Pontiac district found to be $24 million in debt

PONTIAC, Mich. — Facing a budget deficit that has swelled to $24 million, the Pontiac School District is considering staffing reductions and health care changes, according to The Oakland Press. The district must submit a revised deficit elimination plan to the state by Dec. 6.

The district anticipated a deficit of about $10 million as of June 30, 2011, but the latest estimate is $24.5 million, The Detroit News reported separately.

While district revenue has declined, district spending has not, interim financial officer Paul Bryant said at a recent meeting, The Press reported. Bryant is employed with Plante Moran and has been assigned to the district since the spring of 2011, according to The Press.

For example, Bryant said that the district received $7 million through the American Recovery and Reinvestment Act to employ teachers in 2009 and 2010, but when those funds ran out, the district retained the teachers and paid them out of its general fund, The Press reported.

Now the district is considering privatizing, staff reductions and school closings, The News reported. Bryant said the school board also could consider asking voters for a sinking fund millage and making money-saving changes to employee health care plans, according to The Press.

The district plans to conduct a health insurance audit and a payroll audit to determine “whether people working in the district are the only ones getting paid,” The Press reported.


The Detroit News, “Pontiac schools' interim superintendent resigns amid deficit controversy,” Nov. 23, 2011

Oakland Press, “Pontiac School board reviews deficit elimination,” Nov. 22, 2011


Mackinac Center for Public Policy, “Privatization Growth Spurs Savings,” Dec. 15, 2010