LITTLE ROCK — The Arkansas Board of Education released North Little Rock and three other school districts from the state’s fiscal distress program Monday.
North Little Rock, West Side in Cleburne County, Dermott and Strong-Huttig will no longer have to seek state approval for their expenditures and won’t be subject to state monitoring above and beyond what is typical for all school districts.
But the state board added the Mineral Springs district to the fiscal-distress program because it is in jeopardy of deficit spending this year.
The 489-student Mineral Springs district in Howard County is projected to overspend by $131,616 this year, Hazel Burnett, the state’s coordinator of the fiscal-distress unit, told the Education Board.
“We think it will be better than that but there are variables out there that we are still reviewing,” she said.
Bill Blackwood, who recently retired from the nearby De Queen School District, represented Mineral Springs at the meeting. He is its new interim superintendent.
Arkansas Education Commissioner Tom Kimbrell said the Mineral Springs district “should count its blessings” in being able to hire Blackwood.
“I know he’ll get them on the right track,” Kimbrell said. “He is recognized as one of the great superintendent leaders in the state.”
A school district designated in fiscal distress has no more than two years to correct deficiencies or face penalties - such as a state takeover or annexation into another district. The state Department of Education can take over a district at any time if progress isn’t made on correcting financial problems.
The four districts removed from the fiscal-distress program avoided those penalties.
The 9,000-student North Little Rock district is by far the largest of the districts released from the fiscal distress.
The state classified the North Little Rock district as fiscally distressed in May 2011 after annual audits repeatedly faulted the district for failing to reconcile its bank accounts in a timely manner.
In response, the North Little Rock system hired a new chief financial officer, Denise Drennan, who is a certified public accountant and experienced as a legislative auditor.
Additionally, the superintendent removed some of the duties previously assigned to the chief financial officer and assigned them to others. This allowed the fiscal manager to focus on finances.
The school district also created a supervisor’s position to oversee the daily work of district bookkeepers. And the district began requiring payroll checks to be directly deposited into employee bank accounts to avoid accounting problems associated with paychecks that are not immediately deposited or cashed.
District Superintendent Ken Kirspel told the state board that district employees have worked closely with the Department of Education’s finance staff to remedy problems and receive training. The district also worked with Arkansas Public School Resource Center, a nonprofit organization, to help the district reorganize its business department.
“The point of our [financial improvement] plan was not to just reach this goal - which was to be able to petition for removal from distress - but to have a knowledgeable well trained staff, and the policies and procedures that would allow us to be successful” in the long term, Kirspel said.
“We think we have accomplished that.”
State Education Board member Vicki Saviers congratulated district leaders for the corrections.
“This is a great example of a district using all kinds of resources to do the right thing,” Saviers said. “Good job.”
The 405-student Dermott School District eliminated its high school football program as one of the steps to cut expenditures.
The district also reduced its number of principals from three to the one who now serves grades kindergarten through 12. About a dozen certified teaching positions and eight noncertified jobs were eliminated. Work days for 14 teachers and 22 non-certified staff were reduced.
The Dermott district’s balances, which had dipped from more than $1 million in 2008-09 to $716,603 in 2010-11, improved to $1,029,288 this past school year.
Kelvin Gragg, the district’s new superintendent, said the sole principal is a former elementary principal. But Gragg will be able to assist at the secondary-school level because of prior experience in that role, he said.
As for the loss of the football program, Gragg said the district still offers basketball, track, choir and band, making it possible for students to participate in extracurricular activities.
Gragg said that monitors from the different sections of the Department of Education visited the district in Chicot County.
“I’m proud to say that there were no recommendations they could make to us,” Gragg said. “They said we were operating as efficiently as possible. That reaffirmed what we were doing.”
The 439-student Strong-Huttig School District in Union County took several steps to cut overspending and rebuild its reserve funds that went from $950,279 in the 2008-09 school year to $775,197 in 2009-10 and up to $1 million this past school year. Those steps included eliminating five certified and eight noncertified positions, eliminating stipends to employees and reducing district-funded employee insurance benefits.
Saul Lusk, who recently returned to the superintendent’s job in Strong-Huttig after working elsewhere in the state, also said the district eliminated its boys’ basketball and track programs.
“We realize that if you remove us from fiscal distress, we must continue to implement, and be very smart to implement, measures to keep us from returning to fiscal distress,” said Lusk, who also drives a school bus for his district.
The West Side School District in Cleburne County improved its financial condition in part with voter approval of a 4.9-mill property tax increase in July, said Ray Nassar, the district’s new superintendent.
“That shows the community is really interested in the school,” Nassar said. “It’s reassurance they really want to save the school.”
The district, which has about 430 students, reduced certified and noncertified staff positions through layoffs and attrition, and it reduced the number of workdays per year for a handful of employees.
The district cut two bus routes, limited school trips and stabilized its purchase-order system. It had a positive audit for the 2011-12 school year.
As a result, the district’s reserves that were at $2.1 million in 2008-09 and dropped to $916,688 the following year improved to $1.67 million in 2011-12.
“Our district has gone through some hard times,” Nassar said. “Our future looks brighter,”
Other school districts currently in the state’s fiscal distress program are Aplena, Bismarck, Drew-Central, Brinkley, Hartford, Western Yell County, Cutter-Morning Star, Helena-West Helena, Hermitage and Pulaski County Special.
Front Section, Pages 1 on 12/11/2012