Portland City Manager Joseph Gray Jr. has asked the school superintendent to sign an agreement to limit the responsibilities of the city's finance staff in fixing budget problems for the embattled School Department.
Joseph Gray sought the agreement after Superintendent Mary Jo O'Connor introduced a plan last week that would limit her financial management duties and assign most of those responsibilities to the School Committee and the city administration.
The city's finance staff took over the School Department's finance office on Aug. 2, shortly after school Finance Director Richard Paulson resigned amid controversy over an estimated $2.5 million deficit in the 2006-07 school budget.
While the role of the city's finance staff is billed as temporary, it could become permanent if Portland officials decide to combine the school and city finance offices, as was the case in the 1980s.
"I felt we needed to formalize an agreement between the city and the School Department if we're going to be assisting them in their financial operations now and in the future," Gray said on Monday.
O'Connor, who has come under fire in recent weeks for her admitted lack of financial expertise, has yet to sign the agreement and may seek School Committee approval before she does, Gray said.
The proposed agreement stipulates that "decisions on educational policy and any adjustments to the school budget will continue to be the responsibility of the superintendent and the School Committee."
In addition, "city staff will participate in all school budget and financial-related matters," which is something City Councilors James Cohen and Edward Suslovic said was lacking in the plan that O'Connor unveiled last week.
The agreement is based on the premise that "restoring confidence in the management of the school department is of paramount importance to both the schools' and the city's management staff. To be successful, all parties need to participate fully and share information freely."
O'Connor has scheduled a meeting this morning with senior School Department staff members to discuss financial concerns, Gray said. Ellen Sanborn, the city's assistance finance director and budget manager, plans to attend, he said.
O'Connor declined a request for an interview on Monday. Susan Ward, O'Connor's secretary, said she was instructed to refer all media inquiries to School Committee Chairman John Coyne. Coyne did not return several phone calls seeking comment.
The committee has a regular business meeting scheduled for 7 p.m. Wednesday at Portland Arts and Technology High School. The meeting's agenda, distributed by e-mail on Monday, doesn't mention Gray's proposed agreement.
However, it could be discussed during the superintendent's report or when O'Connor delivers her plan for improved financial management and reporting to the full committee. She introduced her plan during a workshop on Aug. 8, when she described it as a "work in progress."
Sanborn and her staff are helping the School Department close the books on last year's $82 million budget and figure out whether the 2007-08 budget, which took effect July 1, will hold up. City officials are expected to report their findings at a meeting of the City Council and School Committee finance committees on Aug. 29.
In addition, the full City Council and School Committee will meet on Monday, at a time to be determined, to discuss plans to address the school budget deficit.
Part of the $2.5 million deficit would be offset by the School Department's $1 million surplus account. The rest would be covered by the city's $20 million reserve account, which must be repaid within two years to maintain the city's high financial rating.
Looking ahead, Gray's proposed agreement instructs the city and school finance staffs to work together to develop a deficit- recovery plan and recommendations to prepare for long-term spending reductions...
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