NORTH ANDOVER — Just two weeks after Christopher Hottel started as superintendent, officials in his former district discovered a $3.3 million school budget deficit.
Nashua, N.H., officials wanted to know why Hottel and former Business Manager Jim Mealey, who also came to North Andover this summer, didn't notice such a huge gap in the balance sheets.
There had been no indication of a shortfall — especially a multimillion-dollar one — before the books were closed for the fiscal year June 30.
Mealey and Hottel wrote up statements and attended Nashua meetings, blaming the deficit on an antiquated accounting system and the more than $1 million in school disaster money the city's aldermen hadn't yet approved but were budgeted to receive.
Nashua leaders questioned how much of the deficit had been human error.
Now, two weeks after the news first broke, as Nashua officials scramble to close a daunting deficit through layoffs and program cuts, North Andover officials say they are satisfied with Hottel's and Mealey's explanations.
They say they are confident the same thing will not happen in North Andover.
"It doesn't seem applicable to our situation here," Town Manager Mark Rees said of the deficit. "I've had conversations with him. I think whatever occurred in Nashua will not reoccur here."
Rees said Hottel told him, the School Committee and other administrators about the $3.3 million before it even hit the newspapers in Nashua.
"He sat us down and let us know this was coming," Rees said.
Hottel sent a statement to newspapers last week, explaining the shortage as being out of his hands.
He said the deficit was closer to $2 million — not $3.3 million — since they received special education money from the state, but aldermen never voted to move it to the school budget for "political reasons."
The $2 million loss can be attributed to the use of the "antiquated" Digital Equipment Corp. VAX system, he said.
He said the VAX system "reported on May 31, 2009, that school spending was on target to meet the budget." But a month later, in the year-end accounting wrapup, it showed a $2 million deficit in special education and salary.
Hottel said this will not happen in North Andover since the town's budgeting software is much more advanced and "state-of-the-art."
North Andover launched new accounting software, Budget Sense, a couple years ago when the town's former system was getting older, trying to avoid any slip-ups.
"There are protocols and procedures in place to prevent reporting errors of the type Nashua has experienced," Hottel said in his statement. "All users of the financial and accounting software ... are thoroughly trained in the use of the system."
School Committee Chairman Stanley Limpert said the committee was not alarmed by the news since the explanation seemed logical.
Committee members spoke about it at their retreat last month.
"It seemed all pretty straightforward," Limpert said. "We have a brand new accounting system, only a couple years old. It seems like a different situation than here."
"There is all kinds of new transparency of where the money is going that wasn't there before," Limpert said of the town's new accounting system. "We're doing very well."
Nashua's and North Andover's budgets are very different.
Nashua schools boast 13,000 students, 16 schools, dozens of administrators and an $80 million budget. North Andover, on the other hand, has about 4,540 students, seven schools and a $37 million budget.
Officials said they have heard people comment about the Nashua deficit around town, but haven't received any inquiries or complaints from parents.
"Only the newspapers are asking about it," Rees said.
Hottel had worked in Nashua since 2005. He came on as an associate superintendent and was named interim superintendent shortly after. Before arriving in Nashua, he spent nine years in Haverhill, working up to assistant superintendent of student services.
The North Andover School Committee voted to give Hottel the superintendent job in December. He started in July.
He was brought in as someone who can lead North Andover through some tough budget seasons, a real number cruncher, School Committee members said.
Limpert said he is still confident Hottel is that man.
"His explanation seemed reasonable," Limpert said.
ÔÇæÔÇæÔÇæ
Join the discussion. To comment on stories and see what others are saying, log on to eagletribune.com.
