Franklin City school leaders ask council for $650,000 as they disclose months-long unpaid vendor bills

At its July 14 meeting, the Franklin City Council heard a request from Franklin City Public Schools to reallocate $650,000 of school capital funds toward a roughly $1.588 million package that would pay for a cosmetology and barbering CTE lab, a teachers’ lounge restroom and an upgraded pre-K/K playground.

Dr. Carter introduced the package and said the district would cover some elements itself but needed council help for the prioritized items. Cheryl Midkiff, account executive with Energy Systems Group, described a two-phase unsolicited PPE (public-private education facilities) proposal to renovate classroom and lab space and to upgrade HVAC, plumbing and electrical systems. Midkiff said the proposal would be turnkey: “We would be turnkey providing all of the different . . . construction needs, the bidding, all of that as part of the process,” she told council.

School officials gave a line-item total of about $1.588 million for the three priority projects and asked the council to reallocate $650,000 from the school system’s capital improvement funds to support the work. “We will take care of the rest, but we need City Council’s help in order to get these crucial and vital projects completed,” Dr. Carter said.

During questioning, council members pressed staff about where the requested reallocation would come from and whether funds had previously been “taken” from capital accounts. City staff explained that, for FY2025, the local-share appropriation was issued as a lump sum (about $4.3 million including a $330,237 capital component) and that classification differences between operating, debt and capital can require the schools to return to council to move money between categories. Council members said the FY2026 local share was reduced by roughly $400,000.

In the presentation and ensuing exchange, school leaders also disclosed an operational shortfall that affected daily operations earlier this year: they said vendor accounts were cut off beginning May 9 and that some bills had not been paid. The district told council it had continued payroll but could not pay vendors and that, until recent action, some vendor credit accounts remained suspended. In response to repeated questions from council, a school official said the treasurer did not pay those bills and that the district had not received a written explanation for the stoppage.

Dr. Carter said summer-school operations nearly stopped because the district could not pay bills: “It was getting close to a decision that I was about to end summer school early because we were not able to pay our bills,” he said, adding that credit cards were reinstated last week so buses could be fueled and services continued.

Public commenters underscored community concern about school fiscal management and performance. Resident Brandon Lily said he had filed public records requests for administrator salaries and student-retention data and pressed for accountability, saying residents needed clarity about staffing and accreditation. Pam Lee urged the board to take stronger action if central-office problems persist.

Council did not appropriate funds at the July 14 meeting. Members said they will continue the discussion after staff and school leadership meet to clarify FY2025 and FY2026 accounting and to work with the treasurer’s office. The council’s work-session discussion closed without a binding appropriation; council members asked for additional information and a follow-up meeting with the school board to review next steps.

What’s next: Council staff said a follow-up meeting with school leadership is scheduled for Thursday; council members indicated they would review any documentation produced in that meeting before making an appropriation decision.