House Suspends Rules To Address Hancock County Schools Financial Crisis

The West Virginia House of Delegates suspended its own rule Monday to provide emergency funds to Hancock County Schools.

The West Virginia Board of Education declared a state of emergency on Friday due to the district’s financial issues.

The West Virginia Constitution states that “No bill shall become a law until it has been fully and distinctly read, on three different days, in each house, unless in case of urgency.” Lawmakers voted to suspend rules because House Majority Leader Pat McGeehan, R-Hancock, said gross mismanagement has led to a situation where current funds available to the district would not carry them through March. 

“The state school board and the Department of Education have said they’ve never seen anything like it, where a county superintendent or administration doesn’t make the proper adjustments at the beginning of the year and then just allows the deadlines for being able to kind of make sure things get back on track with a balanced budget, allows that to pass,” McGeehan said. “Now they have no more money, and they’re insolvent, even though there’s obligations, they have to make payroll for the rest of that school year.”

Delegates passed House Bill 4574  to grant the state Board of Education the ability to administer supplemental funds beyond the state school funding formula. The bill creates a loan program titled, “Temporary Shortfall Supplement Fund for County Boards of Education” for financially distressed counties whose reserve funding has fallen below 5% of available funding. The funds carry with them limitations to only be spent to honor personnel obligations and other essential operating expenses and reporting requirements to both the state Board of Education and the Legislative Oversight Commission on Education Accountability.

Lawmakers also approved of House Bill 4575, which appropriates an additional $8 million to the state school system to fund the Shortfall Supplement Fund. Both bills passed with overwhelming majorities.

The West Virginia Department of Education estimated the Hancock County Schools has overspent its budget by close to $8 million, starting fiscal year 2024 with a $5.5 million fund balance to now having a projected deficit of $2 million. McGeehan said much of the overspending came from the district having more than 140 employees over what the school funding formula budgeted for, as well as large spending on athletic facilities at several schools.

“Then there was also a number of other things that took place, and there may have been potentially some… well, it was gross mismanagement,” he said.  “Hopefully it’s not more, something worse than that.”

McGeehan said he was made aware of the situation last month, and he expected the situation is likely to prompt a reevaluation of school finances and legislative oversight.

House Minority Leader Sean Hornbuckle, D-Cabell, urged passage, but urged caution due to the direct effects the situation has on children and local jobs.

“I would also say to piggyback off the gentleman from the first looking at oversight measures and what we can do in auditing,” Hornbuckle said. “But more importantly than that, I would recommend to this body we need to re-evaluate also what we have done and what we will do to make sure we are not putting financial hardships on counties, so that we are not sitting here yet again, having to make emergency action, because if we do not, we will be here.”

Both bills now head to the Senate for its consideration.