Reports show Dublin City Schools in deficit all of FY25

The Dublin City Schools operated every month of the most recent fiscal year in a deficit – falling as deep as $7 million in the hole – while giving raises to employees that included an almost $60,000 increase for Superintendent Fred Williams, school system records show.

The school system’s finances have come under scrutiny after state officials raised “financial concerns” that included almost $5 million owed in past-due State Health Benefit Plan payments, as well as outstanding audits and other “operational deficiencies.”

In a letter last month to district officials, state Superintendent Richard Woods said the system owes $4.8 million to the state health plan after not paying its employer contributions for the entirety of fiscal year 2025. The letter also says the system withheld employee contributions for at least six months without paying, but then wired $780,512 to the state Department of Community Health after an Aug. 15 meeting with state officials.

Williams and school board members all have said they were surprised by the findings and that they were unaware the benefit payments were not being made. Finance director Chad McDaniel resigned late last month during a two-hour-plus closed meeting with the board. 

Meanwhile, the system is working with the state on required repayment and deficit-reduction plans. The schools announced a hiring freeze on Monday, and Williams said the district has enlisted certified public accountants and a chief financial officer from another school system to help take a “deep dive” into the district’s finances.  

Monthly financial reports show the district began fiscal year 2025 with a $1.8 million deficit and never got out of the red. By December 2024, typically one of the leanest months, revenue-wise, for school systems, the deficit had grown to $7.3 million.

That deficit dwindled significantly in February of this year as $12 million in property taxes – including more than $2 million in additional revenue from a controversial tax increase – began to roll in. The system finished that month with a $579,000 deficit, but posted an almost $1.3 million deficit the next month.

By May 31, the system was $2.6 million in the red.

Because of its past financial troubles – the district languished in a huge deficit for nearly decade until erasing the last of it in February 2020 – the Dublin City Board of Education is required to file its monthly financial reports with the state. Those reports must be – and these were – signed by members of the board.

In June, the school board approved a $47.5 million budget for the current fiscal year that officials said included $1.4 million in cuts from positions, eliminated mostly through attrition. According to the payroll records, almost half the school district’s budget – more than $23 million – will be needed for salaries.

The most recent salary records posted on open.ga.gov are from fiscal year 2024. They show 25 employees with the Dublin City Schools earning at least $100,000 a year. However, according to payroll records from the current school year, that number has grown to 29 employees earning six-figure salaries.

Most of them are central office staffers and administrators. A handful are teachers and coaches.

Williams is the lead earner at $294,386.83 – up from $236,970. His wife, son, daughter and daughter-in-law also work for the city schools. Including the superintendent, their compensation packages total $539,777.

The Courier Herald reached out by email to school board members for comment. 

“Dr. Williams was already in his current contract by the time I was appointed to the board about two years ago,” replied board member Regina McRae, who was appointed to the board then won a special election in fall 2023.

Williams contract was renewed in 2023 for three more years, with the terms recommended by a committee of three board members, said board chairman Kenny Walters. He said Williams’ actual pay increased from $180,000 to $220,000, with the difference being benefits and other compensation.

“We had a committee, and they said based on his education and experience, his salary was in line with other superintendents in Georgia,” Walters said in a phone interview Friday. “The committee gave us a recommendation. We were told we had the money.”

The school system, which has about 2,300 students, has more than 500 full-time and part-time employees, including substitutes, on its payroll. In February, after Gov. Brian Kemp had announced a $2,500 raise for teachers, the school board voted to give the raise to all employees, and not just to positions funded by the state, meaning local dollars would pay the increase. Not all employees were to receive the full raise, however, with the amount depending on where employees rank on the salary schedule.

Hiring freeze on after latest board meeting …

The school board has imposed a hiring freeze as board members and Williams work with state officials to figure out how the district wound up owing more than $5 million to the state health plan.

No vote was taken on the freeze, but Williams announced the move at Monday night’s board meeting, part of the system’s response to a letter last month from the state outlining “financial concerns” that included past-due health plan payments, outstanding audits and other “operational deficiencies.”

“This is something that as a system we’re not proud of,” Williams said after the meeting, “but this is something that we are really focused on to make sure that it never happens again, and we’re working on, again, really extreme minding and tightening the belt as much as we can.”

Asked what happened with money for the state health payments, Williams said the system is working to find that out.

“We have the support of the state in collecting the dots so that we connect all the dots to make sure that we’re getting a holistic view of everything,” he said.

The city schools are without a finance director following the resignation of Chad McDaniel during a called board meeting Aug. 28. McDaniel declined comment Monday, saying, “At this point, I am not in a position to really talk about things.” 

McDaniel started as finance director in 2024. Woods’ letter noted the school system had not completed an audit in four years. 

“Further review also showed operational deficiencies that have yet to be reported, as the district has not yet completed audit reports for FY22, FY23, or FY24,” Woods said in the letter.

The letter outlines steps required for the system that includes plans to repay the benefit plan and to eliminate the system’s deficit before fiscal year 2027. In addition to the state, Williams said the schools have enlisted the help of certified public accountants and a chief financial officer from another school system to help.

Williams said officials are taking a “deep dive” into the system’s finances, “actually fixing practices” and implementing others.  

“We have a lot of support from the state, also, coming in to help us with those things. That’s pretty much where we are at this point. And we do have a repayment plan that we’re working on with the state.”

Board members in their comments expressed appreciation to school system employees while also asking the community for patience.

“We are doing the absolute best that we can do to ensure that our students continue to have a place to learn, that we have staff that feel supported, and we’ve been spending time trying to do the hard work that it’s going to take to make sure that that happens,” said McRae.

“I just want everyone to be encouraged. If you feel anything like I feel, you know that the temperature in the community is a little hot and sometimes it’s a bit much. But relax, take some deep breaths. There is some hard work to do, and we’re committed to doing that work.”

Added member James Lanier, “I appreciate the hard work that our people put in everyday. In all of the turmoil that’s going on, sometimes that gets lost, and I will put our staff up against any staff and the state of Georgia with what we do for our kids and the results that we get from our kids.”

Walters said school boards need three things to succeed – power, responsibility and resources. 

“And if anybody has been keeping up with the Dublin school system, you know we’ve really been suffering with the resources,” Walters said. “You’ve got to have the resources to do your power and your responsibilities. This district is doing a great job with our responsibilities and educating our kids.”

The system’s financial woes come after a 25 percent tax increase last fall that should have generated at least $3 million more in revenue over budget. The school board rolled back its millage rate, but not enough to offset the net growth in the tax digest following a long overdue property revaluation.

Asked after the meeting about what happened to the money owed to the state health plan, Walters said, “We never had it.”

On a social media post afterward, the chairman joined Williams in encouraging concerned citizens to bring “positive” ideas to the board.

“All the energy that people are using to try to figure out what’s happening, what went wrong, use that energy to help us out,” Walters said.