Texas school superintendent’s $2.25 million buyout threatens district’s finances………………..(Pssst…file this under Poor Risk Managment)
Lancaster ISD superintendent buyout could drain district reserves
A judge’s order temporarily halted the payment on Thursday afternoon
Nov 19, 2020
The financial outlook for Lancaster ISD will be grim if a $2 million superintendent buyout moves forward.
Should the district pay out former Superintendent Elijah Granger, LISD will have to take $2.24 million from its fund balance, wiping out the majority of its savings.
“It is going to reduce our projected fund balance to virtually nothing,” chief financial officer Shonna Pumphrey said at a board meeting Thursday night. “And that’s provided all of our revenue projections hold.”
That’s also before the state docks an estimated $1.8 million from the district for such a large buyout.
However, the buyout’s future is uncertain after a judge temporarily halted the payment Thursday afternoon. The judge granted the request of three trustees – Marion Hamilton, Carolyn Ann Morris, and Ty G Jones –– who voted against the buyout agreement and sought a temporary restraining order to stop the payout.
The district is temporarily enjoined from paying Granger any money related to his Nov. 9 buyout, and the three trustees will make further arguments for an injunction on Dec. 2, according to the order.
Granger’s annual salary was set at $315,000 in a contract approved Oct. 29, and the buyout agreement offered the departing superintendent more than $2 million to end his employment.
A buyout agreement that exceeds the value of one year’s salary and benefits triggers stiff financial penalties from the state. The state’s reduction in funding would likely come next school year, Pumphrey said.
At the board meeting Thursday night, the three trustees who won the order and newly elected trustee Kendall Smith voted to table a proposed $2.24 million budget amendment until December.
The other three trustees — La Rhonda Mays, Rhonda Davis, and LaShonjia Harris — voted against delaying the budget amendment. All three also voted in favor of the buyout.
Had trustees approved the amendment, the district would be facing economic constraints.
“In August, we budgeted fairly conservatively to allow the district some cushion in the event of unforeseen activities in the midst of the pandemic,” Pumphrey said. “So this particular amendment would virtually clear out any of the reserves and things that we had left for ourselves.”
The $2.24 million transfer would leave about $629,000 left in Lancaster’s fund balance, she said. Pumphrey didn’t know how long it would take the school district to rebuild the funds in the district’s fund balance if depleted. She pointed out that the upcoming legislative session also creates uncertainty about the future of state funding.
The board meeting indicated that a new board majority is forming with the election of Smith. In this month’s election, he beat out Ellen Clark, who was the pivotal fourth vote to approve Granger’s buyout agreement.
Before the board meeting ended, Morris requested an item be added to the next meeting’s agenda: a vote to censor Mays, Davis, and Harris. Morris did not elaborate on her reasons for the request and the board adjourned quickly after.
The DMN Education Lab deepens the coverage and conversation about urgent education issues critical to the future of North Texas.
The DMN Education Lab is a community-funded journalism initiative, with support from The Communities Foundation of Texas, The Meadows Foundation, The Dallas Foundation, Southern Methodist University, Todd A. Williams Family Foundation, The Beck Group, Bobby and Lottye Lyle, and the Solutions Journalism Network. The Dallas Morning News retains full editorial control of the Education Lab’s journalism.
Emily Donaldson, staff writer. Emily is an education reporter for Education Lab at The Dallas Morning News.
emily.donaldson@dallasnews.com emilyjdonaldson
Write RiskManager@RiskManagers.us
FORMER TEXAS SUPERINTENDENT OF SCHOOLS
For the first time we are seeing superintendent buyouts approaching and exceeding $1 million in several places around the state. This is what happens when superintendents have no moral compass when it comes screwing over the community and when board members are too stupid and inept to keep from entering into these egregious contracts. If you are in the private sector I say negotiate whatever you want but when it’s taxpayer dollars a decent person thinks of the common good.
