But the district's three black trustees at the time—Hollis Brashear, Lew Blackburn and Ron Price—weren't as impressed, saying they wanted a candidate from a large urban district. In the vote to name Hinojosa the sole finalist, Blackburn and Brashear voted against Hinojosa, while Price abstained.

Hinojosa's proud father, Amado, seemed to anticipate the drama that would unfold after his son returned to DISD. The elder Hinojosa told The Dallas Morning News he asked his son before he accepted the job, "Can you avoid the troublemakers here?"

His son also gave his share of interviews, sounding confident—maybe too much so. "I have some finance acumen as well," he told the News. "I know how budgets work. People say school finance is complicated—it's not."

The super: Fending off calls that he quit his job, Michael Hinojosa points to improvements in the classroom.
Mark Graham
The super: Fending off calls that he quit his job, Michael Hinojosa points to improvements in the classroom.
Check your work: Teacher rep Aimee Bolender says Hinojosa should have made sure DISD didn't blow its budget.
Mark Graham
Check your work: Teacher rep Aimee Bolender says Hinojosa should have made sure DISD didn't blow its budget.

The budget crisis that threatened to cost Hinojosa his job emerged last March. But the superintendent never saw it coming. In the wake of hiring more than 700 new teachers as a part of Dallas Achieves!, a reform initiative pushed by business community, administration officials told the board that they were facing a $52 million payroll deficit. That should have raised a fleet of red flags. But Eric Anderson, the Chief Operating Officer for DISD who had been hired to revamp the district's finances, told the board not to fret.

That's because the district was now expecting $29 million in state revenue and more than $30 million in savings from cutting operational expenses. On April 18, district officials sent out to all DISD employees an unsigned memo trying to ease any concern about the school finances. Although the memo acknowledged that DISD had spent more money than it initially projected on hiring teachers, the district wouldn't be in the red, the correspondence maintained. "Balancing the additional revenue and the cost savings, the district projects that it will end the fiscal year with a surplus of revenue over expenditures."

That DISD's finance guys claimed to have erred in the district's favor overshadowed a fundamental point: They clearly had no idea what money was coming in and what money was going out.

Budget officials miscalculated teacher salaries by nearly $3,000 per position. Principals routinely asked for extra teachers and routinely got them—even if their schools were adequately staffed.

There were instances of invoices that were left unpaid for months. In May 2008, Hinojosa received an e-mail from a credit analyst for one of the district's vendors, Science Kit and Boreal Laboratories. The analyst wrote to inform the superintendent that the district hadn't paid several purchase orders dating back nearly a year and totaling nearly $90,000. "Although one of our team members has been in constant contact with your accounts payable department, we are failing to see any type of resolution."

People working closely with the district regularly heard stories of DISD's adventures in accounting. That's why Aimee Bolender, the president of Alliance AFT, a negotiating group for teachers, couldn't believe how nonchalant Anderson was about the possible $52 million payroll deficit. "No worries, everything is fine," she remembers him saying in meetings at least twice.

But Bolender remained unconvinced. She always thought of Anderson as arrogant, and she needed assurances that her teachers were going to have jobs next year. So later, in a meeting with him at the district's main offices, Bolender asked Anderson to provide a more thorough accounting.

"I don't have to explain the budget to you," she says he told her. (Anderson declined to comment when reached by the Dallas Observer.)

Anderson and the district's other finance staffers weren't much more forthcoming with their boss. Last spring, Hinojosa asked for a "district-wide labor costs report" that could have spelled out DISD's looming problems in greater detail. But it never ended up on his desk.

"They were in the process of getting it," Hinojosa says. "They just didn't produce it, and that led to the systemic issues in place here."

But that explanation is not good enough for Bolender, who wishes the superintendent did what she tried to do.

"Let's just say that the $52 million was the elephant in the room. How do you walk around without dealing with it?" she notes. "If I was Dr. Hinojosa I would have asked Eric Anderson every day to prove to me it was taken care of. I wouldn't have just taken his word for it; I probably would have had someone else take a look at it too."

Hinojosa agrees that he should have done more to make sure that Anderson's projections were solid. "Hindsight is 20-20. I wish I would have done those things," he says, after learning about Bolender's rebuke of him. "He and his team did prove to us where the money was going to come from, but I did not have it validated externally. I wish I had."

If Hinojosa has been reluctant to condemn Anderson publicly, behind the scenes, he was critical of how Anderson handled the audit of the district as well as the budget issues that prompted the current fiscal tumult. In a job evaluation of Anderson, dated May 29, 2008, Hinojosa all but told the chief operating officer he was going to lose his job.

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