Consultant: Hammond Schools Likely to be on Takeover Watch List

School Board transfers funds to avoid negative cash balances at end of year but consultant says schools are at risk for State intervention

December 20, 2018-After the fiscal crises in Gary and Muncie, the State of Indiana directed the Distressed Unit Appeals Board to create criteria designed to identify schools that exhibit signs of financial distress. House Enrolled Act 1315 established a fiscal and qualitative indicators committee charged with determining whether schools were likely to be in need of State intervention:

Report of MTW Consulting to the School City of Hammond p. 9

According to the report by MTW Consulting, “the eight bullet points from the IEERB summary should be reviewed by the Hammond Schools since all of them would indicate the very real potential for the School City of Hammond to be placed on the “watch list” based on current data.”

Some Steps Already Being Taken

To their credit, Hammond School Trustees have already begun some of the steps suggested in the report. A strategic planning committee was formed and made recommendations for school closures-one of the primary cost cutting measures suggested in the report. The referendum provides $10M per year in operating costs but for the district but that appears to be insufficient to address the long-term financial difficulties. According to Trustee Murphy, one board member quashed any attempts to cut administrative staff from the budget. The Board of Trustees should also be commended for publishing the report although it came only after it was mentioned by Trustee Murphy and discussed on social media. The report is dated November 12, 2018 and was paid for by Hammond taxpayers.

Unfortunately, Trustees, under the leadership of Board President Deborah White, continue to try to hide the true financial condition of the schools from the public. As reported exclusively by the Gazette, the strategic planning committee process itself was shrouded in secrecy from formation to conclusion and the suggestions now lack legitimacy as they did not seek input from the public. At a meeting of the Board of Trustees last night, Deborah White appeared to be visibly upset as outgoing Trustee Cindy Murphy brought up the MTW Consulting report and discussed some of the findings. Absent the discussion by Trustee White and pressure from the Gazette, it is unlikely the report would have ever been published.

Full MTW Consulting report (Source: http://www.hammond.k12.in.us/UserFiles/Servers/Server_43216/File/MTWReport.pdf)
MTWReport

2 Comments

  1. The SCH is in deep financial trouble, and has been for some time. Between the bloated administration, the debt for the schools already built, and the alleged over run costs for the new school, the SCH is on the cliff’s edge.I am surprised the state hasn’t already stepped in.The SCH has no one but itself to blame, but our children, their parents, and all residents of Hammond will suffer the consequences.

  2. 7/18/2008 9:25:00 AM
    State rejects $165 million Hammond high school plan
    What happened
    The state School Property Tax Control Board voted 6-3 against a $165 million plan to build a new Hammond High School and convert Gavit High School into a middle School. The fate of the project now rests with Cheryl Musgrave, commissioner of the Indiana Department of Local Government Finance, who has up to 180 days to make a decision.

    If Musgrave rejects the project, a voter referendum would be the last resort. Time is running short to get a question on the November ballot, and Indiana does not hold elections in 2009. That means Hammond schools would have to finance a special election if they want a vote on the project next year.

    Times of Northwest Indiana

    BY PATRICK GUINANE, Times of Northwest Indiana
    pguinane@nwitimes.com

    INDIANAPOLIS | The $165 million plan for a new Hammond high school flunked its first financial test Thursday and could be headed for a showdown with property tax-weary voters.

    The state School Property Tax Control Board voted 6-3 to reject the construction project. The nonbinding recommendation now goes to the Indiana Department of Local Government Finance Commissioner Cheryl Musgrave, who has six months to make a final decision.

    If Musgrave axes the project, which already has been delayed three years by local tax angst, supporters would have to win approval for the new high school via referendum. Opponents want voters to have that say.

    “This isn’t something that should be left to four or five people,” said George Janiec, one of three Team Hammond taxpayer advocacy group members to speak against the project on Thursday.

    The legislative property tax overhaul that took effect this month requires referendums for new high school projects exceeding $20 million. But the Hammond plan, which also would convert Gavit High School to a middle school, survived a 2001 voter challenge under the old petition and remonstrance system.

    Hammond schools Superintendent Walter Watkins on Thursday told the state panel the district considers it a “moral imperative” to replace the 1917 high school with a modern building. The project would cap a $245 million construction spree — interest payment notwithstanding — that began a decade ago.

    Principal Linda Fullilove said students with disabilities must enter the current Hammond High School building through a boiler room, take smelly freight elevators to classrooms on the second and third floors and be wheeled through an outside parking lot to enter the gymnasium.

    An architect for the project went on to list various deficiencies of the current building, including 610-square-foot classrooms that measures about a third smaller than state recommendations and science labs that lack emergency second exits.

    State control board members said they sympathized with the need for a new high school, but they bristled at the price tag: $106.6 million in principal, plus an estimated $60 million to $70 million in interest over 20 years.

    And the payments are backloaded. The proposed financing schedule calls for the already debt-heavy district to pay nothing this year and next. Annual payments would jump to $5.3 million in 2010 and balloon to $13.9 million in 2020.

    © Copyright 2018, nwitimes.com, Munster, IN

Leave a Reply

Your email address will not be published.


*