DECATUR : Three workers to give account of school funds
Posted on Wednesday, July 23, 2008
URL: http://www.nwanews.com/adg/News/232099/
The Benton County prosecuting attorney on Tuesday subpoenaed three Decatur School District employees to answer questions related to the district’s finances.
Prosecuting Attorney Van Stone said he issued subpoenas to secretary Terri Burden, School Board President Mike Wilkins and Superintendent David Smith, whom the School Board suspended and replaced with Decatur High School Principal Bobby King.
A fourth subpoena was served to Candy Brown, who is employed with American Check Cashers in Bentonville, Decatur Police Chief Terry Luker said.
On July 31, the Arkansas Board of Education will consider annexing the 580-student district into neighboring Bentonville, Gravette or Gentry. The state board voted July 14 to place the district on its financial distress list.
The Arkansas Department of Education recommended the annexation after its calculations showed the district would close the fiscal year that ended June 30 with a $ 60, 000 deficit and the 2008-09 fiscal year $ 600, 000 in the red.
Stone said a conversation with the officials from the state’s Legislative Audit Department prompted the investigation. The department reviews the finances of Arkansas’ 245 school districts annually. He wouldn’t say if other district employees would be questioned or what might re- sult from the investigation.
“We’re trying to gather all of the facts,” Stone said.
Information presented to the state board July 14 showed approximately $ 2. 4 million in checks that hadn’t been recorded, bank accounts that hadn’t been reconciled for three years and unfiled Medicare deductions and federal payroll taxes.
District bookkeeper Tina Murray resigned in June. Stone wouldn’t say whether Murray would be questioned.
Administrators and School Board members have said that they were unaware they were operating in the red until the end of the school year, when the state Education Department froze school accounts in response to a projected deficit.
“As numbers came across our budget reports, we got numbers that said we were operating in the black,” King said earlier this month.
The district’s latest financial statement shows Decatur’s operating fund ending the year with a negative balance of $ 1, 374. 56, consultant LeRoy Ortman said at Monday’s School Board meeting.
If additional adjustments were made, the school could end the year with more than $ 30, 000, Ortman said.
Some bills were coded so that money came out of the district’s general operating fund instead of the category funds designated for items such as building projects. School officials received permission from the Legislative Audit Committee to transfer the money out of the specific funds into the operating fund, bringing up the ending balance, Ortman said. Community members and parents raised about $ 136, 000 through barbecues and fundraisers, and another $ 100, 000 has been pledged to help keep the schools open. Larry Hunter, deputy legislative auditor for educational institutions, said his division generally seeks documents related to district finances, but formal investigations of district employees are rare. He wouldn’t comment on ongoing investigations in Decatur.
To contact this reporter: eblad@arkansasonline. com —————— • ——————Information for this article was contributed by Janelle Jessen of the Decatur Herald and Tracy M. Neal of the Benton County Daily Record.