BYRON, MINN. — Amid budget troubles, the superintendent of Byron Public Schools is trying to reassure voters that the district’s finances are under control before the public weighs in on a $1.9 million operating referendum.

The district has been under scrutiny since the spring following the discovery of a budget miscalculation that led to $1.5 million in cuts, including the loss of at least 22 staff positions. Doubts about the district’s financial management only deepened after the abrupt resignation of its financial director just eight months into the job.

Now, with less than two months to make the case for the referendum, Superintendent Mike Neubeck said the district is still working to get a firm grasp on its finances. He was unable to provide specifics on the size of the deficit the district is facing or what might be cut if the referendum fails.

“Everyone’s asking, ‘How much is it?’ We won’t know until probably a few weeks,” Neubeck said.

To complete an audit of the district’s finances, Neubeck has brought in a new financial director, who will stay on through the rest of the year. It will be the Byron district’s third financial director in less than a year.

“I want to make sure I am putting out numbers that are true and verified,” Neubeck said. “There have been times when people have said stuff that may not have been totally verified.”

For critics of Neubeck’s financial stewardship of the school district, it may be too little too late. Chris Schmit, a former school board member, said while she believes the initial miscalculation could have been an honest mistake, she questions why it took months for the district to come forward with details about it.

“I am concerned about giving more money to a district that is mismanaged,” Schmit said, adding that she would only support the referendum if Neubeck stepped down.

Neubeck said the district first learned of issues with the 2023-24 budget around the time it was preparing the budget for this school year. Ashley Bocchi, who was hired as financial director at the beginning of 2024 and has since departed, found that the previous director, Todd Lechtenberg, had miscalculated an increase in staff wages, leading to a budget deficit.

The increase stemmed from budget negotiations the year before that resulted in a 5% bump in wages. The models used by the district and presented to the school board, however, inadvertently showed a 1.5% increase.

The district said that during the transition from Lechtenberg to Bocchi, an outside financial adviser also found bank reconciliations that had not been completed, low cash reserves and an $800,000 credit line that had been run up.

Lechtenberg, who was contracted part-time as financial director for Byron, left the district in early 2024 to join Austin Public Schools. He did not respond to a request for comment.

Byron School Board Chair Duane Quam III declined a request for comment.

“In hindsight, more could have been done,” Neubeck said. “But I will tell you that when you hire people with that expertise, then you would expect that they would follow through on that expertise — that’s what you pay for.”

Neubeck said the credit line has since been paid off and that measures have been taken to provide greater oversight of the district’s finances, including more frequent and detailed reporting to the board.

He declined to answer questions about the departure of Bocchi, who resigned on Aug. 17. Bocchi, who joined Byron schools after 17 years at IBM, could not be reached for comment.

In 2021, Neubeck’s first year as superintendent, Byron voters approved a $44.5 million capital referendum to fund improvements to athletic facilities, renovate a preschool building and add more classroom space at the high school.

It was no easy task — two other referendums had failed in the previous two years in Byron.

Neubeck, though, said making the case for an operating referendum is more of a challenge. Unlike with a capital campaign — in which districts pitch specific projects like a sports stadium or computer lab — operating referendums are used to cover everyday expenses that keep the district afloat.

For Byron, a growing town of about 6,300 people, many of the financial problems its school district faces are the same ones playing out in public school systems across the state, including 10 minutes east in Rochester. Inflation, new government mandates and the end of COVID-era funding have created a perfect storm for school finances, Neubeck said.

Byron, he added, is already the third-lowest-funded district per pupil in the state. And despite an enrollment increase of 20% over the past decade, the district is one of 92 in the state without an operating referendum.

“Eventually, we would have been going out for an operating referendum,” Neubeck said. Recent financial challenges, including a nearly 30% hike in insurance costs, “just exacerbated it a little bit more.”

Nicki Nicholas, a parent of three kids in Byron schools, said she plans to vote for the levy increase, which would bring in $19 million for the district over the next decade.

Nicholas said while her support doesn’t come without hesitation, she views the referendum as a vote on whether students and teachers have the support they need. She worries about the impact cuts would have on a district that consistently ranks toward the top in test scores when compared to hundreds of schools of the same classification.

“As a voter, I hope others can separate the challenges from their choice to support the referendum,” Nicholas said.