CHARLESTON, W.Va. (AP) - The West Virginia Department of Education expects only one of the state’s 55 county school systems to end last fiscal year with a deficit, but that one is far into the red and embroiled in employee grievance filings that are hindering its recovery.
Joe Panetta, the department’s chief operations officer, told members of the state Board of Education’s Finance Committee this month that - although counties aren’t required to have audited financial numbers until next March - he believes only Calhoun County ended the 2014-15 fiscal year with a deficit. The 2015-16 fiscal year began July 1.
There were nine school systems with deficits three years ago, and Panetta attributes the decrease to the committee’s closer monitoring of county finances.
However, Calhoun’s deficit going into last fiscal year was $1.8 million - more than one-fifth of the annual operating budget for the county, whose last reported enrollment was about 1,070 students. Panetta said Calhoun was hoping to drop the deficit by about $300,000 last fiscal year, but it appears it will drop only by $100,000 or less. And even that reduction could be erased, he said, as employee grievances over significant pay cuts are litigated
“There’s starting to be a real concern about that county,” Panetta told committee members. “If they’re only making even a $100,000 progress in reducing a deficit of $1.8 million, that’s 18 years that it’s going to take them.”
Calhoun Schools Superintendent Tim Woodward told The Charleston Gazette in January that he hoped the county’s cuts would save $600,000 in 2014-15.
In March, though, Administrative Law Judge Carrie H. LeFevre ruled in favor of county employees who filed grievances against the Calhoun school board over one of those cuts: eliminating $600 yearly pay supplements that the county paid all workers with local funds, rather than with the usual state-provided salary funding.
John Roush, the West Virginia School Service Personnel Association attorney representing the union members who filed grievances on the issue, said the school board has not appealed LeFevre’s order for the workers to be paid their supplements for last year, but the board is trying to remove the supplement for the new school year.
Roush said about 60 union members are opposing that in a new grievance. The service union represents employees like bus drivers, custodians and cooks.
Christine Campbell, president of the American Federation of Teachers’ West Virginia branch, said her union is now trying to get teachers their supplements for last year. She said she didn’t know yet if the union will fight for the supplement for this year.
“We didn’t have employees in the original grievance, so due to the inequity, we had members that wanted to file for equity,” Campbell said. “These folks said, ‘We want to provide this supplement to our school employees,’ and now they’re taking it away.”
Calhoun School officials weren’t available for comment on July 17. The Department of Education says Calhoun’s diminished progress in curing its deficit is because of grievance payouts, increased substitute costs and higher food costs.
According to LeFevre’s order, on May 29, 2014, the Calhoun school board voted to request that the state school board OK its planned elimination of the supplement for 2014-15. The state board approved the action on June 11.
LeFevre cited a passage of state law that says counties cannot reduce local funds allocated for salaries in effect as of Jan. 1, 1990, “unless forced to do so by defeat of a special levy, or a loss in assessed values or events over which it has no control and for which the county board has received approval from the State Board prior to making such reduction.”
Although Calhoun voters shot down the county’s May 13, 2014, effort to raise property taxes in an excess levy election that would have partly supported supplements, LeFevre said the levy’s failure wasn’t grounds for ditching the supplements because the extra pay was never historically funded with levy money. Panetta said assessed property values in Calhoun have actually increased, and the county is the only one in West Virginia with an excess levy for libraries but not for schools.
The Calhoun school board argued that the “events over which it had no control” exemption allowed it to cut the supplements, but LeFevre noted that the county has run a deficit since the 2010-11 fiscal year. She said school board members and former superintendents knew about the growing deficit, but didn’t reduce or transfer employees to reduce spending.
“The evidence presented suggests that no serious actions to reduce spending were taken until May 2014 when Mr. Woodward began as superintendent,” LeFevre wrote. “It appears that this inaction resulted in the last minute budget cuts which prompted this grievance. Therefore, the financial condition in which Respondent found itself in May 2014 was no surprise.”
The judge said county school board members and the former superintendent “allowed the deficit to spiral out of control, and lead to the situation that existed in May 2014. Roger Propst retired as Calhoun superintendent in March 2014.
LeFevre did allow the county to reduce of some employees’ annual work days - something the state Department of Education ordered the county to do on June 30, 2014, the day before its 2014-15 budget was supposed to take effect. Roush, the attorney for the service employees union, said he’s also appealing that decision, and about half of the affected employees’ cases are pending in Kanawha County Circuit Court, with the rest before the West Virginia Supreme Court.
When asked why the department waited so long to give that order, Panetta said counties aren’t required to turn in their budgets for approval until May 31 of each year, and the department must then review, within one month, the documents for all 55 counties plus eight Regional Educational Service Agencies and seven multi-county vocational centers. He recalled that Calhoun didn’t immediately respond to the department’s requests for more information.
Even though Calhoun is not among the counties the state school board has taken over to fix problems their local boards can’t seem to solve, the department is required to sign off on all counties’ budgets. Even assuming the supplement elimination would stick, the department found Calhoun’s budget to be insufficient, and ordered it to reduce employment days until it saved at least $100,000.
Panetta said the department has kept approving Calhoun’s budgets, despite its growing deficit, because it trusted that county officials were making a good-faith effort to fix the issue and because they had to spend enough money each year to support educating county students.
“I guess, now, we’re going to wait on what the legal process is going to produce,” he said.
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Information from: The Charleston Gazette, https://www.wvgazette.com
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