Manatee County School Board in time pinch to respond to state audit findings

eearl@bradenton.comDecember 11, 2013 

MANATEE -- The Manatee County School District is mapping out a plan to face the State Auditor General's 33 suggested operational improvements from the first half of an audit released Dec. 3.

The report contained a total potential financial impact of $9 million for the district.

Don Hall, deputy superintendent of operations, said every state finding has been assigned to a staff member to verify and determine any necessary corrective actions. Some state claims are repeat findings dating to 2005.

"I cannot comment on what previous staff did, but in this case the past is coming back to us for us to answer," Hall said. "It is one of the realities we have to face. We will work through it in a reasonable way to address concerns and make sure none are repeated in following years."

The second half of the audit will be released by the state Wednesday, which will add to the school district burden.

Audit findings already include more than $4.1 million in questionable sales tax spending, another $1.4 million in questionable ad valorem tax revenue spending and another $1 million in questioned spending from construction bonds, state board of education bonds and other funds earmarked for capital projects.

The school district also failed to return more than $728,000 to the state as required, according to the audit. The school district also reportedly misspent money from the workers' compensation fund leaving it with a $1.7 million deficit, according to the audit.

The Manatee County School District has until Dec. 20 -- a week from Friday -- to contest state findings and issue a plan to repay any money it owes the state. The district also must rebuild its own funding to state-required levels and remediate other audit findings, which include lax technology security controls.

The district has three options in responding to the state audit:

• Refute the finding with evidence it is flawed.

• Present a plan to mitigate some or all costs to the district.

• Without supporting documentation, the district must give an action plan for how it will move forward.

School board member Karen Carpenter said she is concerned about the staff members handling the corrective plan.

"I hope no one who had responsibility in the areas that had findings will be assigned to fix it," Carpenter said. "I want to underscore that if someone made an error in the past, they really shouldn't be in charge with fixing it. People are rightly upset."

Hall said specialists or directors in each area of state concern will work on the response.

The Manatee County School Board will meet at 3 p.m. Dec. 18 to further discuss the audit. Hall said the district's corrective action plan will be made available next Tuesday morning.

"We have had an issue in the past of missing state deadlines," Hall said.

School board vice chairman Dave "Watchdog" Miner said the district has also struggled with documentation.

"We did not document, and that was repeated in the report," Miner said. "There was not good record-keeping by the district. We cannot show we were doing the right thing. How is this allowed?"

Hall also provided a table showing how much money was carried over in certain funds, worksheets from the last two years and state allocations matched with actual school expenditures.

Last year, Manatee County schools spent more money than the state sent and balanced the budget using the district general fund.

This year, Hall said school finances are on track to get back in the black. However, teachers have not yet been paid advanced placement bonuses, which usually come out around Christmas time.

"We are not providing bonuses until we have the money," Hall said. "We are not estimating."

The district announced it will hold a strategic planning meeting Wednesday. Miner said the strategic planning session is unnecessary.

"This has not been well-administered. It does not take a committee when what we know is staring us in the face," Miner said. "What is the purpose?"

Miner said the meeting ties valuable people, such as internal auditor Byron Shinn, up for a few days.

Shinn said communication between the school board and audit committee must improve. The next audit committee meeting is 3 p.m. Wednesday.

The State Auditor General's financial and federal grant audit, the second part of the state fiscal review, will be released Wednesday.

Superintendent Rick Mills has said he expects similar funding difficulties to be outlined in the second audit.

Erica Earl, education reporter, can be reached at 941-745-7081.

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