School district receives advice on financial crisis
Strong leadership under Superintendent Pat Gemma and an early identification of the problem will help Tahoe-Truckee Unified School District weather its financial crisis, according to Thomas Henry, the executive director of the Fiscal Crisis and Management Assistance Team (FCMAT).
“He’s providing the leadership and a good heads up early,” Henry said of Gemma. “The fact that you’re on top of it early, that’s very productive.”
Getting to fiscal health won’t necessarily be an easy job, but there is plenty of time to address the issues, he said.
Contracted by TTUSD, the Fiscal Crisis and Management Assistance Team is currently scrutinizing the school district’s budget and studying various aspects of the district’s operation. It will present a final report Monday, Nov. 23.
“We consider ourselves an independent, external review,” Henry said.
The cost to the district is $4,500 for the FCMAT study and report, but Gemma said the team was needed to give the beleaguered district a second opinion about its financial worries and to help the district with the budgeting process.
“The whole notion of managing a school district is so convoluted,” Gemma said.
It will be educational to learn how TTUSD’s spending and operations compare with other school districts in the state, he said. Henry said the -Tahoe-Truckee school district is not any different than the dozen or so other schools that FCMAT is helping at this time.
“Tahoe Truckee is no different than any other districts. There’s always that level of anxiety and concern,” Henry said. “School districts up and down the state are having financial difficulties. Tahoe-Truckee is not unique in that regard.”
It was a school district bankruptcy in
Richmond that resulted in the creation of the Fiscal Crisis and Management Assistance Team in 1992. The legislation gave greater fiscal oversight of school districts by county offices of education.
Counties must approve budgets of school districts and can issue negative or qualified declarations if they cannot approve them. If that happens, the state is notified and there are various actions which can be taken, the most extreme being a state administrator or team bypassing a school board and setting its own budget for a school district.
Right now, three out of 1,000 school districts in the state are currently under state control, Henry said.
Gemma said Tahoe Truckee Unified School District’s interim budget report is on notice as “qualified” because it will not have the 3 percent reserve mandated by the state.
The “proactive approach” being taken by TTUSD, however, will most likely keep the Placer County Office of Education from declaring a “negative” budget, said Pat Matthews, the deputy superintendent of business for the office of education.
She said the county will probably be able to approve or qualify the 1999-2000 budget without the proper reserve if it has been increased from its current low level and if there is a plan of action for the next couple of years that is prudent fiscally.
She doesn’t anticipate a negative budget or potential state control.
“They’re just being so energetic and realistic. I am impressed with the new superintendent and how he is dealing with this situation that was handed to him when he walked in the door,” Matthew said. “He’s very aware of the ramifications of not taking actions.”
Bringing in the FCMAT team is an action that Gemma and the TTUSD Board of Trustees undertook in order to develop a plan to bring the school district to fiscal health.
The FCMAT can be called by the state to provide mandatory fiscal crisis intervention to districts, but most of its work is similar to what it is providing TTUSD, Henry said.
“Eighty-five percent of our work is on the preventative management assistance,” Henry said.
FCMAT uses teams that include a certified public accountant, past superintendents, support staff and about three writers for the report to analyze school districts.
For the TTUSD, Gemma said FCMAT combed through the budget Oct. 4, 5, 6 and then returned Oct. 20-21 to visit the district’s high schools. An initial report pointed out various problems with the budget and made recommendations concerning the Special Education program and other district operations.
During the most recent visit, Gemma said the team looked at the high school’s staffing, quality of programs, class sizes, ratios of custodians and secretaries, among other items. The report on the high schools is not finished, but Gemma said the team did offer some observations.
The FCMAT team said it is rare for a high school of North Tahoe’s size to offer so much variety in programming, Gemma said. For example, Gemma’s former high school offered calculus every other year, but NTHS offers it every year.
“If part of the plan to make the budget healthy is to cut staff and teachers, you do more than raise class sizes, you also cut programs,” Gemma said.
FCMAT’s Henry said the Tahoe Truckee Unified School District is facing many of the same fiscal issues as other California school districts, except for one problem unique to Tahoe Truckee.
Tahoe Truckee Unified School District has declining enrollment, but it is not able to financially take advantage of that because there is a charter school under its wing. Normally, the state will fund a school district based on its current enrollment or its past year’s enrollment if it is a declining enrollment school district. Although TTUSD has less students than last year, the state does not consider it a declining enrollment district because charter school students are included.
Another big factor with TTUSD is the impact of the collective bargaining agreement, Henry said. The agreement uses the cost of living adjustment (COLA) monies for this year and has promised that COLA money to the teachers and staff for next year.
“We need to analyze it and have a good sense of what the impact is going to be,” Henry said. “That remains to be seen. The study hasn’t been finished yet.”
Gemma said after the FCMAT report is given Nov. 23, he will convene a group of community leaders, teachers, staff, administrators, students and district officials to prepare a business plan to present to the TTUSD Board of Trustees in December.
He expects the group to heavily weight the FCMAT report, even if some of the solutions are politically unpopular.
“It would be equally unpopular to go bankrupt,” Gemma said.
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