With lots of applause and some argument, the West Contra Costa school board voted this week to begin the process of paying off a state loan that has bogged down the district since the early 1990s and to remove two schools from a closure list.
District staff members will take the first step in the payoff process -- hiring a state-approved auditor to examine West Contra Costa's finances and determine whether they can pay off the $8.1 million in principal that remains, as of next year, from a loan that resulted from financial mismanagement 20 years ago.
"This has been a wound to the district that it's carried all these years. This is a night we begin to heal," board member Madeline Kronenberg said Wednesday night. "I'm ready to burn the (closure) list along with the mortgage."
School administrators hope to begin the audit process next week and complete it in December. Once the audit is accepted by the school board, it will go to the state Superintendent of Public Instruction, who will decide whether the district can pay off the debt and be released from its state trustee, who began overseeing the district's finances in the 1990s. The payoff would mean an ongoing $1.4 million saving to the district's general fund. Under the earlier payment schedule, the debt would have been settled in 2018.
The loan would be paid from the district's long-term debt fund, established in 1993. The fund currently has $9 million, which school officials think will be enough to pay both the remaining principal and an interest amount that has yet to be determined.
This week, trustees also discussed how to prioritize the money that would be freed up if the loan is repaid. Parents, teachers and students from Lake Elementary in San Pablo and Shannon Elementary in Pinole -- both chosen for closure by the board in 2009 -- came to ask that money previously set aside for the loan be used to keep their schools open.
"I'm glad you've found the money to pay off the loan. We gave up a lot to benefit your general fund," said Eric Swabeck, a teacher at Lake. "Now is the time for the district to pay back the community. Lake has been on life support long enough."
The closure list included eight schools, three of which have been shuttered. Lake has stayed open with funding from the city of San Pablo, while Kennedy High School, Olinda and Grant elementaries have been funded by the city of Richmond. Shannon was set to close in June when questions arose about the cost of building portable classrooms to house students at three other sites.
Most board members were ready to vote Wednesday for keeping the campuses open. However, board member Tony Thurmond questioned whether such a vote was properly noticed on the agenda and if it would pose a violation of state open meeting laws.
"I have no opposition to keeping Shannon and Lake open. But I cannot vote on how to spend savings we haven't yet achieved," he said. "I caution us again to take a step-by-step approach to how we make these decisions. I fail to see how the agenda lets the board take this action tonight."
Still, the board voted to remove Shannon and Lake from the closure list and budget for the two schools in coming years, with Thurmond abstaining.
Board President Charles Ramsey argued that the item was properly placed on the agenda and that the Lake and Shannon communities deserved answers. He added that there is enough money to pay off the debt, so there would be no negative financial effect that would trigger action by the state trustee.
Meanwhile, Sheri Gamba, the district's associate superintendent for business services, reminded the board to also consider potential state budget cuts in coming years. The district might need to use money from its special reserve to address budget shortfalls but settling the debt could mean they will not have to dip into the fund as much.