Monday, October 28, 2013

So which will it be . . . forensic audit or playground? How about both?


In the last post the authors of this blog pointed out that money is available to pay for a forensic audit and an independent investigation.

In this post, the taxpayers will see that not only are funds available to pay for a forensic audit and an independent investigation, there’s probably enough surplus money in the General Fund to pay for the playground upgrade and more. 

Here’s why . . .

Fort Cherry administrators maintain a separate fund for technology purchases.  Each year the board approves the General Fund Budget, along with purchases which are to come from the Capital Projects Fund and the Technology Fund.  The Capital Projects and Technology Funds are in separate bank accounts from the General Fund.


In 2010-2011, the board approved $229,591 in technology expenditures.  Those purchases were to be paid from the Technology Fund.





Sometime during the 2010-2011 school year, Chris Lauff publicly questioned Paul Sroka about board approved technology fund purchases coming out of the General Fund instead of the Technology Fund.   At that same meeting, Sroka told Lauff that he would transfer the money from the Technology Fund back into the General Fund at the end of the fiscal year.


 Let’s review:
  • The board approved $229,591 in expenditures from the Technology Fund.
  • Sroka used money from the General Fund to pay for the purchases instead.
  • Lauff questioned technology expenditures coming out of the General Fund.
  • Sroka told Lauff that the money would be transferred at the end of the year.

So, what’s the big deal?
  • The money was never transferred.  The Technology Fund (held at Northwest Savings) remained intact, with interest credited, for the entire 2010-2011 fiscal year.
    July 31, 2010, ending balance is $708,526.94:


    July 4, 2011, ending balance is $712,087.35:
    Why does it matter?

    As stated in the last post, by law, the district must follow the budget as approved by the board.  In this case, the administration pulled $229,591 of expenditures that were not approved as General Fund expenditures from the General Fund.

    In addition, having $229,591 available in the General Fund for unapproved expenditures indicates a gross mismanagement of taxpayer funds.  Sure it’s always nice to have extra money available, but responsible budgeting dictates that revenues and expenditures balance out.  There should not be an extra $229,591 available in the first place.


    What does this mean?

    If the administration pads the budget in this manner, then more than likely money is available to pay for a forensic audit and outside investigation as well as playground upgrades.


    Why doesn’t the board just ask that the money be transferred from the Technology Fund into the General Fund now?

    The administration has not been truthful with the board concerning the 2010-2011 technology expenditures; and as of this date, the board has not required the administration to produce documentation to support their claims.

    At the June 3, 2013 budget meeting during the discussion of the 2013-2014 technology budget, Dinnen publicly stated that the board routinely spends around $160,000 per year on technology, except for the 2010-2011 year when “there were no purchases for technology due to the drastic cuts”.

    During the 2013-2014 budget hearings, Lauff asked Sroka for a list of technology expenditures for the past few years.  Here’s the total amount spent on technology each year, as presented to the board by the administration:

    • 2012-2013:  $176,777.99
    • 2011-2012:  $150,730.63
    • 2010-2011:  No Purchases
    • 2009-2010:  $92.922.92
    • 2008-2009:  $156,952.54

    How do the authors of this blog know the administration has not been truthful with the board?

    A resident, who is in possession of 2010-2011 General Fund bank statements (obtained through a RTK request), found $300,000 worth of checks written from the General Fund to pay for technology purchases (list of checks at the end of this post).

    This was brought to board members attention with this public comment at the June 17, 2013, meeting:

    At the last budget meeting, Mr. Dinnen stated that the board routinely spends around $160,000 per year on technology, except for 2010-2011 when “there were no purchases for technology due to the drastic cuts”.

    I am holding bank statements for the 10-11 fiscal year which were obtained through a RTK request submitted to the district.  In 2010-2011, the Technology Fund located at Northwest Savings remained intact, no expenditures at all.

    However, cancelled checks from the 2010-2011 General Fund account show a large amount of technology purchases.  According to these documents, which were obtained from the school district, from July 1 to October 31, there were over $214,000 in technology purchases paid for out of the General Fund. 

    I recall Chris Lauff asking Mr. Sroka about technology purchases coming out of the General Fund that year.  Mr. Sroka told him that he would transfer the money spent on technology from the Technology Fund back into the General Fund at the end of the year.  According to the 10-11 Annual Financial Report and the bank statements, that did not happen.

    I respectfully submit two questions to the board:

    If your administration is budgeting properly, how can you possibly have that much extra money in the General Fund to spend on items that were not budgeted for?

    Why isn’t your administration being upfront with you about the technology purchases made in 2010-2011?  Clearly, purchases were made even though Mr. Dinnen said there were none.


    In addition, this follow-up email was sent to board members:




    How did the administration respond?

    At the June 24, 2013, meeting, the administration admitted that there were technology purchases in 2010-2011, but Dinnen and Sroka claimed that the purchases were made with grant money.


    How did the board respond?

    The majority of the board accepted the administration’s excuse.  However, board member Leann Darnley asked Sroka for documentation supporting the administration’s claim that grant money was used.

    Although directly requested by a board member, Sroka never produced that documentation.

    Also, grant money or not, school code requires that the board approved Technology Fund purchases be written out of the Technology Fund.  Any grant money received would then replace the money used from the Technology Fund.  By law, administrators cannot override school code.

    It should be noted that Trisha Craig, who reports on all grants received by the district (no matter how minimal), never announced over $300,000 in grants awarded to FC during the 2010-2011 year.  Any grant or grants of that magnitude would have been a major achievement considering the cuts in state funding facing Pennsylvania school districts that year.  Such grants would also provide a significant increase in administrative pay – don’t forget, according to FC’s Act 93 Compensation Plan, administrators get 5% of grants they sign-off on – a potential $15,000 increase in administrative pay. 


    Can this situation be even more dismal?

    Actually, yes . . . back in May of 2011, near the end of the fiscal year that the administration pulled $229,591 or more from the General Fund to pay for technology, the administration convinced the board that cuts in federal and state funding as well as the low fund balance in the General Fund necessitated the need to furlough teachers and cut vital programs.  (So if the $300,000 was truly grant money, administrators were rewarded with a $15,000 pay increase while teachers and programs were cut.)




    Were the furloughs and cuts necessary?

    In May of 2011, when the curtailment resolution was adopted, there was $229,591 to $300,000 of taxpayer funds sitting in the Technology Fund that should have been transferred into the General Fund and used to retain Fort Cherry teachers and programs.

    Did the administration purposely drain the General Fund of hundreds of thousands of dollars to advance an agenda to eliminate teachers and programs?  (This was also discussed in a previous post:  http://www.fortcherryinfo.blogspot.com/2012/01/shell-game.html)

    FC needs an independent investigation into the credit card abuse as well as a forensic audit into the finances of the district.

    There should be enough money for the audit, investigation, and a playground upgrade as well.


        - - - - - - -

    List of checks written from the General Fund for technology expenditures:

    CHECK NUMBER
    DATE CLEARED BANK
    DESIGNEE
    AMOUNT
    205017
    7/27/2010
    COMPUTER RESOURCES LLS (MMS SOFTWARE)
    $3,475.00
    205033
    7/23/2010
    SUNGARD
    $4,246.96
    205044
    7/30/2010
    WIRELESS GENERATION
    $1,560.00
    205067
    7/30/2010
    ORBIT SOFTWARE INC.
    $2,940.00
    205069
    7/30/2010
    SUNGARD
    $1,297.92
    205144
    8/11/2010
    SUNGARD
    $1,297.92
    205213
    8/31/2010
    CENGAGE LEARNING
    $2,871.99
    205221
    8/30/2010
    DELL COMPUTERS
    $835.14
    205232
    8/31/2010
    ??? SOFTWARE COMPANY
    $1,400.00
    205235
    8/31/2010
    GOV CONNECTION (IT SUPPORT)
    $32,900.00
    205288
    8/31/2010
    SMART SOLUTIONS TECH. (SMART BOARDS)
    $28,125.00
    205301
    8/31/2010
    VERNIER SOFTWARE & TECH.
    $1,098.32
    205337
    8/31/2010
    SUNGARD
    $1,297.92
    205212
    9/2/2010
    CDW GOVERNMENT, INC.
    $13,522.00
    205219
    9/2/2010
    COMPUTER RESOURCES LLS
    $2,622.00
    205262
    9/3/2010
    ONHAND SCHOOLS (SOFTWARE AND TRAINING)
    $22,700.00
    205297
    9/3/2010
    THE UPGRADE PLACE
    $1,045.00
    205423
    9/22/2010
    SMART FUTURES
    $3,250.00
    205435
    9/15/2010
    NEW HORIZONS CLC PGH
    $500.00
    205476
    9/24/2010
    RELIANCE COMMUNICATIONS
    $2,967.25
    205482
    9/24/2010
    SUNGARD
    $1,000.00
    205492
    9/28/2010
    A.V. LAUTTAMUS COMM.
    $167.26
    205495
    9/29/2010
    BOZIC COMMUNICATIONS
    $497.50
    205521
    9/28/2010
    BI TRONICS (PRINTERS)
    $220.00
    205742
    10/21/2010
    QWEST BUSINESS SERVICES
    $19.04
    205560
    10/18/2010
    MICROSOFT CORPORATION
    $349.00
    205565
    10/5/2010
    SUNGARD
    $1,297.92
    205648
    10/15/2010
    ACHIEVE 3000
    $13,105.00
    205650
    10/18/2010
    APPLE COMPUTERS INC.
    $17,134.10
    205660
    10/18/2010
    CDW GOVERNMENT, INC.
    $9,455.50
    205658
    10/14/2010
    CARNEGIE LEARNING
    $12,301.45
    205667
    10/15/2010
    DVS DIRECT
    $15,494.00
    205678
    10/18/2010
    INFORMATION WORKS
    $194.00
    205682
    10/15/2010
    LANCASTER LEBANON IU13
    $3,995.00
    205724
    10/18/2010
    WIRELESS GENERATION
    $5,285.00
    205726
    10/19/2010
    A.V. LAUTTAMUS COMM.
    $75.00
    205780
    10/20/2010
    BOZIC COMMUNICATIONS
    $3,990.00
    205823
    11/2/2010
    CDW GOVERNMENT, INC.
    $994.00
    205883
    11/2/2010
    INFORMATION WORKS
    $1,052.00
    205851
    11/2/2010
    ROSETTA STONE, LTD
    $2,725.00
    205854
    11/2/2010
    SMART SOLUTIONS TECH. (SMART BOARDS)
    $698.00
    205873
    11/4/2010
    BOZIC COMMUNICATIONS
    $62.50
    205891
    11/4/2010
    INFORMATION WORKS
    $179.00
    205913
    11/5/2010
    SUNGARD
    $1,297.92
    205914
    11/5/2010
    SUNTEX INTERNATIONAL (ON-LINE MATH)
    $1,249.50
    205951
    11/12/2010
    CDW GOVERNMENT, INC.
    $7,999.55
    205961
    11/15/2010
    INFORMANT TECH INC.
    $450.00
    205970
    11/10/2010
    PGH TECHNOLOGY COUNCIL
    $99.00
    206003
    11/17/2010
    QWEST BUSINESS SERVICES
    $16.84
    206005
    11/17/2010
    SUNGARD
    $1,280.00
    206011
    11/22/2010
    CDW GOVERNMENT, INC.
    $296.22
    206045
    12/3/2010
    AB CONSULTING
    $111.00
    206047
    11/29/2010
    CDW GOVERNMENT, INC.
    $1,723.00
    206068
    12/3/2010
    CDW GOVERNMENT, INC.
    $23,550.30
    206098
    12/6/2010
    FOLLETT SOFTWARE CO
    $106.67
    206112
    12/13/2010
    INFORMATION WORKS
    $194.00
    206130
    12/9/2010
    SUNGARD
    $1,297.92
    206140
    12/14/2010
    CDW GOVERNMENT, INC.
    $2,271.00
    206155
    12/13/2010
    VISION OFFICE PRODUCTS
    $269.45
    206218
    12/22/2010
    KC DISTANCE LEARNING
    $7,356.00
    206256
    12/27/2010
    BOZIC COMMUNICATIONS
    $725.00
    206259
    12/28/2010
    CIMA SOFTWARE
    $1,018.22
    206269
    1/5/2011
    KC DISTANCE LEARNING
    $836.40
    206333
    1/12/2011
    SUNGARD
    $1,297.92
    206487
    2/1/2011
    BOZIC COMMUNICATIONS
    $4,725.00
    296537
    2/3/2011
    INFORMATION WORKS
    $218.00
    206630
    2/16/2011
    SUNGARD
    $1,297.92
    206698
    3/11/2011
    APPLE COMPUTERS INC.
    $5,609.00
    206703
    3/9/2011
    CDW GOVERNMENT, INC.
    $308.00
    206708
    3/8/2011
    INFORMATION WORKS
    $278.00
    206739
    3/8/2011
    SUNGARD
    $1,349.84
    206741
    3/8/2011
    TREBRON COMPANY, INC.
    $6,443.37
    206852
    3/30/2011
    PROSOFT
    $1,494.00
    206864
    4/1/2011
    BOZIC COMMUNICATIONS
    $275.00
    206892
    4/5/2011
    APPLE COMPUTERS INC.
    $2,003.00
    206896
    4/6/2011
    CDW GOVERNMENT, INC.
    $235.00
    206910
    4/5/2011
    SMARTED SERVICES
    $2,248.00
    206916
    4/6/2011
    BOZIC COMMUNICATIONS
    $512.00
    206926
    4/5/2011
    SUNGARD
    $1,349.84
    206913
    4/5/2011
    VERNIER SOFTWARE & TECH.
    $1,583.25
    206947
    4/14/2011
    A.V. LAUTTAMUS COMM.
    $1,200.00
    206948
    4/14/2011
    BOZIC COMMUNICATIONS
    $684.90
    206970
    4/15/2011
    LANCASTER LEBANON IU13
    $31.50
    207061
    5/4/2011
    LANCASTER LEBANON IU13
    $166.50
    207125
    5/10/2011
    SUNGARD
    $1,349.84
    207150
    5/31/2011
    MONOPRICE, INC.
    $280.20
    207185
    5/17/2011
    BOZIC COMMUNICATIONS
    $326.00
    207250
    6/15/2011
    GREEN SCREEN WIZARD
    $170.90
    207253
    6/9/2011
    INFORMATION WORKS
    $949.00
    TOTAL
    $308,776.66

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