New questions about red ink at Dallas ISD

NEWS 8 INVESTIGATES

DALLAS — New questions are being raised about budget problems at the Dallas Independent School District. News 8 has learned the district is $43 million over budget in state and local funds.

Two nights ago, we told you the district had quietly laid off 85 employees because it had over-spent $10 million in federal funds. Now some board members says there are more questions than answers.

Six months ago, Dallas ISD's finance director proclaimed that the district was in the best financial shape in its history. The question being asked now is: How do you go from accruing record surpluses to suddenly being in the red?

The deficit was a topic of discussion at last Thursday night's board meeting. Dallas ISD financial reports show the district has a $43 million deficit.

"Just make a note I'm getting real nervous about our finances," said Trustee Lew Blackburn.

Those same finances show that one year earlier, the district had accrued a $61 million surplus. That's a $100 million swing that administration officials have not been able to explain.

"I still don't have the answer to why this has happened," said Trustee Joyce Foreman. "I've asked about the budget, and I've received no real explanation of where the over-spending took place."

Dallas ISD Finance Director Jim Terry told board members Thursday night he believes the deficit will be closer to $20 million by the end of the budget year. The reserve fund will still have in excess of $300 million.

But what Terry did not tell trustees that night is that the district had overspent its federal funds this year by $10 million, and was just hours away from laying off 85 workers.

"If the administration knew this was going to happen, that would have been an opportune time to at least brief the board," Foreman said.

Instead, Foreman said the first she heard of the layoffs was when News 8 contacted her on Friday night.

Dallas ISD Superintendent Mike Miles Tuesday declined to answer our questions about the layoffs or the deficit. Miles did record remarks regarding the layoffs, and the video was posted on YouTube.

While he did acknowledge that the district will be short $10 million in federal funds dollars next year, Miles said those losing their jobs will likely get them back.

"It happens every year, so no one needs to panic," Miles said in the YouTube clip. "We're not panicked; we are going to know more clearly this week what those revenue dollars are."

In the interview, Miles also touched on allegations that Dallas ISD has also miscoded millions of supplemental dollars designed to provide additional money for the district's "at risk" students. Miles blamed the error on the Texas Education Agency.

"TEA changed its coding, so they've said, yes, they've miscoded," Miles said.

But when News 8 contacted the TEA on Tuesday, the agency denied miscoding or admitting to miscoding supplemental dollars for Dallas public schools.

News 8 also talked to Dallas ISD Board President Eric Cowan, who said that he, too, is concerned about the funding issues News 8 has been raising. He said he expects answers from administration in the coming days.

MORE: From News 8 Investigates


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