sive training in preparation for July 1, when they will officially resume the governance of their districts.
“I think I can speak for the entire community when I say we are thrilled,” said Lea Ramsey, a parent of a Midland High School student and the leader of an unprecedented effort in early 2006 to raise more than $400,000 in donations to retire the district’s short-term debt and save the district from an immediate state-ordered consolidation with a neighboring district.
Ramsey said in a telephone interview that community members are beginning to plan a celebration day for July.
Ramsey’s son, Jonathan Farrar, received national attention when he donated to the Midland district the $1,000 he had saved for a trip to see the New York Yankees play baseball. Yankees’ owner George Steinbrenner learned of the 12year-old’s donation, reimbursed him and invited him to Yankee Stadium to see a game. Jonathan is now a ninth-grader at Midland High and a first baseman on the school’s varsity baseball team.
Education Commissioner Ken James said Monday that his department and the state board were criticized in the past for not intervening in the affairs of mismanaged districts. But changes to state laws now force the department to take action.
“Local districts need to run local districts, but when they prove for a variety of reasons that they can’t do so ... we will not hesitate to take action, however unpopular it happens to be,” James said.
Under Act 1467 of the 2003 special session on education, a school system categorized by the state as being in fiscal distress has up to two years to regain financial stability or the Board of Education must consolidate the district with a financially stable district.
The Helena-West Helena School District on Sept. 8, 2005, became the first district to have the state take over its operations under the Omnibus Quality Education Act. Rudolph Howard, a former principal at Little Rock Central High School, was installed by the state as superintendent. At the time of the takeover, the district had a projected ending negative balance in 2006 of $2.3 million.
Since then, the 2,714-student district has overhauled purchasing, inventory, payroll and accounting systems. School board members were trained. The district’s projected ending balance for this school year is $5.7 million.
James said the fiscal condition of the district before state takeover was one of the biggest examples of “mismanagement and malfeasance” that he had ever seen.
But now the situation is better.
“We think the board is ready to have the opportunity to assume control of the school district and move forward,” he said. “We’ll continue to monitor it very closely.”
Howard, the state-appointed superintendent who is now a candidate for the permanent job, said the district’s books are in order and leaders can fully focus on improving academics.
“We know where we need to be, but for the first time, all the elementary schools in the HelenaWest Helena School District have made AYP,” he said, referring to a federal law that requires each school to demonstrate “adequate yearly progress” in student academic achievement.
The Midland district was taken over by the state on Jan. 13, 2006. The 561-student district had a negative balance of $190,000 in its operating fund at the end of 2004-05.
James appointed a retired superintendent, Charles Vondran, to lead the district. He was later replaced by Lynn Roe King.
The department had recommended that the district be merged with a neighboring district. But after the community’s fundraising efforts, the state board allowed the district to continue to exist but under state direction.
Since then, the district has reduced the number of certified and noncertified positions and has taken steps to cut other costs in areas such as utilities, transportation, substitute teaching and custodial supplies. The district is expected to end this year with $1.6 million in its operating fund.
The Hughes, Omaha and Turrell districts were removed from the fiscal distress list Monday after proving to the state board that they had a handle on spending. All three were put on the list in 2006 and were required to adhere to financial improvement plans that they submitted to the state.
The Hughes School District, in St. Francis County, had available operating funds of only $14,867 in April 2006. The financial problems have been aggravated by declining student enrollment, which dropped from about 721 in 2003-04 to 531 in 2006-07.
Retired administrator Charles Jones returned to help the district pass a property-tax increase of 12 mills. The district sold nearly 400 acres of land and three houses, closed a school building and a section of the high school, cut eight teaching positions and 14 nonteaching positions. It cut back paid work days, teacher benefits and administrative benefits.
The district is expected to end the year with a balance of $1.3 million.
The Omaha district, in Boone County, had about $25,644 in unrestricted revenue to work with in March 2006. The 435-student district now has a projected end of year balance this year of $382,771. The district took steps such as cutting positions, filling vacant positions with less experienced personnel, using distance learning systems to teach Spanish and eliminating employee dental insurance.
The Turrell district, in Crittenden County, similarly eliminated positions and reduced health benefits, cut transportation and utility costs and limited use of outside contractors. The district also plans to sell two school district-owned houses. The 317-student district is expected to end this school year with an operating balance of $409,907.
Of the eight districts that the state Education Department recommended for placement on fiscal distress, four appealed: Gentry, Greenland, Mineral Springs and Westside. The board denied each appeal, except for Mineral Springs, which was tabled until the board’s regular meeting in May.
In the Gentry School District, the state said the district has used cash-flow loans to cover expenses twice since the 2004-05 school year. The district anticipates another loan for the 2009-2010 year after ending this year with a projected negative balance of $254,225. The Northwest Arkansas district has a stable enrollment, meaning it should not lose state funding.
Gentry Superintendent Randy Barrett said that in the past several years the district has replaced a substandard school building and added classrooms to Gentry High School. It paid for it with construction bonds and state aid but had to use operating money to fully furnish parts of the building that the school board decided to expand after the projects were started, he said.
Scott Smith, the education department’s attorney, said state law allows the district to do that. But Gentry never replenished the operating reserves used to furnish the buildings, he said.
Greenland School Board President Bill Groom attributed much of his district’s financial problems — including its need for short-term loans — to that district’s acquisition in 2004 of the tiny Winslow School District. The district has since closed both the elementary and high school in Winslow, prompting as many as 178 former Winslow students to transfer to schools outside the Greenland district at a loss to the Greenland district of about $1 million.
To help offset its financial woes, the 934-student Greenland district is seeking a 2.64-mill tax increase at a special election June 10.
The Westside district had unrestricted operating revenue of $1.7 million in 2005, an amount that dropped to $218,000 by 2007.
Westside School Superintendent James Best argued that his Jonesboro-area district is coping with enrollment decreases by cutting positions in district staff and will show an increase in revenue at the end of this year. He said his district, which is recognized for academic achievements, hasn’t resorted to borrowing money and has no audit findings of financial irregularities. He warned that the fiscal distress designation will cause the district’s enrollment to drop further.
The 1,636-student district recently observed the 10th anniversary of the 1998 shooting by two students who killed four classmates and a teacher. Best said the district continues to struggle against the perception that the district’s schools are unsafe.
Concord has a projected ending balance of $148,510 this June.
Hartford’s three years of declining ending balances will lead to a low of $156,170 this year, state officials said.
Hermitage’s end of year unrestricted balances have dropped from $896,207 in 2004-05 to $77,000 last year.
Murfreesboro’s unrestricted balances dropped from $499,820 in 2004-05 to $256,842 last year.