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Gary schools wrestling with debt as enrollment plummets

November 1, 2015

A state-hired consultant says the Gary school district faces more staffing cuts and possible school closings as it tries to emerge from estimated debts of at least $75 million and enrollment continues to plummet.

The Indiana State Board of Finance last week approved a $15 million interest-free loan so the district can help pay overdue vendor bills.

Financial specialist Jack Martin, the former emergency manager for the Detroit Public Schools, found that the Gary district's 15 schools are, on average, about half-occupied and that the students in its three high schools could fit into a single school, the Post-Tribune of Merrillville reported.

Gary Community Schools officials have closed more than half of the district's buildings since 2000, but Martin said many parents have sent their children to charter schools rather than busing them across town.

The school district has seen its enrollment drop by more than 1,000 students in the past year, to about 6,000 this fall, The Times of Munster reported. Enrollment stood at about 16,000 students a decade ago, according to state records.

Martin said the Gary district isn't able to pay its bills regularly.

"It's just whoever screams the loudest and threatens to cut something off, then we've got to find a way to pay them," he said.

A major cause of the debt trouble is overstaffing, Martin said, adding that the Gary School Board has been receptive to his findings.

District Superintendent Cheryl Pruitt said the district has lost about $100 million in funding since 2009.

"We're trying to stay stable," she said.

The district's debt includes more than $7.1 million in taxes and interest due to the IRS; $4.15 million owed to Northern Indiana Public Service Co.; and $730,000 owed to AT&T.

Martin said he believed Pruitt has been working to make necessary staffing cuts and school closures. He also said the $15 million loan was needed.

"I think if we don't do the loan, I think we would be out of business," he said. "I think it would probably mean take our kids and move them to other school corporations."

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