Schools

So what went wrong last time?

Missteps led to deficits that officials say aren't likely to happen again.

(Editor’s Note: This article is part of three-part package. to examine the debate over Hopkins’ financial situation. to read about the challenges that make education finance hard to understand.)

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would arguably face less pessimism about the district’s financial future if eight years ago it had not dropped into “statutory operating debt,” a legal term for when districts go in the hole by more than 2.5 percent in a single year. 

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So what caused that to happen the first time?

John Toop, the district’s director of business services, said the School Board and administrators at the time—which did not include Toop or Superintendent John Schultz—made some inadvisable decisions.

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First, they waived the fund balance policy—voluntarily allowing the district’s savings to drop to unsafe levels for multiple years because they weren’t getting the level of state funding they thought they needed.

Second, it used a budget process that asked a citizens group to rank programs individually and decide what level of funding each deserved without adequately taking into account the district’s needs as a whole.

In the process, they wound up with a collection of programs they didn’t have funding for—and without adequate support services necessary to make those programs work, said Schultz and Toop. One year, that even led to not funding transportation.

“It didn’t translate into the actual budget,” Schultz said. “It didn’t work. It didn’t use actual numbers. It never projected. The variables that weigh heavily on a budget—like contracts—weren’t considered.”


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