Five Million Dollars Richer (or poorer)

Loren Martell

Old Duluth Central High School. Photo credit: Ted Heineken
Old Duluth Central High School. Photo credit: Ted Heinonen

The official line

The Superintendent’s Report, given after public comment during school board meetings, is generally a feel-good speech filled with soft-soaping spin and boilerplate rhetoric about education and “the kids.”  During the 11/20/18 school board meeting, Mr. Gronseth used his platform to assess the district’s referendum results. 

“Sharing more gratitude,” Mr. G. said in sincere tones, “we’re very pleased with the results of the referendum.  (Board) chair Kirby and (teachers’ union president) Bernie Burnham have spoken as well about this, tonight.  Having two levy questions pass demonstrates how important education is to our community.  And our level of local support is now just under the State average for an operating referendum, which gets us a long way from where we were.”  

Super G. delved a bit into the process and passed out kudos.  “We included staff and students and the community in our early discussions, to identify priorities, and followed that with community polling--to take a deeper look into those priorities.  And there were many teachers and principals and staff and organizations and community members involved with getting information out to the community.  I know they were door-knocking and having events and going to other events and tabling and handing out fliers at football games — everywhere that they could think of — to be sure the voters had the information that they needed to build support for the referendum.  And we know that this really would not have been possible without everyone involved.  So, thank you, again.””

A review of the official line

The thing that disturbed me most about this entire process was the Superintendent and the School Board suggesting that the reason for the district’s fiscal problems was the cheapness of Duluth citizens.  Right out of the gate, the Board and Administration started passing around a comparison between Duluth’s operating levy and other districts around the State and grousing about how it was less than average.  

Mr. Gronseth has made more than one statement of this ilk over the years.  In a 10/7/12 Duluth News Tribune article, for example, he was quoted this way: “There are communities that have triple the levy Duluth has.  For them, class size isn’t as big of an issue.”  
Mr. G. was allowed to gloss over the fact that the operating levy was only part of the picture.  Duluth taxpayers had been clobbered by millions of dollars of non-voter approved construction levies.  He was also given a free pass in regard to another pertinent fact: nearly six million dollars ($5,914,728) was being drawn out of the General Fund that very year to pay Red Plan debt; $7,518,527 had been drawn out the previous year.   

I still have the graph the school board and Keith Dixon were passing around at the start of the Red Plan, claiming cheap Duluth was substantially lower than other Minnesota school districts, in terms of its investment in facilities.  Under the graph, we were lectured: “Duluth invests far less in its schools than do communities with similar sized school districts around Minnesota.  This chart shows that the state’s average annual facilities levy--meaning how much is spent per student on facilities — is $1,060.  The bar at the far left shows Duluth only contributes about one-third of the state average — $385.  The white bar in the middle of the chart shows that when Duluth implements its long-range facilities plan, it will bring the community’s investment in facilities to nearly the state average.”

The year before Dixon came to town, and started braying about tapping into Duluth’s “tax capacity,” district 709’s total levy was $11,940,373.81.  St. Louis County’s estimate (before the referendum) for the district’s 2019 levy was $32,222,310.26.  The dollar figure for the tax increase authorized by passage of the referendum’s second tier is $5,088,750, according to the district.  Adding $5,088,750 to $32,222,310.26 equals $37,311,060.26--or about a $25.4 million jump in our annual public school tax burden in 13 years.  

Had the district gained passage of the referendum’s third tier, the levy would have topped $40 million a year.  Referring again to the Superintendent’s speech, I’m pretty sure none of this information was included in the sales blitz the town was subjected to, while the district’s movers-and-shakers were making sure the voters “had the information that they needed.”   

And if you think we’ve finally reached “average” in ISD 709’s eyes, you would be mistaken. 
While expressing his “gratitude,” the Superintendent included a not-so-subtle message that cheap Duluthians were still just barely stepping up to the plate, and that “our level of local support is now just under the State average…”  
Hold onto to your wallets, Duluth.  As Mr. G. put it, we’ve already traveled a “long way,” but we’ve just begun this expensive journey.  For years I’ve written in this column that the people controlling the boardroom had only one solution for bailing out the district’s fiscal problems: they were going to hit the taxpayers, again and again.  After an extremely unwise capital investment, five million more dollars a year barely scratched the surface of our school district’s need.  This tax trip is far from over.   

The Trib stands up

The biggest surprise of the last election was the Duluth News Tribune’s editorial advising the public to approve only the base tier of the referendum and say “no” to any increase in funding: “…voters can insist first on a better accounting of the public dollars already flowing to the district. They can vote ‘no’ and ‘no’ on the second and third levy referendum questions, the rejection a clear representation of their insistence.  Is it any wonder there’s frustration with this district?  Just consider a few headlines from this past year: ‘Duluth schools face nearly $4M deficit,’ ‘Fiscal stability eludes Duluth district,’ ‘ACT scores dip in Duluth,’ ‘Former board member sues Duluth schools,’ ‘Duluth schools CFO put on leave,’ ‘Rat infestation closes Congdon Park School,’ and ‘Central High School property gets lower price.’

‘What many Duluth-district voters want,’ as (our own paper) opined in February, ‘is fiscal stability and a sense of budgeting confidence. At least optimism for an end to the constant budget-crisis mode.’  What we have instead, for literally decades now, is an unease of never-ending chaos and disarray…”

This harsh (but accurate) assessment of our public school district from the hometown newspaper must have kept Mr. Gronseth from sleeping soundly as the clock ticked closer to the election.  I think it was courageous of the paper to risk ruffling the feathers of the district’s powerful constituency.  My only muted criticism is that we all would have been better served if the Trib had focused whatever reporting prowess it has left on putting the district’s entire organization under the microscope and helping it come up with a foolproof plan.  
For years I’ve wanted to see someone in Duluth’s media market mimic Marshall Helmberger, the owner of the TimberJay Newspaper in Tower--demanding documents, demanding real numbers, insisting on seeing a real, tangible plan based on real numbers.  (For those who don’t know, Johnson Controls went north after Duluth, and grossly over-promised and under-delivered in another massive consolidation project.) No one, including our representatives on the Duluth school board, asked for any real numbers backing up the referendum claims, until I put in an information request.  Two Board members commendably helped expedite a response to my request, but it was too late to really dig in.   

I still have some questions I hope to get answered.  For example, the district’s 10-year projection is based on this year’s projected APU enrollment number staying perfectly static for a decade. That seems a bit optimistic, given that enrollment dropped from 9,976 students to 8340 over the last decade, a total loss of 1636, or an average of about 160 students a year — 16.5% of the student body. 

The ten-year projection I had in my last article for 25 new teachers ($2.6 million a year) was pretty much on target with what the district is projecting ($2.7 million,) but I still have questions regarding possible step-and-lane increases and other contractual costs.   
I also maintain that all the old ways of doing business should not remain in place.  Some changes should be made in the boardroom, especially around the agenda-setting process.  That process should be out in the open, so the public can more clearly see how the district’s priorities are decided. . 

How did it happen?
From the beginning of my involvement in these issues, I haven’t been able to fathom what gives in this town.  How did we ever let Keith Dixon slip behind closed doors and run up a huge bill on the Red Plan?  While the establishment lined up behind Mr. D., it was again the alternative press waving the RED flags.  Consider one passage from an excellent article written by Jennifer Martin-Romme of the Zenith News, right after Dixon’s arrival:
“From 1995 to 2005, Faribault, Minnesota was ripped apart. That was the decade when Keith Dixon was their Superintendent of schools. ‘The pain will be there for a long time,’ says (the chairwoman) of Faribault’s school board.  She describes a community and a school district bitterly at odds, public meetings that devolved into shouting matches.  People left town or yanked their children from the district and sent them to private school.  During that time, (the chairwoman) worked for the city, but describes herself as ‘always very active in the schools.’  She was elected to the school board shortly before Dixon left in 2005. ‘We were instrumental in (his) exodus. By that time, the community was willing to elect anybody who wouldn’t renew his contract…We told him to start looking (for another job.)’  In July of that year, he found one — as the Superintendent of Duluth’s Independent School District 709.”

Shortly before our astute school board solved Faribault’s problem, the Faribault Daily News wrote: “Board members talked candidly about the public’s lack of confidence in the current district superintendent and the reality that a much-needed levy likely won’t pass as long as Mr. Dixon remains with the district…Mr. Dixon stated at the meeting that he would not resign and so the board will eventually have to make a major decision: whether they will buy out the superintendent’s contract or allow him to stay on despite how local residents feel.” 

This is the person we brought in to save our school district?  
In her article, Martin-Romme further quoted the chairwoman of the Faribault school board, saying that Dixon “didn’t budget for the operating of those buildings.  It was like we built the building and then didn’t have enough money to turn the key. That’s where he failed.”  
Why does that sound so familiar? 
Martin-Romme  reported that Faribault’s district ended up in a similar fiscal mess as Duluth’s district, officially crashing into statutory operating debt status in 2000.  A month later, Faribault teachers presented a tally to the school board, showing 66% of them voted “no confidence” in Dixon’s leadership.  

HIRE that guy!  Give him carte blanche with half a billion bucks!  
One thing must be said about the cotton-topped hustler, however: he wasn’t an imbecile.  He figured out when to exit.  He didn’t make the same mistake he made in Faribault and extend his stay in Duluth, taking the heat while another of his grandiose schemes went south.  He declared: “I don’t see how this is going to get any better within the next few years,” and flew the coop.

Mr. Gronseth has tried to fly away six times.  What makes me especially nervous about this new plan our Superintendent hatched up is its ten-year projection.  Will the numbers really work for a decade, or are we going to be looking a déjà vu all over again?  Will Mr. G. or any of the current Board members, who promoted this gauzy long-range plan, still be around to make sure it works?  

Fool me once…       

Good hearts
Someone I know who opposed any increase in the district’s levy described the majority of Duluth’s citizens as “fools” to me, after they voted to give our public school system a five million dollar funding increase (fifty million more over ten years,) but I think the majority of this town’s citizens are good-hearted to a fault--which sometimes amounts to the same thing.  In the Red Plan’s market survey (conducted by the same marketer hired to do the recent referendum survey,) Duluth citizens overwhelmingly agreed with these two statements: “Duluth Public Schools are a good investment and I would support a property tax increase to support that investment,” and “I’m willing to invest in education by paying higher taxes, provided the schools continue to operate efficiently and offer high-quality educational programs.”

I actually thought the district would win passage of all three tiers of the levy.  As I told people during the campaign: “ISD 709 hasn’t been very good at managing our tax money, but it’s always been pretty good at managing to get more of our tax money.”
The third tier of the levy failed by only 2.6 percentage points.  In the midst of paying off an eight million dollar bill for the purchase and installation of technology products during the Red Plan, a near-majority was willing to cough up another three million for technology.  The primary reason another big investment was necessary boiled down to this quote in the News Tribune: “‘There was a lot of conversation about the fact that those systems would need some ongoing financing plans,’ (the former Facilities Manager) said, because the large initial investment meant upgrades would be needed all at once…”
In other words, there was a lot of talk but no actual maintenance scheme built into an absolute farce of a “long-range” plan.  
ISD 709 employs some very dedicated public workers.  A few examples are Dave Spooner, the current Facilities Manager and Peggy Blalock, the district’s current Account/Finance Manager.  I sent the previous Finance Manager a retirement card, in which I wrote: “Some of us who have been following this closely regarded you as a straight shooter.  In the atmosphere that existed, that was no small thing.”  I felt it was important to once again express that sentiment, here, before pointing out that we have not gotten a good return on our education tax dollars.  

For years we’ve been subjected to grand “big-thinking,” but everything comes down to numbers.  A solid foundational budget must be in place in order to get proper allocation of resources and good outcomes.  
I personally feel conned every time the Board promises “responsible use of resources” in its mission statement before meetings.  The people of Duluth have been repeatedly hoodwinked and/or let down, and their seemingly inexhaustible goodwill has been exploited.