HAMBURG – The community meeting hosted by the Hamburg School Board and Superintendent for a crowd of 100-plus covered much of the same material covered in the community meeting held in Riverton the previous week.
Copies of the agenda, a sheet defining some of the terms used in school budgets, and a sheet providing current and potential tax rates, and current balances was provided, along with an eight year spreadsheet showing the maximum budget, expenditures, and unspent budget of each school.
Superintendent Terry Kenealy clarified that any numbers shown for upcoming years were best estimates, especially those used for the two schools combined.
After explaining to those gathered that the district was still waiting on its site visit report, and that there probably would be changes to information provided after that receipt, Kenealy assured the crowd that he and the board were there to answer what they could that night, and would keep working on the questions they couldn’t answer.
Kenealy read questions already submitted and provided answers prior to an open forum phase where the audience was allowed to ask questions.
He explained the difference between whole grade sharing and reorganizing and in response to the question which is better said that it was a tough call.  “Whole grade sharing is not intended to be a long term solution,” he said, “there are schools in long term whole grade sharing situations, but their enrollments and finances are stable, so they don’t feel forced to take that next step.”    He went on to point out that the district was not financially stable and enrollment numbers were still dropping.
One question asked why the district kept having this problem with spending authority, which prompted a discussion of how spending authority is figured, and what had happened in the district over the last eight years.  Kenealy said he still wasn’t clear on what had happened to cause the big jump in expenditures in 2013, and didn’t think the accounting mistakes causing some things to be billed in a different year accounted for the jump of nearly $500, 000 in spending, but either way fiscal year 2013 was the start of more serious budget authority issues that would continue to accumulate and escalate.
Kenealy explained that districts get a notification in October from the Department of Education inviting them to appear for a hearing in December to explain why they went over and how it will be fixed and avoided in future.  He said that both he and the Farragut superintendent had already contacted the Department of Education themselves recently rather than waiting to get the letter, because they knew that they were in the hole again.
Someone wanted to know if each district dealt with the School Budget Review Committee (SBRC) individually regarding their overage and Kenealy explained that they do, but that both districts’ corrective action plans state they are in a whole grade sharing arrangement with an eye to reorganization.
“The SBRC will want to see serious, significant changes to address our budget issues,” Kenealy warned, “they’re going to want this because we’ve both been brought before them multiple times.”
Another question asked if it was possible to whole grade share with someone else.  Kenealy explained that it was an option, but too late to be any help for the December hearing, and that other districts had no incentive to take on a struggling district.
Someone wanted to know about the possibility of Hamburg district making it on its own, but Kenealy said it probably wasn’t doable, with a $299,000 negative balance and the need to reinstitute high school programming if they wanted to go it alone, he said they would still need a partner of some kind.
Moving on to the audience questions, one person wanted to know how the open enrollment out of 32 students affected the spending authority.  Kenealy explained that they were still considered part of the district and would be allowed for in the budget authority, but then the district which they were actually going to would bill Hamburg district and receive all of that money, so the money was in and right back out, following the students.
One person asked him to explain the petition, so he took some time explaining that signatures of 20% of eligible voters in each district would be required to send the petition on to the Area Education Agency (AEA) for consideration to be put on the ballot.  He explained further that due to various scheduling deadlines, those petitions must be in to the AEA by August 1 in order to make it to the December ballot.
Another wanted to know if they had enough signatures yet.  Kenealy advised that Farragut did, but Hamburg did not, and that Hamburg was 50-75 signatures short.
One question asked in a couple of ways was how would the district make up for the $299,000 if there wasn’t going to be a reorganization vote and the SBRC wouldn’t forgive the debt.  Kenealy explained that he doubted that the SBRC would forgive it; they hadn’t already because they weren’t happy with the district’s efforts to get budgets under control.  
Kenealy explained there were only three ways out of that kind of hole:  enrollment growth, reduced spending, and increased allowable growth.  Of those, reduced spending was the only one the board had any control of and they had been making efforts to that end.  
Board member Susan Harris explained that when they found out about the negative balance of $46,350 they had already begun serious budget slashing, cutting out one administrator and two teachers, and thinking they had it figured out.  Then just this last week they were shocked to find out they would have a negative balance of approximately $299,000 this year, and the number crunching had to start again.   She said that as late as April or May of this year they had been told they should end the year $156,000 to the positive.
Members of the audience asked the board how they were going to fix the budget.  Harris said that they really needed to wait to receive the audit report before they could fully answer that.  Kenealy advised the crowd that he felt compelled to look at moving from two buildings to one, and Harris acknowledged that had been considered, along with more teacher and staff cuts, and looking at programs they weren’t required to have at the different levels, but she reiterated that it was important to have that audit report first.
One audience member angrily suggested that reorganization didn’t seem to be in the board’s vocabulary.  Harris defended the board saying they didn’t say that, and later defended their position again saying that the board needed to hear from the people what they wanted to do about reorganization.  
More angry audience members wanted to know how many of the board members had signed the petition, and for those who hadn’t why not.  When there was clapping and jeering and the board members didn’t respond, Louie Becker jumped up angrily from the audience to shout them down, saying he didn’t sign it and wouldn’t, and he’d tell them why:  “the first thing they’re going to do is take our middle school and grade school!”
Kenealy stepped in to calm the audience down and move them on to other questions, but in a later aside with this reporter, Becker defended his comment, saying, “if you look around at all the small towns around us, you’ll see; in every town that’s reorganized, the lower grade students end up going to the town that had the high school.”    He acknowledged it would be the new board’s decision, but insisted if the board was divided 2 per district and 1 at-large, and the at-large person was from Farragut district, it was guaranteed what the decision would be.
Some audience members wanted assurances that Hamburg would not be absorbed by Farragut, and that everything wouldn’t be moved to the Farragut district.  Kenealy stated honestly that they could not categorically state this or that will never happen because all of those kinds of decisions would be made by the new board.
Others wanted to know if the board had considered an arrangement with Sidney since that was where nearly all of the students were open enrolling out to, anyway.  Kenealy said that he had recently asked the Sidney superintendent about when districts in the county had last talked about possible solutions and was waiting on a copy of that information.  “Understand, though, that’s down the road; those things don’t happen overnight,” he said.  He went on to stress that Hamburg’s negotiating position was horrible, with the negative unspent balance and low and declining enrollment numbers.
Wrapping up the meeting, Kenealy defended his board, saying since they had just found out about the potential negative $299,000 budget authority in the last week, they needed time to work on possible solutions, and that they still needed to have that audit report back before too many hard and fast decisions could be made.  
“Unfortunately, we’re up against a deadline, from my perspective.  I ask you to consider if you want to be able to continue to discuss the best options, and how to maintain the most options,” he said, explaining again that signing the petition was not the same as voting, but merely gave the public the chance to choose what it wanted to happen by voting in December.  Kenealy repeated his warning that the SBRC was really going to be looking at the district’s future plans hard at the hearing in December, and his feeling that if reorganization was not a key part of that plan, the hearing could go very badly for the district.