The area’s biggest taxpayer funded school bus agency – Dallas County Schools – is in serious financial trouble.
Dallas County Schools plans to quickly cut up to 100 jobs after interim-CFO Alan King says the beleaguered bus contractor is $42 million behind budget projections.
King said Tuesday during a meeting with the board that the agency's revenue was overstated by a significant amount. King said while he doesn't have a full picture of the problems, the accounting is in bad shape.
Rick Sorrels, superintendent of Dallas County Schools, said staff reductions and other efforts are needed to restructure the agency's finances.
Additionally, DCS's controversial stop-arm program, which is designed to record and ticket drivers who bypass the stop arms on school buses, has failed to meet revenue expectations and is $20 million behind projections.
In 2013 and 2014 NBC 5 Investigates raised serious questions about that camera program.
Records we uncovered showed DCS had spent $50 million buying camera equipment – not only for school buses in Dallas County, but also for other school districts across the state.
DCS would give them cameras in exchange for splitting fines collected when drivers run past the school bus stop arms.
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After insisting the stop-arm program would pay for itself four years ago, DCS said Tuesday parts of the program will need to be discontinued and that 50 of the layoffs will come from those changes.
"We cannot continue the program as is with the funding model in place," King said.
Officials have not identified the areas from which the other jobs will be cut.
Sorrels would not take questions after Tuesday's board meeting, leaving board president Larry Duncan to answer for how the district could be so far off its projections.
"Yes, the buck stops here. We are responsible, that's why we brought in Alan King. We knew there were serious concerns," Duncan said.
King was hired in October after NBC 5 Investigates discovered more financial mismanagement at DCS.
DCS employees used $80,000 in taxpayer money to pay hundreds of traffic tickets racked up by school bus drivers who ran red lights.
Tuesday, King said bookkeeping at DCS was so bad when he arrived, $30 million of transactions do not appear recorded in the districts books.
Asked if he is concerned there was fraud involved, Duncan said, "Of course I'm concerned. There's, as we explained, when we started talking about this this fall, there was a systemic failure in the accounting area. That was one of the two areas that was why we brought in Alan King. He has been going through it systematically. He's now got his arms wrapped around the scope."
The union that represents some of the employees whose jobs will be cut said it's stunned by the depth of the problems.
"I'm really concerned and shocked that this is happening at this time," said Angela Davis, president of the NEA-Dallas.
Duncan said Tuesday he has seen no evidence of any criminal activity in the finances at DCS, just bad accounting practices. He also said school bus service will not be affected by the staff cuts.
In a few weeks he hopes to have more answers on how to begin digging out of this mess.
DCS serves as the bus contractor for the Aledo, Carrollton/Farmers Branch, Cedar Hill, Coppell, DeSoto, Dallas, Highland Park, Irving, Lancaster, Richardson, Weatherford and White Settlement independent school districts.
In a statement Tuesday, State Sen. Don Huffines, R-Dallas, said:
"Taxpayers deserve answers, which is why I am calling for an in-depth, independent financial audit of Dallas County Schools. With such extreme fiscal mismanagement by Dallas County Schools, it's time that we start to consider whether this rogue and unnecessary bureaucracy has committed crimes against taxpayers. Oversight over Dallas County Schools is virtually non-existent, which will make this audit a challenge. That's all the more reason we need to get to the bottom of what seems to be fraud perpetrated against the taxpaying citizens of Dallas County."
