Frustration is it coming?
Mar 10th, 2010 by Randy Toman
The systematic risk within the Bethlehem Area School District (BASD) is far larger and goes well beyond what the people might suspect it to be. We not only have troubles within the areas of finance, revenues and budgeting, there are serious flaws that make-up the legal obligation of the BASD.
Let me start with the financial aspect and what CC-BASD has learned.
The BASD, so we were told, has only about 4% of the total budget, which they actually control. The balance is man dated by state and federal government. Federal and State programs, in order to cut costs within programs, you must eliminate the whole program, rather then modify or trim the costs within the program. There is no correction that can be made in the area of cost savings within the program it is all or nothing, something that is total insanity in my mind.
Here is another insanity, if the BASD should fail and/or declare bankruptcy all contracts will be voided accept the Union Teachers contract. There is no need for cooperation and absolutely no fairness within the bounds of negotiations because the Teachers Contract stays in place, regardless if things get run into the ground.
On top of this we have no willingness on the part of the School Board to consider a Zero base budget and/or vote “NO” to a school property tax increase.
The BASD is deeply involved with Swap’s and Derivatives and have fallen prey to not only the obligation and responsibility of paying for a $295 million dollar debt but have involved the BASD in what has become a systematic risk of the Greedy Wall Street/Banking Industry. They have opened BASD up to were Moody’s Bond Rating Agency looked at BASD and had wanted to down grade the BASD rating, which would have cost the tax payers millions if in fact they would have down graded BASD. How the financial advisor talked Moody out of not down grading BASD financial portfolio, I have no idea, but the one thing I do know is, as this thing is being exposed, it is becoming increasingly clear the School Board had gambled with tax payers money and for sure they should never have been involved with these type of financial products.
The correction of the problem must start with some want to make a correction, I have not seen nor do I know of that correction effort to exist within the BASD. It may even be worse then that; I see no mechanism to make correction by a citizens advocate group, even if CC-BASD would start to be noticed by BASD.
The question then becomes; how are we going to make these corrections, before a frustration sets in and we go completely off the track? We see this frustration starting to manifest itself on the State and Federal levels as I write this. We Shall See and shortly.