A financial investigation into Byron Public Schools in Minnesota has concluded without criminal charges, but not without a sharp rebuke of past spending practices. Olmsted County Attorney Michael Walters stated there was “insufficient evidence” to pursue charges related to the alleged mismanagement of funds, according to reporting by Gray Media’s KTTC.com.
The investigation stemmed from a state audit conducted last year by Minnesota State Auditor Julie Blaha, which revealed a lack of supporting documentation for approximately $60,000 in purchases and over $4,000 in gift cards. Blaha cautioned at the time that while no fraud was immediately apparent, the situation created a significant risk for potential misuse of funds, stating, “This is how fraud can happen.”
The findings prompted a review of financial controls within the district. New Superintendent Nate Walbruch has since implemented changes, including replacing traditional credit cards with purchase cards and requiring pre-approval for all purchases. “We started making changes literally the first day,” Walbruch told KTTC.com. “In order for a person to make a purchase, we essentially have to approve the purchase before they can even run the card through.” He acknowledged past shortcomings and emphasized the district’s commitment to “rebuild trust and transparency with the Byron community.”
The audit followed accusations of financial mismanagement within the district, including a $1 million budget cut in 2024 resulting from a miscalculation. This incident is part of a broader trend of budgetary challenges facing U.S. School districts, as highlighted by reporting in The Lion.
A growing number of districts across the country experienced budget shortfalls in 2025, including those in California, Oregon, Washington, Pennsylvania, Michigan, and Illinois. These shortfalls were often initially underestimated before being revised upwards, a pattern attributed to “incompetence, bad accounting and administration’s inability to say no,” according to Ruth B. Turner, superintendent of Montclair Public Schools in New Jersey.
Montclair Public Schools provides a case study of this trend, initially estimating a $11 million deficit in July, which was later revised to $18 million. The financial pressures facing these districts are compounded by rising expenses and declining enrollment following the expiration of COVID-19 pandemic-related funding.
Similar issues have surfaced in Wisconsin, where audits of Milwaukee Public Schools revealed a $46 million budget deficit. The district is currently developing plans to cut spending and address the shortfall, as discussed at a February 10 committee meeting. However, concerns were raised during the meeting that greater fiscal accountability could have prevented the deficit from occurring.
During the meeting, Will Fitzgerald, a special education teacher, questioned the district’s priorities, stating, “You say this budget is a reflection of your values, so where does lack of transparency about financial mismanagement fall into your values?” This sentiment underscores a growing demand for greater financial oversight and accountability within public school systems.
The situation in Byron, Milwaukee, and Montclair reflects a wider pattern of financial strain and accountability concerns within U.S. Public schools. While the investigations in these cases have not uncovered evidence of criminal activity, they highlight the critical importance of robust financial controls, transparent reporting, and proactive budget management to ensure the responsible use of public funds and maintain public trust.
The trend of underestimated deficits, as seen in Montclair, suggests a systemic issue with financial forecasting and planning within school districts. The reliance on temporary funding sources, such as pandemic relief funds, also appears to have contributed to the current challenges, leaving districts vulnerable when those funds expire.
The response from Superintendent Walbruch in Byron, focusing on implementing stricter purchase controls, represents a proactive step towards addressing these issues. However, the broader problem requires a more comprehensive approach, including improved training for financial staff, enhanced oversight from school boards, and a commitment to transparency in all financial matters.
