PEYTON WOLCOTT - NATION'S 1st DAILY CONSERVATIVE PUBLIC ED COMMENTARY

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"Walk softly
and carry a big stick."
-- Teddy Roosevelt

"Trust but verify."
-- Ronald Reagan

Just because you can
doesn't mean you should.

H o w w e t a k e b a c k o u r c h i l d r e n ' s e d u c a t i o n: o n e p e r s o n , o n e q u e s t i o n , o n e s c h o o l a t a t i m e.

Conservative Commentary - Financial Exigency 101

Gloria from Luling on
sidewalk outside
Walsh Anderson party
at Austin's Iron Cactus
with unnamed man
who was
shy about revealing
his name
(TASA Mid Winter,
2007 )

The American Superintendent (Leonard Merrell) as
Allan Ramsay's King George III
(Mixed-media collage by Peyton Wolcott, Copyright 2008)

Wolcott

Peyton

6 SIMPLE GUIDELINES
FOR PUBLIC SCHOOL
SUPERINTENDENTS & TRUSTEES
By Peyton Wolcott
October 1, 2008

1. End discretionary spending.
Set an example for your staff; let them
know you mean business about running a
tighter ship: No trips, no conferences, no
meals, no credit cards. If you want to
learn more about something, use Google.
Do a webinar. Read a newsletter. No
golf games with vendors, ever. No
chauffeurs, no rental cars. Stay home, do
your work and keep your nose clean.

2. Reduce administrative costs.
Go through your administrative staff roster
and cut every other job, starting with
getting rid of all PR and marketing. No
advisors, no consultants. No multi-year
contracts for any administrators. Learn
how to really read a budget. Put your
check register and all wire transfers online.

3. Ethics.
No nepotism. Let your wife and kids earn
a living in a field other than education. No
board members' spouses working in the
district. Conduct all discussions with
vendors and potential vendors in the
open; invite your public to watch and ask
questions. Throw away your contract and
work year by year. Move your chair off
the dais at board meetings. You're not a
team member with your elected trustees.
You're not equal to them. They're your
boss.

4. No construction.
If you're the rare district truly experiencing
sufficient growth to justify building new
schools, splinter off that population and let
them start their own new school district or
charter school. They might be able to
take over an abandoned church or office
building for much less than the Taj Mahal
you had in mind.

5. Back-to-basics curriculum.
Math table (1st grade: add, 2nd grade:
subtract, 3rd grade multiply, 4th grade
divide) daily drill. You made sure your
own kids learned the basics at home or
with tutors; why shouldn't all children have
that same opportunity? Ditto for phonics.
Classical literature. History, not social
studies. No more block scheduling. Daily
P.E. for all. Emphasize individual effort
and accomplishment.

6. Attitude.
You're a public servant, not a Third World
dictator. Practice humility and gratitude.
Remember when your employees laugh at
your jokes or tell you you're cool or
vendors marvel at your every utterance
that they're all sucking up to you.
Remember why you got into education to
begin with. Sell your house in the gated
community and buy one in the middle of a
real subdivision like your average parents
and taxpayers can afford. Let yourself be
driven not by the latest platitude you
picked up at the latest education
conference but by the same wonderful
noble desire to educate kids that got you
into this field.

Is your
school district's
check register
online yet?

Instruction
Instructional & Media Svcs.
Curriculum/Staff Development
Instructional Leadership
School Leadership
Guidance Counseling
Social Work Services
Health Services
Transportation
Food
Cocurricular
General Administration
Plant Maintenance/Operations
Security/Monitoring
Data Processing Services

DALLAS ISD 2006-07 TOTAL PER STUDENT NEW SAVINGS

$794,651,062
20,227,879
41,646,131
23,668,571
80,092,755
53,791,105
2,254,085
15,745,747
18,430,137
63,928,900
10,311,558
36,307,915
153,948,158
16,753,799
16,434,569

$5,004
127
262
149
504
339
14
99
116
403
65
229
969
105
103

Total Operating Expenses $1,348,192,371 $ 8,489

$1,000,000
0
1,000,000
11,250,000
1,000,000

1,000,000
5,000,000

$19,227,879
41,646,131
22,668,571
68,642,755
43,791,105

9,311,558
31,307,915

TOTAL SAVINGS
$236,595,914

* If you're in Texas, you can find your school district (including Dallas ISD) on the handy drop-down
alpha sort here. Or, here's the entire URL for Dallas ISD to copy and paste:
www.tea.state.tx.us/cgi/sas/broker?_service=marykay&_program=sfadhoc.actual_report_2007.sas&_service=appser
v&_debug=0&who_box=&who_list=057905

DALLAS ISD (TX)
Financial exigency 101
By Peyton Wolcott - Wednesday, October 2, 2008 /10:00 a.m.

N E W S F L A S H
09.30.08/3:02 pm

Dallas ISD (TX)
can cut consultants
before they cut
teachers.

While it is true that in the
Texas Education Code the
only RIF's mentioned as
regards a declared state of
financial exigency are for
those educators holding
SBEC certificates and
nurses, DISD can examine
their consulting contracts
and exercise the contracts'
30-day opt-out clauses to
send notice-of-intent letters.

What it means; what can and can't be done...including
the $1.239 billion in fed funds to Dallas ISD since 2000

The nickel version
After a week's worth of research the main thing I've come away with is that there is no solid
reason why Dallas ISD cannot start saving money today by first cutting consultants and
those administrators who are not core employees, well ahead of cutting teachers.

Rather than depending on principals to come up with fire lists -- while I'm in favor of local
control, this is essentially a qualitative approach guaranteed to perpetuate favoritism --
why not initiate a more quantitative approach by appointing outside administrators to go
through Dallas ISD's employment rolls and ask the following two questions:

(1) What is the statutory requirement for this position? and (2) Is this job part of Dallas
ISD's core mission? Using these guidelines, rather than cutting teachers, including
principals' pets -- if teaching is not at the heart of Dallas ISD's core mission, what is? -- as
one possible example Mike could theoretically at least dissolve the entire DISD
PR/communications department tomorrow and start speaking to journalists and parents
and taxpayers himself. Who knows, such a bold move might help his relations with the
public. As another example of legal cost-cutting available to Mike, he could also take
advantage of the 30-day opt-out provisions (such provisions exist, right?) (and if not, why
not?) existing in the contracts of the district's cottage industry of TEKS helper-consultants
and such. He did tell us "everything's on the table," didn't he?

Away, then, to the dollar version:

DICTIONARY DEFINITION
"Financial exigency": an
urgent need or demand: He
put financial exigency before
personal sentiment.
--Oxford University Press

AMERICAN ASS'N OF
UNIVERSITY PROFESSORS
DEFINITION
A standard for claiming
financial exigency that was
suggested by the American
Association of University
Professors (AAUP) in 1976
was that the institution would
have to close if tenured
faculty were not dismissed,
and that other remedial
measures must be instituted
prior to dismissing tenured
faculty.

The courts have not adopted
this AAUP "survival
standard," rejecting the
contention that capital assets
need to be invaded to
alleviiate existing financial
problems. The judicial
definition allows an
institution to take necessary
measures to reduce financial
hardship before the situation
becomes irreversible.
[Continued here]
--Financial Exigency and
Faculty Dismissals:
Guidelines for Universi-
ty Administrators.Authors: Kelly,
Michael; Kitabchi, Gloria

QUESTION FOR DALLAS
ISD TRUSTEES -- AND
DALLAS RESIDENTS:
If Dallas ISD schools are not
good enough for DISD trustees'
kids, why aren't the trustees
working to make DISD schools
better if not excellent for all kids?

Texas case law
When you look at the following five lawsuits supporting Texas
school districts' declaration of a state of financial exigency,
keep in mind that often the term is defined in local board
policies, as with the above four examples, and therefore each
case might have a different definition.

Permanent School Fund
"Financial exigency" is also defined in the Permanent School
Fund ("PSF") Bond Guarantee Program policy, here, or you can
copy and paste this URL:
www.tea.state.tx.us/school.finance/bond_finexig.pdf#xml=http://www.tea.state.tx.
us/cgi/texis/webinator/search/xml.txt?query=financial+exigency&db=db&id=3001d0
a978813a1d

______________________________
* Here's a link to the Texas Education Code so you can scroll down to Chapter 21 and read all of it for yourself:
http://tlo2.tlc.state.tx.us/statutes/ed.toc.htm

** While it's not an ideal situation to second guess DISD superintendent Mike Hinojosa or DISD board president Lowe or
Jon Dahlander, DISD's chief PR guy, as none of these gentlemen have responded to queries, all that any of us who are not
insiders at DISD headquarters can do is try to figure out things for ourselves as best we can with the limited news they've
been willing to share with us and whatever research we've been able to scrounge on our own by contacting other agencies
such as TEA. The most I've received thus far from Steve Korby, DISD's current chief numbers guy, is that "we have
reviewed every option for cost reduction, including contracts." Still awaiting a response from him and/or the others
mentioned as to what if any consulting contracts they're severing.

*** Here's the link to the February 2007 DISD logo flap to copy and paste into your URL search box:
www.dallasnews.com/sharedcontent/dws/news/localnews/stories/DN-disdlogo_09met.ART0.West.Edition1.29957a0.html

Clarification from TEA
Many administrators are not required to hold contracts
according to the positions defined above; they're also not
required to hold SBEC certificates -- such as for instance
employees in DISD's PR/communications department.

§ 21.211. TERMINATION OR SUSPENSION.
(a) The board of trustees may terminate a
term contract and discharge a teacher at any
time for:
(1) good cause as determined by the board;
or
(2) a financial exigency that requires a
reduction in personnel.
(b) For a good cause, as determined by the
board, the board of trustees may suspend a
teacher without pay for a period not to
extend beyond the end of the school year:
(1) pending discharge of the teacher; or
(2) in lieu of terminating the teacher.
(c) A teacher who is not discharged after
being suspended without pay pending
discharge is entitled to back pay for the
period of suspension.
(Added by Acts 1995, 74th Leg., ch. 260, § 1, eff. May 30, 1995.)

Dallas ISD board policies
Four DISD board policies mention financial exigency; when you read these keep in mind that "Legal" policies are
statewide policies from the Texas Education Code, and "Local" are policies set by Dallas ISD trustees. Here's the first:

Per the Texas Education Agency, there are three types of
contracts but this is the broadest and most common
definition as regards who is entitled to a term contract:

§ 21.201. DEFINITIONS.
In this subchapter:
(1) "Teacher" means a superintendent,
principal, supervisor, classroom teacher,
counselor, or other full-time professional
employee who is required to hold a certificate
issued under Subchapter B or a nurse. The term
does not include a person who is not entitled
to a probationary, continuing, or term contract
under Section 21.002, an existing contract, or
district policy.

When asked this past Monday whether Dallas ISD's
consulting and other non-employment contracts could be
affected by the district's financial exigency, TEA general
counsel David Anderson replied, "That depends on their
contracts, if there is a contract. The default is that a noncerti-
fied employee, or a certified one serving in a position that
doesn’t require certification, is at-will and can be terminated
for any permissible reason -- most state employees are in
that type of position," David said. "That doesn’t necessarily
make it easy given the potential for allegations of impermis-
sible reasons -- all of the possible discriminations,
whistleblower, etc. -- but there is no statutory right to any type
of process. Higher administrators who aren’t certified might
have employment contracts just as someone in the private
sector could. The terms of those individual contracts would
control how or when they could be terminated. Each contract
could be different. A dispute over a written employment
contract can sometimes be appealed to the Commissioner
under Section 7.057 of the Education Code."

Texas Education Agency
Austin

of a curriculum offering, program, or school operation due to either a lack of student response to particular course
offerings, legislative revisions to program funding, or a reorganization or consolidation of two or more individual schools,
school programs, areas, departments or divisions. The term shall also include a Districtwide change in curriculum
objectives, or a modification or reorganization of staffing patterns.

EMPLOYMENT AREAS AND CONSIDERATION FOR AVAILABLE POSITIONS: A reduction in force may be implemented in
one, several, or all employment areas, as determined by the Board if for financial exigency, or as determined by the General
Superintendent if for a program change. When a reduction in force is to be implemented for financial exigency, the General
Superintendent shall assist the Board by making recommendatons to the Board regarding the employment areas and
positions to be affected. In determining affected employment areas and positions, the General Superintendent or Board
may combine or coordinate employment areas, as defined below (e.g., the Board may combine “elementary programs”
and “compensatory education programs” to identify an employment area of “elementary compensatory education
program”).

Allen Gwinn at
Dallas.org has a
suggestion:
Because Dallas ISD
board president
Jack Lowe has
spoken so highly of
superintendent Mike
Hinojosa's
management of
DISD, wouldn't it be
a great idea for Jack
to hire Mike to head
up TD Industries?

The other three Dallas ISD board policies which mention financial
exigencies do so only briefly; the following are excerpts from the three
specifically referencing financial exigency:

TERM CONTRACTS SUSPENSION/TERMINATION DURING
CONTRACT
DFBA (LEGAL) DATE ISSUED: 4/1/2005 UPDATE 72

GROUNDS FOR DISMISSAL: The Board may terminate a term contract
and discharge a term contract employee at any time for: 1. Good cause
as determined by the Board; or 2. A financial exigency that requires a
reduction in personnel. Education Code 21.211(a)

TERM CONTRACTS NONRENEWAL
DFBB (LEGAL) DATE ISSUED: 12/16/2003 UPDATE 72

GROUNDS FOR NONRENEWAL: The Board may terminate a term contract for a financial exigency that requires a reduction
in personnel. Education Code 21.211(a)

TERM CONTRACTS NONRENEWAL
DFBB (LOCAL)-X DATE ISSUED: 05/30/2005 LDU-22-05

REASONS: The recommendation to the Board and its decision not to renew a contract under this policy shall not be based
on an employee's exercise of Constitutional rights or based unlawfully on an employee's race, color, religion, sex, national
origin, disability, or age. Reasons for proposed nonrenewal of an employee's term contract shall be ....9. Reduction in force
because of financial exigency or program change. [See DFF]

"Financial exigency" in the Texas Education Code
Surprisingly, "financial exigency" appears only once in the Education Code* and then only
in the context of firing teachers and other personnel who hold certificates from the State
Board for Educator Certification, and nurses, which may explain** why Dallas ISD initially
at least said it intended to fire personnel rather than cut consultants' contracts.

Stidham v. Anahuac ISD Ruiz v. Edinburg ISD
Collins v. Kountze ISD Peevy v. Liberty Hill ISD
Wheeler v. Port Aransas ISD

"Dr." Dean Andrews, former Liberty Hill ISD superintendent who CBS
discovered last year had bought a diploma mill doctorate

dire financial straits that they need to
declare financial exigency, it's
because my own Llano ISD
superintendent Dennis Hill declared
such a state in April 2003. That the
50th wealthiest district in Texas had
been so mismanaged that our bonds
fell to junk status woke up me and
my neighbors in our too-complacent
far-southeastern part of the county. I
recall one board meeting during this
period when the financial advisor
Dennis hired tried to paint a rosy
picture of district finances with a
graphic showing that including the
$50,000 loan the advisor had just
secured (by walking across the street
to the local bank) LISD had a positive
fund balance of $5,000. Imagine.
For more, here's the Comptroller's
audit report.

Although most folks aren't exactly sure what it means for a
school district to declare a state of "financial exigency," we
don't have to be a CPA to know it was not good news when
Dallas ISD superintendent Mike Hinojosa declared a state
of financial exigency on September 19 after having
discovered he'd overspent by $64 million; that he said the
declaration enabled him to start firing teachers then soon
afterwards the disclosed overspend jumped to $84 million
then $148 million made the situation even more troubling.

Sound familiar?
Comments by & about
Wilmer-Hutchins supe
Charles Matthews

"Dr. Matthews refused to
adjust the district's budget to
reflect declining enrollment."

"He's a very pleasant man, a
likeable person," said a
former board president. "But
that's about it. I don't know
how you could rely upon his
abilities to be the
superintendent."

"The ultimate goal in
everything we do from now
on is to improve student
achievement."
--C.M. at Wilmer-Hutchins

"We're embarking on a new
and exciting time for Wilmer-
Hutchins. It will take some
work, but we've got a lot to
work with."

--C.M. at Wilmer-Hutchins
(SOURCE--Dallas Morning News)

Although Dallas ISD has
lost 2,734 students since
2000, DISD's spending is
up by a half-billion dollars.

2000-2001/161,548 students
$ 1,152,435,870 total
expenditures all funds

2006-2007/158,814 students
$ 1,708,816,170 total
expenditures/all funds

(SOURCE--TEA/Dallas ISD PEIMS
actual financials)

Most public school superintendents would rather eat glass
than admit they'd mismanaged so much money, likely
because of the more extreme examples that come to mind.

At least two districts which have declared financial
exigencies have been shut down completely by the Texas
Education Agency in the past three years: Mirando City and
Dallas ISD's former neighbor, Wilmer-Hutchins; not only
did Wilmer-Hutchins' superintendent Charles Matthews
eventually declare the exigency in October 2004 but also
later that same month he was indicted on a felony charge
and again a few months later on a second felony charge --
this despite Matthews having been named TASB

Dallas ISD superintendent Michael
Hinojosa (above) enjoying rosier
times at his 2005 "State of the District"
report to the Chamber of Commerce;
(inset) more recently at Dallas ISD
school board meeting.

superintendent of the year in 1991. His prior work experience included stints in Dallas
ISD (as "Wellness Programs" director from 1996 to 1998) and Houston's North Forest
ISD, another district which has declared financial exigency with resulting increasingly
serious steps of state intervention.

This commentary has been prepared to not only help
end the confusion in Dallas regarding exactly what financial
exigency means, but also to clearly show steps Mike
Hinojosa can now take. You'll find pertinent Texas
Education Code references plus a helpful clarification from
Texas Education Agency general counsel David Anderson
in addition to the four Dallas ISD board policies which
specifically mention financial exigency; there's also case
law and a mention in the Permanent School Fund 's bond
guarantee program.

My own district, Llano ISD, has recovered sufficiently that
Dennis Hill was a 2008 TASB superintendent of the year
finalist; more below.

Still, for a Texas public school district to declare a state of
financial exigency is a rare and serious enough occurrence
that a Google search this morning for "financial exigency"
and "ISD" only yielded 533 reports, a couple of hundred of
them about Dallas ISD.

Defining "financial exigency"
While there's the dictionary definition for "financial exigency" (see the two grey boxes
above right for general background information), more important for Dallas ISD residents
is what financial exigency means as a defined term both within the Texas Education Code
and also in Dallas ISD's own board policies.

TERMINATION OF CONTRACT REDUCTION IN FORCE
DFF (LOCAL)          DATE ISSUED: 9/25/2006 [Excerpted]

PURPOSE: "To provide for an orderly method for the separation of professional employees
who are affected by a necessary reduction in force (RIF)."

DEFINITIONS: 1. “Reduction in force (RIF)” means the dismissal of a teacher,
administrator, or other professional employee under contract before the end of a contract
term or at the end of the contract term, for reasons of financial exigency or program
change.    2. “Financial exigency” means any decline in the District’s financial resources
brought about by decline in enrollment, cuts in funding, decline in tax revenues, or any
other actions or events that create a need for the District to reduce financial expenditures
for personnel.   3. “Program change” means any elimination, curtailment, or reorganization

pursuant to applicable policies related to termination or nonrenewal. These criteria are listed in order of importance. The
General Superintendent shall apply them sequentially to the extent necessary to identify the employees who least satisfy
the criteria and therefore are subject to the reduction in force; i.e., if all necessary reductions can be accomplished by
applying the certification criterion, it is not necessary to apply the performance criterion, etc.

Board oversight
If I've written about Dallas ISD trustees needing to sever all revenue
streams to the district, it's because I've watched what happened in my own
local district where such streams were allowed to continue and flourish to
the detriment of the populace. We watched through board meeting after
board meeting where trustees with a financial stake in not upsetting their
superintendent more or less rubber stamped everything the
superintendent wanted to do, with very few substantive questions asked.

Friends, it's a very sad thing to see old people have to sell off some of their
property in order to be able to pay their school taxes and remain in their
homes.

This is the lay of the land, Dallas. The bridge is out ahead. Best take heed.

In fairness to Dennis, he had just stepped into the job vacated by Jack Patton, famous in a way for having become Texas'
first Public Information

Act conviction, although in the interests of accuracy it must also be pointed that Dennis was Jack's number-two guy and
assistant superintendent throughout this entire period. There was the construction of a new Taj Mahal high school
followed by the expensive remodeling of the old high school -- after the community was told the new high school was
necessary because the old high school was too, well, old.

During this period our school board was composed mostly of members who were doing business with the school district
during their tenure. The fellow with a furniture and appliance store was selling furniture and appliances to Llano ISD, the
woman with an insurance agency sold insurance to the district, the plumber on the board worked on the new Taj Majal
high school as a subcontractor, and so on.

Further, Jack Patton had used theTaj Mahal architects for a major remodel of the house at his ranch, as had the district's
CFO, Carol Voit, whose new home featured the only residential indoor lap pool in Llano (population 3,325). Voit's
accounting practices included as a few examples coming to several board meetings without having balanced the district's
checkbook, discovering "mathematical errors" while reading her department's financial reports to the board, and creating
a second checking account for the district with the same check numbers with the result that folks asking to view checks
had to know which account to ask for.

Today, Jack Patton, who permanently surrendered his SBEC credentials, is selling barbeque out of the convenience store
he bought back home in Crockett, Texas. Carol Voit moved back to Lubbock where she is employed by Region 17
Education Service Center as their business services coordinator.

Llano ISD's income almost doubled since 2000 while adding only 311 more students

2000-2001 / 1,682 students
$ 24,893,309 total receipts all funds.

2006-2007 / 1,993 students
$ 46,992,417 total receipts all funds;
a property-rich district, LISD's Robin Hood payment accounted for only $ 12,605,044.

(SOURCE--TEA/Llano ISD PEIMS actual financials)

Friends, here's what the
new media looks like.

10.3.08/Brief history of Dallas ISD reporting: Some
months ago a blogger started blogging live from
Dallas ISD school board meetings then
D Magazine followed suit and included a
photograph of the board meeting on Sept. 19, then
last week and yesterday The Dallas Morning News
ran a sophisticated self-refreshing live blog,
complete with viewer comments and photographs
of the board room and the teachers picketing
outside. Bravo to all!
--------
This is the future of the media: More and direct
coverage including photographs which allow
people to sort things out for themselves including
backfence chatter. The best service the media can
provide now is to present facts, accurately disclose
their point of view and get out of the way. I felt I had
a clearer grasp of who Sarah Pallin was after
getting to observe her directly myself for 90 minutes
at the VP debate last night than after Katie Couric
and CBS's heavily edited highly slanted version of
what they wanted me to see of Palin. After years of
reading words about them, when DMN presented a
few brief video clips last week of Dallas ISD
superintendent Mike Hinojosa and DISD board
president Jack Lowe I could see for myself the two
men's mettle.
-----------
10.2.08/Dallas ISD special board meeting covered
by three live blogs:
D a llas Morning News
Dallas.org and The Dallas Observer

10.03.08 / NEWSFLASH:
Texas public schools are driven by
vendors and TASA*, in that order. This was
the lesson of last night's Dallas ISD board meeting
in which a majority of trustees voted to RIF teachers
and low-level workers rather than take advantage of
the opportunity to rid the district of its bloated admin.
layers and too-many consultants.
     These 5 DISD trustees voted to fire its bottom
rung rather than the district's six-figure kings and
queens: Leigh Ann Ellis, Edwin Flores, Jerome
Garza, Jack Lowe and Adam Medrano. Only Ron
Price said "he wanted to discuss further the
possibility of reducing district spending on
consultants."
     Dallas ISD's union leadership has proven itself
to be ineffective. Where they had an opportunity this
past week to drive a dialogue in favor of their
teachers and against DISD administrators, instead
they did nothing. In fact, one even took a day off to
move house.
     Can someone explain to me why Dallas
teachers' union leaders have been so quick to sell
their members down the river?   I've yet to hear a
peep from the unions insisting that DISD first get rid
of its pricey administrators/consultants.
    We're not talking architects here -- although in a
time of a shrinking student population that's not a
bad idea -- but about the multi-million dollars spent
on education consultants, leadership consultants,
image consultants, TAKS helpers, etc.   All the
teachers' unions have done for their membership is
show up on TV and raise a ruckus, with no tangible
results for rank and file. If I were a DISD teacher, I'd
ask for my dues back.

*Texas Ass'n of School Administrators

H O M E

Friends, this was prepared during October 2008 for Dallas, Texas residents; if you live elsewhere, be sure to look up your own state and local policies -- and remind your officials to fire your district's kings and queens before they fire teachers and low-level workers.

DALLAS ISD FAST FACTS

On Sept. 19, 2008 Dallas ISD
superintendent Mike Hinojosa
announced he'd misspent
$64 million the prior year
which meant he'd have to
declare a state of financial
exigency; he immediately
announced that he'd have to
fire 675-750 teachers. The
next week the amount
misspent rose to $84 million,
then later to $148 million, the
total of the two years.'

Q: Was the misspending the
result of too many more
students? A lot less money
coming in?

A: Compare DISD's
2000-2001 figures below
against 2006-07 figures and
judge for yourself:

Q: Where'd the extra
half-billion go last year?
A: You'll have to ask Dallas
ISD superintendent Mike
Hinojosa. His phone number
is (972) 925-3700. Fair
warning: In two years of
attempting to leave phone
messages for Mike, in
addition to its being very
difficult getting through the
admin. layers to his three
secretaries, he's never once
called me back. Hopefully
you'll be luckier.

Was the logo*** fiasco
a warning sign?

Rather than spending his
time focusing on learning
how to read Dallas ISD's
financials, thereby preser-
ving his district's financial
integrity, instead DISD supe
Mike Hinojosa wasted time
last year on a new logo:

which proved to be a waste
of time as the trustees
understandably rejected it
in February 2007. The old
one (top) was fine.
Tellingly, Mike told the
school board that his
cabinet was enthusiastic
about the new design. Like
employees are going to tell
the boss the truth.

Not all declarations of financial exigency end so badly, and
some districts are able to pull themselves out of their
troubles and replenish their financial reserves such that
they're no longer teetering on the brink. Port Arthur ISD, hit
hard by Hurricane Rita, has ended its exigency and TEA has
sent home the conservator it appointed. (SOURCE--Business Wire)

I'm publishing this also for another reason: It distresses me to hear only about teachers
and switchboard operators losing their jobs, while Dallas ISD's bloated admin. layers
appear to have been left largely intact. Couldn't just one of the Viramontes' stay and the
other leave -- or work for $1 per year as principal Larry Feldman volunteered to do earlier
this year in Miami? Wouldn't one six-figure salary be enough for a family to live on? In
addition to the salary dollars saved, this two-fer fix would also help alleviate DISD
superintendent Mike Hinojosa's PR problem as regards allegations of nepotism within
his administration.

Student parking lot art at Dallas ISD's
Woodrow Wilson High School

DEFINITIONS

Under whose leadership
did DISD's financials
slide into disarray?
Mike Moses (above) was the
permanent superintendent
before Mike Hinojosa started
work at DISD April 28, 2005.

ABOVE--September 19, 2008 Dallas ISD board meeting
(PHOTO--D Magazine); BELOW-- DISD golf tournament

DISD audit timeline
1997 through 2005: The district churns through at
least four full-time or interim chief financial officers.

March 2005: Michael Hinojosa is named the lone
finalist by trustees to replace Mike Moses as
district superintendent.

August 2005: Ron Peace, a former superintendent
in Victoria ISD, is hired as Dr. Hinojosa's deputy
superintendent to oversee business services.

November 2005: David Rastellini is hired as
executive director of financial services. He
previously worked for school districts in Waco, San
Angelo and Austin.

December 2006: Dr. Hinojosa replaces Mr. Peace
with Eric Anderson, a former CEO of Crescent
Machinery in Fort Worth, to oversee the district's
business and maintenance departments.

Fall 2006: State and federal auditors begin
examining district grant expenditures after a
Dallas Morning News report highlighting
inappropriate grant purchases.

April 2007: The district hires Deloitte & Touche as
its outside auditor, replacing KPMG.

July 2007: Deloitte begins auditing financial
records from the 2006-07 fiscal year.

November 2007: District officials announce that
the 2006-07 financial audit might not be
completed by a December deadline and that it will
cost at least $1 million. Later, the district reveals
that the delay is caused by missing records,
sloppy bookkeeping and poorly trained employees.

December 2007: Draft financial statements for the
2006-07 fiscal year show millions of dollars in
accounting errors. The records also reveal that the
district intends to refund to the federal government
at least $8 million to cover misspent grant funds.

February 2008: Trustees agree to ask voters to
approve a $1.3 billion school bond program,
though the audit is not complete. Mr. Rastellini
resigns.

April 2008: Deloitte briefs trustees on its progress.
Auditors cite a pattern of ineffective financial
management throughout the district. The district
begins hiring outside help to begin reforming its
finance department.

May 2008: Voters narrowly approve the bond vote.

June 2008: Deloitte requests another $1 million to
finish the audit. Records show that the district
intends to spend $11 million over three years to
clean up its financial operations.

(SOURCE--Dallas Morning News)
________________

DALLAS ISD SPRING 2008 AUDIT
Some of the problems found

The Dallas school district's outside auditors
outlined 31 pages of problems they found in
nearly every department that touched taxpayer
money such as payroll, fixed assets, grant
spending, accounts payable and accounts
receivable. Below is a sampling of problems
found:

•The district lacks internal controls and effective
policies and procedures to support its key
business practices.

•The district failed to train employees about the
importance of maintaining financial controls, and it
failed to discipline those who broke the rules.

•The staff had trouble explaining changes in
account balances.

•Accounts receivable and payable detail ledgers
were not reconciled to the district's overall ledger.

•The district could not show that departmental
managers kept track of their current employees
and failed to notify the personnel department
when personnel changes were made.

•The district doesn't have a documented process
to gauge its risk of fraud.

•The district does not have formal, districtwide
procedures in place to ensure that grant rules are
followed before money is spent.

•The district could not provide supporting
documentation that salaries paid to selected
employees were accurate and approved by
management or based on the school board-
approved salary schedule.

(SOURCE--Dallas Morning News)
________________

As promised, more about Llano ISD
If I'm a bit more familiar than most Texans with school districts with a lot of money -- remember, $1.7 billion flowed
through Mike Hinojosa's checkbook at Dallas ISD during 2006-07 -- who nevertheless suddenly find themselves in such

Dennis Hill (above center) at Llano ISD school board
meeting; below in office

Former Llano ISD supe Jack Patton (far left) in court in Burnet, Texas; then-Llano ISD CFO Carol Voit (R).

Dallas ISD keeps its eye on the
$500,000 Broad Prize
By Blair Lovern
Tuesday, January 16, 2007
Pegasus News

As Wilonsky points out in Unfair Park, the Dallas
ISD wants to be one of the best urban school
districts in America. Superintendent Michael
Hinojosa organized the Dallas Achieves
Commission to help get to that point.

"The goal of the Dallas Achieves effort is to
transform the Dallas ISD so that all of its students
graduate from high school college- or
workforce-ready," states the DAC site. An
honorable goal, yes.

So how does a school district do this?

"High academic achievement is built," according to
the Dallas Achieves Commission, by the following:

Empowered principals as instructional leaders
Administrative structures supportive of campus
leadership Data- and best practices-driven
approaches Common curriculum and instruction
across campuses Feel free to chime in with
regular English (do they teach that any more?) if
you know what those things mean.

But here comes the kicker: "This will be measured
in large part by Dallas ISD being recognized,
through the Broad Prize, as one of the best urban
school districts in the country by 2010."

Ooof.

Houston Independent School District won the first
Broad Prize in 2002. How has that school district
done since then? The next year came reports of
Houston falsifying dropout rates. In 2006, the
Houston Chronicle reported that Houston officials
estimate 30 percent to 45 percent of students don't
finish high school.

In 2005, Norfolk (Va.) Public Schools won the
Broad Prize. A year later, it was reported that the
system's graduation rate ranges from about 40
percent to about 70 percent, reports the
Virginian-Pilot. State average is 75 percent.

New York City Department of Education has been a
Broad finalist for the past two years. In 2005, it was
reported that half of the 7th graders couldn't read at
grade level, and high school graduation rates are
"terrible," (38.9 percent, according to one study)
said John Merrow, president of Learning Matters,
Inc.

Miami-Dade County Public Schools was a finalist
in 2006, too. Maybe it's because the district caught
hundreds of teachers in a phony transcript-buying
scandal? Or maybe because the district's
graduation rate, reported USA Today in 2006, was
45.3 percent?

The graduation rate for Dallas is about 46 percent,
according to one study. But the state of Texas
disputes that and says it's really 81 percent.

You'd think that counting how many people walk
away with a high school diploma each year
wouldn't be so complicated. HAHAHA! You are a
sucker.

The Broad folks list a number of criteria to win its
prize. But as the Norfolk paper wrote in the linked
story above, "If one-third or more of students can't
even make it out of the starting gate, somebody
needs to rethink the definition of success."

URL:
www.pegasusnews.com/news/2007/jan/16/dallas-isd-keeps-its-eye-
500000-broad-prize/

Employment areas shall be defined as:
1. Elementary grades, subjects, departments, or programs.
2. Secondary grades, departments or programs.
3. Counseling programs.
4. Special programs, such as gifted and talented, bilingual, spe-
cial education, compensatory education, and migrant education.
5. Library programs.
6. Other nonteaching professional and professional staff.
7. Teachers on probationary status.
8. Professional employees holding temporary certificates or permits.
9. Other Districtwide programs.

Once the General Superintendent has identified the appropriate employees in
the affected area(s), those employees shall be considered for other available
positions for which they apply and are qualified up to the date of a hearing
requested in accordance with the provisions below. Assignments to new jobs
shall be based on matching of certification, qualifications, experience and
skill sets.

CRITERIA FOR DECISION: Using the following criteria, the General
Superintendent shall recommend employees within the affected employment
area(s) for discharge or nonrenewal because of a reduction in force,

How much money has Dallas ISD spent -- some
would say "wasted" -- on pursuing the Broad Prize?
How many millions for a $500,000 prize?

1. Certification: Appropriate certification and/or endorsement for the
current or projected assignment.
2. Performance: Effectiveness as reflected by appraisal records and other
written evaluative information.
If the General Superintendent in his or her discretion decides that the
documented performance differences between two or more reduction in
force prospects are too insubstantial to rely upon, he or she may proceed
to apply criterion 3 and, thereafter and to the extend need, criterion 4.
3. Seniority: Length of continuous service in the District. An authorized
leave shall not be considered an interruption of continuous service.
4. Professional background: Professional education and work experience
related to the current or projected assignment.

...starting with: What
have Dallas & Mike
Hinojosa achieved
beyond their $148+
million 'oops'?

Time to ask serious
QUESTIONS

(L) Dallas ISD
superintendent Eliu
Misael "Mike" Hinojosa;
(R) Dallas ISD board
president Jack Lowe