The bad blood continues to flow between the Wake County Board of Commissioners and the school board.
As noted in today's article by Martha Quillin, Republican commissioners accused the school system of misleading taxpayers about its fund balance. The GOP majority also tabled approval of a land purchase for a northeast Raleigh middle school and accused the school board of engaging in politics in wanting them to approve buying the former YWCA building in Raleigh.
GOP commissioners said they were speaking for the taxpayers. But Democratic commissioners said Republicans were endangering development of the next school bond issue and harming relations with the school board.
It's the latest example of the deteriorating relations now that both boards are led by majorities from different political parties.
The first flashpoint Monday came when David Neter, the school district's chief business officer, presented the comprehensive annual financial report. He said that as of June 30, the district's undesignated fund balance was $32.1 million.
But what would draw the ire of some GOP commissioners was when Neter put on the PowerPoint that the fund balance amount was 2.57 percent of the annual operating budget instead of listing how much it represented of the county appropriation.
Current school board policy says that the district can keep up to 6 percent of the county appropriation, which would be about $19 million. Excess would be returned to the commissioners.
For the past two years, the school board has waived the policy to keep the excess fund balance, which means about $13 million a year hasn't gone back to the county.
Neter has recommended that the school board change the policy to say it can keep a fund balance of up to 3 percent of the overall operating budget, which would be a higher number than 6 percent of the county appropriation.
Neter told commissioners that the fund balance got so high because of things such as utility costs coming in lower than projected and not paying teacher assistants to work on teacher workdays. He said they also shift as much money from county funds to state and federal funds as possible since those dollars have to be returned if they're not spent.
GOP Commissioner Paul Coble noted that the school district underspent local funds by $26 million.
"We quite often are accused of not funding schools at an appropriate level," Coble said. "But you underspent the money that we gave you by quite a bit."
Neter responded by saying he had shared with commissioners how the fund balance was built up. Neter said he would be glad to go over it with Coble again.
GOP Commissioner Tony Gurley said he wanted to discuss how the fund balance included $7 million that the school district thought it would have to cover in workers compensation claims before the state decided not to shift it to the schools.
Gurley said that $7 million should have come back to taxpayers after the state budget was finalized and the money wasn't needed by the school board.
Neter said that if they hadn't put money into fund balance to help offset loss of one-time federal dollars they would have to lay off teachers and teacher assistants.
Gurley replied that it should have reverted to the county because it was funded in good faith. Neter said he was not in a position to discuss ideology.
Gurley then focused on why Neter had put on the presentation how much the fund balance was of the overall budget when the school board hasn't changed its policy yet.
"It's disingenuous for you to report it to us based on the total budget when that's not your school policy," Gurley said. "I think you're trying to mislead us."
"I'll apologize if you feel misled," Neter replied.
Democratic commissioners spoke up for the school board.
"I think that the questions that have been asked are very good questions," said Democratic Commissioner Betty Lou Ward. "But by the same token I also think that you have to realize that there is an elected school board and that they have the ability to be able to manage — along with the professionals that work with them — their budget very carefully."
Ward said the school board needs to be able to adjust its budget because situations happen.
"It's hard for us as a board to take criticism for not funding the schools when teachers and classrooms are said not to have what they need and there is money that is not spent on those needs that sits in a reserve," Coble answered.
GOP Commissioners Chairman Joe Bryan wrapped up the discussion.
"We all have an opinion," Bryan said. "Many of us think that we're the school board's bank and they don't need a fund balance at all. Some of us think they should at least follow their fund balance policy and now it's changing.
We'll get asked for exceptional amounts of additional money every year and get beat up because we don't fully fund the request and then find out that there's additional money left at the end of the year. That's a debate between the two boards."
Next up was the vote on giving second and final approval to purchase land near River Bend Elementary for a new middle school.
GOP Commissioners Vice Chairman Phil Matthews called for tabling the vote to the March 18 meeting. Ward asked Matthews why.
"I need to review this longer," Matthews answered. "I'm not prepared to vote on it."
Ward asked Betty Parker, the school district's director of real estate services, what the impact would be of delaying the vote. Parker said that closing is March 30 so it wouldn't be adversely impacted if they got the purchase approved March 18.
Before the vote, Democratic Commissioner James West questioned the delay.
"It just appears to me that we're just not on the same wavelength here as a board as a team," West said. "They're in front of us. They've got deadlines.
Just to say I'm going to ask to postpone it just because I want to postpone it, it ain't about me. It should be about us trying to work toward the goals, but do what we have to do."
After the party-line vote to table the purchase, more questions were asked on first reading of the new deal to purchase the YWCA building.
Joe Desormeaux, the district's assistant superintendent for facilities, said various ideas such as a blended high school, a pre-kindergarten school and expansion space for the Wake Young Men's Leadership Academy have been proposed. He said the purpose won't be finalized until they have money for the construction.
In the meantime, Desormeaux said several groups have expressed interest in temporarily using the building.
Ward, West and fellow Democratic Commissioner Caroline Sullivan spoke in favor of the purchase, with Sullivan especially interested in its possible use as a pre-K facility. Republican commissioners questioned the urgency of the purchase, the price and the usefulness of the building and its two acres.
Gurley asked Desormeaxu if there were political concerns discussed during the school board's closed-session discussions on the revised YWCA purchase.
"My understanding is that this is a political decision and that there were very pointed political discussions made by the school board and that the reason it's back to our board is not because of any strategic need, but specifically as we can't let the county commissioners have any say over how we operate our school board and we need to stick it back to the county commissioners," Gurley said.
Ward said Gurley shouldn't ask Desmormeaux that question.
Desormeaux answered that the school staff's position has strictly been on the use of the property.
Gurley said he's asked for a copy of the minutes of the closed-session discussion that he said should be public now that the school board had voted for the deal.
"I believe the school board has misused its rules seriously so I would like to see the minutes of that closed session as part of the second reading," Gurley said.
Democrats responded to Gurley's questioning.
"It really looks like that we are certainly developing a good working relationship going into our joint meetings to hopefully come up with some kind of resolution for a bond referendum and addressing the issues," West said sarcastically. "It just bothers me the direction that we're going."
"It doesn't just bother me," Ward said. "It makes me mad because I think that by virtue of the fact, as I've said many times before, they are elected just as we are. I can understand your desire to see that in other things too."
"Anybody can see it," Gurley said. "It's a public body."
"I understand that," Ward answered. "But, you know, how to make friends and win people is not the way to go, the direction that we have been taking with this board.
If we really do want to be successful with the school bond issue, with all the things that we hope to do with them in the next year, I think we need to be a little more conscious of people's feelings at this moment."
"I would suggest we should be conscious of the taxpayers, and that we make sure the taxpayers have all the information they need," Coble said. "They need to have confidence that both boards, if we have a bond issue, are looking at the financial needs, the educational needs, all the different elements of what the bond is.
A bond's not going to successful if the public at large has doubts or questions about how the money is going to be spent or handled. I think it's good to get it on the table and let's have a discussion."