Persistent Financial Pressures and Budgetary Shortfalls: The district approved a budget with a "negative contingency" of $434,388 and had earlier projected a shortfall approaching $2 million. It formally notified the state of its inability to balance the budget.
Declining Student Enrollment: Randolph County has seen a nearly 8% drop in student numbers over five years, leading to reduced state funding (e.g., a loss of over $600,000 due to a 100+ student decrease in one year).
Impact of School Choice Programs: The Hope Scholarship program has been cited as a "significant contributor" to enrollment decline, with 43 students utilizing these vouchers in the last school year.
Failure to Approve School Consolidation: The Board of Education's decision to reverse a plan to consolidate Harman and Pickens schools, against the superintendent's advice for cost savings, was explicitly noted as a concern by the WVDE.
Personnel Overages and Reductions: Despite over 50 Reduction in Force (RIF) hearings and the termination of 33 staff positions and 80 extracurricular posts, these measures were insufficient to resolve the budget deficit after the consolidation plan was rejected. The WVDE had flagged "personnel overages" as a concern.
Governance and Leadership Concerns: The WVDE's move suggests a perception that local leadership has been unable or unwilling to effectively address the mounting operational and fiscal crises, particularly regarding the consolidation and budget.
Impending State Oversight and Corrective Actions: If the State of Emergency is declared, the district will face increased state monitoring and be required to implement a corrective action plan.
Mandated Six-Month Improvement Period: The school system will have to develop and execute a formal improvement plan over six months to demonstrate progress in addressing the identified deficiencies.
Here is a proposed framework for a remediation plan, drawing on best practices and common corrective actions observed in similar situations within West Virginia :
I. Foundational Principles for Remediation:
Full Cooperation with WVDE: Establish open and continuous communication with WVDE officials, actively seeking guidance and adhering to all mandated directives and timelines.
Transparency: Ensure all aspects of the remediation process, including decision-making and progress, are conducted transparently with staff, parents, and the community.
Data-Driven Decisions: Utilize comprehensive data analysis to inform all corrective actions and measure progress effectively.
Accountability: Implement clear lines of responsibility for each component of the remediation plan and establish mechanisms for regular progress reporting to the BOE and WVDE.
II. Core Areas for Corrective Action & Strategic Initiatives:
A. Financial Restructuring and Fiscal Responsibility:
Develop a Balanced and Sustainable Budget:
Objective: Eliminate the current $434,388 "negative contingency" and achieve a structurally balanced budget for the upcoming and future fiscal years.
Actions:
Conduct an exhaustive line-item review of all expenditures to identify immediate and long-term savings.
Implement stringent spending controls and approval processes for all non-essential expenditures.
Explore all potential revenue enhancement opportunities, including grant applications and shared service agreements.
Work closely with the WVDE to ensure the budget meets all state requirements and aligns with the district's financial recovery goals.
Implement Enhanced Financial Oversight and Transparency:
Objective: Restore confidence in the district's financial management.
Provide regular, clear, and accessible financial updates to the BOE and the public.
B. Operational Efficiency and School Consolidation:
Re-evaluate and Implement a School Consolidation/Rightsizing Plan:
Objective: Address the WVDE's explicit concern regarding the "failure to approve a consolidation plan" and reduce operational inefficiencies stemming from under-enrolled schools and being "building heavy".
Develop a phased implementation plan for approved consolidations, including clear timelines, community communication strategies, and support for affected students and staff. This plan will likely be developed under WVDE directive.
Analyze per-pupil expenditures across all schools to identify and address disparities and inefficiencies.
Optimize District Operations:
Objective: Streamline non-instructional services to reduce costs.
Explore opportunities for shared services with neighboring districts or county agencies.
C. Personnel Management and Staffing Optimization:
Address Personnel Overages and Align Staffing with Needs:
Objective: Ensure staffing levels are appropriate for current student enrollment and programmatic requirements, addressing the WVDE's concern about "personnel overages".
Implement any further necessary Reductions in Force (RIFs) or transfers transparently and in strict accordance with state law and board policy, ensuring fairness and due process.
Ensure all hiring practices are compliant with state and local policies, focusing on recruiting and retaining highly qualified individuals.
Support and Develop Staff:
Objective: Maintain morale and effectiveness during a challenging period.
Provide professional development focused on areas identified in the improvement plan.
D. Enrollment Strategies and Community Engagement:
Develop Strategies to Stabilize and Potentially Increase Enrollment:
Objective: Mitigate the financial impact of declining enrollment.
Analyze the root causes of enrollment decline, including the impact of the Hope Scholarship.
Review and enhance academic and extracurricular programs to improve attractiveness and retention.
Develop targeted outreach and communication efforts to highlight the strengths and improvements within Randolph County Schools.
Objective: Rebuild trust and foster a collaborative environment.
Establish regular communication channels with parents, staff, and the broader community regarding the remediation plan and progress.
Actively solicit input and feedback from Local School Improvement Councils (LSICs) and other community groups.
E. Governance Enhancement and Leadership Accountability:
Improve Board of Education Effectiveness and Compliance:
Objective: Ensure the BOE operates with maximum effectiveness, transparency, and in full compliance with all legal and policy requirements.
All BOE members and the superintendent to participate in comprehensive training facilitated by the West Virginia School Board Association (WVSBA) and/or WVDE on roles, responsibilities, ethics, open meeting laws, parliamentary procedure, financial oversight, and effective governance practices.
Review and update all local board policies to ensure alignment with current WVBE policies and W. Va. Code.
Strictly adhere to protocols for executive sessions and ensure all board business is conducted openly and transparently as required by law.
Develop and publicly adopt clear board goals that are aligned with the district's improvement plan and student achievement.
Strengthen Administrative Leadership and Accountability:
Objective: Ensure strong, decisive leadership throughout the remediation process.
The superintendent will lead the development and implementation of the detailed six-month improvement plan, working closely with WVDE liaisons.
Clearly define roles and responsibilities for all central office and school-based administrators in executing the improvement plan.
Implement performance metrics for administrative staff tied to the successful implementation of corrective actions.
III. The Six-Month Improvement Plan:
Collaborative Development: The detailed six-month improvement plan will be developed in direct collaboration with, and subject to the approval of, the WVDE.
Specific, Measurable, Achievable, Relevant, Time-bound (SMART) Goals: The plan will articulate clear benchmarks, timelines, and responsible parties for each corrective action.
Regular Monitoring and Reporting: Progress will be rigorously monitored, with frequent reports submitted to the WVDE and shared with the Randolph County BOE and the public.
This strategic framework provides a pathway for Randolph County Schools to address the critical issues leading to the State of Emergency recommendation. Success will depend on unwavering commitment from local leadership, strong collaboration with state authorities, and the collective effort of the entire school community.
An Analysis of Financial Mismanagement in Randolph County Schools: Best Practices and Remediation Strategies
1. Introduction
1.1. Overview of Randolph County Schools' Financial Crisis
Randolph County Schools (RCS) in West Virginia is currently navigating a severe financial crisis that jeopardizes its operational stability and threatens the quality of education provided to its students. The district faces a budget shortfall estimated at nearly $2 million, a figure so substantial that even with proposed position cuts, a deficit of approximately $800,000 could remain.1 This dire situation has culminated in the Randolph County Board of Education (BOE) acknowledging its inability to present a balanced budget for the upcoming fiscal year, a mandatory requirement under state code.2 Consequently, RCS is poised to be placed on the state Board of Education's "watch list," with the strong possibility of direct state intervention or takeover of the school system's operations.2 The district's treasurer and director of finance, Brad Smith, has explicitly stated the legal obligation to provide a balanced budget and the current failure to meet this mandate, underscoring the gravity of the financial predicament.2
1.2. Purpose and Scope of the Report
This report aims to provide an in-depth analysis of the factors contributing to the financial failures within Randolph County Schools. It will examine the district's current financial management practices concerning accounting, expenditures, and resource allocation. Furthermore, this report will research and delineate best practices in public school financial management, drawing upon established standards and successful strategies from other educational systems. Finally, based on this analysis, a series of actionable recommendations will be proposed to remediate the existing financial deficiencies and guide RCS towards long-term fiscal stability and improved accountability. The scope encompasses both the specific circumstances within Randolph County and broader principles applicable to K-12 public education finance.
1.3. Significance of Addressing Financial Failures in Public Education
The financial health of public school districts is inextricably linked to their capacity to deliver quality education. Failures in financial management, such as those experienced by Randolph County Schools, have profound and detrimental impacts on students, staff, and the wider community. These impacts can manifest as reduced educational programs, inadequate resources, larger class sizes, deferred maintenance of facilities, and diminished staff morale due to job insecurity and increased workloads. The West Virginia state constitution guarantees the legislature's provision for "a thorough and efficient system of free schools".1 Financial instability, exacerbated by factors such as outdated funding formulas and programs like the Hope Scholarship which diverts public funds, places this constitutional promise at risk.1 The challenges confronting RCS are not unique; they mirror systemic issues faced by many rural, high-poverty school districts, making the analysis and remediation of these failures significant not only for Randolph County but also as a potential case study for other similarly situated districts.1 Addressing these financial shortcomings is paramount to ensuring equitable educational opportunities and upholding the public trust.
2. Contextual Factors Contributing to Randolph County Schools' Financial Distress
The financial predicament of Randolph County Schools is not the result of a single cause but rather a confluence of external pressures and internal decisions. Understanding these contextual factors is essential for a comprehensive analysis.
2.1. Declining Enrollment and Funding Formulas
A primary driver of RCS's financial woes is a significant decline in student enrollment, which directly impacts state funding levels. West Virginia's school aid formula, like those in many states, allocates resources based on student numbers. Statewide, student enrollment has decreased by approximately 4.5% over the past five years; however, Randolph County has experienced a much steeper decline, losing almost 8% of its student population during the same period.1 The loss of over 100 students between the 2022-2023 and 2023-2024 school years alone translated into a reduction of more than $600,000 in state aid for the 2024-2025 fiscal year, money crucial for essential costs such as staffing, operations, and transportation.1
A notable contributor to this enrollment decline is the Hope Scholarship program, a form of education savings account or voucher. In the last school year, 43 students in Randolph County utilized these voucher funds, more than tripling the participation from the previous year.1 This program diverts public funds that would otherwise support the public school system, further straining RCS's budget. Compounding these issues, the state's school funding formula itself is widely criticized as outdated and inequitable. It fails to sufficiently meet the current needs of schools across West Virginia and, troublingly, incentivizes school districts to terminate staff or close schools as a means to reduce costs and remain operational.1 This systemic flaw in the funding mechanism creates an environment where districts like RCS are pushed towards austerity measures that can harm educational quality.
2.2. Impact of Rurality and Socioeconomic Factors
Randolph County's geographical and socioeconomic characteristics present unique and costly challenges. As the largest county in West Virginia by land area, it faces inherently higher transportation costs due to students living farther from schools.1 Rural school districts, compared to their urban counterparts, often struggle to offer a broad curriculum, fill open teaching positions, and retain staff. With fewer students, rural districts also have a smaller base over which to spread the fixed costs of services, leading to higher per-pupil operational expenses.1
Furthermore, nearly half of the children attending Randolph County public schools come from lower-income families.1 Extensive research indicates that students experiencing poverty often require additional resources and support services to achieve the same educational outcomes as their peers from higher-income families.1 These factors mean that RCS inherently requires more robust funding to meet the diverse needs of its student population, a need that the current state and federal funding mechanisms may not adequately address.
2.3. Loss of Pandemic-Era Federal Relief Funds (ESSER)
The COVID-19 pandemic prompted an unprecedented infusion of federal relief funds into school districts nationwide through programs like the Elementary and Secondary School Emergency Relief (ESSER) Fund. The West Virginia Department of Education (WVDE) received nearly $1.2 billion in ESSER funds, a significant portion of which was distributed to Local Educational Agencies (LEAs) like Randolph County Schools.5 While these funds were crucial for addressing pandemic-related challenges, such as learning loss, technology upgrades, and health and safety measures, they were, by nature, temporary.
The cessation of these pandemic-era federal relief funds is a significant factor in RCS's current $2 million budget shortfall.1 For many districts, ESSER funds may have masked underlying structural deficits or delayed difficult budgetary decisions. With these funds now depleted, RCS is confronting the "fiscal cliff"—a sharp decline in available resources—forcing it to reconcile its expenditure levels with its more constrained, regular revenue streams.
2.4. Local Decisions and Management
While external factors have undeniably pressured RCS's finances, internal decisions and management practices have also played a role. The Randolph County Board of Education recently voted against proposals to close and consolidate Harman and Pickens Schools, the two smallest schools in the state.4 These closures were recommended by the superintendent as a measure to address the financial hardship.6 Superintendent Shawn Dilly explicitly stated that the board's rejection of these consolidation proposals significantly limited the administration's ability to find a viable path toward balancing the budget.6
Board member Philip Chua acknowledged the district's predicament, stating, "we're building heavy, we're location heavy and we're very spread out. We're in a terrible situation".4 This admission points to potential inefficiencies in resource allocation, particularly concerning the district's physical infrastructure in the context of declining enrollment. The decision to ultimately report an unbalanced budget to the state signifies the culmination of these financial pressures and the exhaustion of readily available local solutions.2
Adding to the complexity is the uncertainty surrounding other federal and state grant funding. The district has had to issue Reduction in Force (RIF) notices, at least temporarily, due to this uncertainty, even for positions like Special Education teachers, which are federally mandated.7 This situation suggests potential challenges in grant management, budgeting for positions without secured funding, or an over-reliance on non-guaranteed funding streams for core operational needs.
3. Analysis of Financial Management Practices in Randolph County Schools
The financial crisis in Randolph County Schools necessitates a close examination of its internal financial management practices. While external factors create significant headwinds, the effectiveness of budgeting, expenditure control, resource allocation, and accountability mechanisms within the district are critical determinants of its fiscal health.
3.1. Budgeting Processes and Controls
The most telling indicator of deficiencies in budgeting processes and controls is the district's current inability to present a balanced budget, as mandated by West Virginia state code.2 The school system faces an immediate $460,000 gap to balance the upcoming fiscal year's budget, with board members and the finance director acknowledging that even larger deficits are anticipated in subsequent years.2 Superintendent Dr. Shawn Dilly's comment that "I think we've already whittled every place we feel comfortable, based on what we know is the actual way the budget functions," suggests that the district may have exhausted easily identifiable cuts and is now facing more systemic budgetary challenges.3
This situation implies a budgeting process that may be more reactive than proactive, potentially lacking robust, long-term financial forecasting and planning. The necessity of issuing Reduction in Force (RIF) notices due to uncertainty over federal and state grant funding further illustrates potential weaknesses.7 Budgeting for positions contingent on unconfirmed grant awards introduces significant financial instability and can lead to disruptive personnel actions if funding does not materialize. This practice deviates from prudent budgeting, which typically aligns expenditures with confirmed or highly probable revenues.
3.2. Expenditure Management and Oversight
Expenditure management and oversight in RCS show areas requiring significant improvement. The proposed cuts to balance the budget, including four school counselors, a special education teacher, and the coordinator of transportation, indicate that critical student support and operational services are at risk due to financial constraints.6 While such cuts may be unavoidable in a crisis, they highlight the severity of the expenditure pressures.
A specific instance of oversight lapse is found in the West Virginia Department of Education's (WVDE) ESSER I monitoring report for Randolph County. The report identified that RCS had exceeded the allowable indirect cost recovery by $1,342.34 due to the exclusion of certain object codes, necessitating a reimbursement to the federal grant.8 Although the monetary amount is relatively small, this finding points to a potential misunderstanding or misapplication of federal grant regulations, which can have larger implications if systemic.
Broader concerns about oversight are raised by a WVDE Performance Evaluation and Research Division (PERD) audit of ESSER funds statewide. This audit concluded that the WVDE itself "Lacks Adequate Capacity or Structure to Monitor Local School Districts' Use of Federal Emergency Education Funds Which Has Resulted in an Increased Risk of Fraud, Waste, and Abuse of these Funds".5 While this is a statewide finding concerning WVDE's capacity, it underscores a heightened risk environment for all LEAs, including Randolph County, regarding the management of substantial federal funds. Effective local expenditure management becomes even more critical in such a context.
3.3. Resource Allocation Decisions
Decisions regarding the allocation of resources, particularly concerning school facilities, appear to be a significant factor in RCS's financial strain. The Board of Education's vote to keep Harman and Pickens Schools open, despite their status as the two smallest schools in West Virginia and the administration's recommendation for closure as a cost-saving measure, exemplifies this challenge.4 These schools are described as very remote, implying high operational and transportation costs per student.4 While community attachment to local schools is understandable and important, resource allocation decisions must also consider fiscal sustainability, especially in a district facing a multi-million dollar deficit.
Board member Philip Chua's assessment that the school system is "building heavy, location heavy and we're very spread out" directly points to an inefficient allocation of resources across its physical plant, especially given the nearly 8% decline in student enrollment over five years.1 Maintaining an extensive network of facilities for a shrinking student body inevitably leads to higher per-pupil costs for operations, maintenance, and staffing, diverting funds that could be used for instructional programs or other student needs. This structural inefficiency in resource allocation is a critical area for review.
3.4. Transparency and Accountability
The Randolph County BOE's decision to formally report to the state that it cannot balance its budget is, in itself, a public acknowledgment of a failure in financial accountability.2 This action, leading to placement on the state's "watch list" and the potential for state takeover, signals a breakdown in the district's ability to manage its finances responsibly and meet its legal obligations.2
In terms of transparency, the WVDE makes ESSER monitoring reports for individual counties, including Randolph County's ESSER I and ESSER II/ARP reports, publicly accessible on its website.8 This practice provides a degree of external transparency regarding the use of these specific federal funds. However, the effectiveness of this transparency is somewhat undermined by the statewide PERD audit finding that WVDE's own monitoring capacity for ESSER funds is inadequate, potentially increasing the risk of fraud, waste, and abuse across all LEAs.5 This systemic weakness in the state's oversight mechanism can inadvertently lessen the pressure for stringent local accountability. True accountability requires not only the availability of reports but also robust systems to ensure that financial resources are used effectively, efficiently, and in compliance with all regulations, and that deficiencies are promptly and thoroughly addressed. The current crisis suggests that such accountability mechanisms may not have been sufficiently robust or effective within Randolph County Schools.
4. Best Practices in Public School Financial Management
To effectively address the financial challenges in Randolph County Schools, it is crucial to understand and implement established best practices in public school financial management. These practices cover accounting standards, budgeting techniques, expenditure control, resource allocation, transparency, and long-range planning.
4.1. Accounting Standards and Principles (GASB & GAAP)
Public school districts, as governmental entities, are expected to adhere to Generally Accepted Accounting Principles (GAAP) as established by the Governmental Accounting Standards Board (GASB).11 GASB's mission is to improve financial reporting by state and local governments, ensuring that financial statements provide accurate, useful, and reliable information.12 Key GAAP principles applicable to school districts include regularity (adherence to rules), consistency (in applying standards), sincerity (impartial accuracy), permanence of methods, non-compensation (full reporting of positives and negatives), prudence (avoiding speculation in reporting), continuity (assumption of ongoing operations), periodicity (reporting in standardized timeframes), materiality (full disclosure of financial situation), and utmost good faith (honesty and transparency from all parties).13
Annual financial audits conducted by independent auditors are a cornerstone of accountability, verifying compliance with GAAP and other regulations.14 These audits often result in a Comprehensive Annual Financial Report (CAFR), which should be publicly available. Furthermore, specific GASB pronouncements, such as Statement 75, dictate the reporting of liabilities like Other Post-Employment Benefits (OPEB) on the face of financial statements.11 The West Virginia Department of Education also provides a standardized Chart of Accounts to guide LEAs in classifying financial transactions consistently.15 Adherence to these standards ensures comparability, reliability, and transparency in financial reporting.
4.2. Effective Budgeting Techniques
Effective budgeting in school districts is a proactive, strategic process, not merely a reactive accounting exercise. Best practices emphasize starting by reviewing financial data from previous years to set realistic expectations for revenue and expenses.14 Essential expenses like salaries, utilities, and maintenance should be prioritized, with remaining funds allocated to secondary priorities.14 The use of financial management software can streamline budgeting, tracking, and reporting, saving time and reducing errors.14
The Government Finance Officers Association (GFOA) outlines several best practices for school budgeting, including the development of a budget calendar, thorough cost analysis, active stakeholder engagement, and the creation of a strategic financial plan that directly aligns the budget with instructional priorities.16 Superintendents play a crucial role in this process, particularly as staffing costs typically constitute 70-80% of a school district's budget.18 Priority-based budgeting is a highly recommended approach, shifting the focus from mere line-item expenditures to achieving specific student-centric, outcome-driven goals based on data-informed decisions.19 This ensures that financial resources are directly tied to the educational mission of the district.
4.3. Prudent Expenditure Management and Procurement
Prudent expenditure management involves controlling costs without compromising essential services. Key strategies for streamlining school procurement include digital transformation through appropriate technology, optimizing internal purchasing processes, strategic supplier management, aligning procurement activities with school budget cycles, and employing strategic sourcing for competitive pricing.20 This can be facilitated by developing standardized requisition forms, creating templates for common orders, establishing clear documentation requirements for different spending thresholds, and implementing streamlined approval workflows with defined authority levels.20 Regular vendor performance evaluation (tracking delivery, quality, and pricing) and robust contract management (centralized storage, renewal notifications, compliance tracking) are also critical.20
Centralizing purchasing functions can create economies of scale and improve negotiating power.21 When making purchasing decisions, especially for significant assets, prioritizing the Total Cost of Ownership (TCO) over just the initial purchase price is essential. TCO considers all lifecycle costs, including installation, training, maintenance, operation, and disposal.21 Adherence to public procurement laws and regulations is mandatory.22 Effective cost control mechanisms for projects include detailed preliminary cost estimates (covering both "hard" construction costs and "soft" costs like design fees and contingencies), life cycle cost analyses for major systems (e.g., HVAC), and innovative design and construction strategies to stay within budget.24 For ongoing operational costs, strategies such as implementing preventive maintenance schedules, digitizing facility information for quick access, real-time asset tracking, conducting energy audits, and tracking workforce productivity can yield significant savings.26
4.4. Strategic Resource Allocation and Equity
Strategic resource allocation ensures that limited funds are directed towards activities and programs that most effectively support the district's educational goals and priorities.16 This requires a clear strategic plan that guides all budgetary decisions. A critical component of strategic resource allocation is a focus on equity. This involves identifying underserved student populations (e.g., students of color, students with disabilities, English learners, students from low-income backgrounds), actively listening to their needs and the perspectives of their families, and conducting root cause analyses of achievement or opportunity gaps.28
Research strongly supports the principle that school funding systems should provide more resources—not merely equal—to meet the needs of underserved students.29 This can be achieved through weighted student funding formulas, where students with greater needs are assigned a higher funding weight, or through targeted grants for specific programs supporting these students.30 The inadequacy of West Virginia's current funding formula and the diversion of funds through programs like the Hope Scholarship, as noted in Randolph County's context 1, run counter to these best practices in equitable resource allocation. Fair funding aims to remove the predictability of student success or failure based on social or cultural factors.28
4.5. Transparent Financial Reporting and Accountability
Transparency in financial reporting is crucial for building public trust and ensuring accountability. The Every Student Succeeds Act (ESSA) mandates the reporting of per-pupil expenditures at the school level on state and district report cards, providing a clearer view of how funds are distributed within a district.31 Annual financial reports, including audit results, should be made easily accessible to the public.14
Accountability is further strengthened through robust internal audit processes. Internal audits should look beyond financial compliance to evaluate the efficiency and effectiveness of operations, identify potential risks, and make recommendations for improvement.33 The school board plays a vital role in initiating internal audits, overseeing the process, and ensuring that findings are addressed.34 The WVDE also has a set of financial efficiency standards for county boards, which include metrics like timely budget submissions, the nature of audit findings, and maintaining an adequate unrestricted fund balance (recommended at 3-5%).35 Districts not meeting a 70% threshold on these standards are identified as needing assistance.
4.6. Long-Range Strategic Financial Planning
Effective school districts engage in long-range strategic financial planning, looking beyond the immediate budget cycle to anticipate future challenges and opportunities. This involves managing financial risk, maximizing opportunities for resource enhancement, and mitigating financial vulnerabilities.36 Strategic financial planning should be curriculum-led, with close collaboration between finance and instructional leaders to ensure that financial decisions support educational goals.36
Key elements include developing multi-year financial models to project revenues and expenditures under various scenarios, diversifying revenue sources (e.g., grants, partnerships), implementing staff retention strategies to control costs associated with turnover, conducting periodic efficiency audits, and evaluating options like school consolidation where appropriate due to declining enrollment or underutilized facilities.36 The GFOA emphasizes that strategic planning is an overarching process that articulates an organization's future vision and identifies goals and objectives, which then informs long-term financial planning, financial policy development, capital improvement planning, and annual budgeting.38 The Tigard-Tualatin School District's Strategic Financial Plan serves as an example of aligning financial planning with broader district goals related to student achievement, equity, talent, and climate/culture.39 This proactive and comprehensive approach is essential for sustained fiscal health.
5. Recommendations for Remediation and Future Stability
Addressing the profound financial challenges in Randolph County Schools requires a multi-faceted approach involving immediate crisis management, short-term stabilization efforts, medium-term capacity building, and long-term systemic changes. The following recommendations are designed to guide RCS towards financial recovery and sustainable fiscal health.
5.1. Immediate Actions (0-6 Months)
5.1.1. Cooperate Fully with WVDE Intervention: Given the high likelihood of state intervention due to the inability to balance the budget 2, RCS must engage proactively and transparently with the West Virginia Department of Education. This includes providing all requested financial data, facilitating access to personnel and records, and actively participating in any state-led assessments or planning processes. This cooperation is not merely compliance but an opportunity to leverage state-level expertise and resources for recovery.
5.1.2. Implement Emergency Budgetary Controls: The district should immediately institute a freeze on all non-essential spending. This includes a moratorium on discretionary purchases, travel, and new contractual agreements unless deemed absolutely critical for health, safety, or core instruction. All current contracts should undergo an expedited review to identify any potential for immediate cost savings or renegotiation.
5.1.3. Conduct a Rapid Financial Health Assessment: RCS, potentially with assistance from the WVDE or an independent financial expert, must conduct a swift and thorough assessment to verify the precise current deficit, identify immediate cash flow challenges, and validate the accuracy of existing financial data. This assessment will provide a reliable baseline for all subsequent recovery actions.
5.1.4. Enhance Transparency with Stakeholders: Rebuilding trust with the community, staff, and students is paramount. RCS should establish clear, regular, and accessible communication channels (e.g., a dedicated section on the district website, regular email updates, community forums) to provide factual information about the financial situation, the steps being taken by the district and/or state, and the rationale behind difficult decisions. Open communication is a key strategy for maintaining solvency and stakeholder buy-in.40
5.2. Short-Term Actions (6-12 Months)
5.2.1. Comprehensive Independent Audit: Beyond the standard annual audit, RCS should commission a comprehensive, independent forensic audit. This audit should focus on internal controls, the management of all grant funds (with particular attention to ESSER and other significant state and federal grants given the ESSER I finding 8 and statewide WVDE monitoring concerns 5), procurement practices, and detailed expenditure patterns over the past three to five fiscal years. The goal is to identify specific points of failure, any potential misuse of funds, and systemic weaknesses in financial oversight.33
5.2.2. Develop a Multi-Year Financial Recovery Plan: Based on the findings of the rapid assessment and the comprehensive audit, RCS must develop a detailed, actionable financial recovery plan spanning three to five years. This plan needs clear, measurable targets for deficit reduction, revenue enhancement strategies, and stringent expenditure controls. It should be grounded in GFOA best practices for school budgeting 16 and incorporate principles of priority-based budgeting to ensure resources align with core educational missions.19
5.2.3. Review and Restructure Administrative Overhead: A thorough review of administrative staffing levels and costs, benchmarked against comparable rural school districts, is necessary. This review should identify opportunities for consolidation of administrative roles or the strategic outsourcing of non-instructional services (e.g., payroll, some maintenance functions) if proven to be more cost-effective and efficient.41
5.2.4. Strengthen Internal Controls and Financial Policies: The district must revise existing, or develop new, robust internal control procedures consistent with GASB standards and GAAP.13 This includes ensuring meticulous documentation for all financial transactions, clear segregation of duties, and regular reconciliation processes. Comprehensive financial policies covering procurement, travel, asset management, cash handling, and grant administration should be updated or created and rigorously enforced.20
5.2.5. Initiate Comprehensive Review of School Facilities and Operations: Addressing the "building heavy, location heavy" issue 4 is critical. A data-driven analysis of building utilization rates, per-school operational costs (including utilities and maintenance), and transportation logistics is required. This analysis should generate options for potential school consolidation, co-location of services, or boundary adjustments, always involving transparent community consultation throughout the process.
5.3. Medium-Term Actions (12-24 Months)
5.3.1. Implement a Modernized Financial Management System: Investing in an integrated, modern financial software system is crucial for improving efficiency, accuracy, and transparency in budgeting, accounting, procurement, and financial reporting. Such a system can provide real-time data for better decision-making and reduce administrative burdens associated with outdated systems.14
5.3.2. Enhance Staff Capacity in Financial Management: All personnel involved in financial processes, from school-based staff managing activity funds to central office finance teams, require targeted professional development. Training should cover the new financial management system, updated policies and procedures, GASB/GAAP principles, effective grant management, and ethical conduct in financial matters.20
5.3.3. Establish a Formal Risk Management Framework: The district should develop and implement a formal process for identifying, assessing, monitoring, and mitigating financial risks. These risks include, but are not limited to, fluctuations in student enrollment, changes in state or federal grant funding, economic downturns impacting local revenues, and unforeseen catastrophic events.36
5.3.4. Pursue Grant Diversification and Strategic Partnerships: RCS should proactively seek a wider range of grant opportunities from federal, state, and private foundation sources to supplement core funding. Exploring strategic partnerships with local businesses, community organizations, higher education institutions, or other governmental entities for shared services, joint programming, or resource contributions can also alleviate financial pressures.17
5.3.5. Advocate for State-Level Funding Reform: Recognizing that local efforts alone may be insufficient given systemic issues, RCS should collaborate with other rural and high-poverty school districts in West Virginia to advocate for meaningful reforms to the state's school funding formula. Advocacy should focus on ensuring the formula adequately addresses the unique costs associated with rurality, student poverty, and declining enrollment, and mitigates the negative fiscal impact of programs like the Hope Scholarship that divert public education funds.1
5.4. Long-Term/Ongoing Actions
5.4.1. Embed Strategic Financial Planning into District Culture: Long-range financial planning should become an integral and continuous part of the district's operational culture, closely integrated with educational goal-setting, curriculum development, and strategic initiatives. The multi-year financial plan must be a living document, regularly reviewed, updated, and used to guide annual budget development.16
5.4.2. Maintain Rigorous Adherence to Best Practices: The district must commit to the ongoing implementation and monitoring of best practices in all areas of financial management, including accounting, budgeting, expenditure control, resource allocation, procurement, and transparency, as outlined in Section 4 of this report.13
5.4.3. Foster a Culture of Fiscal Responsibility and Accountability: A sense of shared responsibility for sound financial management should be cultivated among all district employees, the Board of Education, and the broader community. This includes clear expectations, performance metrics for financial health, and consequences for non-compliance with financial policies.19
5.4.4. Regular Internal and External Audits with Public Reporting: The district should establish a schedule for regular internal audits of key financial processes and departments, supplementing the annual external audit. All audit findings, along with management's responses and corrective action plans, must be made readily available to the public to ensure transparency and accountability.14
5.4.5. Continuous Monitoring of Enrollment and Demographic Trends: Proactive and continuous tracking of student enrollment patterns, birth rates, housing development, and other relevant demographic trends is essential for accurate long-term facility planning, staffing projections, and resource allocation strategies.1
Actionable Recommendations Implementation Matrix
To facilitate the implementation of these recommendations, the following table provides a structured overview, assigning priority levels, potential lead entities, and key performance indicators (KPIs).
Rec # | Action Item (Summarized) | Priority Level | Potential Lead Entity | Key Performance Indicator(s) (KPIs) |
5.1.1 | Cooperate Fully with WVDE Intervention | Immediate (0-6 mos) | Superintendent, BOE | WVDE intervention plan established; Regular communication meetings held with WVDE; All WVDE data requests fulfilled promptly. |
5.1.2 | Implement Emergency Budgetary Controls | Immediate (0-6 mos) | CFO, Superintendent | Spending freeze implemented; Contract review completed; Documented savings from immediate controls. |
5.1.3 | Conduct Rapid Financial Health Assessment | Immediate (0-6 mos) | BOE, Superintendent (External) | Independent expert contracted; Assessment report received; Verified deficit figure established. |
5.1.4 | Enhance Transparency with Stakeholders | Immediate (0-6 mos) | Superintendent, Communications | Dedicated financial update webpage live; Schedule of community forums published; Regular stakeholder updates disseminated. |
5.2.1 | Comprehensive Independent Audit | Short-Term (6-12 mos) | BOE | Audit firm selected via RFP; Audit fieldwork completed; Final audit report with findings and recommendations received. |
5.2.2 | Develop Multi-Year Financial Recovery Plan | Short-Term (6-12 mos) | Superintendent, CFO, BOE | Recovery plan drafted, incorporating audit findings; Plan approved by BOE; Plan submitted to WVDE (if required). |
5.2.3 | Review & Restructure Administrative Overhead | Short-Term (6-12 mos) | Superintendent, CFO | Administrative cost analysis completed; Restructuring plan developed and approved; Initial implementation of restructuring begins. |
5.2.4 | Strengthen Internal Controls & Financial Policies | Short-Term (6-12 mos) | CFO, Finance Department | Revised/new internal control manual developed; Updated financial policies approved by BOE; Staff training on new controls/policies initiated. |
5.2.5 | Comprehensive Review of School Facilities & Operations | Short-Term (6-12 mos) | Superintendent, Operations | Facility utilization and operational cost analysis completed; Report with options for consolidation/efficiency presented to BOE. |
5.3.1 | Implement Modernized Financial Management System | Medium-Term (12-24 mos) | CFO, IT Department | RFP for new system issued; Vendor selected; System implementation initiated; Staff training on new system underway. |
5.3.2 | Enhance Staff Capacity in Financial Management | Medium-Term (12-24 mos) | CFO, HR Department | Training needs assessment completed; Comprehensive financial training program developed and delivered; Participation rates tracked. |
5.3.3 | Establish Formal Risk Management Framework | Medium-Term (12-24 mos) | Superintendent, CFO | Risk management policy approved by BOE; Risk register developed; Process for ongoing risk assessment implemented. |
5.3.4 | Pursue Grant Diversification & Strategic Partnerships | Medium-Term (12-24 mos) | Grant Coordinator, Supt. | Grant opportunity pipeline developed; Number of new grant applications submitted; At least one new strategic partnership formed. |
5.3.5 | Advocate for State-Level Funding Reform | Medium-Term (12-24 mos) | BOE, Superintendent | Participation in statewide advocacy groups; Position papers/testimony developed; Meetings held with state legislators. |
5.4.1 | Embed Strategic Financial Planning into District Culture | Long-Term/Ongoing | Superintendent, BOE, All | Annual review and update of multi-year financial plan; Budget explicitly linked to strategic goals; Departmental plans align. |
5.4.2 | Maintain Rigorous Adherence to Best Practices | Long-Term/Ongoing | CFO, All Finance Staff | Regular review of GASB/GFOA updates; Internal checklists for compliance; Positive trends in audit findings. |
5.4.3 | Foster Culture of Fiscal Responsibility & Accountability | Long-Term/Ongoing | Superintendent, Principals | Financial literacy included in leadership training; Performance metrics for financial health regularly reported; Clear accountability lines. |
5.4.4 | Regular Internal & External Audits with Public Reporting | Long-Term/Ongoing | BOE, Audit Committee | Schedule for internal audits established and followed; Annual external audit completed and publicly presented; Corrective actions tracked. |
5.4.5 | Continuous Monitoring of Enrollment & Demographic Trends | Long-Term/Ongoing | Superintendent, Planning | Annual enrollment projection reports produced; Demographic data regularly analyzed; Long-term facility plan updated based on trends. |
This matrix provides a clear framework for implementing the proposed recommendations, assigning responsibilities, and measuring progress, which is vital for navigating Randolph County Schools out of its current financial crisis and towards a future of stability and educational excellence.
6. Conclusion
Randolph County Schools stands at a critical juncture. The district is grappling with a severe financial crisis, characterized by a substantial budget shortfall, an inability to meet its statutory obligation to balance its budget, and the looming prospect of state intervention.1 This situation not only threatens the district's operational viability and local autonomy but also compromises its fundamental mission to provide a thorough and efficient education to all its students.
Addressing these deep-seated financial issues requires more than temporary fixes or superficial adjustments. It demands decisive action and a sustained, unwavering commitment from the Board of Education, district leadership, staff, and the broader community to implement comprehensive financial reforms grounded in established best practices. The path to fiscal health will undoubtedly be challenging, involving difficult decisions and a significant shift in operational culture. However, undertaking this journey is essential if Randolph County Schools is to fulfill its educational mandate and restore public confidence.
The current crisis, while undeniably severe, also presents a compelling opportunity for fundamental transformation. The external pressures and the clear evidence of financial unsustainability can serve as a catalyst for Randolph County Schools to overhaul outdated or ineffective financial management systems and practices.1 By embracing the comprehensive recommendations outlined in this report—spanning improved budgeting and expenditure controls, strategic resource allocation, enhanced transparency and accountability, and robust long-range planning—the district has the potential to emerge as a more resilient, efficient, and fiscally sound organization. This is an occasion to rebuild the district's financial foundations thoroughly, learning from past deficiencies to create a stronger future.
It is crucial to remember the human element at the heart of this financial crisis. The data, deficits, and budgetary line items translate into real-world consequences for the students of Randolph County, nearly half of whom come from low-income families, and for the dedicated staff members facing the uncertainty of Reductions in Force.1 The ultimate objective of achieving financial stability is not merely to balance spreadsheets, but to ensure that Randolph County Schools can effectively and equitably serve every student, providing them with the resources, support, and high-quality educational experiences they need to succeed. The commitment to this human-centered goal must drive the difficult work of financial remediation and reform.
Works cited
Randolph County Schools Facing RIFs, Deficit Due to Funding Inadequacies - West Virginia Center on Budget & Policy, accessed June 5, 2025, https://wvpolicy.org/randolph-county-schools-facing-rifs-deficit-due-to-funding-inadequacies/
Randolph BOE to report to state that budget can't be balanced - The Intermountain, accessed June 5, 2025, https://www.theintermountain.com/news/local-news/2025/05/randolph-boe-to-report-to-state-that-budget-cant-be-balanced/
Randolph BOE decides budget can't be balanced | News, Sports, Jobs - The Intermountain, accessed June 5, 2025, https://www.theintermountain.com/news/local-news/2025/05/randolph-boe-decides-budget-cant-be-balanced/
Randolph County school board could soon be in a state of emergency - WV MetroNews, accessed June 5, 2025, https://wvmetronews.com/2025/06/04/randolph-county-school-board-could-soon-be-in-a-state-of-emergency/
DEPARTMENT OF EDUCATION - West Virginia Legislature, accessed June 5, 2025, https://www.wvlegislature.gov/legisdocs/reports/perd/DOE.ESSER_NOVEMBER_2023.pdf
Reduction-in-force hearings begin this week for Randolph County school system, accessed June 5, 2025, https://wvmetronews.com/2025/03/23/reduction-in-force-hearings-begin-this-week-for-randolph-county-school-system/
Official: More RIFs in Randolph County forced by grant funding uncertainty, accessed June 5, 2025, https://www.theintermountain.com/news/local-news/2025/03/official-more-rifs-in-randolph-county-forced-by-grant-funding-uncertainty/
West Virginia Department of Education Elementary and Secondary School Emergency Relief Fund (ESSERF) LEA Monitoring Document, accessed June 5, 2025, https://wvde.us/sites/default/files/2023/03/Randolph-Final-ESSER-I-Monitoring-Document.pdf
ESSER Monitoring Reports | West Virginia Department of Education, accessed June 5, 2025, https://wvde.us/about-us/finance/esser-monitoring-reports
wvde.us, accessed June 5, 2025, https://wvde.us/sites/default/files/2023/03/Randolph-Final-ESSER-II-and-ARP-Monitoring-Report.pdf
GASB 75 & OPEB Frequently Asked Questions - New York State Comptroller, accessed June 5, 2025, https://www.osc.ny.gov/files/local-government/publications/pdf/GASB-75-FAQ.pdf
What is GASB? - Governmental Accounting Standards Board, accessed June 5, 2025, https://www.mip.com/blog/what-is-the-governmental-accounting-standards-board-gasb/
Public School Accounting Principles | Vanco, accessed June 5, 2025, https://www.vancopayments.com/education/blog/public-school-accounting-principles
Public School Accounting: Ultimate K-12 Guide for Administrators - YouTube, accessed June 5, 2025, https://www.youtube.com/watch?v=W0PUt8vTtmY
Local Education Agencies - CHART OF ACCOUNTS - WVDE, accessed June 5, 2025, https://wvde.us/sites/default/files/2023/08/Chart-of-Accounts-FY2024.pdf
Best Practices in School Budgeting Summary - GFOA, accessed June 5, 2025, https://www.gfoa.org/gfoa-has-developed-a-series-of-best-practices-in-school
How to overcome education funding issues in public schools | Hāpara, accessed June 5, 2025, https://hapara.com/blog/how-to-overcome-education-funding-issues-in-public-schools/
10 Essential Strategies for Optimizing Your School Budget - Go Solutions, accessed June 5, 2025, https://golearn.gosolutions.com/resources/10-essential-strategies-for-optimizing-your-school-budget/
Priority-Based Budgeting in Education - MyBudgetFile, accessed June 5, 2025, https://www.mybudgetfile.com/post/priority-based-budgeting-in-education
How to Streamline School Procurement Process: 7 Strategies for Education Leaders in 2025, accessed June 5, 2025, https://www.procuredesk.com/streamline-school-procurement-process/
Ultimate Guide to Procurement in Education: Tips for Schools ..., accessed June 5, 2025, https://planergy.com/blog/procurement-in-education/
Contracts and Purchasing - InfoHub, accessed June 5, 2025, https://infohub.nyced.org/in-our-schools/working-with-the-doe/contracts-and-purchasing
Public School Contracts Law - NJ.gov, accessed June 5, 2025, https://www.nj.gov/dca/dlgs/programs/PS_contractsLaw.shtml
Cost Estimating for K-12 School Projects: An Invaluable Tool for ..., accessed June 5, 2025, https://www.ls3p.com/cost-estimating-for-k-12-school-projects-an-invaluable-tool-for-budget-management/
4 Methods We Use to Maintain Budget Control in K-12 Projects - Schmidt Associates, accessed June 5, 2025, https://schmidt-arch.com/4-methods-we-use-to-maintain-budget-control-in-k-12-projects/
Reducing Facility Management Cost in K-12 Schools, accessed June 5, 2025, https://www.arcfacilities.com/blog/strategies-reducing-fm-cost-k12-schools
Proven Creative Ways to Cut School Operating Costs, accessed June 5, 2025, https://www.numberanalytics.com/blog/proven-creative-ways-to-cut-school-operating-costs
Build a Strategic Plan Around Educational Equity | Studer Education, accessed June 5, 2025, https://studereducation.com/commit-to-achieving-equity-in-education/
edtrust.org, accessed June 5, 2025, https://edtrust.org/wp-content/uploads/2014/09/Equal-Is-Not-Good-Enough-December-2022.pdf
Equitable Funding Policy Breakdown - Educators for Excellence, accessed June 5, 2025, https://e4e.org/equitable-funding-policy-breakdown/
ESSA's Financial Transparency Reporting Requirement - Comprehensive Center Network, accessed June 5, 2025, https://compcenternetwork.org/resources/resource/4465/essas-financial-transparency-reporting-requirement
Financial Transparency and Reporting Readiness Assessment Tool ..., accessed June 5, 2025, https://www.ed.gov/teaching-and-administration/lead-and-manage-my-school/state-support-network/ssn-resources/financial-transparency-and-reporting-readiness-assessment-tool
How to Nail Your School Audit in Four Easy Steps | KerberRose, accessed June 5, 2025, https://kerberrose.com/audit-assurance/how-to-nail-your-school-audit-in-four-easy-steps/
What Is the School Board's Role in a District Internal Audit? | TASB, accessed June 5, 2025, https://www.tasb.org/news-insights/school-board-role-in-internal-audit
School Finance Hot Topics – July 13, 2022 - WVDE, accessed June 5, 2025, https://wvde.us/sites/default/files/2022/08/Hot-Topics.pdf
Strategic financial planning for schools: Six ground rules & four ..., accessed June 5, 2025, https://www.headteacher-update.com/content/best-practice/strategic-financial-planning-for-schools-six-ground-rules-four-tactics/
Funding the Future: Financial Strains and Strategies for Schools - MGT.US, accessed June 5, 2025, https://www.mgt.us/insights/funding-the-future-financial-strains-and-strategies-for-schools/
Strategic Planning - GFOA, accessed June 5, 2025, https://www.gfoa.org/materials/bp-strategicplanning
Strategic Financial Plan - Tigard-Tualatin School District 23J, accessed June 5, 2025, https://www.ttsdschools.org/about-us/strategic-plans/strategic-financial-plan
files.eric.ed.gov, accessed June 5, 2025, https://files.eric.ed.gov/fulltext/EJ1016275.pdf
www.mackinac.org, accessed June 5, 2025, https://www.mackinac.org/archives/2002/s2002-06.pdf
5 Financial Challenges Facing Schools (and How to Overcome Them), accessed June 5, 2025, https://www.learnyoss.com/post/5-financial-challenges-facing-schools-and-how-to-overcome-them
Discover 15 Money Saving Tips for Schools and School Districts, accessed June 5, 2025, https://www.schooledtech.com/discover-15-money-saving-tips-for-schools-and-school-districts/
No comments:
Post a Comment