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Education Reporter

Turnaround Firm Cleans Up St. Louis Schools' Fiscal Mess
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In an experiment that could prove a successful model for other cities, the City of St. Louis school board hired a business turnaround firm in 2003 to spend a year restoring financial sanity to the beleaguered district. When the firm completed its work at the end of June, there was no question but that progress had been made.

In one tumultuous year that began with the surprise disclosure of a $55 million deficit by the outgoing superintendent, Alvarez & Marsal of New York accomplished the following steps which had eluded previous superintendents:

  • Reducing expenses by $79 million without the loss of a single teacher - a result achieved by closing 16 underutilized schools; privatizing maintenance, payroll and food services; dismantling the central office and putting the lavish new building up for sale; firing 1,400 employees; and consolidating school bus lines and warehouses

  • Accounting for textbooks and supplies and selling unnecessary books

  • Rationalizing bus transportation routes with a software program purchased years ago but never installed

  • Implementing a literacy-based curriculum, improving reading test scores, increasing the number of high school graduates by 11%, and making tangible progress toward full accreditation.
"When it comes to education in St. Louis," Mayor Francis Slay observed, "no one has ever accomplished as much in as little time as Bill Roberti" (the interim superintendent from the turnaround firm, who is a former Brooks Brothers executive). (St. Louis Post-Dispatch, 7-1-04)

"Financially, the system was flying blind," explained Vincent Schoemehl, a school board member and former mayor of St. Louis. "We've demonstrated that there is a way to connect the cultures of the private sector with the culture of urban education. I would recommend the model to any public entity that needs to refresh itself." (Education Week, 6-23-04)

An assessment by the Council of Great City Schools, while critical of many aspects of St. Louis schools, concluded that St. Louis, in hiring a professional restructuring firm, set itself apart from other cities that are "captives of their inaction." The school board made its hiring decision shortly after a new majority reform slate was voted into office.

On the heels of Roberti's departure, the school board voted to close five more schools — some of which were more than half empty, and two of which had just had air conditioning installed a year earlier. In addition, the board decided in late September to adopt the phonics-based Open Court reading program.

No one would say that St. Louis's school problems have been solved. Educationally, the district has a very long way to go. But putting its fiscal house in order was a necessary first step.

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