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Pontiac School District OKs Consent Agreement, Avoids EM

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PONTIAC (WWJ/AP) - The Pontiac Board of Education has approved a consent agreement with the state to deal with a financial emergency in the district, avoiding the appointment of an emergency manager.

The board approved the deal Wednesday night.

Gov. Rick Snyder last month confirmed that the Pontiac School District was in financial emergency, facing a roughly a $38 million deficit. Options included accepting a consent agreement, appointment of an emergency manager, a neutral evaluation process or a Chapter 9 bankruptcy filing.

Interim Superintendent Kelley Williams says she’ll follow the agreement’s terms, which require her to work with consultant named by state Treasurer Andy Dillon, The Oakland Press reported.

Aimee McKeever, president of the teachers union, says the consent agreement equals a “dictatorship” by the state treasurer’s office.

A review team found that Pontiac Schools’ general fund budget deficit increased by almost 54 percent from $24.5 million to $37.7 million between 2011 and 2012. Unpaid bills to vendors totaled about $33 million as of the end of June.

District staff also may have violated state law by covering payroll with debt retirement funds. Pontiac Schools on May 1 defaulted on a $1.4 million debt service payment related to energy bonds issued in 2006.

The city of Pontiac, located north of Detroit, has an emergency manager.

TM and © Copyright 2013 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2013 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.

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