Tuesday, February 07, 2012

TOP STORY >> PCSSD hoping it can escape state scrutiny

Leader senior staff writer

Bill Goff, the Pulaski County Special School District’s chief financial officer, thinks the district has a good chance of meeting all requirements to be released from fiscal distress by the end of the 2012-13 school year by balancing its books, which would help the district get out from under state supervision.

“I’m very optimistic we can fulfill the fiscal distress plan” by cutting several million in spending, Goff said.

The original finding of fiscal distress dates back to transgressions several years old, discovered after the PCSSD board asked the state Bureau of Legislative Audit to take a good look at the district’s books.

When the state Board of Education meets Monday, it is slated to consider classifying the district as being in fiscal distress for having a low financial reserve budget.


This would be on top of the district’s existing designation of fiscal distress, issued last March.

Following that designation, the state board dissolved the PCSSD school board and fired its superintendent, Charles Hopson, who is a finalist for a superintendent’s job in Florida.

State Education Commissioner Tom Kimbrell thus became a board of one for the district.


The fiscal distress designation that the state Board of Education will consider Monday is based on the drop in the district’s financial reserves from $9.5 million to $4.5 million over the course of the 2010-2011 school year, Goff said.

Excluding federal program funds, the PCSSD budget is about $170 million, about 80 percent of that in hard-to-touch salaries, Goff said.

The teachers and support staff have agreed to forego pay increases, other than regular step-grade in-creases, which could save the district about $4 million, using Goff’s rough figures.

A change — reduction for some — in fringe benefit health insurance could save another $1.5 million, improvements to some buildings, making them more energy efficient, will help some, the warm winter has reduced utility costs will contribute to the $7 million in savings, he said.

The 70 percent of district workers who receive $313 a month for their health insurance will continue to do so, but those who opt instead to receive a similar amount toward buying their own insurance will have that amount reduced to $40 a month.

For the first time in at least a decade, student enrollment increased at PCSSD by perhaps 135 students. Each student brings about $5,500, so there’s an income increase in minimum foundation aid of about $750,000 if those numbers hold.


A district that can’t escape from fiscal distress within two school years is subject to consolidation or annexation with an adjacent school district, or reconstitution, but the existing desegregation agreement would make any of those options difficult if not impossible, according to Goff.

Federal District Judge Price Marshall has oversight regarding desegregation matters, and any real change in structure would have to be approved by him.

Kimbrell has told some state legislators that he would like the law changed to allow a district five years to fully implement a recovery plan. Kimbrell’s proposal is unlikely to be considered next week, when the state General Assembly convenes for its fiscal session, but it could be considered at the next regular session a year from now, in plenty of time to be in force before the district’s two-year time limit expires.

Based largely on the legislative audit, the state Education Board last March put PCSSD on fiscal distress for bad financial oversight and transparency, improper payments to former superintendent James Sharpe, inappropriate reimbursement to board members and because a maintenance manager stole and sold $400,000 in parts, supplies and items — among other reasons.