State panel gives SAD 40 scathing report

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WARREN – In grading SAD 40, the state has given the district a “P” for provisional – not for passing.

On Monday, Commissioner Susan Gendron and a team of department experts, who earlier this year inspected SAD 40 operations, gave a PowerPoint presentation on the deficiencies within the district and ended the brief session with the announcement that the district has lost its “approved” status.

The school board has 60 days to present an acceptable written plan for corrective action, Gendron said, telling residents that the level of poor findings the team discovered makes the provisional status necessary.

The team review requested by the district in February involved an inspection of financial management, school board operations, certification, pupil transportation, building maintenance and school nutrition. All of the areas were deficient.

It took about a half-hour for seven state specialists to present findings in their area of expertise before the commissioner announced the district’s provisional status and laid out the terms to regain approval. The meeting adjourned with no public comment.

“I was wrong,” said Angelo Wieland of Union. “It wasn’t a whitewash. It was a scathing report.” Wieland was quite vocal throughout the past year’s turmoil brought on by the discovery that former Superintendent William Doughty had withheld information that the district had a serious financial deficit.

“It’s accurate,” a district administrator, who asked not to be identified, said. “On one hand, it is sad,” the administrator said, but “I’m pleased it wasn’t a whitewash. I’m happy it’s given us a road map to move forward.”

Zel Williams, a former SAD 40 director, said that all along staff and residents have told the superintendent and school board what the state just finished saying. Now, maybe district officials will listen because it’s the state telling them what is wrong, she said.

“This is just the tip of the iceberg,” Williams said.

In financial management, the state found that SAD 40 used unavailable funds as revenue sources in the fiscal year 2002-2003 budget from Medicaid, tuition revenue, balance forward and nonrevenue receipts. The state recommends that the district maintain Medicaid funds as part of the general fund budget, use audited financial statements to determine balance forward funds available, review prior year actual amounts for tuition receipts to forecast new-year budget amounts and review the validity of revenue accounts with the audit firm.

The report states that the district’s accountant had difficulty understanding basic accounting fundamentals when asked the difference between an accrual and an encumbrance during the team review.

It seems the bulk of the district’s problems are in money matters, such as:

. Transactions charged incorrectly.

. Inaccurate financial, staff and student reports filed in FY01-02.

. Lack of internal control over purchases and employee work hours.

. Overstock of supplies on hand.

. Overtime paid that was not in budget.

. Categories of purchases not an appropriate use of district funds.

The recommendations are to stop the bad practices and to properly review accounts, purchases and reports and provide training where needed.

Under auditing, the state-identified deficiencies included:

. No full-time qualified business manager.

. Adjusted line items without budget authorization.

. Account reconciliations incomplete.

. No resolution of audit findings since the FY 1999 audit.

The state recommends actively seeking a full-time business manager, record expenditures in proper budget categories; stopping unauthorized transfers between line items and for the superintendent to provide the board with regular monthly budget and financial reports.

Some of the findings in school board operations show:

. The district suffers from significant lack of clearly defined roles for superintendent and board members.

. The public has lost confidence and trust in the ability of the board to develop policies in guiding the direction of the district.

. The size of the board is too large (16 members).

Some board members do not adhere to existing policies pertaining to meeting attendance and committee participation.

. Financial information not available in a timely manner.

The state recommends training for district officials in areas to include confidentiality, personnel laws, communication and chain of communication and availability of information and right-to-know laws. Also recommended is reducing the size of the board.

Before the meeting adjourned, Commissioner Gendron told district residents it is important for everyone to work together.

“I know that commitment is here,” she said. “It’s time to let go of some of the issues of the past.”