Gary Emergency Manager Plan: Close School, Reconfigure Grades

The state-appointed manager of the Gary Community School Corporation told state officials Friday the district faces an $18 million annual deficit and a proposal to close two buildings is only the start of cutting costs.

Gary Schools emergency manager Peggy Hinckley asked the state’s Distressed Unit Appeal Board Friday to let her close the Wirt-Emerson Visual and Performing Arts Academy and the district’s central office, formerly the Lincoln School, this summer.

Students, the arts program and district administrators would be relocated to the last remaining high school -- West Side Leadership Academy. Hinckley says consolidation will help improve academics and led to several $100,000 in annual utility savings.

Read More: Can Gary Schools Be Saved By A State Takeover?

“The goal would be to order a larger course selection because we have more students to be able to offer them to,” Hinckley says about the future combined enrollment at West Side school. “When you are running classrooms with less than 10 students it is not very efficient.”

Only one high school, Hinckley says, would allow the district to be more competitive in attracting new students to the district by offering robust academic and sports programs.

Hinckley also proposed reconfiguring grades into three groups at current buildings: K-5, 6-8 and 9-12. The new middle school would be added to Bailly Preparatory Academy. In 2016 the State Board of Education voted to shut down the district’s only middle school Dunbar Polaski due to chronic failure.

The Distressed Unit Appeal Board, or DUAB, will vote March 2 whether to approve the closures and grade reconfiguration. The Gary School Board will hold a public meeting Feb. 21 to take public comment on the plan. Meetings have been held previously at both high schools about the possibility of a closure.

These are the first large-scale reforms by Hinckley’s emergency management team since August when the state took over the school corporation in the last ditch attempt to save it from debt and academic failures at most of its schools.

During Friday’s meeting, DUAB approved a request for a $3.75 million common school loan to cover district payroll for March and into April.

Leonard Moody, Gary School’s new CFO, says the district is running an $18 million annual deficit and expects to continue asking for state funds to pay staff.

“We will need some help to stay on track to continue the work we are doing,” says Leonard Moody, Gary School’s new CFO.

Moody says the district made “progress” in reducing the deficit from $22 million since the takeover began. Eliminating the deficit by the end of 2019 is the team’s goal, he says.

Ideas to eliminate the deficit that includes staff layoffs, a tax increase referendum and attracting new students as means of increasing state funding.

To hold a campaign for a property tax ballot referendum, Moody says, the district would need money from the state.

Eliminating the deficit is only part of Gary School’s ongoing financial trouble. There’s still more than $100 million in debt, Moody says. The district owes: around $40 million in unpaid bonds; around $40 million in loans from banks and the state; $8 million to the IRS in unpaid payroll taxes; and $6 million to vendors.

Contact WFYI education reporter Eric Weddle at eweddle@wfyi.org or call (317) 614-0470. Follow on Twitter: @ericweddle.