Manatee School district called poster child for financial mismanagement

Herald/Times Tallahassee BureauJanuary 14, 2014 

TALLAHASSEE -- A panel of state lawmakers Monday blasted the Manatee County School District for what they called a "radioactive" audit of the school system's finances.

"I've never seen anything like this in my life," said state Rep. Daphne Campbell, D-Miami. The audit report questioned more than $7.2 million in school district spending over the past five years.

Said state Sen. Alan Hays, R-Umatilla: "I'm embarrassed as a Floridian that such conduct took place."

But lawmakers expressed confidence in Manatee Superintendent Rick Mills, the retired lieutenant colonel tapped to lead the district out of its budget crisis in March. They praised Mills for his leadership, and for providing a thorough response to the state audit report.

"You got handed a big task, and it seems like you are handling it with your military muster," said state Sen. Joseph Abruzzo, D-Wellington.

The Manatee school system confronted a budget disaster in 2012-13, when the district general fund dipped from a deficit of $4.1 million to $8.6 million in the red.

State auditors discovered millions in district spending may have run afoul of state and federal guidelines. Questionable expenses included $1.7 million earmarked for special-needs students and $92,000 for improving teach

er quality.

The auditors also found Manatee schools officials held on to $728,000 in capital construction money that was supposed to be returned to the state.

All told, the audit could result in an $8 million hit to the school district budget.

Addressing the Joint Legislative Auditing Committee in Tallahassee on Monday, Mills explained the problem in simple terms: The district overspent its budget by about $38 million over the last four years.

"We didn't open a closet and a skeleton came out," said Deputy Superintendent for Operations Don Hall, who was hired in May. "We opened a closet and an entire cemetery fell out."

Some fiscal problems persisted even after Mills took the helm at the school district, including hiring teachers whose salaries had not been budgeted and charges to the special education program not properly documented. Hall said the district has revamped its accounting practices.

"Our goal is no repeat findings," he said.

He also said the school system has taken steps to reduce spending, such as slashing utility costs, cutting nearly 100 central-office positions and freezing non-essential hiring.

The measures could result in millions of dollars in annual savings, he said.

Hall predicted the district would close out the fiscal year with at least $8 million in reserves -- a number that could shrink based on how much the district loses as a consequence of the audit.

Hall said he is working with the state Department of Education to determine the final amount, and the district could sell some properties to generate extra cash, if necessary. Any fines to the Manatee County School District will be levied by the Florida Department of Education.

Despite district plans to move forward, lawmakers said they were troubled its financial situation had become so dire.

Hays said the committee should use the Manatee County School District as a "poster child" for financial mismanagement, and create new state laws to prevent similar situations from happening in other districts.

Hays called upon the superintendent to look into the possibility of criminal charges.

"Can we find anyone whose pockets were filled with the proceeds?" he asked.

School system officials said it wasn't clear if any crime had been committed, but that they planned on holding former employees accountable.

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