Fiscal emergency may solve Niles schools’ financial woes

Not only is the Niles City School District facing a major financial crisis, but the teachers’ union has rejected the board’s “last, best and final” contract offer. To describe the situation as dire is to state the obvious. What is not so obvious is a solution that at first glance may seem counter intuitive: State imposed fiscal emergency.

Such a declaration by state Auditor David Yost would trigger the appointment of a state fiscal oversight commission. The entity would the take control of the school system’s finances, and would also have the power to set aside all labor contracts. In other words, fiscal emergency would give the school district a powerful ally, the state of Ohio.

On its own, the school board will be hard pressed to come with the $375,000 that is the projected deficit for the current fiscal year which ends June 30. And, it certainly has no way of closing a $4.3 million hole in the five-year economic plan that is required by the state auditor’s office.

While no public entity wants the stigma attached to a declaration of fiscal emergency, the long-term benefits outweigh the short-term embarrassment.

The Youngstown City School District, which was under the state’s thumb for six years, is today fiscally stable and its long-term prospects are good. The fiscal oversight commission forced the school board and the administration to make decisions that were not popular with the superintendent, administrators, teachers and other employees, but were necessary.

All spending had to be approved by the oversight panel and the board was required to develop a five-year spending plan that showed a balanced budget each year.

The commission has also told the board it must seek another operating levy when the current one expires.

Youngstown would have had a very difficult time erasing the red ink in its operating budget had board members not had the cover of state law. They made the tough decisions they otherwise would have been reluctant to even contemplate.

Road to recovery

The Niles school district needs Auditor Yost’s help in dealing with its economic crisis. A declaration of fiscal emergency will put the system on the road to recovery. It does not have the wherewithal to do it on its own.

Last year, we criticized the board for entering into a contract with the new superintendent, Mark Robinson, that was more lucrative than the one with former Superintendent Rocco Adduci.

The board approved a six-figure salary for Robinson, who began his assignment Aug. 1. But it was the raise of 8.5 percent, or $9,400, after just one month on the job that triggered our reaction. We were especially troubled by the justification for the raise: 7.9 percent “incentive pay for the achievement of goals,” which were not defined in the contract; and, 1 percent “ancillary responsibilities compensation” for work he has to do outside of normal business hours.

“Is the Niles Board of Education so out of touch with reality?” we asked in the editorial.

The district’s fiscal crisis could have been anticipated by the board, given the cuts in state funding and the national economic recession.

Now, board members must decide the best course of action to stanch the flow of red ink. Fiscal emergency, as unpalatable as it may be, could offer the best way out for the district.