New Haven Mayor Harp rescinds concern school district heading to massive deficit

Jan. 31--NEW HAVEN -- What at first appeared to be a school board budget crisis and a mark against the superintendent of schools was resolved by the end of the day with Mayor Toni Harp getting assurances the education budget will come in on target and is not facing a $9 million deficit.

"I'm comfortable that he has a handle on it (the budget,)" Harp said late Friday afternoon of Superintendent of Schools Garth Harries.

She also said she will not try to hold up review of his first year in office until later in the spring when the city's fiscal situation is more apparent.

Harp said she misunderstood that a $9 million shortfall from the last fiscal year, a total of $7.2 million in the school board's food services budget and $1.6 million deficit in its the daycare account, would be carried forward this year.

Harries was criticized this week by a clergy group over his credentials, but that wasn't Harp's concern when asked about it Friday.

"The reality is all of these departments have got to know that they have got to balance their budgets and we have got to have a fund balance. Right now ... we don't have that savings account," Harp said, holding the school budget out for the harshest criticism when she thought it was underwater fiscally.

Joe Clerkin, the city's budget chief, late Friday afternoon, said accounting standards are stricter now than they were and structural problems, such as the historic deficits in the food services account, have to be formally recognized and dealt with. He said they occurred before Harries took office as superintendent last July.

Clerkin agreed that the city's Rainy Day Fund, however, is a negative $600,000 and has to be improved, but the food services and daycare accounts have been taken care of.

"Going forward, they start with a clean balance," Clerkin said of the two accounts, and Harries said he expects to end the fiscal year in the black.

Clerkin said a $4 million shortfall in the city's self-insurance fund to cover litigation will be addressed over the next few years, which the auditors are comfortable with.

As for the Rainy Day Fund, Clerkin said: "It's really raining."

Clerkin said he always worries about the city's bottom line, particularly on the revenue side. He said the voluntary payment by Yale-New Haven Hospital won't be recalculated until June and it is not known if the $9 million expected from building permits, mainly from Yale University, will be realized.

An upset Harp Friday morning said she didn't feel comfortable making a decision on extending Harries' contract beyond his one-year probation in March, the date called for in his contract.

By the end of the day, however, Harp said the school board had entered into a contract with Harries concerning his review "and I'm going to respect their process." The review includes talking to parents, teachers and others and the next contract is typically awarded for three years.

"I like working with him. I think we have a good working relationship. ... I want the process to run its course. Honestly, I'm going to respect the board," she said.

Harries, after his meeting with the mayor, said he very much wants to remain as superintendent. "I have a commitment to this city," he said, and wants to continue to advance the school reforms he has helped put in place. "A lot of time and resources have been invested in this," he said.

School Board Chairman Carlos Torres said they are concentrating on never again having a deficit. He said last year was the first time it happened.

He said they would have hired Harries for three years starting last year, but the city charter mandated that a new superintendent's first contract has to be limited to one year. Torres said it would be inappropriate to comment on Harries' evaluation as they are still in the middle of finishing it.

Harp made her critical comments earlier in the day in an impromptu press conference after the announcement that former Alder Migdalia Castro, D-16, will be the city's director of elderly services. Castro recently resigned from the board and a special election for that seat and the alder position in Ward 7 will be held March 17.

The mayor said at the press conference that she has attended two school board meetings and has never seen material that would indicate where they are, spending-wise. By the evening, she said Harries will explain where they are at the next board meeting.

The mayor earlier in the day said the school board has not aggressively accounted for students who qualify for free and reduced lunch so the school system can get reimbursed.

She said there should be an enrollment effort every year "and it should be effective." If it isn't, they should figure out why not, she said.

Harp said as the co-chairwoman of the Appropriations Committee at the state legislature she found enrollment in this program was really low in New Haven, as opposed to Bridgeport and Hartford. Harp said now it is apparent to her it is the one area that "historically has been overspent and under resourced" by the school board.

Harries was appointed to a one-year term in July 2013 after former schools chief Reginald Mayo retired.

He came on as assistant superintendent in 2009 to head up school reform efforts, not school finances.

Harp and Harries discussed the budget and other topics at a 4 p.m. meeting that had been arranged long before the deficit issue, which she said she was informed of this week.

The mayor wants to establish an Office of Policy and Development within the mayor's office to go find outside revenue to add to what comes to New Haven from the state and federal government, in addition to taxes. She said the city has been lacking in a coordinated effort to do that. "There is a lot of work that we need to do," Harp said.

She said the office, which will be headed by Mindi Blue, will make sure that the city takes advantage of available opportunities.

"With the recession, we haven't been able to get what we are entitled to from the state and the federal government. ... The gridlock in Washington has really not been able to deliver to the city," she said.

Harp has asked for a number of new positions, which over the next few months would be covered by unexpended specials funds, if they are approved by the Board of Alders. She said in the fiscal 2015 budget she would cover them with general fund revenues.

Blue, who is now hired as the labor director, would switch out of that post to the new office, if the alders approve the new job, while Rebecca Bombero would leave her post as head of the parks department to fill a new post of legislative director.

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