of you should be fired for two reasons. First, because you failed to manage this expense against your budget; and second because you are not taking responsibility for the huge expense miss.

    D65 is a financial mess. Last week, D65 architects determined in a recent assessment of district buildings that $189 million in repairs are necessary between now and 2030. But, D65 has very limited means to fund these costs.

    Doesn’t anyone at D65 plan ahead?

    I’m glad Superintendent Horton is gone. But it looks like there are others at D65 that need to be shown the door as well.

  6. This community has been given MULTIPLE opportunities to show members of this board the door or to at least send a message of disapproval to their incompetence. Instead the messages we have sent are either, “Great job, keep it up,” or, “School board? What’s that?”

    Let’s hope this situation is an anomaly (I doubt it). Because a school district is not a restaurant that will just go out of business and be replaced if it’s financially mismanaged. If the 5th Ward school and the significant work needed to be done at all of our existing schools becomes a financial disaster it will be us that picks up the bill.

  7. It is hard to believe that the CFO and the business manager are so incompetent that they had an additional $4mm transportation expense just sneak up on them without them noticing. Expenses of this nature don’t vary much on a week-to-week basis and should be easy to monitor and project into the near future. It is hard to believe that they did not discuss this with either the superintendent or one or several board members in a timely manner. It would have been awkward having to disclose a sudden deficit in March on the eve of what could have been a tight D65 board election. It would have been awkward for our job-applying superintendent to answer questions to the public in Georgia about his grasp on the finances in D65. Better to disclose it after school has ended when nobody is paying attention.

  8. I know of quite a few kids who are currently bused to neighborhood schools that got into so much trouble bullying other kids on the bus that the district’s response is to take them off the bus and send them to school every day in a taxi. That must be incredibly expensive. In what world is getting a free taxi instead of having to go on the school bus a punishment.

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