The state has accepted the School City of Hammond’s corrective spending action plan aimed at stabilizing the district’s perilous financial status.
The cost-cutting plan, approved by the school board, trimmed about $30 million from the district’s budget with most of the cuts coming through layoffs and facilities maintenance, according to a Friday release. About 200 employees have lost their jobs.
The state Distressed Unit Appeal Board, which monitors the financial health of school districts, has required Hammond to meet twice a month with DUAB Executive Director Peter Miller or the DUAB staff, and maintain an 18-month rolling cash flow that’s adjusted monthly. Hammond also must maintain five-year rolling income and expense projections, adjusted annually, and make a presentation to DUAB annually after the financial close of the calendar year.
Monitoring and implementation actions shall continue until the DUAB determines the school district is no longer subject to a corrective action plan.
The process is explained in a document on the school district’s website, hammond.k12.in.us.
The district fell into financial turmoil last year when voters failed to renew an operating referendum that brought $15 million into the district annually. Shortly after the defeat, the DUAB issued an order requiring cuts across the board.
Besides losing the referendum, the district faced increased health insurance costs in the past two years because a bargaining agreement capped teachers’ contributions.
A 2021 11.4% base salary increase for teachers cost $7.6 million and an additional 3.2% raise in 2022 tacked on another $2.4 million.
Meanwhile, enrollment declined 1,581 students from 2019-20 to 2023-24, triggering a loss of $12.5 million.
The fallout led the school board into contentious meetings with former superintendent Scott Miller, who resigned last month to become Hammond Mayor Thomas McDermott’s chief of staff.
In April, the school board voted to close Lew Wallace, Kenwood, and Morton elementaries at a savings estimated at $5.6 million.
Carole Carlson is a freelance reporter for the Post-Tribune.