Gary schools deficit could disappear by December
Growing annual shorfall and long-term debt led to state takeover in 2017
The Gary Community School Corp. could shed its once $22 million deficit by the end of the year, officials told the state Distressed Unit Appeal Board Thursday in a rare in-person meeting in the city.
A state-appointed private management team has whittled the $22 million deficit down to $1.7 million and that should be erased by December, its leaders said.
About 100 people packed into the meeting at the Gary Area Career Center and about 40 wanted to make remarks.
The growing annual deficit and about $104 million in long-term debt led the state to take the district over in 2017. The state eliminated the elected school board and rendered the superintendent powerless.
Gary Democratic lawmakers State Rep. Vernon Smith and state Sen. Eddie Melton pushed DUAB members to ask the legislature to forgive the district’s $40 million in remaining state loans.
Smith said he’s drafted forgiveness legislation before, but it never gained traction in the GOP-dominated General Assembly.
“If the recommendation comes from DUAB, I think it has more credence,” he said. “If you’re really concerned about giving us a new start, take the burden off our back.”
Smith and others blamed the proliferation of charter schools in Gary as the reason for the school district’s financial free fall.
Gary loses more students to charters than
any other district in the state. State data last year showed 4,397 students enrolled in traditional Gary schools while 5,609 chose charters and 516 went to private schools supported by state vouchers. This year, Gary’s enrollment is up slightly at about 4,770.
On average, the district loses about $8,000 in state money every time a student leaves.
Smith said with the deficit soon to be wiped out, the state should begin transitioning the district back to self-governance with its elected school board and appointed superintendent in place again.
Gary schools careened into debt as its former school board disregarded debt and vendor payments, including payroll taxes owed the U.S. Internal Revenue Service.
Chief financial officer Nicole Wolverton told the DUAB the district had righted its ship now and its annual tax levy could support its spending.
“Our goal is to start a rainy-day fund and be better stewards of savings,” she said.
Melton praised district officials for making improvements to schools including roofs and HVAC systems that have chronically plagued the district. Other upgrades include a new parking lot, football turf, track, tennis courts and press box at the West Side Leadership Academy, the district’s lone high school.
Melton and Smith said the MGT Consulting management team, led by Paige McNulty, still needs to improve academic performance.
Smith, a former educator, said school grades have nose-dived since MGT took over and more than half the district’s schools are receiving F grades.
The district extended the school day by an hour this year and has added instructional coaches in each classroom.
Smith also urged more transparency in the spending of funds from a $71.5 million referendum approved by voters last year.
The district is also receiving about $67 million from two federal COVID19 funding programs passed by Congress.
Jackie Lee told the DUAB it’s time to turn the district back to its own leadership.
“It was a failure,” she said of the state takeover. “You should apologize to the schools and children you failed. We had a superintendent and you just drug her though the ground …
Just make it right.”
Former superintendent Cheryl Pruitt, who resigned in 2018, attended, but didn’t speak.
Other speakers voiced criticism at lockdowns and fighting at West Side.
Former city councilwoman LaVetta SparksWade, whose son is a senior at West Side, said the band lacks uniforms.
“I think it’s really a slight to our children,” she said.
Judy Meade, who heads a Roosevelt High alumni group, asked when it will be advertised for sale again.
“If charters can buy a school for a dollar, what’s the process for alumni to buy it for a dollar?”