Indiana Statehouse

Indiana Statehouse

INDIANAPOLIS — The Gary Community School Corp. is set to be taken over by a state-appointed emergency manager with sweeping powers to reduce costs and restructure the district's academic offerings.

Indiana lawmakers gave final approval Friday to a revised version of Senate Enrolled Act 567, sending the first-of-its-kind measure to Republican Gov. Eric Holcomb for his signature or veto.

The legislation was modified to give the cash-strapped school corporation an opportunity to seek additional state grants to cover its multi-million dollar operating deficit and request that at least a portion of its $100 million debt burden be forgiven.

But the measure still directs the Indiana Distressed Unit Appeals Board (DUAB) to appoint an emergency manager to supplant the elected school board and exclusively exercise all financial and academic authority over Gary schools, with a goal of balancing the budget and reducing debt.

A chief financial officer and a chief academic officer selected by the emergency manager, along with the district's superintendent, would help decide what cuts to make.

In addition, a four-person fiscal management board, consisting of one member each appointed by the school board, mayor, state superintendent of public instruction and state board of education, also could weigh in on the manager's decisions in a strictly advisory capacity.

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Only DUAB would have the authority to override any decision made by the emergency manager.

State Sen. Eddie Melton, D-Merrillville, who initially proposed a locally-directed financial takeover of Gary schools, said he accepted the final product crafted by the General Assembly, in part because it requires Gary or Lake County residents be considered for the emergency manager and district leadership posts.

"I'm hoping that whomever comes in as the emergency manager will be collaborative. I'm hoping that the community will be open and willing to work with this individual to make sure that we create the best educational foundation for the children of Gary," Melton said.

He's also asked state budget leaders to open Indiana cash-stuffed wallet to immediately remedy the environmental and safety hazards present throughout the district's older school buildings.

"The 5,000 or more children within the (district) will either succeed or fail based on the funding decisions we make today," Melton said.

If signed into law, this will be Indiana's first use of the extraordinary remedy of relying on an emergency manager to take over and try to fix a struggling local governmental entity.

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