Reviving a School District: Strategies for Financial Turnaround

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You already knew that you were heading into a declining enrollment environment. Now you're facing having to do a financial turnaround as well. So how do you pull this off? That's the question that we're going to be tackling today.

And the person who's going to be guiding us through this discussion is joining us today. He, and he is Doug G. Doug has been in education for over 34 years as a teacher, coach, activities, director, assistant principal, principal, and now as a superintendent. He's worked in small school districts as small as 400 total students and the largest school district in Iowa for over 30, 000 students.

trict by solution tree and a [: 00:01:00

[00:01:18] Doug Gee: morning. How are you?

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That's going to be a unique conversation that we haven't dug into before on the show. But before we dive in, I think it's going to be important for you to get the listeners Up to speed on a little bit more of your backstory than what we included in that intro. So why don't you share with us a little bit more about some of those defining moments throughout your career that helped shaped sort of your leadership philosophy and operational style.

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Being a very public role model in a district and then, becoming into a superintendent situation. I tell you, when I looked at Clearlake I really liked a lot of things about Clearlake. Clearlake is a rural school district of about 1400 students. In north central Iowa and one of the things that was unique about clear lake, that's becoming more and more an Iowa thing is that it shared a superintendent.

son city was a district about: 3000

Not by that superintendent's fault, but [00:03:00] just the job is just tremendously hard. And there were three school board members that actually ran on the premise that they really wanted to have their own superintendent. They wanted their own person to be involved with the community, to get out and build those relationships with the community.

And that was really landscape and what I walked into was a, yes, a school district that the enrollment was declining, but also financially they had overspent their authority which, and I was the key by 1. 3 million over three years prior to my arrival.

They'd overspent their fund balance or their cash by almost a million dollars in the last, in the year previous to me coming here. That along with client enrollment were huge. The relationships with the community were really I wouldn't say non existent, but they were broken a little bit because they just didn't have that relationship built.

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That's that's a little bit shaky when you look at all of those different things. What were the things that you learned in your previous experiences, especially within a larger school district that helped prepare you for the job that was in front of you at Clearlake?

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But this business of being a school leader, whether it be as an activities director or principal or superintendent, it's really about the relationships that you build and that trust that you build with people and about transparency. And so I learned real quickly that the key was to go out and, meet people.

ctor, I did that at a school [: 00:05:00

And that's really what I did here at Clear Lake because I brought that mentality of building that relationship and trust. And so as I sat down with each school board member individually and I asked them, three questions. And this is what I did as an activities director is, What's one thing that we need to continue doing here?

What's one thing we need to stop doing and what's one thing we'd start doing and ask them kind of their goals or aspirations. And then I also asked them for four to five business leaders in the community that I need to go out and talk to and meet with and find out, what their goals were and what they dreamed of for the school, because in rule.

their heart and they want to [: 00:06:00

And I looked at, look, those enrollment trends and where were they going? I had to look at, the staffing and where does that staffing, are we overstaffed or understaffed? How things are being spent financially. And so those are things that we looked at as we looked into clear like when we got here.

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The organization, what was the exercise that you went through to prioritize which to tackle first because all of them are important. So what was your reasoning or process for figuring out what what to hit first?

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What is it one thing that we need? What are some things we need to change? What's one thing we need to stop doing? And what's the thing we need to start doing? So I had some background coming in from the staff. I also wanted to. know a little bit about them so that when I started talking to them and build those relationship, I'd have something to talk to them about.

And so I started being very visible in the buildings and talking to staff. I started hanging out at, sporting events and other activities and talking to community and parents. Just those conversations that you really gather a lot of information by those one on one conversations that transparency and them knowing that I was done for there.

e there's relationships. And [: 00:08:00

So that was relationships. That was trust. And what I told them is the one thing you'll know about me is that, one, I'm always going to make sure that we put our kids first and number two, you're going to, I'm going to do it. I'm going to, what I say, I'm going to do it. I'm going to do it every time.

And that's really important to them to know that if I say this is something we're going to do and something I believe in, then I'm going to do it. I'm gonna follow through with that. And We worked really hard to build those relationships with the union and with the community members through this process.

And one thing we really started doing then is through those conversations, I was also very transparent with them. I went out to each building and I showed them here's where we are financially. Talking to him about some of the goals that we had for the school district and what was best for kids.

And there were some things that I felt we really needed to implement here for the kids sake but we just didn't have the financial means to do it. So working with the board, working with the administrative team, working with the teachers union, all those things were really key with relationships, transparency and trust.

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And even those community relationships because you can probably interface with them on a regular basis. Those three groups, the union. I don't have visibility into how often you would be connecting with the union. So how do you repair a relationship that's been historically contentious when you don't have really regular face to face time or time to, to kind of collaborate on, on solutions that work for everybody.

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I think that being visible because you're, a school district you're our CLA, Clear Lake [00:10:00] Education Association. Those are teachers. And then they work with the Iowa education association. And so you're working with those people and them seeing me and that visibility in the building and that transparency as I shared with them financially, here's some things where, it was just really starting those meetings and really developing those conversations. And then as they saw me follow through with the things that I said that I was going to do was really was really key. There was a time in there where, we had some, chapter 20 came through and, we were able to take.

Basically and change our entire handbook and master contract. And we did that and said, we weren't going to do anything to change it. We just changed it to a handbook instead of a master contract and took a 42 page master contract and changed it. And there were some people that doubted we would change that and we didn't.

em about here's where we are [: 00:11:00

[00:11:10] Dr. Jim: It's interesting that you got to the end state of being able to navigate negotiations in roughly a 10 minute conversation, but there was something that you mentioned that you changed the contract to a handbook.

Why is that significant? What's the significance of of that transition?

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Now the board has a final say, but that handbook committee can bring a recommendation to the board for a change. And so we were able to navigate that process and we have since. And so there's been [00:12:00] a couple of times, even during the year where we've said, this isn't working. Whether it be from the district side or the teachers and them come to me or we have that handbook committee meeting, we've been able to change that handbook mid year as opposed to waiting to negotiation this time.

It really took a lot of the other stuff out of it. They always talk about language being a key to negotiations. Our master contract is one page. It's a base wage. And that's it. And so that's really the only we have to talk about it when it comes contract time.

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And if it and everybody's got an open door. So I think that's a that's a really interesting process for navigating that. So I want to it. I want to bring this back to what we opened the show with, which [00:13:00] was you're, you're dealing with a situation where you have a lot of financial headwinds and you have declining enrollment.

You started the process of repairing some of these relationships. And that, that's something that you started with right away. But I think when we're talking about repairing relationships in the face of a financial crisis, That's going to be tough to do because there's going to be people sitting across from me and wondering if they're going to get whacked.

So how did you navigate that sort of friction? And level set and set expectations so that nobody was caught off guard or by surprise.

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Decline and as far as financially, and so one of the things we did is we meet as an administrative team with the principals and assistant principals. We started talking about staffing and where we're staffing where enrollment was, was going down. And so 1 of the [00:14:00] things we decided to do was put in place and open up.

Early retirement. And that early retirement, a lot of school districts do it and some offer it every year. What I know is if you offer an early retirement every year, teachers will say I can hang on one more year. I can hang on one more year. And so what we did is said, I went to the board and said, what we need to do is put an early retirement package together.

That's the best we've ever offered. And basically stick to the fact that we're not going to offer it for at least two to three years. And the next time it comes back, it may not ever be this good again. People will move on a fear of loss more than a promise of gain. And so we sold that on them as we put together a really good package.

And we got 12 people 12 certified staff to retire. Some of which we replaced and some we didn't. And we replaced the ones that. We had to replace with younger teachers with a smaller salary, and that alone really allowed us to reduce our budget by about 600, 000. And the neat thing about it is the board or I didn't have to sit across from somebody and say you're not going to have a job next year.

body they didn't have a job. [: 00:15:00

And so we really were very transparent. And so that was the first part of that. The next part we looked at, as I started looking at our programming and we built our strategic plan is built around students, staffing, programming, and then Facilities, sorry. And so when we look at programming, there was some programming that we really felt as an administrative team that our students need and deserve to have.

TW launch at the elementary, [: 00:16:00

And we wanted it for all kids, not just the talented and gifted kids. We wanted to get all our teachers trained on it, but we had to get some funding for that. And so that comes back to now full circle tools, relationships I built with those community leaders, because I said, look, we were, we're cutting expenses right now, but we need this programming, can you help me out?

So through grants and donations, we were able to build or get enough money to start that project Lead the way. At the elementary next week we moved into the high school and middle school. We started a computer science program, a biomed program. We started in ag and FFA program. My third year here we live in Iowa and on 20 to 25% of our kids that graduate from Clear Lake are gonna go into an aggravated field.

e donations, and we got that [: 00:17:00

[00:17:03] Dr. Jim: You just talked about how the ag program was informed by one of the data points that 20 percent of your graduates go back into an ag related field when you look at all these different programs that you launched. What evidence did you rely on to say, Hey, these are the programs that we need to launch versus these other programs that might exist because you have a lot of options on things that you can launch.

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The Ag part, I had also started an Ag program at my previous district before Clear Lake, and I saw the impact of Ag and the FFA program on leadership and what it did for the kids. And the fact that I knew that we were the, there was [00:18:00] no other school district in Saragota County. that had ag or FFA.

So I knew if I brought that in one, it was good for kids, but two, it's going to bring kids in the, from our neighboring districts to Clear Lake to say, Hey, they have an ag field. So we're going to, we're going to go to Clear Lake. Computer science. We have a couple companies here in town that are computer programming.

I knew I could get the backing from them. And I also knew I could work in some internship and apprenticeship type situations. with them. So yes, it was based on community need community influence. We have a very affluent community around the computer science industry. And Ag was the one that was the hard sale because a lot of our people said, look we don't have a lot of.

ally would relate to that ag [: 00:19:00

So That was a big part of it, our farm, local Farm Bureau was huge in that helping me get these people together. So it really was those conversations around the community and then my past experiences of those programs that really worked and we're working to bring kids in to the school district.

We have a saying here at Clear Lake, it's called we need to use the. present the Disney experience. And what I used was, why do parents spend an ungodly amount of money to send their kids to Disney or take their kids to Disney? It's for the experience. So what we wanted to do is we wanted to create an experience so good, so phenomenal, that kids wanted to get up and come to school every day.

we found is they do. And so [: 00:20:00

We created that experience and then we promoted the heck out of it through social media and website. And it started drawing parents to bring their kids to Clear Lake.

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[00:20:27] Doug Gee: The example of the Ag program, when I sold the board one, is if I, all I need to do is get 10 kids to open enroll into Clear Lake, and this program is paid for, because it's about 7, 500 per student, we get in money for an open enrolled student, and within the first year, and I, you can't track it directly to Ag, but I can show that there was well over 10 kids even the first year, and if you looked at how many kids were enrolled in our Ag and FFA program we have a high school of 450 kids, and we have, Now you're 5 over 150 kids that are in ag related [00:21:00] classes.

: 2016

That's kids that come from another, live in another district or town that open, bring their kids to Clear Lake. As of this fall, 2024, our open enrollment is 310 students that have open enrolled into Clear Lake. So that's more than doubled our open enrollment.

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[00:21:53] Doug Gee: I don't know if we can go student by student, but I would say, if you look at and track how we track a lot in that in the high [00:22:00] school really is because when they start getting those to those electives, that's where you can really see. Okay. What track are these kids involved in? And so we've seen it.

We've seen a growth, obviously, in our ag and FFA classes. We've seen some decline in some of our other classes, art and some classes that are electives. Computer science, I will tell you, this last year we've cut back on computer science classes because we weren't seeing the enrollment in there.

Okay. A little bit. We still have it, but we've cut back on it a little bit. The biomed program Which is at the high school. That's the project Lead the Way, follow through. That's been steady. And so we, again, we can track the, whether they go biome med route or they go to the science route, the chemistry physics route.

and we started an apprentice [: 00:23:00

So we got kids that go to the high school. They're in high school that spend 2 to 4 hours a day and get paid 14 bucks an hour to go weld. And they walk out of high school and they got a welding job paying 25 or 30 bucks an hour. And that's helped both. We got those guys came in and gave us all kinds of welding equipment and provided resources that we just didn't want to have otherwise.

But those are, that kind of hits those kids that probably aren't going to go that route of that four year college, but we knew we still had kids that. They're not all going to go to college but they need to be able to have some kind of training beyond high school. And so we needed to help engage those kids and bring those into that program.

en't going to go to college, [: 00:24:00

And I said I could, if I had 60, 000 a year, I could hire another teacher. And so they set aside for four years, 60, 000. For us to hire another teacher to expand our industrial tech area. And so guess what? We've expanded our industrial tech area. So it just, it really it's about working with the community and opening those doors for that, those conversations.

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When you look at all the other programs that that you, that you've been able to launch since this turnaround, how tied are they to. You know, postgraduate, you're ready to work at this company with this set of skills for this position regardless of whether they're [00:25:00] going the college route or taking a couple of years before they decide if they even want to do that.

How does that fit into your overall community strategy as a district?

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the sciences and the engineering route. And we have a lot of kids as we saw from graduation that go into the medical field and go into engineering at Clearlake. And so that hit that other arena. And so when you think about schools you have all kinds of students and I'm a firm believer in that all students are gifted.

A lot of, people put, kids and we have our tag and I sell program, but. All students are gifted. It's our goal to find out what they're gifted at and what their passion is. And for us to stoke that passion. And that's where we gotta provide these programs to do those things.

Whether it be the work world or college.

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But after you've recovered, it sounds like you're still pretty hands on on the finance side. What's the reasoning behind your hands on approach to finances within the district?

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Those things and what we're spending, how we spent last year and the reason for that is because we want to protect the school district from not ever going back there. We're in the best financial shape that Clearlake has ever been in because of that, we use [00:27:00] a five cast, a forecasting tool where we put in, we build scenarios every year and say, okay, if we have add this staffing or take the staffing away, We gave this kind of a percent raise or not percent raise.

What will that do for us five years out? I don't know how school districts can really plan for the future if they're not looking at those things and how they're going to affect their finances later, because of those good finances, we're able to hire and retain. Some of the best teachers out there. And let's face it, a good school district has to have a good people working for it.

And so we've been able to do that. And it's a climate right now in education where it's a fight for good teachers because there's not a lot of them out there. So That's really the biggest thing is one. I don't want to have to lose programming for our kids. And two, I want to retain and recruit the best staff that I possibly can do.

we keep up to date on those [: 00:28:00

[00:28:00] Dr. Jim: When you look at this turnaround conversation that we've had, and you're speaking to that superintendent who might be In a similar scenario and dealing with similar circumstances, what what are sort of the key lessons that you learn that might offer some insight into how they can navigate a similar situation?

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in finances. Be transparent with your staff make sure they know what you're doing and why you're doing. Be very transparent with your school board and your community. Present things to your school board at school board meetings and make sure they are up to speed and understand why you're doing what you're doing.

y use a financial, some kind [: 00:29:00

Just whatever those cases may be, build those scenarios out because we need to do that. And then think about all students. Think about all your students and how can you help support your students all students. And I always tell people, think about. If that was your child, grandchild, niece, nephew, how would you want them to be treated in that school district?

Our mission statement is to ensure a high level learning for all. And so that, that means all students, and I, we always have the saying that if we fail one student, We failed that family. And so as we think about those kids, we need to really think about all of them and how can we help them. And if it's good for kids, we need to find a way to make it happen.

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[00:29:55] Doug Gee: I think the best way is through email.

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You had. Well, actually it's quadrangle because you had four different constituencies that you needed to navigate. You needed to repair relationships with the school staff and educators. You needed to do the same thing at the union level. You needed to make sure that the board was aligned with what you wanted to do and you needed to make sure that the relationships in the in the community and business landscape were were salvaged or repaired as well.

And I think when you're looking at any sort of turnaround, one of the most useful exercises that you can go through is figure out, okay, who's going to be impacted by all of these things that are going on and try to bring as many of them together and get their point of view so that you're making informed decisions as far as.

What is the action plan [: 00:31:00

So I think those were two important things that stood out to me in this conversation for everyone that's been listening to the discussion. Hopefully you liked the conversation that we had. Make sure you leave us a review on your favorite podcast player. If you haven't already done so, make sure you join our community. Then tune in next time where we'll have another great leader hanging out with us and sharing with us the game changing insights that helped them build a high performing team.