Johnston Mayor Joseph M. Polisena Jr. fears school department finances are close to falling off a “fiscal cliff,” and a “Town takeover” may be the only thing that can stop the hemorrhaging before the damage “becomes irreversible.”
On June 16, Polisena announced the “interim takeover of the Johnston School Department and the administrative consolidation of their business office functions,” according to a press release. “This takeover will be codified by a joint resolution before both the Town Council and School Committee.”
In the meantime, Polisena and the town have retained former Cranston mayor, Rhode Island gubernatorial and congressional candidate, Republican Allan Fung.
“I have been engaged by the town of Johnston to help them with the school deficit issue,” Fung confirmed Wednesday morning. “In my prior capacity in the city of Cranston I dealt with school deficits on many occasions and the town wanted to get proper legal advice to ensure we have a sound school district that’s providing a high quality education for their students.”
Fung cited attorney-client privilege when pressed to answer follow-up questions.
As of this week’s print deadline, the Johnston School Committee had announced a pair of last-minute meetings, on Wednesday, June 21 and Thursday, June 22.
The Thursday meeting has been labeled an “emergency meeting” and will feature a pair of closed-door executive sessions followed by a prepared statement form School Committee Chairman Robert LaFazia.
“For the budget year ending 2022, the Johnston School Department ended with an approximately $955,000 deficit,” according to Polisena’s press release.
The mayor says he “was recently notified that the schools will likely end the current 2022-23 fiscal year with a multi-million dollar deficit.”
“Consecutive deficits are unacceptable and against state law,” Polisena said in the press release. “I am also gravely concerned the Department will run another deficit by the end of the upcoming 2024 fiscal year as well, which would amount to three consecutive deficits. Even though the Department exists as a separate entity from the Town, we all have an obligation to the taxpayers.”
The school department’s swelling budget has been the topic of discussion during the budgeting process for the past two years.
“While the Town recognizes the Department faces unprecedented mandates from the State, I believe we are at a critical point where the Town needs to intervene and take over the Department before the problem becomes irreversible,” Polisena said in the press release. “I am grateful to the School Committee and Superintendent for their willingness to work with the Town oversight. All changes implemented by Town oversight will be for the 2024-25 school year. These changes will be made with the new schools in mind.”
The town has also launched a major school building renovation project, which has been plagued by cost overruns. The project, first pitched by Polisena when his father was mayor and he was vice-president of Town Council, initially called for major renovations at the middle and high schools and a brand new Early Childhood Center and new town-wide elementary school center.
The project and a $215 million bond went to voters, who overwhelmingly supported the plan.
However, that project was recently down-scaled drastically, eliminating the middle school renovation and new ECC building (instead focusing on the new elementary school and a high school rebuild).
The bond was pitched as a “no tax increase bond” prior to the vote. New revenue from the Amazon project is expected to cover future bond payments.
“First, the town will be loaning funds to the schools to address the past deficits,” Polisena’s press release explained. “Next, the Mayor and Town Council are in the middle of the fiscal year 2024 budget process and will be finalizing it later this month.”
Johnston Town Council is expected to discuss and vote on the 2023-24 budget at a 5:30 p.m. public meeting on Thursday, June 29.
“To ensure that Johnston students are receiving a high-quality education, the Mayor and Town Council are committed to appropriating another $2.15 million to the Department,” according to Polisena’s press release. “This is the largest appropriation to the schools in Johnston’s history.”
As of this week’s print deadline, neither the budget nor the town takeover of school finances have been discussed or voted on in public session.
“The school department is going to run a deficit in two consecutive fiscal years,” Polisena reiterated in an interview following the dissemination of the “Town takeover” press release. “For this upcoming FY2024 budget, I am foregoing $1.4 million in one-time capital projects for the Town and shifting that over to the School Department to help stop the bleeding, which totals their local aid increase to $2.1 million, an exorbitant amount of money.”
Past transfers from the town to the school department haven’t prevented the current projected overage.
“Just allocating more money isn’t going to solve the problem,” Polisena wrote via email. “The Town will take over the financial management of the Department and work in conjunction with educational and financial experts to adopt meaningful changes and maximize operational efficiencies. Additionally, every taxpayer needs to know the Department is burdened with cumbersome state mandates, particularly when it comes to out of district tuition.”
Polisena said the town’s public school system pays about $17,000 per pupil for out-of-district tuition and district-wide spends around “$2.8 million to send students to other schools for CTE programs we simply cannot implement here in Johnston due to financial and facilities constraints.”
“This is the time to make the changes not only because of the operational inefficiencies but also with the new schools coming in the near future,” Polisena wrote. “We need to ensure that we are providing a high-quality education to every student but also not wasting taxpayer dollars. I am not going to idly sit by and watch the school department fall off a fiscal cliff.”
Town Council President and attorney Robert V. Russo questioned the use of the word “takeover” to describe the plan of action.
“I think the wording ‘takeover’ may not completely describe the actions going between the respective town and school administrations,” Russo said. “The town is seeking to oversee the school finance department to see where the shortfalls are and correct any structural issues in their budget and spending. The town is not interested, nor can it legally influence the daily operations of the school department.”
Russo suggested the action is more of a cooperative partnership with a shared goal.
“It is my understanding that both administrations have had an on-going dialogue and have the same goal of maximizing the educational environment for the schools while at the same time looking out fore the taxpayers,” Russo explained. “My understanding is that town’s finance people will be overseeing the schools financial department — not taking over daily operations of the school department. (The) town cannot take over school operations by law.”
School Committee Vice-Chairman Joseph Rotella deferred most questions to Superintendent Dr. Bernard DiLullo Jr. and Polisena.
“It is my understanding that the town administration and school administration have been meeting for weeks and developed a resolution to close the holes in the school finances,” Rotella said Tuesday. “The town simply wants to have the town finance department assist the school finance people to find a resolution going forward. I welcome the collaboration.”
DiLullo would not answer questions regarding Polisena’s proposed “takeover.”
“I don’t have a comment at this time but Mr. Lafazia is preparing a statement regarding the press release,” DiLullo wrote via email, following several requests for comment.
The Wednesday, June 21 special meeting, scheduled for 6:30 p.m. in the Ferri Middle School library, has just a single item on the agenda: “a budget workshop discussion and vote.”
The agenda for the Thursday, June 22 meeting (scheduled for 5:30 p.m. also at Ferri) calls for the School Committee to convene into separate executive sessions to discuss collective bargaining or litigation, or work sessions pertaining to collective bargaining or litigation (Regarding: Town takeover of School Department) and the school administrator’s Job Performance.
Although no votes or public discussion have taken place, Polisena said he is confident both the Town Council and School Committee will vote to support the “Town takeover.”
“I’ve met with the superintendent and school committee chair multiple times over the past few weeks about their current financial situation,” Polisena wrote via email Wednesday morning. “Per the superintendent and school committee chair, the original increase in allocation of aid from the Town I proposed was not sufficient due to their current financial state, even with a possible last minute increase in aid to not just Johnston but several schools across (Rhode Island), from the General Assembly’s edits to the budget (we will know by Friday if that additional increase is coming through). Therefore, I had to go back and shift money away from the Town to put toward the school department’s operations. The school committee then adjusted their budget accordingly with the increase in aid. As is not only customary but also best practice, I’ve already met with all five council members individually for their annual budget breakdown and there were no objections to an increase in Town aid to school department.”
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