The Hattiesburg Public School District is cutting jobs and salaries for staff to help keep the district running through this school year on decreased finances.
“Eighty to 85 percent of our budget is employees and salaries," said John G. Ladner, interim superintendent. “We are going to have some wage cuts and current salaries as well as there are a number of positions that we’re currently studying. In those instances where we may be overstaffed there’s going to be a reduction in staff. That will start immediately. I want everyone to know that it’s going to start immediately, and it’s going to continue until every employee, virtually every employee, in this district will be affected in some manner or another.”
Ladner said the cuts will be in addition to the spending freeze on all nonessential items, like teacher travel to out of town conferences. He said trying to maintain as much classroom stability as possible is a priority, but said students will likely feel some impact.
“In some cases, we have had to make some cuts, which in effect, do affect our children,” Ladner said. “Is learning going to be the same? Most certainly, we hope so. We just have to ask ourselves, ‘do we really have to do all of this for a program to make our children successful?’ And in some instances, we can do a little bit less. In any case, where we have duplication of task, in other words, if three people are doing what one or two can do, then there may be reductions to staff.”
He said he plans to communicate with HPSD staff about the cuts within the next week or two.
Ladner's announcement comes after a letter from the Mississippi Department of Education to the state auditor sent a "rapid response team" to investigate the district's finances and management practices.
“We’re working with the state department of education,” Ladner said. “I am sending scenario plans of action to them. Their eyes are on it. Our eyes are on it. Meanwhile, I’m about to start doing some of these cuts and cutbacks.”
In that letter, State Superintendent of Education Carey Wright notes "the district secured a $7,000,000 tax anticipation note (TAN) in August of 2015. Of the $7,000,000 loan proceeds, the district has already spent $6,000,000.”
Ladner explained that $7 million loan is based on the expected amount of money the district should received from taxes and was received at the beginning of the 2015-2016 school year.
“Well, in so many cases, because of diminished fund balances or not having enough money to bridge over, you can go borrow the amount of anticipated money that you’re going to need," Ladner said. "When you are having to go borrow $7 million dollars in any one given year, that tells you that you should be at least keeping $7 million in your fund balance each year. So that is roughly based on the current note that we have, over the next several years try to build our fund balance back up to a number that is somewhere around $7 million.”
Ladner said the immediate goal is to make it through the rest of the school year with the money the district has left.
“As we all are looking at these numbers, it is so very, very close that it is really hard to calculate,” he said. “We can only get so close to figuring out if we can make it to June 30. It appears, I’m going to be a little positive with you and say that it appears to me that we’re going to make it.”
If the district is not able to fund itself through the end of the year, Ladner said the state department of education would likely step in.
“The worst-case scenario would be that we would not be able to meet our financial obligations, and the state would come in and set up, bring in a conservator who would basically do the same things that I’m going to do,” Ladner said. “But they can do them in a more expeditious manner. I most certainly am working with the state department right now to hopefully convince them to allow me to try to do some of the same things that would be done in that situation.”
For a conservator to step in, the governor would have to declare a state of emergency in the school district. Then, "the State Board of Education may abolish the school district and assume control and administration of the schools formerly constituting the district and appoint a conservator," according to MS Code § 37-17-6(11)(b).
“We’re considering any and all solutions,” Ladner said.