A special committee has been formed by the Moab Area Chamber of Commerce to help the Grand County School District deal with the ongoing budget deficit issues. The School Crisis Committee came about when two members approached the Chamber after becoming increasingly concerned with the impact of the financial crisis on the community.

“The Chamber has been watching the situation for some time and not responding. The members came to us wanting to help in this tragedy,” said Chamber of Commerce President Phil Mueller. “We realized the economic future of the community is also at stake, and we need to help any way we can.”

A subcommittee, consisting of chamber members in the business community, was created, and those committee members are sharing some of their business expertise. Members Joe Kingsley, Geri Hamilton, John Fogg, Steve Laury, Ken Davey, Bayley Rodgers, Tara Richardson, Mueller, and Chamber Executive Director Kammy Wells comprise the committee.

The first act of the School Crisis Committee was to meet with retired Murray District Business Administrator Richard Clark on Jan. 5, to go over the district’s financial records from the past few years. Mueller said the committee wanted to gain an understanding of how school finances work.

“Many of our members have financial backgrounds as business owners,” Mueller said. “But the finances of a school district are very different. There are more restrictions, and we wanted to get a better picture of the situation.”

Wells said it was important for the chamber members to review the district’s budget to get a clear understanding of how the district’s $2.2 million shortfall for the 2008-2009 and 2009-2010 school years could have happened. District and Grand County Board of Education members have said the district also faces a $1.9 million budget shortfall for the 2010-2011 school year, in part, because of the financial impacts caused by the previous years’ deficits.

“After taking a close inspection of the budget and the numbers that led to this situation, we were able to come away with assurance that the school board could not have caught this problem ahead of time,” Wells said. “We saw no signs of embezzlement or criminal misuse of the funds.”

Part of the task of the committee at Tuesday’s meeting was to discuss possible solutions for the crisis, including land sales and a possible realignment of the district boundaries to include Spanish Valley residents, whose children attend Grand County schools, in the Grand school district.

The members of the School Crisis Committee also suggested that the board consider the sale of surplus lands, including Red Rock Elementary, as a way to create revenue, and raised the possibility that the district could enter into an owner-financing arrangement for the sale of the Red Rock property. That would allow the district to lease the property and collect a down payment immediately, and accrue principal thereafter as a way to ensure an income over an extended period of time.

During a meeting with school board members on Tuesday afternoon, Kingsley, a local realtor, said his office, Coldwell Banker-Arches Realty, would be willing to handle the sale of the school properties and would forgo any commission on the sales.

According to Wells, revenue collected from a leased Red Rock property can be put toward the maintenance and operation fund (M&O) in the district. The M&O fund was the fund into which money was allocated incorrectly over a period of years, creating the growing deficit now affecting the school district.

“It’s a Band-Aid solution, but it could buy the district some time,” said Wells. “The issue is finding a buyer in this poor economic market.”

Finding new revenue for the district’s maintenance and operations is difficult, school officials have said. Because of restrictions imposed by the Utah Legislature and the Utah State Department of Education, the only real avenue for new M&O income is through taxes, state and local school officials have said. The school district is hoping voters will approve a June voted leeway to generate additional revenue and give the district the ability to move tax money around as needed from restricted funds.

Only eight districts in the state of Utah operate without a voted leeway, and three of those districts are struggling financially, including GCSD. Wells said she hopes that members of the Moab community will come together to educate themselves on the situation and help create the solutions required to resolve the financial crisis.

“We need to draw the line and accept what happened,” Wells said. “We may never know why this happened, but we know how, and we need to move forward and start putting it back together.”

GCSD Superintendant Margaret Hopkin said the board of education welcomes the advice of the chamber committee and hopes that it will help bring the entire community together.

“People are becoming well-informed and coming up with ideas to help. As the community becomes more aware of the specifics of the issue, they become more understanding and more open-minded to the possible solutions,” Hopkin said. “There is a lot of concern, but there is a movement to approach this in a positive way as a community. We are happy to see this kind of support.”

The next step for the crisis committee is to meet with lead representatives from the different special interest groups. Moab Arts and Recreation Center Director Bayley Rodgers, will be discussing those issues with leaders from the Grand County Senior Center, the city and county councils, and the Grand Education Foundation, among other community groups, at a meeting at the MARC on Monday, Jan. 11.

“The hope is to get every group in the community on the same page,” Wells said. “The more groups involved, the more power there is behind our goals and actions.”

Mueller said he agrees that there is a need for this sort of action, and he stressed that the future of Moab is at stake.

“The layoffs in the district will affect families and cash registers immediately,” he said. “But the long-term economic health of this community will be affected if future teachers and future businesses don’t trust this community.”

The school district is also presently able to accept donations. This is due to the “financially distressed school district status” that the State Board of Education granted Grand for the current school year – an action that gives the district the power to move funds from restricted areas to the M&O fund until the end of the fiscal year in June 2010.

Many Moab citizens have written checks to the district for the amount their taxes would have been raised had the voted leeway passed in the November election, district officials said.