×

Gwinn schools dealing with fiscal stress

District seeks business manager

GWINN — The financial picture for Gwinn Area Community Schools is grim, but the district is taking steps to alleviate the issue.

GACS Superintendent Tom Jayne said the school district is looking at having to implement a roughly $400,000 budget reduction this school year.

The district’s financial situation was a major point of discussion at a special Tuesday meeting of the GACS Board of Education, at which it voted unanimously to hire the company Hiring Solutions LLC, based in downstate Okemos, to assist with a job search for a new business manager.

“We need somebody with experience,” Jayne said.

Bob Nardi, associate superintendent with the Marquette-Alger Regional Educational Service Agency in charge of finance, information and quality assurance services, spoke at the Tuesday meeting after having studied the district’s finances.

“It’s not happy to report that you got a problem, but I want you to know you’re not alone in fiscal stress,” Nardi said. “It’s a very unfortunate thing that happened here, but we’re all pitched in.”

He agreed a new business manager will need special financial savvy.

“This person’s going to have to be skilled,” Nardi said. “They’re going to have to be able to do financials. They’re going to have to be able to do a deficit-elimination plan. They’re going to have to find a way to get you guys up above the 5 percent fund balance threshold.”

In August, the board terminated AJ Filizetti, then director of finance and human resources, because of what Jayne said at the time was “basically dereliction of duties, misfeasance and malfeasance of duties, not performing his duties as expected, not having our records and finances in the type of shape that we would wish at this time of year.”

Amy Finkbeiner, business manager for the district from 2003 to 2015, was appointed interim business manager. A financial team also was established for the 2017-18 fiscal year.

Karen Anderson, former interim superintendent and business manager, also discussed the money situation at the meeting.

She said that in March 2015, the board identified goals that included creating and maintaining a “reasonable” 8 percent fund balance, increasing enrollment, having a quality instructional program and having a clear understanding of the district’s financial condition.

“We need to remember those goals and reinstate and renew those goals, because once we get through the mess that’s come up for the next year or two, we need to get a good handle on where you are financially,” Anderson said.

The district, she said, was short approximately $135,000 in revenue for the 2016-17 budget, with expenditures over what was budgeted by about $262,000.

The $7,600 per-pupil aid from the state is a fixed amount, Finkbeiner said, regardless of outlying development.

“We’re still only going to get X amount of dollars per pupil,” Finkbeiner said.

Area population trends also should be taken into account.

“Gwinn is a transient community, so you can’t just look at enrollment,” Finkbeiner said.

She suggested more oversight on the part of the school district as well.

“You should be requiring financial statements monthly from your business manager,” Finkbeiner said.

Nardi recommended having a sinking fund, whose funds go into facilities.

“Having a sinking fund is a huge, huge advantage,” said Nardi, noting the Gwinn school district was robbing its general fund to pay for facilities.

He also suggested looking at other school districts’ organizational structures and obtain superintendents’ ideas on how they handle their finances.

In a follow-up meeting Thursday with The Mining Journal, Jayne said: “I don’t want to make excuses and point fingers. If there is any of that to be told, then I’ll take the responsibility. I’m the CEO. I’m the superintendent, so it starts and stops with me.”

Jayne said the district’s auditors in August said they were unable to complete the audit because there were insufficient documents. After meeting with Filizetti about the situation, the board later made the decision to fire him.

“We did not know the depth of how inadequate our finances and books were,” Jayne said.

He said tax revenue had been miscalculated, and some accounts hadn’t been reconciled.

The school district incurred a big expense in 2015 when Gilbert Elementary School was reopened to alleviate crowding at nearby Sawyer Elementary. Jayne said it cost about $300,000 in building and site costs to reopen the facility to bring it up to code, plus about $210,000 to hire three teachers.

Jayne stressed the board will implement former practices, such as amending the budget each month so the board will know if any overspending has taken place.

A permanent business manager still needs to be hired, and Jayne said he took part Thursday in a two-hour conference call with Hiring Solutions.

“They feel confident we’ll be doing interviews within eight weeks,” Jayne said.

Making up the huge deficit, though, won’t be easy.

For one thing, it means cutting down on non-essential items, Jayne said.

“If you can live without it at this moment, we have to live without it,” he said.

An administrative team is to bring him ideas to make the $400,000 worth of cuts by Tuesday, according to Jayne, who was to meet with the unions to tell them of the “severity” of the problem and solicit their ideas.

There also will have to be special board meetings, and cuts will first start with auxiliary and administrative services, he said.

“We’re going to try and make those decisions that least impact any of our student operations,” Jayne said. “We don’t want to interrupt the current process of teaching and learning as best we can.”

Christie Bleck can be reached at 906-228-2500, ext. 250. Her email address is cbleck@miningjournal.net.

Newsletter

Today's breaking news and more in your inbox

I'm interested in (please check all that apply)
Are you a paying subscriber to the newspaper *
   

Starting at $4.62/week.

Subscribe Today