State still waiting on delinquent MPS financial reports due in September

Milwaukee Public School and state education leaders say the district still has not submitted financial data for fiscal year 2023 to the state.

After financial mismanagement was uncovered in the spring, MPS and the Department of Public Instruction wrote a corrective action plan giving the school district until the end of September to submit missing financial reports. 

Those reports are now expected by Thanksgiving. 

State Superintendent Jill Underly and Interim MPS Superintendent Eduardo Galvan said the process is taking longer than expected because the financial problems were more significant than originally anticipated. 

“Our goal is to not only get the fiscal ’23 reports, like the audited financials submitted, but also to work with them to improve internal practices and procedures,” Underly said during a press conference Monday.  “We are also actively working to plan for the submission of the district’s Fiscal Year ’24 reports.”

Underly said the corrective action plan was not about instituting deadlines, rather laying out a path for what needed to be done. ‘

“And the fact is that while we insisted the district lay out a path, what we have been learning about the depth of the problem along this journey, means it has taken longer than we’ve hoped,” Underly said. 

The 29-page corrective action plan revealed an inexperienced, understaffed financial office that was using an outdated accounting system to manage the state’s largest school district. 

The report states that 12 vacant finance department positions needed to be filled by the end of September and the MPS software system, BusinessPlus, needed to be updated. 

The current system could not convert financial data to DPI’s WISEdata system, essentially meaning it was useless. 

On Monday, the district did not answer whether that system had been updated. 

DPI Assistant State Superintendent Tricia Collins said most of the vacant positions in MPS’s finance department have been filled but the district still has not hired a comptroller. 

After the financial scandal was revealed, Superintendent Keith Posely and CFO Martha Kreitzman resigned and Gov. Tony Evers called for operational and instructional audits of the district. 

Legislative Republicans have called for an audit of DPI. The department knew about the district’s financial issues before MPS asked voters to approve a $250 million referendum. 

Underly was asked Monday if DPI should get involved with district finances sooner to avoid future issues like this.

“We’re always looking at ways that we could reevaluate our processes, and I think that certainly we can look at that as a possibility,” she said.

The mismanagement of MPS’ finances have been costly to the district. DPI deducted $42.6 million in state aid from its payment to the district last month due to district reporting errors in the 2022-23 school year.

Galvan, who has been serving as interim superintendent for about three months, says he realizes the public is frustrated with the situation, but significant progress has been made. 

“It is now my goal to ensure this never happens again,” Galvan said. “I feel confident that we are putting the right people in place to move the district forward.”