Like the City of Harrisburg, the State has had to step in and assist the Harrisburg School District.
On January 16, 2012 the Harrisburg School District’s (HSD) state-appointed Chief Recovery Officer Gene Veno held the first meeting of the Advisory Committee, a group of people brought together to meet and discuss the District’s precarious financial situation. Like the City of Harrisburg, the School District is mired in debt and mismanagement resulting in multi-millions of dollars in public debt. After only weeks analyzing the situation, the newly appointed Veno proclaimed, “I don’t think the community really knows the total number of dollars that is outstanding.” Nor would it seem the Harrisburg community is exactly aware of how this debt was accrued, however, a glance at the deals done during the City of Harrisburg’s ten year oversight of HSD shows that many of the same practices and participants were at play that architected the Harrisburg Incinerator financings.
As the Chief Recovery Officer says, this is something that needs to be publicly discussed in these beginning steps toward recovery. That community conversation has to encompass the mess of creative financial agreements enacted on behalf and backed by City taxpayers, as well as the resultant deficiencies and inadequacies of the School District’s services. Just like the City, the District is plagued by condemnation of its performance. Based on national standards, HSD continues to be categorized as “low student achievement” and is ranked one of the worst schools in the State.
The impoverished condition of HSD led Pennsylvania’s Secretary of Education, Ron Tomalis, to declare it “in Moderate Financial Recovery” on December 12, 2012. He then named Gene G. Veno as the District’s Chief Recovery Officer. Veno is tasked with developing a Financial Recovery Plan that not only addresses the District’s lack of financial stability, but also one that suggests changes to the organization and policies of HSD.
In some ways, the School District sealed its own fate in June by accepting $1,732,162.16 in “distressed district” funds from the State, which helped the District restore some of its severe budget cuts such as teaching positions, programs, and extracurricular activities despite, even with a tax increase. Based on the need for these funds that led to a balancing of the budget, in August HSD was given a “Preliminary Designation of Financial Recovery.” This designation gave the PA Department of Education the right to review and analyze the District’s financial records, which ultimately resulted in the Secretary’s determination that HSD was “in Moderately Financial Recovery.” At a PA Senate committee roundtable on December 18, 2012 only a week after the Secretary’s declaration, the President of the School Board of Directors, Jennifer Smallwood said, “We actually fought the designation, because we feel as though we weren’t distressed. We have a balanced budget but we understand that we are lacking the resources to move our district forward. And that’s where we feel the Chief Recovery Officer Veno will help in that aspect.”
Smallwood is not alone in her sentiment about her expectations of the State’s oversight and the Chief Recovery Officer’s focus. During the Advisory Committee meeting on January 16th, Superintendent Sybill Knight-Burney maintained that her Administration is doing a good job and has been doing a good job. but like the City, Burney asserted it’s the financial deals of the past that have burdened the District. “I don’t want anyone to walk around thinking that we’re not on the right track.” Knight implied that she and the Board of Directors have sufficiently managed the District’s business but now look to the Chief Recovery Officer and his team to indicate “how do we deal with the bond and the debt that we’re holding.”
“Did we close the right buildings? I don’t know, Dr. Burney, if you did.”
However, as the Chief Recovery Officer pointed out, the challenges of the District are more than the massive debt it’s amassed. Veno referred to inaction on pending litigation, a lack of reported and public accessible information, and delayed action as current administrative procedures that should be remedied. Using last year’s closing of two elementary schools as an example—Hamilton and Lincoln, Veno cited the fact that no Facility Feasibility Study had been performed by the District in order to support the decision to shut down those particular schools versus others. Turning to the Superintendent, Veno stated, “Did we close the right buildings? I don’t know, Dr. Burney, if you did.” It’s Veno’s contention that a study should have been performed to justify the closings.
To further punctuate his point that too little information is available to the public, Veno referred to the upcoming Budget process and its overlap with his mandate to produce a Financial Recovery Plan. According to the Chief Recovery Officer, although he had been asking, he had yet to receive any report of numbers to support the Budget process. He expressed concern about the short window of opportunity the District was affording the public to review the Budget numbers before they are officially turned into the Chief Recovery Officer. In defense, both Dr. Burney and President Smallwood assured Veno a timeline had been set to include a special session of the School Board of Directors to give the public an overview of the process. In light of the fact the meeting was scheduled to take place three days before the January 31st due date, Veno lightly chided Burney and Smallwood for that strategy by asserting the public deserves more time. He told them, “Here you are, you’re trying to plan your recovery, and you’re doing it three days before the 31st.”
It is Veno’s role to work with the Superintendent and the School Board of Directors to devise, implement, and administer a Financial Recovery Plan for the District, which is to be first presented to the School Board of Directors within 90 days of his December 12th appointment, that is March 12th. As stated above, the Plan is to not only include recommendations to get HSD on firm fiscal ground, but also any recommendations to enhance the efficiency and purpose of the District. Such recommendations can be staff reductions, property divestment, and charter schools. Once the plan is developed, the elected School Board of Directors will have 3o days to publicly vote on its acceptance. If the Plan is approved by majority vote, then it goes to the Secretary of Education for validation. Once that’s done, the Chief Recovery Officer and the District together will begin to put the Plan in place. If at any time, the Superintendent or the School Board of Directors do not follow the Recovery Plan’s recommendations, the Secretary can petition the Dauphin County Court of Common Pleas for the appointment of a Receiver to takeover the District’s business management. In that circumstance, the Chief Recovery Officer would take on an advisory role to the Receiver.
A Receiver can also be requested should the School Board of Directors fail to approve the Recovery Plan, which is what happened in the Chester Upland School District. A plan was proposed, rejected, and a Receiver was petitioned and gotten. Based on the different designations of the districts though, Harrisburg School District would have one year to readdress and approve a Recovery Plan before the Secretary could ask the Court for a Receiver.
Chief Recovery Officer Veno is hoping that doesn’t happen. In an open letter to the public he declared, “The development of a recovery plan for the HSD will be a collaborative and open process.” It’s with this approach that the Veno intends to acquire the necessary administrative and community buy-in needed to successfully turn HSD around. “It’s a Recovery Plan of action for the next 5 years and then some,” he told the Advisory Committee.
It’s the potential to change the way things have been done, things that haven’t necessarily worked for the City of Harrisburg.
- January 3, 2013: Harrisburg School District’s Chief Recovery Officer: We Can Do Better
- January 30, 2013: Harrisburg School District: 46% of the District’s Budget is Funded by the State
- Read Pennsylvania Act 141 here
- January 29th at 6:00pm at John Harris High School, 2451 Market Street. A public meeting to discuss the process of the Harrisburg School District’s Financial Recovery.
- Thursday, February 7th at 6:00pm at HSD Administrative Building, 2101 North Front Street, Building 2. Advisory Committee meeting. Public welcome.
- February 21st at 6:00pm at Camp Curtin Elementary School, 2900 N6th Street. A public meeting to discuss the process of the Harrisburg School District’s Financial Recovery.
- March 12th at 6:00pm at John Harris High School, 2451 Market Street. A public meeting to discuss the process of the Harrisburg School District’s Financial Recovery.
- HSD Superintendent, Dr. Sybil Knight-Burney
- Jennifer Smallwood, HSD school board president
- James Thompson, HSD board member
- Scott School Principal Donna Cheatham
- Debra Miller, HSD business manager
- Lisa Lyles, HSD director of human resources
- Harrisburg Education Association President Sherri Magnusson
- Terry Mathis, American Federation of State County & Municipal Employees president
- N. Nichelle Chivis, American Federation of State County & Municipal Employees representative
- Mechanicsburg School District Superintendent Dr. Mark Leidy
- Dr. Mary Jane Gales, Capitol Area Intermediate Unit executive director
- Sylvan Heights Charter School Director Dr. Kevin Moran
- Dr. Rachelle Bonfield, retired educator
- City of Harrisburg resident Karl Singleton
- City of Harrisburg resident Merry-Grace Majors