A dispute broke open today among trustees of the San Diego Unified School District over the perilous nature of the agency's finances.
School Board Trustee Scott Barnett believes it’s only a matter of time until San Diego Unified can’t pay its bills. His plan to close the $122 million dollar budget gap for the coming year is to cancel layoffs for more than 2,500 employees and vote for insolvency now.
“Let’s rescind the layoffs for next year, have a full compliment of teachers in our classrooms and nurses and counselors," he said. "When we go insolvent we’ll at least have our classrooms fully staffed and we don’t have to sell our land in a fire sale.”
In cases of insolvency the state appoints a trustee to run the school district, fires the superintendent and revokes the Board of Education's decision making power. It also issues a loan, which the district generally pays off over a period of 20 or more years. Evans said state takeover would likely result in layoffs and school closures.
Barnett scheduled, then canceled, a news conference in which he planned to propose an overhaul of the district's finances. He then said he would meet with reporters later.
"It's time for all of us to accept the truth -- we are insolvent and must act," Barnett said.
Board President John Lee Evans held a morning press conference to counter Barnett’s proposal. He said the board is still committed to solving the budget crisis and hopes eventual union concessions will prevent some layoffs. He said the insolvency proposal will only cause panic for families and schools.
“We need to be very clear and open with everybody about what’s going on and this includes the parents, the staff, the unions – everybody," he said. "This is what situation we’re in. Any time anybody brings up a last minute proposal it gets people wondering about the solidity of the other ideas.”
He urged a "calm, rational approach to the problem'' and said the debate has reached extremes.
"One board member is panicking and saying we need to declare insolvency,'' Evans said. "Some union leaders have said that he financial crisis is not as deep as we have been saying.''
He also criticized San Diego mayoral candidates for opining about how to run the SDUSD without knowing the facts.
One of those candidates, District Attorney Bonnie Dumanis -- the most outspoken in her comments about the district during the campaign -- released a statement that supported Evans' point of view.
"San Diegans don't want to see our schools declared insolvent and turned over to the state for the same reason they didn't want the city of San Diego to declare bankruptcy in 2005 -- it's a cop out that turns our destiny over to others instead of solving the problem,'' Dumanis said. "San Diego took the tougher path of reform, and the result is a better city government -- the same needs to happen at San Diego Unified.''
She said a state takeover of the district would be "a disaster'' for students and the area economy, since no one will relocate a business to a city where the school district has gone "belly up.''
Barnett, interviewed by NBC7/39, said the question is whether to give up political control or lose about 2,000 employees who've been issued pink slips.
"We're using desperation tactics, we're devastating classrooms,'' Barnett said.
He said class sizes will rise dramatically, and the district will have to sell off $20 million of its property.
