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Saturday, August 26, 2017

FINANCIAL HEALTH CRISIS: Ah-Chooo!

BREAKING NEWS The Grand Traverse Academy's superintendent, Susan Dameron, sent a message to the Traverse City charter school's community today that was both chockablock and nutrition-free.

Dameron announced that teacher Caroline Hetherington is leaving snowy northern Michigan for the sunny shores of Barack Obama's birthplace.

No, not Kenya! Hetherington is moving to Hawaii. And Katherine Thiesen has moved on to an unspecified school district, moving from the classroom to a Special Education spot where she'll also coach teachers.

After the happy talk, Dameron gets to the meat of the matter: money, honey.
I have to take exception with a few assertions Dameron makes:

“We have more great news regarding our financial picture. We have two offers for our state aide note. This note helps with our cash flows throughout the year and is an important part of our budgeting process. One offer is from Traverse City State Bank and the other is through The State MFA in conjunction with PNC Bank. We are particularly excited to get back into the MFA through the state, as it is a sign of our improving financial health. In the last few years we were unable to borrow from them because of our financial picture. This combined with the reduction of our overhead, the amount of money we ended the year with and what we project to put into our fund balance next year makes me very excited about our financial outlook. 

Our current state aide note through TCSB does expire on Monday and depending on which route the board decides to take there will be a gap between when the deal closes and when the existing note is paid off. In conjunction with our financial advisor and our financial management company, the Board will make the best decision on what is best for our future financial health.” 

First, Dameron claims that in “the last few years we were unable to borrow from them (meaning the Michigan Finance Authority) because of our financial picture.” 

That assertion is, in a word, untrue.

As you can see from the chart below, created with the Grand Traverse Academy's State Aid Note loan official borrowing history, provided to me by the Michigan Finance Authority's spokesperson, the school did not participate during the fiscal year ending June 30, 2016, but consistently borrowed between 2010-2015.


Hmmmm?

Dameron then conflates that false statement, enthusing the Grand Traverse Academy is “particularly excited to get back into the MFA through the state, as it is a sign of our improving financial health.” 

Really?


Improving financial health? 

The Grand Traverse Academy violated a general fund minimum balance bond covenant in four of the last five years.

If that's health, somebody needs a flu shot. 

Finally, Dameron fluffs the subject of the looming $2.4 million Traverse City State Bank balloon payment for a loan acquired during the previous fiscal year, a payment that's due on Monday:

“Our current state aide note through TCSB does expire on Monday and depending on which route the board decides to take there will be a gap between when the deal closes and when the existing note is paid off. In conjunction with our financial advisor and our financial management company, the Board will make the best decision on what is best for our future financial health.” 

Deal? What deal? 

Instead of paying 3.0% interest to borrow from the state Michigan Finance Authority state aid note loan program, the Grand Traverse Academy board chose instead to pay a hefty 5.75% to Traverse City State Bank.

If you understand the letter like I did, you'd assume Dameron's comments on the “state aide [sic] note” did not address the TCSB balloon payment loan, only the borrowing for the coming school year.

So what about that not-so-beautiful balloon?


4 comments:

  1. Traverse City State Bank has nothing to lose I believe they will back the school and announce how supportive they are to their community they will Bow Down to get their money back I would never BANK at Traverse City State Bank never! They are professionals they knew what Ingersoll was doing was wrong they just wanted the money you can't tell me they're in the banking business and don't know rules and regulations I call there bulshit!

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  2. Of course Traverse City State Bank was in on the Ingersoll deal, in on the Noss deal and Dameron is in on it all. They need to get that lying piece of poop out of there and also get some elected board members. It is time for teachers and community to demand that this be taken care of otherwise, they will keep lying to you and filter off money and eventually have to close the school.

    Two separate issues here the Traverse City State Bank loan( balloon payment of 2.4 mil that was a favor to the bank due soon) and the new loan they will take out from the state which is where they should have gone in the first place. Couldn't get one from the state that is a complete lie. You can not run a quality school with all the obnoxious lies from Susan Dameron. I am outraged at what is going on between the bank, Dameron and the board. All complete lies.

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  3. Ah, the high these guys get from The Finagle for The Moola!

    Problem is, as with any addiction, they stop looking in the mirror AND become blind to their abuse: out of mind, out of sight. Attention to ethics then becomes unworkable, and morals crumble.

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  4. The GTA (Grand Theft Academy) needs more than a flu shot. It needs a new heart - not the Ingersoll/Noss one the one that had profit and ego as its heartbeat, but rather one that truly educates its students and serves its community.

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