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MOAB -- Financial troubles at a rural Utah school district have become an example of how even school children are falling victim to the recession.
The Grand County School District is in financial trouble. A recent audit revealed that the 1,500-student district is facing a $2 million deficit.
The bottom line translates to cuts for the school district and possibly tax increases in Grand county, which includes Moab.
The district superintendent says an audit uncovered "accounting errors" that, along with the tough economy, spell trouble.
"We are in need of making some immediate cutbacks," says Superintendent Margaret Hopkin.
Hopkin gave the staff a glimpse of the grim news Monday afternoon. She and the school board are ordering the following:
- An immediate 4 percent salary cut district-wide
- Two additional furlough days, for a total of five this year
- A co-pay on insurance
- A $100,000 cut to the student activities budget.
In addition, the school board has applied for "financially distressed district" status from the state, opening the door for a voter-approved tax increase. The school board is not sure how large that request might be.
As frustrating as the situation is, Hopkin and state officials don't think the shortfall is anything criminal.
"There appears to be no indication of embezzlement or theft. The problem appears to be in accounting errors themselves," Hopkin says
She says the shortfall is confined in the district's operating budget and does not affect the financing of new construction.
Friday, the state board of education will hold a hearing on the Grand District's request to be declared financially distressed.
Larry Newton, the state's chief school finance expert at the State Board of Education, says what's happening there is a sign of how tough things are for smaller school districts in general.
"We're going to have to tighten our belt continually. This is not a one-time thing that's going to go away," Newton says.
Hopkin says an investigation is ongoing to see to insure the district's problems don't grow.
E-mail: rpiatt@ksl.com
