Pontiac school finances face state scrutiny

May 2, 2012

The state is set to take a preliminary look at the financial situation of Pontiac's public schools, a step that could eventually lead to the appointment of an emergency manager.

According to Lori Higgins with the Detroit Free Press, the district is currently saddled with a $24.5 million deficit---a figure  that pulled the district out of compliance with its own deficit-elimination plan and earned disapproval from state Superintendent Mike Flanagan. As a result, the state is withholding aid payments to the district amounting to $1.25 million.

More from Higgins at the Freep:

Among the reasons Flanagan cited Tuesday for the review:

• The district's deficit increased from $12.2 million in June 2010 to $24 million in June 2011.

• The district's deficit-elimination plan calls for the deficit to be whittled to $22.8 million by the end of this school year, but district officials have said they expect the deficit to increase to $26 million.

• The district received two advances from Oakland Schools to meet financial obligations, including payroll.

So how likely is it that Pontiac's schools will go the way of the city's government and end up under emergency manager control?

The Oakland Press reports that the preliminary probe should be finished by the end of the month, after which Flanagan will "determine whether to recommend to Gov. Rick Snyder that he appoint a formal review team."

Pontiac's Interim Superintendent Walter Burt told the Press:

“The law provides for several additional steps before appointment of an emergency manager could occur, including a request from the state superintendent that the governor appoint a review team; development of a consent agreement; continuing operations plan; or recovery plan.”

And, according to the Oakland Press, the school district is still  trying to bring it's debt under control---"officials already have announced layoffs of 95 employees, including 43 teachers cut shortly after spring break, as well as a planned school closing."

-John Klein Wilson, Michigan Radio Newsroom