School District Gets More Bad News on Audit Findings

BRADENTON – The Manatee School District received word late Thursday that the impending financial consequences of restoring misspent funding dating back to 2005 will cost $7 million, adding yet another financial blow to a district that was already dealing with tens of millions in financial errors made public in late 2012 and early 2013. Superintendent Rick Mills addressed the issues at a press conference Friday. 

"Late (Thursday), we received official notification from the Florida Department of Education regarding the findings and restoration costs resulting from operational and federal audits of the Manatee County School District conducted by the Florida Auditor General’s office during the 2012-2013 school year," said Mills. "It is important to note, that although the audits were conducted for the 2012-2013 school year, the findings and resulting restoration costs are the result of financial failures and fiscal mismanagement dating back to at least 2005. In total, the restoration costs assessed against the Manatee County School District’s General Fund for this school year amount to $7 million dollars."

The amount of restoration assessed against the district as a result of the operational audit amounted to $4.1 million dollars. Meanwhile, restoration assessed against the district as a result of the federal audit amounted to $2.9 million more dollars.

The $7 million will come from this year’s general fund. Of the $7 million in restoration costs assessed to the district as a result of these audits, $6.5 million are the result of findings associated with fiscal years dating from 2005 to 2012, which include part of Roger Dearing's reign as superintendent and the entirety of Tim McGonegal's, who resigned in September of 2012, after finally acknowledging that the district had known that what had been reported as a more than $3 million surplus, was actually a large deficit.

Prior to receiving the news Thursday, the district was projecting a positive fund balance for this school year of $8.2 million dollars, an amount that was recently verified by the informal state monitoring team. The assessment will reduce the positive fund balance to approximately $1 million dollars.

Manatee Superintendent Rick Mills

"Although this is not where we wanted to be as a district, it is still a monumental leap from the approximate $8.5 million dollar deficit incurred by the district at the end of the last fiscal year," said Mills, calling the restoration news "painful and disappointing." 

"A lot of people inside and outside of the Manatee County School District put a lot of sweat and hard work into improving the financial standing of this district," he added. "They should be commended. In the span of one year, we were able to take this district from a negative fund balance of approximately $8.5 million dollars, to a projected positive fund balance of $8.2 million dollars, which represents a $16.7 million turnaround. This is a huge step forward for the Manatee County School District and this community and something we should all take pride in."

Mills, along with board members, state legislators and county commissioners, appealed to the state to forgive as much of the restoration as possible in order to help the new administration better turn the district's finances around. While he said he was disappointed, he also tried to find a silver lining in the process finally coming to a close. 

"At least now, there is a sense of relief in knowing exactly where we stand, and we can focus on moving forward. I want to say to our employees and to our entire community, we will prevail over this challenge, just as we have prevailed over previous challenges during the past year. We will confront these brutal facts head on, and become stronger for it. I am proud to be the Superintendent of the Manatee County School District, and I have complete faith in our community and the employees. We will be a great school district.”

Mills said that the district would again look for ways to cut spending in order to build reserves, but stressed that they would continue to try and do so as far from the classroom as possible. He later issued a statement that he was standing by his pledge made earlier Thursday, not to request the sale of McKelvey Park, adjacent to Miller Elementary School, which had been discussed when the district was looking at selling excess properties.