Gary school district touts path to financial recovery
Contributed By:The 411 News
$22 million deficit cut by half, public hearing set for 2020 budget
The Gary Community School Corporation is in the final stages of developing its 2020 budget with one of the key elements being deficit reduction.
Lisa Rosinko, Chief Operation and Financial Officer said the yearly deficit has been sliced in half to $11 million. In August 2017, when the State of Indiana and its partner MGT Consulting began managing the school district, that year’s deficit was $22 million.
Rosinko said the district is on the path to eliminate the final $11 million by the 2020-21 school year.
That deficit meant the district owed $22 million more than the revenues it received in 2017.
School closings and staff cuts made up part of bringing the yearly deficit down to $11 million in 2019.
In 2018, the district was able to reduce contractual costs for student busing and employee health care.
The district negotiated a settlement with the Internal Revenue Service, reducing the IRS $8.5 million lien on the district to $320,000.
Eric Parish, of MGT Consulting, leads the financial side of the emergency management team. Since the beginning of the state takeover, he has emphasized the way to the district’s financial recovery cannot just be cost cutting; it must include bringing in more revenues.
The most significant sources of revenue for a school district are its students. Neither Gary’s population nor that of its neighboring cities is growing. So, retaining current students and attracting more is a priority. The Gary school district counted it as a plus in 2018 when its student population dropped by only 100 compared to a decade long slide of as many as 500 and more students left the district each year.
Districts across the state keep close tabs on their enrollment numbers. Each student means thousands of dollars in state support. The Gary Community School Corp. receives nearly $8,000 for each student from the basic state support grant. And state support accounts for about 85% of a school district’s budget.
Loans from Indiana’s common school fund continue to keep the district operating but add to the deficit. The district aims to operate within the funds received from the basic state support grant and property tax collections, reducing the need to borrow.
Another source of revenue could come from voters approving an increase in property taxes.
A public presentation on the budget, along with a public hearing, will be held Friday, October 4th at 4p.m. at West Side Leadership Academy.
The budget will then be considered by the Distressed Unit Appeal Board (DUAB) on October 10th.
The approved budget will be posted on the District’s website at www.garycsc.k12.in.us and www.budgetnotices.in.gov.
Story Posted:09/30/2019
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