Larry Lewis and the incredible shrinking fund.
Okay, at the end of the 2005-06 school year (August 2006) the audit team from Judd Thomas and Smith found Larry Lewis had drawn down the cash fund balance in the general fund to $274,000. The problem was generally blamed on CFO Eugene Smith.
In 2006-07 the general fund went negative by about $3 to 4 million, which was disguised by a "bridge loan" of six million. The cash on hand appeared positive, but Larry Lewis left the Lancaster ISD actual cash balance , according to TEA investigative review,was negative by about $3 million.
In 2007-08, the year just ending, the district expenses exceeded projected revenue by another $3 to $4 million dollars. The spending was not so excessive that year, but the revenue was short because the attendance rate did not meet Dr Lewis's projections. The annual compliance audit is only beginning. But it appears the cash on hand in the general fund for the year ending August 2008 will be in the red by about $7 to $8 million.
The coming year, school and fiscal year 2008-09, the district has over-hired by at least eighteen teachers -- a $900,000 excess expense over budget. The attendance rate in Lancaster is still falling, and the revenue is about $1.8 million short of projections. If nothing is done, the ending fund balance will accumulate a $10 million debt.
It will be interesting to calculate the rate of debt to the "rise" in TAKS test scores. How much does it cost to rise in the ranks from last place in 2006 to, uhm, well, wherever we are now?
Larry Lewis will no doubt argue that "all districts" have secret payday loan operations, pay unbudgeted awards to favorite employees, and generally ignore Texas law.
He may even be correct.
