The Coastal Post - March, 1999

District Can't Pay Its Bills;
Lagunitas School Can't Borrow As Wastewater Debt Mounts

By Jim Scanlon

As time passes and debt mounts, it becomes clearer that the intrusion into the affairs of Lagunitas School by a small, activist, faction of the San Geronimo Valley Planning Group under the leadership of Steve Kinsey was a disastrous error. With only one Trustee consistently in opposition, other Trustees steadfastly pursued, and still pursue, a joint sewage system with the French Ranch Development, which benefited the developers, but has proven a financial disaster for the school.

The latest figures show that the District advanced $201,023 to partially complete its wastewater project and its General Fund is overdrawn by $20,000. All this on top of a half million dollar hardship grant to replace the old, conventional septic system.

Kinsey, when still a paid consultant to the school, proposed a joint sewage plan which would benefit both the school, and the private Development in a "win-win" situation. After his election to the Board of Supervisors, Kinsey energetically promoted and facilitated the joint plan, helping it over significant hurdles with the Planning Commission, County Council and the State Regional Water Quality Control Board. So far, the developer has his win and the school is losing big time.

The wastewater induced deficit, combined with a pattern of deficit spending over the past two years, resulted in the District receiving a "qualified" certification after its first budget report to the Marin Office of Education. A "qualified" certification means that County Schools staff oversee financial planning and that the District is not free to borrow money without approval by the Superintendent of Schools. In effect the District has lost its credit and is on probation.

The $201,023, however is not a true picture of the debt due to its unusual alliance with a private developer. The school's sewage system is somewhat more than half finished, but, as yet, it has not begun construction of a pipeline trench to its second, already completed, "winter" leach field on French Ranch Property.

Making the connection requires digging a common trench with the developer, across the San Geronimo Valley Golf Course. There is a direct way, and a round about, up and down, way. The cost could be from $40,000 to $80,000, or much, much more depending on the route. No one really knows.

Normally, capital projects are planned, approved, funded and contracts are bid, completed and paid. Cost overruns can usually be foreseen and they aren't usually large. This project has been one long improvisation-an improvisation that is still in progress, with no end in sight.

When Trustee Sloan justified his lone vote against the project, he said, "...I don't know where it will go, what it will look like, how much it will cost or who will run it." After all this time these questions are still unanswered.

So far the District has not even received its easement for the direct sewageline across the golf course. Although the easement was calendared for acceptance in January, it has not appeared since. Be that as it may, the District cannot easily proceed with no money, no credit, and a deficit of $20,000.00.

Special permission was obtained from state water officials to begin using it's completed "Summer" leach field, also on French Ranch property. This would save septic pumping and off-site dumping costs, but there was a delay of a month or so, due to the installation of a sub standard electrical control panel. Shortly after pumping to the summer field actually began however, heavy rains caused a sewage spill revealing that the newly installed sewage pumping system was inadequate and incorrectly installed. The whole system was shut down.

It is not clear how much raw sewage was spilled or where it went. The Marin County Gannet Independent Journal reported on the flooding of Sir Francis Drake Boulevard from the luxury housing development and siltation of Lagunitas Creek, as did Listener Supported Radio Station KPFA and the Point Reyes Light. However, no mention was made by anyone of the sewage from the school or the school's desperate financial problems. What seems like overprotection and the lack of public awareness of its problems seems to be seriously harming the school.

State Officials were scheduled to meet on February 25; this meeting might have provided some clarification on reimbursement of the current quarter million dollar excess cost of the wastewater system. Anything other than complete reimbursement of wastewater costs will result in long term indebtedness and oversight by higher authorities, if not a complete take over of all operations. Even if the school were promised total reimbursement on the wastewater overruns, it cannot apply for them until the project is totally completed and the contractors paid. The state meeting, already postponed once is now scheduled for mid March.

Additionally, due to cost overruns, the District applied for hardship grants of $160,611 to pave a parking lot and replace a heating system. These two projects were originally included in the $2.5 million bond issue passed by voters in 1996 but could not be completed when the money ran out.

Funding for these two projects has been approved by the state and is 100% reimbursable, but the state does not have the money available right now. If it wants to do the work, the District must pay for the projects with its own funds or borrow, and it is guaranteed the money in a year or two. But now, it cannot borrow without higher approval. And, if it gets approval it will have to pay interest-and interest is not reimbursable.

Trustee Richard Sloan said that he does not feel that Kinsey and his Valley Planning Group activists are legally responsible for the mess the school is in, but, "They should be held accountable". "What upsets me", he said, "is the actions of my fellow Trustees who signed this disastrous contract and our highly paid consultants who should have known better".

"We are a small School District," he said. "For twenty years we offered unusual, innovative programs involving parents that are not available elsewhere. We could loose all this by the malfeasance of the Trustees who backed this disaster. This is what upsets me."

Sloan introduced two resolutions on February 9. One, that all District expenditures be approved by the Board before they are paid

The second: "that the Lagunitas School District request the signers of the French Ranch/Lagunitas School District contract lend the District sufficient funds to complete the project, until such time as the state reimburses the District."

Trustees met again on February 23. The agenda was described as a "blah," with mainly housekeeping items and a presentation by Montessori parents and teachers.

Although the school's financial plight was not discussed during the scheduled time allotted at the beginning of the meeting, much has been happening behind the scenes. At the end of the meeting, School Superintendent Larry Enos told Trustees he had met with County Schools staff and would be meeting with them again shortly to attempt to resolve the District's "qualified" budget status.

Enos then distributed a letter from County Schools dated February 11, detailing the strictures required under the Educational Code for Districts receiving a "qualified" certification and naming a financial advisor from County Schools to assist the District.

There is nothing in the letter to indicate that County Schools might be willing to suddenly change the "qualified" certification just announced last month. It would seem therefore that the Trustees are in for unpleasant surprises in March.

The manner in which information is passed on from the School Superintendent to District Trustees seems to be flawed .Both the Board of Trustees and its staff seem to be detached from financial reality and to be conducting significant school business in secret, a violation of the Brown Act, California's open meeting law.

Coastal Post Home Page