News

Red Lion Schools could face bankruptcy

Written by Teresa Boeckel/York Daily Record | Mar 8, 2016 5:02 AM
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The district will be denying expenses because of budget impasse.

(Undated) -- Red Lion Area School District will likely face bankruptcy by the end of the fiscal year because of the state budget impasse, Superintendent Scott Deisley said in a letter.

The letter, dated March 4, is addressed to members of the school district and is posted on the district's website.

The letter states that the district's cash flow for the remainder of the school year is "dire."  The state has been without a budget for 252 days, and the state owes the Red Lion Area School District about $9.7 million.

"Unless we take some extraordinary measures right now, the District will likely face bankruptcy by the end of the fiscal year," Deisley wrote in the letter.

Last week the school board passed a resolution to withhold payments for cyber/charter tuition expenses. It was effective immediately.

The letter also states the district will focus on essential classroom needs first, then debt service and utilities, followed by payroll. "All other expenses will be denied," it states.

School board member Joel Ogle said the district cannot buy textbooks or computers because the funding from the state is not coming through.  The district will have to use its reserves to help get through the remainder of this school year.

"We're only buying paper and pencils," he said.

Ogle said the district had been saving up for a few years to buy new computers for the elementary students because the ones they have are old. But the computers can't be replaced and other needed projects can't be done without the money coming in.

It's possible the district will have to cancel field trips for students, too, board president Christine Crone said.

"The sad thing is the students are now being impacted by this," Crone said.

The district wants to be able to make it through the end of the year. It's possible -- depending on how long the impasse lasts -- the district might have to close its doors.

"We really don't want to close the doors and not pay our teachers," Ogle said.

In the letter, Deisley said the district has considered taking out a loan, but doing so would involve risk and uncertainty about whether the district could repay the loan on time. The superintendent explained that bonds for operational shortfalls are not transferable from one fiscal year to the next.

Crone said the district needs the public's support to get the funding flowing to school districts again. Red Lion isn't the only district dealing with the fallout from the budget impasse. She mentioned two state representatives are hosting a town hall meeting Wednesday night at the Springettsbury Township municipal building.

The superintendent wrote the purpose of the letter is not to place blame but to share its plans "to survive this budget impasse" while educating students.

"This bitter dispute happening in our state's capital must end," Ogle wrote in a letter to the editor.

*This article is part of a content-sharing partnership between WITF and the York Daily Record.

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