Strengths, flaws found in Orleans school finances - FOX 8, WVUE,, weather, app, news, saints

Strengths, flaws found in Orleans school finances

Associated Press

NEW ORLEANS (AP) - A New Orleans-based government watchdog group says the school board in New Orleans has significantly improved its financial operations in the years since Hurricane Katrina devastated the city's public education system, but needs to better track its allocation of money between the relative handful of schools it continues to operate and those taken over by the state since the 2005 disaster.

The Bureau of Governmental Research report issued Thursday says that, in 2011, more than $2 million - about 5 percent of the board's general fund resources that year - went to the relatively few schools run or overseen by the board, when it should have gone to the whole system of New Orleans public schools, including those now run by the state.

The New Orleans board still runs six schools and oversees 12 others run by independent charter groups. And the board controls key financial functions for all New Orleans public schools.

Stan Smith, the interim superintendent of the New Orleans school system, noted that more than $800,000 of that money is attributable to insurance expenses for school system buildings occupied by charter schools. The report said the board is now reimbursed for such expenses.

Smith said the board complies with all state and federal laws and that the money went for its intended purpose of educating New Orleans students.

"We're following the guidelines that are used by all of the school districts," Smith said.

Still, noting the unique nature of the current education scene in New Orleans, with different entities running schools or overseeing charters, he didn't rule out future changes in financial practices.

Thursday's report said the once-troubled Orleans board has greatly improved its accounting practices and receives clean audits and solid bond ratings these days. It said an infusion of post-Katrina state and federal money has helped the board reduce debt and improve liquidity.

But the BGR found fault with some board financial practices and said the board lacks transparency in its allocation of resources.

The report said the board lacks a policy governing the spending of what the BGR calls "common resources," including bond proceeds, property tax revenue, government grants and disaster loans that are meant to benefit all public schools in New Orleans.

"The School Board is the sole taxing and bonding authority for all public schools in New Orleans. Its decisions in these areas affect the financial position of all schools. Yet the School Board does not have a formal or informal process for consulting other school operators," BGR said in a news release accompanying the report.

BGR issued numerous recommendations for the board, including expanded tracking of revenue and spending according to the types of schools that benefit from them - whether they are the board's direct-run or charter schools or the system as a whole.

It also said the board should adopt a formal policy requiring that common resources be spent to benefit students in all New Orleans public schools, not just those run or overseen by the board.

"OPSB continues to work diligently to strengthen the relationships and communications with charter schools and the RSD," Smith said in a statement, referring to the state's Recovery School District, which is responsible for most city schools. "There is no doubt that we are all closer today."

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