Mississippi district’s financial troubles revealed in audit
The Okolona school district had accumulated a $1.25 million deficit by the time the Mississippi Department of Education took control last year, according to an audit presented Thursday. The review, conducted by Novum Advisory, found the district had been operating at a deficit for six of the seven years examined.
School officials increased spending, particularly on consulting services and travel, despite declining enrollment. Stephanie Palmertree, co-founder of Novum Advisory, told the state Board of Education that missing annual financial audits and the misuse of pandemic relief funds concealed the district’s financial instability.
The district had not submitted an audit since 2021. In October, officials informed the state they could not meet payroll, leading the Board of Education to assume control in November. This marked the second time the district was placed under state oversight, the first being in 2010 due to financial and academic issues.
The state sent the district $1.5 million in emergency funds, which officials agreed to repay through $300,000 installments over five years, with the first payment due in June 2027. Last school year, the district’s enrollment dropped to 505 students from 547 in 2020-21, while per-student spending rose 83% to about $18,000, compared to the state average of $12,176.
Palmertree noted that the district’s expenses exceeded revenue starting in 2023, largely due to increased travel and consulting costs unrelated to instruction. Many invoices contained unclear descriptions, complicating oversight. The district is working with a new firm to address missing audits and is implementing a corrective action plan with Novum Advisory’s help.
Since the intervention, the Department of Education has tightened oversight, reducing districts missing audits from 47 to 32. However, officials expressed concern that other districts might have similar undisclosed financial issues, as some audits remain missing. Board Vice Chairman Matt Mayo questioned the extent of undisclosed financial problems across districts.
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