Thursday, June 23, 2011

Week In Review

State Capitol Week in Review

LITTLE ROCK – The state has taken over two major school districts that had been in fiscal distress - the Pulaski County Special School District and the Helena-West Helena School District.

In each case the state found continuing financial irregularities that justified the removal of the superintendents and the dissolving of local school boards.

It is the second time Helena-West Helena has been taken over by the state. The first time was in 2005. The state returned it to local control in 2008.

With about 17,500 students, the Pulaski County district is the state's third largest and the largest district that has been taken over by the state. It encompasses the outer parts of Pulaski County that are not in Little Rock or North Little Rock.

Arkansas law authorizes the state to take over a school district for reasons of academic or fiscal distress, and if a district consistently fails to meet academic or financial standards, it may be forced to merge with a nearby district.

Among the signs that signal that a school district is in fiscal distress are declining fund balances, having to pay late fees or penalties on tax deposits, failure to provide timely financial reports to auditors, defaulting on debt obligations and failure to comply with state laws that set minimum teacher salaries.

A factor in the state takeover of the Pulaski County district was a financial audit that showed "a lack of basic financial accountability," according to the state Education Commissioner.

The Helena-West Helena School district had a declining balance of funds and audits indicated a lack of financial controls.

The state appointed educators with years of experience to run each district. They will report directly to the commissioner.

Attorney General Sues Collection Agency

The state Attorney General's office has sued a collection agency named National Credit Adjustors of Hutchinson, Kansas, for failing to respond to an investigation about the agency's collection of payday loans.

Payday loans stores no longer do business in Arkansas because of a campaign by the attorney general to shut them down for violating constitutional limits on usury. The attorney general has also enforced laws against predatory lending to force 30 online payday lenders from operating in Arkansas.

The Kansas firm has been trying to collect old debts for companies that formerly operated payday lending operations in Arkansas. Collecting the debts is illegal because the original loans were illegal in the first place, the attorney general said.

Consumers who are being pressured to pay off an illegal payday loan may call the attorney general at 1-800-482-8982 or 501-682-2341 to reach the office's consumer hotline.

New Highway Director

Dan Flowers, who has been director of the state Highway and Transportation Department for 17 years, has announced his resignation. His final day on the job will be in mid-August. Flowers had worked at the department for 46 years.

He will be replaced by Scott Bennett, 45, the department's assistant chief engineer for planning. He began working full time for the Highway Department in 1989.

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