Howland-area residents voting on $1.1M school bailout loan

Posted Jan. 24, 2012, at 6:21 p.m.

Voters were deciding in a special election Tuesday whether to approve Howland-area schools’ application for a $1.1 million, five-year loan to save the school unit from a financial crisis caused by mismanagement and a lack of oversight.

The polls were set to close at 8 p.m. Tuesday after opening 12 hours earlier in the SAU 31 towns of Burlington, Edinburg, Enfield, Howland, Maxfield and Passadumkeag. Vote tabulation will occur on Wednesday, SAU 31 Superintendent of Schools Michael Wright said.

“I have heard that there’s been a pretty good turnout and I probably won’t know results until tomorrow morning,” Wright said Tuesday. “I am just hoping that the same level of support that was there on the 10th will be there today, and I am hearing that the connections are still out there and that people are still out there encouraging others to vote in support of it.”

At a meeting on Jan. 10, district residents voted 304-30 at Hichborn Middle School in Howland to approve the Maine Municipal Bond Bank loan, which carries an interest rate of about 2 percent. State law and the loan requirements demanded a districtwide referendum after a district meeting.

Wright discovered the mismanagement after SAU 31 merged with his SAU 41 last summer. A review of SAU 31′s records revealed, Wright said, that school leaders gradually had created the deficit by projecting revenues from undesignated fund balances that never actually occurred.

The bond bank’s executive director, Robert O. Lenna, credited school leaders with dealing adroitly with the financial miscues when he announced the bank’s tentative loan deal on Dec. 5.

Besides Wright becoming superintendent and the layoff of 14 ed techs and three maintenance workers, the school district has a new business manager and appointed new board leadership.

Creditors still are owed about $1.03 million in past-due bills and could seize property and other SAU 31 assets if the loan is not approved, Wright said.

Among the district’s bills: about $580,000 for everything from medical insurance to school supplies, and a tax anticipation note of $450,000 owed to Bangor Savings Bank that was past due as of Dec. 8, Wright has said.

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