Decatur Township Schools Looking for New CFO

Well, once again, alert posters on this blog have shed light on what is happening in the MSD Decatur Township administration building.

Now posted on the district's website, is a job listing for Chief Financial Officer. The job is to be posted from January 21 through January 31. Robert Harris is still listed as the district's CFO on the site. The School Board held it's regular meeting on January 11 and a work session on January 13. Posters to this blog inquired after the business manager beginning on January 12.

Good job, alert poster !

MSD Decatur's New CFO - Salary on the Rise

Bob Harris was hired to overlap with the departing Jeff Baer as Assistant Superintendent of Business for the Decatur Township School District. At the time, Don Stinson, Superintendent of the District, told the Mooresville-Decatur Times that Harris would be paid $15,000 less than Baer; yet another cost cutting measure implemented by the phenomenal Don Stinson.

As I reported in an earlier blog entry ("Most Administrators Saw Increase in Salary and/or Benefits"), the actual difference in salaries, according to documents the District submitted to the State Board of Accounts, was $11,500.

Well, the gap is closing. The limited contract information received by a private citizen who requested the records (see "Jeff Baer Without a Contract Since 2006 - Really?"), and which they provided to me, shows that in February Bob Harris managed to get a raise.

The public document provided for the Harris contract was a 'Contract Worksheet' covering pay periods 2/12 through 6/30 2010. The annualized salary is now $130,533. What the SBOA document showed was an annualized salary of $128,927. So, congratulations go out to Bob Harris, who now makes only $9,936 less than Baer. Can't wait to see what his next contract looks like !

MSD Decatur Township Administration Play Blame Game in Audit Response

The most recent audit of the MSD Decatur Township books (spanning July, 2007, through June, 2009) by the Indiana State Board of Accounts reveals one of the hallmarks of the school district's Administration - blaming somebody else for their failures.

All findings of the SBOA audit team are presented to representatives of the governmental unit prior to publication of the audit. Any response to the findings by those representatives is included in the final document in the form of a letter attached at the end. This letter and its contents are not reviewed by the SBOA for the sense or nonsense of its contents; it is simply attached at the end.

I have previously noted how the audit found sloppy bookkeeping and the Administration response to that. Here I would like to focus on the audit findings that the district spent more money than the School Board appropriated and that the district overdrew several fund balances.

Here's what the audit says about spending more than was appropriated:

The records presented for audit indicated the following expenditures in excess of budgeted appropriations:

Fund	Year Expended	Excess Amount
Debt Service	2008	$ 1,282,858
Transportation	2008	938,408

A similar comment appeared in prior Report B32087.

IC 6-1.1-18-4 states in part: ". . . the proper officers of a political subdivision shall appropriate funds in such a manner that the expenditures for a year do not exceed its budget for that year as finally determined under this article."

As noted above, the district spent more than the School Board appropriated in earlier years, as well. In fact, for the 4 years preceding the two years covered in this audit - I noted this in my blog entry "Decatur School Administration Broke State Law by Spending More From Funds Than Had Been Appropriated by Board" - they also over spent. The process of budget review and appropriation of money for specific purposes is a state mandated process intended to keep the review and expenditure of taxpayer money in the public eye. If, during the year, more money becomes somehow available, the district needs to go through the process for those added monies in order to spend it legally. Yes, it is a violation of state law to spend more than the School Board appropriates - but, unfortunately for the Decatur public, this is not unusual in our School District.

The SBOA had this to say about overdrawing funds:

The following funds were overdrawn at June 30, 2008: Debt Service, Retirement/Severance Bond, Local Rainy Day, Construction, Vehicle Repairs/Misc., Textbook Rental, Challenge Learning Center, DTEF Small Grants, GQE Remediation, Early Childhood Center Preschool, Star Grant/DCHS, DWD Biomedical Science Grant; Title II Part A, and Reading First 2008-2009.

The following funds were overdrawn at June 30, 2009: General, Debt Service, Retirement/Severance Bond, Special Education Preschool, Construction, Vehicle Repairs/Misc, Textbook Rental, IMI 2007-2008, Challenge Learning Center, DTEF Small Grants, Early Childhood Center Preschool, School of Ideas, Title I School Improvement, Title III English Lang. Acquisition, Title II, Part B Math and Science.

A similar comment appeared in prior Report B32087.

The cash balance of any fund may not be reduced below zero. Routinely overdrawn funds could be an indicator of serious financial problems which should be investigated by the governmental unit. (Accounting and Uniform Compliance Guidelines Manual for Indiana Public School Corporations, Chapter 9)

Now, I didn't go into it before, but this criticism was also leveled at the Decatur School District in the audit that spanned July, 2005, through June, 2007. At the end of the fiscal year (June 30) 2006, there were 7 funds overdrawn leaving a negative balance. At the end of fiscal year 2007 12 funds were overdrawn. And this audit reveals that at the end of fiscal year 2008 14 funds were overdrawn and at the end of fiscal year 2009 15 funds were overdrawn.

The response letter to this audit's findings was signed by Superintendent Don Stinson and the Chief Financial Officer signature is hard to read, but might be Robert Harris, Jeff Baer's replacement. The parts related to appropriations and overdrawn fund balances reads:

Appropriations;

The records presented indicated expenditures in excess of appropriations. As a result of the mandated reassessment in 2007, Marion county has been woefully behind in property tax collections and distributions to the units of government. Therefore, the budgets for this audit period were approved by the State of Indiana over one year late. This means that the budgets for M.S.D. Decatur were approved after the year ended. Obviously, there will be overspending in some funds when the budget is approved "after the fact". Hopefully, going forward, Marion County property tax collections and distributions will be timely thus ending this issue.

Overdrawn Cash Balances;

There were overdrawn funds during this audit period. Once again, because of the 2007 mandated reassessment, Marion County was delinquent in their property tax distributions to the units of government. Even after excessive borrowing, there will be funds that are overdrawn because of late distributions from the county. As was stated above, the funds were received as much as one year late. Timely property tax collections and distributions from the county will remedy this situation.

It cannot be ignored that these two problems are chronic problems in the MSD Decatur Township and did not begin with the state mandated property reassessment ordered in 2007. More importantly, they attempt to lay the blame for these two problems on somebody else. So, lets look at their logic more closely.

The School District drafted a budget for the two fiscal years 2008 and 2009. They would have received guidance from the State Department of Local Government Finance for how much revenue to expect from property taxes - even though the property taxes would be collected late and sent to the district late. Using this guidance, the district not only knows how much to budget, it knows how much to borrow in a 'temporary loan' or 'tax anticipation warrant'. With all of that information in hand, the School Board appropriates the money that may be spent in each fund.

But, the district spent MORE money than the budget called for. That has nothing whatsoever to do with late property tax collections. They spent MORE money than the budget called for. The funds balances were allowed to go negative. They spent MORE money than the budget called for. It doesn't matter when the DLGF certified the budget - the budget was approved and the money appropriated by the Decatur School Board before they spent MORE money than approved and appropriated.

Stinson just wants to blame anybody else that he can. This excuse doesn't hold water.

Its just like when I asked about the temporary loan included in the retirement pension fund (see "And They Wonder Why...") and they said it was a coding error by the Department of Education, and after being called out on that statement by the DOE they blamed it on some person who no longer works for the District.

Its just like the former Concentra building. First the public was told that they weren't buying the building, just leasing some space. When pressed further, they said they were leasing to own, but it would be relatively inexpensive to turn it into an elementary school; that was the reason to buy it. Now we are being told that they can't think of selling the building even as they lay people off, because the economy is sour. When the solid truth all along has been that Stinson and his cronies don't want to be in their tiny offices in their tiny Central Office; they want to move into the fancy building across the street and impress people.

It is just one thing after another with this Administration. And they always have a poor excuse or have somebody else they would rather the public blame. Well, I don' think the public is buying their excuses and finger pointing any more. The SBOA audits have provided us with enough concrete information to know that it is time for a change in the way this School Board and the Administration do things.

MSD Decatur Township Administration Reaction to Fiscal Mess - Part 1

Its going to take a couple of blog entries to lay out the response of MSD Decatur Township Superintendent Don Stinson to the looming fiscal crisis over the past few years. The bottom line will be that Stinson saw the crisis approaching, but spent money irresponsibly anyway.

The following was posted as a comment to my blog entry "Let's Back Up and Move in a Different Direction" by anon 8:01 on March 10. Anon 8:01 posted a letter to the public from Don Stinson, followed by their own comment. I'd like to start this series with that March 10 comment.

April 8, 2008
Dear Parents, Guardians and Community Members,

I want to make you aware of a serious situation facing our school district. The Indiana Legislature has put a cap, or circuit breaker, on the Transportation, Capital Projects, and Debt Service Funds of school districts. This measure could mean a loss of more than $2,000,000 in the school years of 2008-09 and 2009-10 to the MSD of Decatur Township.

In addition, the tax reassessment in Marion County this past year has resulted in delayed payments to the schools from the state. This delay in payment made it necessary for public schools to borrow money to pay regular expenses. The interest alone on these short term loans for Decatur schools amounts to $900,000 for 2007 and $1,500,000 for 2008.

We need to reduce more than $2,000,000 out of the 2008-2009 budget now. In order to meet this goal we have to reduce expenditures in all areas of the school district’s budget.

Unfortunately, this necessary restructuring will include cutting both staff and programs. It will mean eliminating some things that will upset people and change some services that we have come to expect. I have been taking suggestions and listening to different groups to get ideas and suggestions on how to reduce our expenses. In our ongoing effort to decrease expenses and save classroom positions, we have reduced administrative positions from 38 in 2001 to 33 this past year.

I want you to be aware that these are not easy days or easy decisions. We recognize that we are a publicly funded institution and must operate within the parameters that we are given. We want to reassure you that none of these changes will have a negative impact on the education that your child receives from the MSD of Decatur Township. This is a challenge but we refuse to give up the Journey Toward Excellence for our young people.

Please feel free to call me at 856-5265 or email me at stinson@msddecatur.k12.in.us. You can also reach me through the district website: www.msddecatur.k12.in.us.

Sincerely,
Donald H. Stinson
Superintendent
Metropolitan School District of Decatur Township
5275 Kentucky Avenue Phone: (317) 856-5265
Indianapolis, Indiana 46221 Fax: (317) 856-2156

This letter was sent in April 2008 just two months before he and other administrators were given a 4.5% raise in salaries. This letter verifies that there were financial problems long before the economy went downhill. The fact that he and the board raised salaries knowing full well that they didn't have the $$$ is unreal. He and others continued to travel around the country and eat high on the hog.

Anon 8:01 is absolutely correct. On 6-10-08, the Decatur School Board approved an across the board 4.5% raise for all Administrators (click here to read the minutes for yourself). Here is the section related to the raises:

Mr. Stinson reviewed the fiscal restructuring efforts that have taken place which includes a reduction in force of six positions for teachers. Due to attrition it is not necessary to eliminate any support staff positions. He recommended to the Board a fiscal restructuring proposal for nonpersonnel items totaling $2,143,716. The proposal includes 4½ % increase for administrators and support staff equal to the 4½ % approved in the Master Contract with the Decatur Education Association.

So, after they RIF'd 6 teachers, allowed support staff numbers to drop through attrition, they had the unmitigated greed and financial irresponsiblity to gave the Administrators and remaining support staff a 4.5 % raise. The proposed 5% cut in Administrator salaries contained in Stinson's Fiscal Restructuring Plan, presented in January of this year, was estimated to save $191,215. Using the numbers presented in that Plan, I conservatively calculate the 4.5% raise has cost a minimum of $344,000 over the past two years.

Although they had RIF'd 6 teachers, somewhere around March or April of 2009, they hired School Board member, Don Huffman's, grandson Jason Dixson to become head football coach, which required also hiring him in as a teacher. Dixson's salary is $49,343, as disclosed in the 2010 form 100R filed by the District with the State Board of Accounts. The former coach, Tim Able lost $12,000 in salary. This would result in a net increase of $37,343.

Since this letter went out, they also hired Bob Harris to not just replace Jeff Baer as Assistant Superintendent for Business, but to overlap with Baer for 6 months at an annual salary of $128,927 plus whatever benefits. It is not usual to pay for an overlap in an Administrative position and it cost the District over $64,000 to do so.

Since this letter went out, they also created two 'Building Director' positions that are somewhere between teacher and administrator positions. This caused an increase in salary between the two of roughly $24,700. (from form 100R)

Since this letter went out, and after the 4.5% raise in 2008, they gave Debbie Sullivan a raise of $14,498, Jeff Baer a raise of $4442, Nan Wiseman a raise of $3390, and Robert Kehrein a raise of $2559, plus an overall raise in cash and/or benefits of $1450 per Administrator (see "Most Administrators Saw Increase In Salary and/or Benefits"). This information, too comes from the forms 100R submitted by the District to the SBOA. Just the 4 raises noted first, total $24,889.

This is just what I have been able to find by reading the minutes and obtaining public records from the SBOA. It totals over $150,000 in increased expenditures, NOT including the 4.5% raise Administrators got two years ago, NOR the overall increase in cash and/or benefits they received last year.

Bottom line : Stinson saw the fiscal storm coming and continued to pad Administrator positions and their salaries.