Saginaw fund balance disappears

SAGINAW, Mich. - Rather than the $6 million fund balance it thought it had, the Saginaw City School District now faces a budget that outspends revenue by $2.4 million, according to The Saginaw News.

Former school finance director Richard C. Powell, called back as a consultant, said that poor accounting and double payment of state funds — of which the school board was not informed — means the district cannot afford the spending plan it put in place, The News reported. If the district ends the year in the red, it must file a deficit reduction plan with the Michigan Department of Education and submit to state monitoring, according to The News.

Powell and Superintendent Thomas Barris said that severe budget cuts will be on tap to address the deficit; Barris has proposed closing three schools and reviewing the need for non-instructional buildings, The News reported. In January the district laid off about 120 employees, later recalling half of them, according to The News.

District finance officer Terry Pruitt resigned last month and the district now will seek help from the Saginaw Intermediate School District finance department, The News reported.

The Saginaw News, "Saginaw School District has until June to get its financial house in order or risk a takeover," Feb. 5, 2009

Michigan Education Report, "Detroit not the only school district seeing red," June 30, 2008