By DONNA KENNY KIRWAN

PAWTUCKET — A proposal that would have given Pawtucket and other school districts a lump sum payment of a $7.35 million surplus reportedly accumulated by the Northern Rhode Island Collaborative was defeated Tuesday in a vote by the collaborative’s board of directors.

It was reported through an audit done by Walter Edge, a financial consultant hired by the Pawtucket School Committee last year, some $7.35 million in surplus assets had been accrued by the regional special education facility in 2006. Edge had said that the surplus stemmed largely from the non-profit collaborative’s conservative budget practices that routinely over-estimated expenses and also failed to adjust for any actual cost savings that were realized during the budget cycle.
In his previous report to the Pawtucket School Committee, Edge had not accused the collaborative or its officials of any kind of wrongdoing or mismanagement; rather he categorized the annual budget process as “blue sky” budgeting, which created a build-up of financial reserves.
Northern Rhode Island Collaborative officials had stated that over the past several years, the surplus has been given back to the member school districts through reduced tuition rates for the special education students who use the services.
However, in the wake of the lean budget times at both the state and local level, several of the more cash-strapped school districts, such as Pawtucket and Woonsocket, had sought to get a lump-sum payment of the surplus this year rather than taking it in tuition reductions going forward.
Other school superintendents, however, particularly those with less students enrolled in the collaborative, are reportedly not in favor of the lump-sum plan, preferring to receive their refund through lowered tuitions.
In a marathon meeting session on Tuesday, the collaborative’s board of directors, which is made up of public school superintendents from the 13 member school districts, turned down a resolution that had been submitted by the Pawtucket School Committee through Schools Supt. Hans Dellith.
The vote from the board of school superintendents to reject the pay-out plan was 7-0. Ten school superintendents were reportedly at the meeting when it started, but two, Dellith and Woonsocket Schools Supt. Maureen Macera, left before the voting was concluded and Cumberland Schools Supt. Donna Morelle abstained.
Previously, Julian “Bud” MacDonnell, the collaborative’s executive director, said that he had not disputed the essence of Edge’s report, but said that it did not give a complete picture of the collaborative’s finances. He has maintained that the surplus is substantially lower when federal grant money, surcharges and other factors are figured in.
Repeated attempts to reach MacDonnell this week were unsuccessful. However, it was reported on Tuesday that the collaborative currently has approximately $6.7 million in net assets, which includes $2.88 million in the operations budget and $3.8 million which has been set aside in a holding company that the board created to purchase property on which to build a new facility.
Dellith could not be reached for comment, but Stephen Robinson, the attorney representing the Pawtucket School Department as well as Central Falls, said he and the other school officials are obviously not pleased that the resolution was shot down. He maintained that Pawtucket had been looking for “a reasonable resolution of the matter by the collaborative.”
The Woonsocket School District was also seeking a lump-sum payout of the surplus, according to reports.
Robinson said he thinks that some of the other participants at the meeting, including collaborative officials, had overstated the impact of a lump-sum payout. He characterized some of the comments that were made by MacDonnell and others as “scare tactics,” adding “We had hoped that cooler heads would prevail.”
MacDonnell had previously been quoted as saying that if the board voted to liquidate the collaborative’s assets, it would mean having to dissolve it. He said the collaborative needs approximately $1.8 million in its operating budget, and defended the approximately $3.8 million in the holding company as being necessary for a future school facility and professional development.
Robinson said that he would be discussing the next course of action with Pawtucket School officials and didn’t rule out taking “the necessary legal steps” to get the school district’s share.
Pawtucket At-Large City Councilor Donald Grebien has also strongly urged Pawtucket to be aggressive about recouping its share in a lump-sum payment now, rather than through tuition reimbursements. The City Council has backed taking legal measures, if necessary, to recover the money that the city has essentially overpaid, a position which Grebien said this week that he still supports.