Reader’s view: Claims of Red Plan savings don’t match school budgets

In my report to the state auditor, which soon is expected to result in an investigative audit of the Red Plan, I wrote: “The public of Duluth deserves to have reconciliation of these numbers. Public officials continually arguing over the financial numbers of a multimillion-dollar project with no reconciliation is unacceptable governance.”

In a retort to School Board member Art Johnston’s commentary in the News Tribune, two fellow School Board members made assertions about Red Plan savings (School Board Members’ Response: “Running fewer schools results in savings that are applied to repaying bond.” Nov. 23). What documentation do they have to back up their claims? In my report to the state, I document very thoroughly why many claims being made are inaccurate.

Just look at their claim that $5.3 million of savings already are being realized. That $5.3 million was the full, original projected operational savings claimed by the Red Plan’s downsizing. According to the district’s own debt-and-savings schedule, that full amount was not projected to be realized until fiscal year 2014. Despite a few schools closing earlier than projected, the Red Plan itself is massively delayed. How could full-savings claims be realized ahead of schedule?

Fiscal year 2012 is the last actual budget. The savings figure used in that budget was $2,323,291. This is the exact amount of savings claimed for that year in Exhibit A-1, which outlines the debt and projected savings of the Red Plan. Another figure taken from the same spreadsheet — $3,589,484 — was the claimed savings used in the fiscal year 2013 adopted budget. Neither budget was calculated with $5.3 million of savings.

One of the people who claimed full consolidation savings already were being realized signed the original Red Plan contract and is chairwoman of the School Board. Someone in her position disseminating information that’s demonstrably false is unacceptable. I request the media require full documentation of such claims before printing them.

Loren Martell

Duluth

Tags: opinion, editorials, duluth, education, money