Public Education: Don’t forget the taxpayers

by John Washington on May 16, 2018

The scandal-plagued Scottsdale Unified School District just hired an interim superintendent, Dr. John Kriekard.

Dr. Kriekard was a longtime educator, principal, and assistant superintendent within our district, and served as superintendent of the Paradise Valley Unified School District.

Kriekard sent out an encouraging communication today:

May 16, 2018

Good Afternoon, SUSD Family,

Today marks my third day on the job as your new Acting Superintendent. This has been a homecoming for me, and I want to say a heartfelt thank you to all of you who have already extended such a warm welcome back.

As we approach the end of the school year next week, all of our focus is on a successful home stretch for our students. However, before we break, I want to share with you some of the work that will be underway this summer.

My first priority will be to restore mutual trust and confidence at all levels and among all stakeholders: students, teachers, parents, staff, administration and Governing Board. Rebuilding trust takes time, and this will be an ongoing commitment.

Additionally, SUSD will need to examine, and possibly audit, our Human Resources and Purchasing/Procurement practices. In conjunction with those reviews, it is one of my top priorities to oversee the selection and hiring of some critical personnel, including an exemplary Chief Financial Officer.

I believe successful schools and districts do three things:

  1. Treat students with respect
  2. Treat staff as professional colleagues
  3. Treat parents as partners in their students’ education

These three things are our way forward to rebuilding respect and professionalism – two words you will hear me say often. I look forward to the work ahead and to serving your students.

Sincerely,

Dr. John Kriekard
Acting Superintendent

I replied:

Dr. Kriekard,

I humbly suggest a small addition to your messaging today.

Students, staff, and parents all deserve the respect you offer. However, in today’s  environment, it’s important to remember another group of SUSD clients: Taxpayers who may not fall into one of the three aforementioned categories.

There was a time when taxpayers with no other direct involvement in public schools appreciated the benefits of good public education. Today, those benefits are increasingly esoteric to the masses.

I suggest we all adopt a mindset and language to help remind them–and us–of the mission of public education. To that end, a fourth point:

4. Treat taxpayers of the district with respect for the funding they provide. In return, we will strive do our best to shape future generations of productive, thoughtful, fellow citizens, neighbors, and community leaders; who will help maintain and enhance our property values and our quality of life.

Good luck to you, sir. You have a big job ahead of you, and many in the community are very hopeful you will succeed!

_____________________________________________

John Washington

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Accounting is Complicated, Accountability is Not

by John Washington on May 15, 2018

Former SUSD CFO Laura Smith

The latest shoe to drop in the ongoing Scottsdale Unified School District fraud carnival is the criminal indictment of former CFO Laura Smith.

As the person most directly responsible for the financial health of the 23,000-student district and its $170+ million budget, Smith was simultaneously on the payroll of a company she owned with her sister, and which was a vendor to the district. She directed, approved, and inflated nearly $87,000 in SUSD payments to the company, according to Arizona Republic reporting by Yihyun Jeong.

On Monday (5/14/2018), the Arizona Attorney General publicly announced that a grand jury has indicted Smith on two counts of fraud, along with nine counts of violating Arizona’s conflict of interest laws for failure to disclose her ownership of the vendor company and her family relationship to the other owner.

Former SUSD superintendent Denise Birdwell

Like other key SUSD administration leaders, Laura Smith was handpicked for the job by former superintendent Denise Birdwell, based–it appears–on their service together in the scandal-plagued Higley Unified School District.

Birdwell was recruited to SUSD by governing board member Pam Kirby and hired by unanimous vote of the board (including board president Barbara Perleberg, vice-president Kim Hartmann, and members Alyson Beckham and Sandy Kravetz).

The board also approved the hiring of Laura Smith; as well as Louis Hartwell (the brother of Birdwell’s domestic partner, which was not disclosed) as COO. More on Hartwell momentarily…

Taxpayer/parents discovered and revealed to the board in June 2017 (almost a year ago) Laura Smith’s conflict of interest. Yet the board not only ignored those concerns, they actively praised Smith’s performance in spite of them.

SUSD Governing Board VP Kim Hartmann

In a board meeting in December 2017, board VP Kim Hartman said,

“I grew up with…some of the most talented people in the [accounting] industry, and I believe you [Laura Smith) are among them. You and I have spent much time together, looking at the numbers…and I have 100% confidence in what you are doing…it’s very complicated, and accounting systems, particularly public school accounting systems are not that user-friendly, and we spent hours looking at them together, and I just want to thank you for the outstanding work you are doing…”

Yet, just over a month later, at the end of January 2018, that the board crumbled under intense media scrutiny, and finally separated Smith from her control of district finances by placing her on administrative leave. It’s not clear how much damage Smith did in the six months after the board was informed of the conflict of interest.

Smith subsequently resigned when it became clear the board wasn’t willing to risk the remnants of their credibility to save her.

SUSD interim CFO Doug Virgil

After only a few days on the job as Smith’s replacement, interim CFO Doug Virgil identified millions of dollars’ worth of errors in the SUSD budget. For example: a $2,398,492 expense was mistakenly double-entered (see the 5/10/18 board meeting). So, yippie, we have $2 million bucks we didn’t know we had!

And Virgil educated the board on approximately $41 million in cash reserve funds (mostly for self-insurance within Fund 550) that they didn’t know about. See the SUSD board meeting video from 4/3/2018 starting at about time index 3:40. Gee, I wonder why Laura Smith never explicitly reported them to the board? And in fairness, it seems like her predecessors never did, either.

Virgil emphasized that these funds and their balances are reported in the Comprehensive Annual Financial Report. So if the board members had ever actually read the CAFR for themselves, they might have seen it and asked questions a lot earlier.

And, by the way, Pam Kirby’s feigned surprise and concern about these funds belies the fact that she was told about them months ago by a concerned parent/taxpayer.

Doug Virgil also referenced “money on deposit” with “trust-like” entities, for which I have never seen any reporting. Such entities presumably include the Arizona School Risk Retention Trust, to which I’ve submitted several public records requests but have yet to see the documents.

As far as other SUSD administrators, Birdwell and Hartwell are already gone, having negotiated payoff from the board subsequent to charges of taking bribes (Birdwell) and faking work history (Hartwell). My money is on Hartwell being the next to be indicted, as the AG and the grand jury work their way up the food chain by squeezing the canaries.

So, in summary, I’m sure accounting IS complicated, especially for a budget the size of SUSD’s. But account-ABILITY is not that hard. It’s actually quite simple: Follow the rules (laws and policies), err on the side of transparency, and don’t tolerate those who do otherwise.

The board tolerated the behavior of Birdwell, Smith, Hartwell and others for far too long. It’s time the board accepted responsibility for their inaction by resigning. Of course, I’m not backing off my longstanding assertion that at least some of the board members knew exactly what was going on and may have participated in the malfeasance. Stay tuned…

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Developer Dishonesty? Say it isn’t so!

May 14, 2018

Vicki Falen and her husband Dana live in the Montana Ranch community south of Shea Boulevard at roughly 117th Street. Late last year an adjoining parcel which was similarly-designated as rural residential, was rezoned via “major general plan amendment,” by mayor Jim Lane and the Scottsdale city council to commercial use, for a developer who […]

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Quote of the Day: Confident Ignorance

April 16, 2018

Ignorance more frequently begets confidence than does knowledge. Charles Darwin (1809–1882), English naturalist who authored the unifying theory of the life sciences.

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What the public isn’t told about high-performing charter schools in Arizona – The Washington Post

April 2, 2018

“In 2015-16, only 1.23 percent of the students at BASIS charter schools had a learning disability, as compared to 11.3 percent of students in the state. BASIS schools had no English Language Learners. And in a state in which over 47 percent of all students received free or reduced- priced lunch, BASIS had none. Although […]

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Quote of the Day: Action

March 30, 2018

Action is the only Truth. Marcus Aurelius, 121 AD to 180 AD, the last of the so-called Five Good Emperors of Rome. His death marked the end of the Pax Romana and the beginning of the eventual fall of the Western Roman Empire. (via John Groseclose)

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Charter school real estate

March 27, 2018

McCarty said she is in the process of selling the school buildings to another charter school operator.

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Scottsdale proposes 35 year/$35 mil lease of Papago complex from Phoenix, to keep Giants in the Valley (no cost to Phoenix) – Story | KSAZ

March 26, 2018

One of the most ridiculous proposals I’ve heard from a city full of ridiculousness. The proposed plan involves the City of Scottsdale leasing the complex for 35 years and spending $35 million along with the Giants to upgrade the facility, adding a parking lot and also improving hiking trails in the area.”The Giants will have […]

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Scottsdale schools chief Denise Birdwell hired friend’s family in Higley

February 26, 2018

Among criticisms of Scottsdale schools chief Denise Birdwell is that she hired the brother of a close friend. In Higley, she hired the friend’s son. — Read on www.azcentral.com/story/news/local/scottsdale-education/2018/02/26/scottsdale-schools-chief-denise-birdwell-hired-family-close-friend-higley-school-district/365651002/

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Satanists Sue Scottsdale Officials Who Rejected Their Invocation Request

February 24, 2018

This was a crisis of Jim Lane’s own making. The mayor controls the agenda for the city council meetings, and Lane approved the Satanists and put them on the agenda BEFORE his scripted outrage. You think invocations don’t matter? The Scottsdale City Council members changed the rules to prevent Satanists from speaking. — Read on […]

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