Hillsborough schools avert state takeover with $101 million in bailout funds

TAMPA — Leaders of the Hillsborough County School District have received the first $101 million in this round of federal COVID-19 relief funds, avoiding a feared financial takeover by the state, Superintendent Addison Davis announced Monday.

“We will now focus on the academic successes of Hillsborough County,” Davis told reporters, surrounded by members of his finance staff and School Board Chairperson Lynn Gray. “It’s been nine months that I have been focused on finances. [This] gives us an opportunity to focus on children. This is what I came to Hillsborough to do. This is what I do best.”

Gray, who first tweeted the news on Saturday, said staff is to be commended, as well, for getting spending under control.

“These steps must be done so that our children can continue to receive a world-class education,” she said.

Monday’s event marks the latest in a series of twists and turns surrounding the budget crisis and administration of the large school district.

On April 22, State Education Commissioner Richard Corcoran issued Hillsborough a sternly worded demand for a fiscal recovery plan within 20 days. Failure to complete the task, Corcoran warned, might lead to a financial takeover by the state. At the time, the board was focused largely on Davis’ leadership style, which came under criticism after a series of job cuts to balance the budget.

With the arrival of Corcoran’s letter, attention quickly shifted to the financial plan — and the need to end the year with a reserve of at least $65 million to satisfy a state requirement of 2 percent of revenues.

By applying accounting and cost-cutting measures, district leaders shifted the projected June 30 reserve balance from a negative $23 million to a positive $32 million. Even after reclassifying $24 million in coronavirus-related spending, the district would be $10 million short of the reserve requirement without the federal money it just received.

The state had taken the position that federal coronavirus relief funds must move through the legislative budget appropriation process, meaning they might not be available until July.

A letter Friday from Jacob Oliva, the state’s chancellor of K-12 public schools, said lump sums are being released “to ensure uninterrupted access.” One concern was that some school districts were stockpiling previous relief payments. Oliva wrote that these payments would go only to districts that had 45 percent or less of their original funds remaining as of April 22.

On Monday, Davis and his team had several reasons to celebrate.

In addition to being out from under the looming possibility of a takeover, increased enrollment projections have softened the blow of the recent staffing reductions. Instead of cutting 1,000 positions for the coming school year, they are cutting 700.

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About 95 educators could end up without jobs as those with higher seniority work their way through the transfer and hiring pool process. But the district is working to place as many of these employees as possible into positions, Davis said, even if they must become certified along the way.

The $101 million is only an installment in payments through the federal Elementary & Secondary School Emergency Relief program, which is happening in three phases. Hundreds of millions more are expected to follow.

The money can be used for a variety of COVID-19-related purposes, from reimbursing the district for laptops it purchased for distance learning, to summer programs to help children recover from learning losses. Charter schools, which are funded by the state but managed independently, will receive $14.4 million of the $101 million.

Davis also announced Monday that principals will not have to take unpaid furlough days, as originally was expected. Dissatisfaction from principals, expressed in a harsh survey report, was one reason the board is taking a hard look at Davis’ performance.

Long-term, Davis talked of enhancing choice options, including magnet and International Baccalaureate programs, and of marketing the district-run schools.

While Davis said, “I’m appreciative of the Department of Education,” U.S. Rep. Kathy Castor, D-Tampa, issued a statement that criticized the Republican-led state government for holding onto the money as long as it did.

“Congress passed these “Emergency Relief Funds” in December 2020 with the direction to expeditiously provide the emergency resources to local schools and educators,” Castor said.

“The state is still slow-walking a large portion of emergency funds that are due to HCPS and appear to be siphoning off significant dollars to charter schools. This is particularly critical in a state where the GOP-controlled Legislature’s failure to adequately support public schools year-after-year keeps Florida students in the basement for per pupil funding - ranked 46th in nation - a true embarrassment for a modern, dynamic state like Florida.”