County offered WCPS $3 million loan in exchange for transparency. WCPS said ‘No.’

The Wayne County Board of Commissioners offered the county’s Board of Education a loan to help cover the district’s teacher stipends and June payroll shortfall.

But in return, the county wanted an accounting of how the money would be spent, as well as access to detail of future transactions, board chairman Ray Mayo said.

“We were going to loan them $3 million,” he said. “We did not want it to ‘boss.’ We are prevented by statute from interfering in their dealings. We just wanted to be informed.”

The chairman said that the county and the school district had an agreement ready to go, which the county expected to be brought before the school board Friday morning.

A special commissioners’ meeting was scheduled for 1 p.m. to finalize the deal.

However, soon-to-be Interim Superintendent Dr. James Merrill announced at the board’s morning meeting that the county schools had decided to use state funds that were already in WCPS’ coffers to cover the expenses instead.

Merrill said he was in communication with Department of Public Instruction officials concerning the details. He later said that there would likely be interest charged to make the move — about 1 percent.

When asked if the loan/transfer was similar to the $3 million shuffle in 2019 from the School Food Services fund to the General Fund — the transfer that, along with the projected deficit and negative fund balance, likely forced the resignations of county Finance Officer Michael Hayes and Superintendent Dr. Michael Dunsmore — Merrill said he was unaware of that move.

He added, however, that those were federal funds.

During the meeting, Merrill said the state funds offered “flexibility.”

Mayo said the commission was unaware of the financial problems in the school district and was “blindsided” by the size of the deficit.

“If they did not know, how could we have known?” he said.

Mayo added that communication between the boards concerning the district’s finances has been limited.

The chairman said the commissioners were more than willing to step up to assist the county’s teachers and students.

Until this morning’s BOE meeting, Mayo said he had no idea that the school district had made another decision.

“We had a written agreement and were ready to go,” he said. “They decided to go with DPI.”

When asked if he thought the school board’s decision to go with the DPI alternative had anything to do with the commissioners’ request for detailed accounts of how the money would be spent, Mayo said, “My intuition after nine years of serving on the board is that it is definitely a possibility.”

Mayo said the county commissioners are intimately involved with Wayne County’s budgets and spending, and that the board keeps tabs on the county’s finances monthly.

“We are very involved,” he said. “We do not interfere in the day-to-day operation, but we do watch the money.”

Mayo said he is hopeful that Merrill will get to the bottom of the district’s financial problems.

“I watched the presentation this morning, and if he holds tight, he will get it straightened out,” he said.

He added that changes in state funding and unfunded mandates that force the county to come up with more local dollars for schools can be a challenge.

“It just throws our budget completely out of kilter,” he said.

Mayo added that he hopes the school board will continue to communicate with the county, and the public.

“There has to be accountability,” he said.