Invoking deficit problems in Baltimore and Prince George's County schools, state Schools Superintendent Nancy S. Grasmick said yesterday that she has drafted legislation that would give the state more control over troubled local school systems, including the ability to withhold state aid if necessary.
Grasmick said the bill, to be presented soon to Baltimore and Prince George's County legislators, amounts to an early warning system for the state to identify financial problems in local districts before they become serious. "The state does not have significant oversight authority," she said.
Under the measure, the state would automatically intervene if a school system's deficit exceeded 1.5 percent of its budget. Administrators would be required to prepare a corrective action plan and submit to audits. Systems failing to comply could lose a percentage of state aid, although Grasmick said it was premature to specify how much.
She said her bill was needed "to ensure we have institutionalized a process if the superintendent changes or if board members change."
But not all legislators were so sure. "I don't think it's necessary," said Del. Carolyn J.B. Howard, chairwoman of the Prince George's delegation.
The state already exercises some control over Baltimore's schools.
Under a reorganization of the schools in 1997, the state legislature voted to create a city/state partnership to run the schools. Baltimore gave up partial control of its school system in return for about $250 million in additional state funding given out over a five-year period. Under the partnership, the mayor and the governor jointly appoint the school board from a list drawn up by Grasmick.
At the time, city residents were sensitive to the idea of the mayor giving up too much control of their school system.
Grasmick described the legislation at a joint House-Senate hearing in which Prince George's County school officials described recent reforms in their system, which accumulated deficits between 2000 and 2003. The operating budget's general fund showed a $23.6 million deficit during 2003 - a shortfall that county officials say has been eliminated.
An independent audit received by the state in December chronicled 10 "material weaknesses" in the county's management system. Among them, the system has hired too many workers and failed to adequately monitor grants, according to an audit summary.
The county has been working to enact reforms, said Andre Hornsby, the school system's chief executive officer.
Hornsby told the House Appropriations and Senate Budget and Taxation committees that he eliminated the deficit, in part, by attrition. He said the county did not fill hundreds of vacant positions in the 2004 fiscal year as workers retired or left the system.
Hornsby, who became CEO in June, also said he has remedied a number of budget issues, including problems with computer hardware and an instance in which $2 million in textbooks was purchased without the school board's approval. He said the system had previously been using unreliable data - for example, about payroll - and folded it into new budgets.
Hornsby said he believes the deficit is gone. "No one knows for sure until June 30, but the reality is we have put some stringent controls in place," he said.
Grasmick said she had faith in the new board and CEO. "I am very comfortable that they are aggressive," she said.
Sun staff writer Liz Bowie contributed to this article.