|
|
9486 in the collection
Dallas ISD announces $64M budget shortfall
The Dallas Morning News
thinks a $64 million shortfall is a gaffe.
They have a much different word for merit pay.
Donna Garner Comment:
[Even though the Dallas Morning News
will never say the "M" word because of some
sort of cozy relationship it has with Mike
Moses, all of the above-mentioned abuses
actually occurred under his administration
(DISD supe from 2000-2004). By the time
Hinojosa was hired in 2005, DISD's financial
destruction was already set in place by Moses.
If Hinojosa had been smart, he would have
followed Peyton Wolcott's [conservative public
education commentator]advice
(peytonwolcott.com); and before he spent one
day as Dallas ISD superintendent, he would have
required the district to do a forensic audit.
This type of audit would have uncovered
forensic evidence that could have been used in
a court of law to prosecute criminal acts.
Unfortunately for Hinojosa, he did not require
that type of audit; and there is probably now
no way to prove what abuses were set in place
and were operating under Moses before Hinojosa
became superintendent.
As supe for DISD, Moses was the highest-paid
superintendent in the whole United States
($340,000 per year); but that was not enough
for him. He decided to moonlight with Bracewell
& Patterson, enriching his pocketbook by tens
of thousands of dollars. During Moses'
administration, the DISD went from paying
Bracewell & Patterson a few thousand dollars
for legal work to paying them $718,000.
Just to remind readers about the messes that
Hinojosa had to clean up after Moses'
administration, here is a partial list: out-of-
control spending with school credit cards, lost
dollars for health plans, illegal use of
federal e-rate funds, irregular technology
vendor contracts, misspent federal bilingual
education funds, costly deals with Kinko's,
apparent conflicts of interest involving
Voyager Expanded Learning, contributions by
computer vendors, questionable bond sales,
multiple teacher grievances, eyebrow-raising
private consultancies, lucrative Coca-Cola
contracts, and special privileges for vendors
participating in the Education Research and
Development Institute (ERDI) conferences.
When the DISD problems began to surface in
2004, Moses resigned and walked away with an
additional $480,850. Along with his ongoing
and lucrative superintendent search business
and consultant fees, he now receives a yearly
TRS pension of $224,400 per year. It is no big
surprise that Dallas ISD finds itself in a huge
financial mess.
By Tawnell D. Hobbs and Kent Fischer
The Dallas Independent School District
overspent its 2007-08 budget by $64 million, a
recently discovered gaffe that will probably
require deep cuts just as a new school year is
getting under way.
District officials attributed the overspending,
in large part, to last year's hiring of an
additional 750 teachers to reduce class sizes -
a cornerstone of the Dallas Achieves reform
effort. The district, though, failed to
adequately budget for the new teachers, said
Superintendent Michael Hinojosa.
At the same time, day-to-day spending last
school year exceeded budgeted amounts, but the
district staff members failed to notice. They
were almost singularly focused on completing an
overdue audit of books from the 2005-06 fiscal
year, said Steve Korby, the district's chief
finance officer.
District officials projected a substantial
shortfall in April - just weeks before a $1.3
billion bond election - related to the hiring
of the teachers. They played down the
significance of the problem and said higher-
than-expected state revenue would cover
unbudgeted costs.
It wasn't until last month, when accountants
pulled together last year's spending records,
that they grasped the magnitude of the 2007-08
overrun, Mr. Korby said.
The district remains solvent only because it
had $120 million in reserve, a figure that is
now down to about $56 million. That's about
half of what a district the size of DISD should
have in the bank.
Dr. Hinojosa said he is restructuring the
district's business operations. District
spokesman Jon Dahlander said no employees had
been dismissed as of Wednesday.
Board President Jack Lowe, who is chairman of
the board of TD Industries, said that as a
businessman, he should have spotted the
shortfall.
"I should have said, 'I'm not convinced yet,
show me the numbers, prove it,' and I didn't,"
he said. "In hindsight, I wish that I had dug
deeper.
"We have a great education plan, we made big
strides, we just lost track of the finances.
This is unacceptable. It's embarrassing."
Eric Anderson, the district's chief operating
officer, did not attend Wednesday's news
conference and declined to comment when reached
by phone. Budget Director John McGee also
declined to comment when reached at home.
Hiring freeze
Dr. Hinojosa said he was immediately putting
the finance department under the supervision of
Arnold Viramontes, his chief of staff. The
district was also instituting an immediate
hiring freeze, and administrators will begin
looking to cut spending.
"We're going to try and maintain everything
that we can with Dallas Achieves, but
everything is on the table going forward," Dr.
Hinojosa said.
News of the overrun comes on the heels of
passage of a $1.3 billion bond issue in May and
a months-overdue financial audit in June. The
audit found severe weaknesses in the district's
internal controls and accounting practices.
That report cost the district more than $2
million and will lay the groundwork for a
multiyear, $11 million effort to restructure
DISD's business operations.
Wednesday's announcement is another blow to a
district battered by years of headlines about
problems related to district credit card use,
car allowances, overtime expenditures and cozy
relationships between vendors and district
workers.
None of the problems revealed Wednesday would
have happened "if the people in finance were
doing their jobs in the first place," said Dale
Kaiser, president of the teachers group NEA-
Dallas. "This doesn't lend itself to having a
whole lot of confidence" in district
leadership.
"Ultimately, isn't the superintendent
responsible?"
A 'disconnect'
This was already shaping up to be a lean budget
year. Revenues are expected to come in $10
million short of last year, while expenses are
expected to increase as fuel costs rise and
teachers receive raises.
Mr. Korby, the chief financial officer,
attributed some of the overrun to "position
creep" - campuses hiring workers who are not
included in the budget.
"We don't have a lot of confidence that we know
what's going on at the campuses with
positions," Mr. Korby said, adding that there
is a "disconnect" between what is spent at the
schools and what the central office has
budgeted for each campus.
Trustee Edwin Flores said he asked in February
2007 whether the district could afford the
extra teachers it was hiring under Dallas
Achieves. He said the finance staff told him
money wasn't a problem.
"I'm disappointed, I'm sad, I'm shocked," he
said.
Mr. Lowe said he's concerned about this year's
budget - and plans to ask a lot of questions.
"I think that we need to be ... sure that we
got it right this time," he said.
Trustee Ron Price also laid part of the blame
on the board.
"It is time for the board to hold our employees
accountable," he said. "The board has been
asleep at the wheel. The days of passing the
bucks are over."
Unknown is how any future cuts will affect
classrooms, students and the district's long-
term improvement efforts.
"We believe in Dallas Achieves," Dr. Hinojosa
said. "We know it's having an impact on
students, but everything has to be on the table
as we find a remedy for this."
Timeline
November 2005: DISD eliminates nearly $3.7
million in car allowances after The Dallas
Morning News reports on employees who received
the money despite rarely traveling on district
business.
July 2006: DISD cancels all of its employee
credit cards after The News reports on more
than $6 million in spending that either
violated state procurement laws or district
policy over a nearly three-year period. A
follow-up report finds that workers also used
their credit cards to misspend federal grant
money.
August 2006: DISD announces it is creating an
Office of District Integrity to root out fraud,
waste and academic cheating.
September 2007: The News reports that DISD
spends millions of dollars a year in stipends
and extra pay that is not authorized in the
district's compensation manual. The report
notes that the district also had overspent its
overtime budgets by a total of nearly $13
million between 2003 and 2006.
September 2007: DISD lays off 163 workers in an
attempt to save $10 million and streamline
management.
March 2008: Federal auditors examining a
portion of district grant spending from the
2005-06 school year find at least $5.3 million
in misspent money. The district sets aside $8
million to be returned to the federal
government.
April 2008: The district publicly acknowledges
a $50 million budget gap created by a
miscalculation of teacher salaries. Officials
say the gap will be filled by state revenues,
which were coming in higher than expected.
June 2008: Trustees receive an overdue audit
that found serious flaws in district financial
controls, accounting and bookkeeping.
— Tawnell D. Hobbs and Kent Fischer
Dallas Morning News
2008-09-11
INDEX OF OUTRAGES
Pages: 380
[1] 2 3 4 5 6 Next >> Last >>
|
