Lake County Fiscal Rangers

Florida Online Virtual Schools Outscore AP Tests from Regular Schools & Cost $2159 Less

Tavares, FL - JN. 23, 2012-  SunshineStateNews.com reports that Florida's virtual online school for K-12 students is getting higher scores on AP (Advanced Placement) tests than regular schools, AND it costs $2159 less than regular schools to do so.

Read and understand...  competition once again hits the union dominated teacher ranks, and shows how well routine tasks can be implemented.   We do know that Florida recently mandated that online classes be given also by local school districts, which means the unions may dominate that new skills area and be a reason for increased costs.

However, we do understand that the online courses may be designed to enable passing tests, but perhaps not on how to think. 

In other words, will we just be getting robots that are good at test taking?   Are online learning software programs also available to teach critical thinking and other non-rote learning skills?  I think so, but that is another story.

http://www.sunshinestatenews.com/story/spending-2159-less-student-online-school-outscores-florida-campuses-ap-exams?utm_source=constantcontact&utm_medium=email&utm_campaign=012312  

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vj

Maryland County's Inspector General to Examine School Budget Systems after Failure to Disclose $14-million Surplus

It seems that School District staff in Montgomery, MD failed to notify County council members BEFORE they approved the new annual budget of a $14.5-million surplus in funds due to savings in employee benefit expenses.

And, they found that the staff knew of the surplus cash before the budget agreements were reached. 

Most times we hear about fiscal fiascos where government agencies later discover more expenses than planned in the budget, but this is a surplus.

Why would they hide the surplus and not disclose it to elected officials setting the budget?

- Plain mistakes.

- Plans to save the funds for some favored project or wage hikes later in the new budget year.

- Prevent elected officials from allocating the funds to projects not supported by staff or other elected officials.

But, by not disclosing the surplus funds, credibility of budget and financial processes and reports from staff are questionable, which is why the County Inspector General (no such position exists in most Florida Counties) decided to review the Districts financial reporting.   Budget methods are NOT standardized like annual financial statements, and it is easy for staff to snafu, or purposely not disclose certain items since independent oversight on budget systems is rare.  

Go to the link to read the Washington Post article.

http://www.washingtonpost.com/local/in-wake-of-surplus-inspector-general-to-examine-budgeting-process-for-montgomery-co-schools/2011/06/17/AGZmISYH_story.html 

vj

Ohio Schools Business Manager to be Sentenced for Bribery, Embezzlement & Theft

I add this article as a case study of one type of corruption possible in local government or School Districts.

In this case, a School District Business Manager apparently was able to embezzle funds from the sale of school owned construction equipment.

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AKRON -- Former Maple Heights schools official Steve Canepa, who most recently worked for the West Geauga schools, will be sentenced Monday in federal court on Cuyahoga County corruption-related counts tied to his former Maple Heights job.

Canepa, 43, of Mantua, was charged with three counts related to bribery, and one each for theft and mail fraud.

He is admitting the theft charge but pleaded not guilty when he was first charged with all five counts. He will appear Monday before U.S. District Judge John Adams.

His attorney, Mark Marein, said Canepa only committed one of the five crimes he is accused of.

Prosecutors claim Canepa embezzled proceeds from the 2008 sale of a boom lift used for construction and owned by the Maple Heights school system.

Canepa resigned from West Geauga on Aug. 23 but had been on medical leave since May. Canepa cited personal matters for his departure and thanked the school board and others for the opportunity to work in the system.

He had resigned from Maple Heights schools in 2009.

 

National Legal & Policy Center Tracks SEIU & Other Union Corruption Cases

We periodically read about union leaders running amok and stealing union funds or committing other transgressions.  In 2009 and earlier, many unions like SEIU were found to be affiliated with ACORN.

And, here is an organization, the National Legal & Policy Center, that TRACKS union corruption and crimes. Below is a link just to a search on the SEIU union, which is a national union, but they are the union for non-instructional workers at Lake County School Systems.  The search report lists the pages and pages of listings of crimes committed by SEIU members across the country.

No corporation would have such a track record among their branches or stores, but it seems the SEIU tolerates these antics and doesn't implement stronger policies and procedures to keep the crooks out. 

I don't have any evidence of wrongdoing in the local SEIU at the Lake County School District, but if I was a Lake County member of SEIU, would I be comfortable providing my support and dues to a national union with the constant problems listed at the link below? (or just go to www.nlpc.org and find the reports and search on SEIU )

http://www.nlpc.org/category/keywords/service-employees-international-union-seiu

vj

Education in China stretches just to get everyone to 9th grade

So you think education in Florida is bad, and underfunded.

Here is a link to the Chinese government website on education strategy. To them, they are still trying to bring much of the rural population up to only 9 years of education. Only some 43% of the Chinese population has been to high school. Read some of the linked pages - very interesting.

By the end of 2004, China had 2,236 schools of higher learning, with over 20 million students; the gross rate of enrollment in schools of higher learning (college - 13th year and beyond) reached 19 percent. Postgraduate education is the fastest growing sector, with

Drastic Hikes in Florida Unemployment Insurance Start January 1, Reducing Funds for Other Agencies

Most Florida businesses will get an unexpected hike in employee unemployment insurance taxes starting January 1, 2010.   This problem will cascade into another fight for the total remaining Florida tax revenues, thus reducing the remaining funds for other agencies, including Schools, etc.  (and, remember, Charlie Crist just approved the $600-million SunRail system, which will also compete for funds.  Additionally,if Obama's health plan passes, it mandates drastic hikes in Medicaid payments for Florida and other states that have low Medicaid payments, thus that will "suck" more funds out of Florida State cash).

Below is a briefing sent out by the Eustis Chamber of Commerce that gives a good description of the tax hike, which significantly increases

Update on Monroe County (FL) School District $180,000 Grand Theft & Fraud case

Below is a follow up article on the $180,000 fraud case in Monroe County in the School District.
- People are calling for the resignation of the School Supt because his wife is accused.
- High School students running for office are doing so on a "fiscal integrity" ticket.
- They are barely starting investigation into misuse of school credit cards...

This is a good example of how ignoring cash and finance controls at a school, possibly due to nepotism,  can really cause problems not only for a School District Board but the Superintendent.

Note:  In the Lake County (FL) School District, there have been two past audits of school accounts where it was found that Lake County high schools had very poor controls over game tickets.  They could not match the ticket "sold" count to the cash collected.   I was in the audit committee meetings for one of the audit presentations, and we tried to get the issue added to the personnel file for the Principals who ignored earlier audit findings, but it went nowhere.  The problem was that if you cannot account for serially numbered tickets "sold" or distributed at football games, etc. then it means either someone is stealing some of the cash collections, or they are giving free tickets to friends or VIPS without accounting for them.  (I once was an auditor for the County of Los Angeles and their golf courses, which had the same problem).  I don't know what happened in the most recent audit of school accounts, but I bet there wasn't much improvement, since the period in question would have been while Anna Cowin was superintendent.  Hopefully the new administration will take cash controls over game tickets more seriously and fix the reported weaknesses.   One weakness under Cowin was that the CFO didn't seem to have authority over cash controls at schools, when that should be the normal practice.   My recommendation to the current Board and Administration:  Don't mess around, and ensure proper cash controls are in place in all schools (inlcuding Lake Tech), including installation of safes to put funds into (which was another earlier recommendation that may or may not have been implemented).
vj

Florida School District Superintendent's Wife Skims $180,000

Updated May 1, 2009 to better explain weak vs strong cash controls that should have been used.

vj

Florida School District Superintendent's Wife Skims $180,000

In our never ending quest to find examples of poor or weak government financial practices, here is another one regarding a school district, and some lessons we can learn from it.

Nepotism struck a Miami area School District big time when the wife of the Monroe (FL)County School Superintendent allegedly skimmed $180,000 from fees PAID IN CASH for an adult cosmetology class she ran, and also by improperly using a school district credit card over many years.

Magically, the lady flew away to North Carolina right after the finance director started asking some questions, and they are trying to get her to fly back.  And, they haven't been able to get the husband and Superintendent to come in for an interview...

This illustrates how important it is to have quality internal controls and audits, AND GOOD CASH AND COLLECTION CONTROLS especially when any employee related to high ranking school district administrators have access to ANY funds or assets.  In a well controlled environment, any fees for classes would be paid directly to a separate finance office, which provides a receipt that would be good for the class.  Imagine if police were allowed to collect traffic fines on the spot in cash, and the police only reported  what tickets they wanted, but instead you get a ticket and must pay it at the county clerk to ensure payments are received. 

But in this case, the District let students pay CASH for classes directly to the instructor who apparently kept it in her desk (and didn't turn most of it in).  The Board needs to have hearings to investigate why an instructor was allowed to collect cash fees for classes without requiring that payments be made to a separate department like Finance, and why the number of enrollees were not compared to the expected fee income for that number of students.  Those are both common financial controls that should have been used.

And, let's talk about nepotism here.   There always seems to be a tendency for employees to "overlook" or avoid reporting transgressions by other employees who are connected to, or related to senior officials.  This is why you need a confidential reporting hotline, AND a very strong audit and financial controls program to ensure this doesn't happen.   I have seen this happen three times, and in two of them, the senior individual was fired as well as the transgressor.

Read the full article at the link below.
vj

Favorite quotes:

Acevedo also could face more charges at the conclusion of an investigation of the school district's finances by the State Attorney's Office, state and local law enforcement, state school auditors and an auditor hired by the school board.

''Absolutely, there probably will be a few more charges that come out of it,'' Ward said. ``We have not even started looking at credit card spending and purchase orders. There also could be obstruction charges.''

In less than two years, Acevedo spent more than $95,000 on her school district credit card for items she claimed were for valid school purposes. The list included: pink silk ties, bar stools, spear-gun accessories, a table saw, a chandelier and the complete DVD box set of Six Feet Under.

''Were there dishonest people who looked the other way?'' he (an officail) said. ``We still don't know how the catastrophic breakdown occurred.''

Louisiana School Board District Scammed out of $8.6-million

Here is one of our continuing collection of articles on how many ways School Districts fail to prevent fraud and corruption. 

This one is in Louisiana and the School Board Lost $8.6-million. 

Favorite quotes:

"The five were named in an indictment charging them with defrauding the school system of $8.6 million for air-conditioning contracts over a four-year period. Federal investigators say the school district was charged for more expensive air-conditioning equipment than was installed, for equipment and installation in nonexistent rooms, for amounts in excess of the contract price and for replacing units that were functioning properly."

"Wilson and Lee are accused of overcharging and fraudulently billing the school system, while Johnston, Rhodes and Rowes are charged with falsely certifying the right equipment was installed and approving invoices for payment that included false information."

My new mantra is: 

Professional "Educators" should be embarrassed over their profession's inability or unwillingness to implement well known financial and accounting controls to prevent these types of frauds and scams.
vj

Corrupt Chicago Proves Again They Should NOT be Allowed to Have Taxpayer Funds

This is too good.  This is not only a report of fraud, but just dumb government spending of taxpayer funds.  We focus not only on government agency fraud but mis-management, and it is clear that the Chicago School District is getting too much income

It seems the Chicago School District's Inspector General received 1,012 complaints about waste, fraud and mismanagement regarding the Chicago School District.  In one of them, a Chicago School District manager went out and paid $70,000 for 30 espresso machines for work-school programs in high schools, and five months after the purchase, 22 of them were still unpacked and in the boxes.  Additionally, the managers involved bypassed purchasing controls to avoid required approvals, and thus also overpaid $12,000 for the machines. 

The article below also lists some other Chicago School District fiscal blunders, and they get the FiscalRangers.com Fiscal Fiasco award for the week!   You can visit the Chicago School District Inspector General's webpage HERE and download their 2008 annual report which contains more details on all the fiascos.
vj

Favorite quotes about Chicago and the School District mis-management

The inspector general's office had 1,012 complaints alleging misconduct, waste, fraud and financial mismanagement in the district. Of these, 940 cases were closed with many resulting in recommendations for termination and some for criminal prosecution.

In its FY 06 Annual Report, the OIG reported on an investigation which revealed
that during a five-year period, a CPS employee wrote 319 school checks to
herself. The checks, totaling $456,554.67, were cashed by the employee or
deposited into her personal bank account. The employee resigned during the
course of the investigation and the matter was subsequently referred for criminal
prosecution. In FY 07, the employee plead guilty in criminal court and began
paying restitution. In FY 08, the former employee was sentenced to four years in
prison after having paid $78,000 in restitution to CPS.