(VIA E-Mail and oral testimony to School Board on February 23, 2017)
Fairfax County School Board
Thank you for your willingness to listen to and read my comments about the audit committee, plus hiring an Inspector General for the Fairfax County Public Schools (FCPS) and the School Board.
The public has lost confidence in FCPS and the School Board, as evidenced by the vote against the meals tax. The tax was supposed to go mainly to the school. It was supported heavily by the school and the county government with mail to all voters.
Firing the Auditor General and the assistant last year and not announcing why you did not replace them adds to the mistrust. The financial people in the school would not tell me why the auditors were fired. There’s not a real watchdog or openness by the school or the School Board.
No official watchdog identified the possible conflict of interest in the school’s contract with the future employer of former FCPS Superintendent Dr. Karen Garza. Anna Urman presented the information to you on February 9 and published it in the Fairfax Free Citizen on February 11. Did the audit committee do a report on this and put it on the web site? I can’t find it.
It is even difficult to find the reports from the previous auditors and the audit committee. They are buried on the website.
The audit committee should have an independent, expert majority of members from the public. The public needs to have confidence restored in the school and School Board. Otherwise the unresponsiveness to the public of the current incestuous relation between the School Board and the management of the schools will encourage distrust and resistance to funding school programs. In the meeting of the School Board and the Board of Supervisors (BOS) last Wednesday, it became clear the county is unwilling to increase real estate taxes and provide the funds the School Board wants.
Not only are the voters in the county resisting more taxes, they are also upset about peripheral Democrat agenda items like putting transgender boys in girls’ showers. Now the Federal government has eliminated the threat of removing funding, if transgender boys are not allowed to shower with girls. The School Board should remove this infuriating and dangerous requirement.
One way to restore trust is to establish the post of an Inspector General (IG). In the United States, there are numerous IGs at the federal, state, and local levels. One is desperately needed at FCPS.
An IG would lead a staff charged with examining the actions of FCPS as a management reviewer of their operations:
- to ensure they are functioning in compliance with generally established policies of the FCPS and School Board;
- to evaluate the effectiveness of security procedures;
- to discover the possibility of misconduct, waste, fraud, theft, or certain types of criminal activity by individuals or groups related to FCPS, involving misuse of funds, bank loans, and trade credit;
- to identify and evaluate unethical actions;
- to review and evaluate the accuracy and seriousness of complaints by students, teachers, other FCPS employees, employees of Fairfax County Government, members of the Board of Supervisors, and the public;
- to highlight sole source procurement contracts and evaluate whether the contracts could have and should have been bid competitively;
- to evaluate the detrimental effects of FCPS and School Board policies and procedures;
- to assess whether relevant laws and regulations have been violated and/or not followed;
- to identify conflicts of interest; and
- from time to time, as the IG considers appropriate, to send reports to the audit committee, the management of FCPS, the School Board, the Board of Supervisors, the public, and local newspapers. Complaints and suggestions by the public should be published.
An internal auditor has different functions:
- to review operating results for accuracy,
- to verify financial records,
- to evaluate the adequacy of internal controls,
- to assist with increasing the efficiency and effectiveness of operations and,
- to detect fraud and misappropriation of funds.
The School Board/Auditor General position description is described in a January 2017 statement. It does not provide for adequate independence for reviewing management policy and proposed budget review. An IG should have that independence.
An internal auditor can identify problems, and aims at correcting lapses before they are discovered during an audit by the external auditor. The FCPS top management and School Board members reportedly are not subject to audit; they should be. Although the internal auditors are FCPS employees, they normally do not audit themselves or their own departments, but should entrust it usually to an IG and the FCPS external audit firm, Cherry Bekaert.
Chris Horton published a good comparison between an IG and an Auditor General on June 13, 2014. To oversimplify, an IG is a management and policy critic and an Auditor General is a bean counter.
The FY 2017 Annual Audit Plan is useful. However, it does not provide adequate latitude for the Office of the Auditor General to use discretion on what areas should be audited and how. The Auditor General, who is supposed to be a qualified accountant—not the current temporary HR person, should be able to propose an audit activity. If the School Board refuses the proposal, the reasons should be put on the website in detail.
The School Board Audit Committee should review the reports of the internal auditor and post the audit reports and Audit Committee’s comments on the website where they can be found easily. The management of FCPS should not be on the audit committee; otherwise a conflict of interest would exist.
Hillary Clinton refused to have an IG when she was Secretary of State. After she left, an IG was appointed. The IG disclosed multiple law and regulation violations. These were published by the American Center for Democracy at:
Examples of FCPS Policies and Practices in Need of IG Assessment
Not checking birth certificates and proof of residency means more expenses to the school. Comments to the BOS two days ago about cars from out of the county and state bringing kids to school is proof of this problem. It was reported to the BOS that sheriffs have collected half a million dollars by giving citations for this practice.
The Prince William County experience shows savings that could be achieved by just enforcing laws. The results relevant to schools, reported by Help Save Manassas, were:
Prince William County Schools reported a mid-year drop in ESOL enrollments that saves county taxpayers at least $6-12 million annually. All jurisdictions surrounding Prince William County, including those that have seen a steady decline in student enrollments, are reporting significant increases in ESOL enrollments. By May 1st of 2008, 1,200 ESOL students have been reported as transferring to other Northern Virginia jurisdictions, each of which costs taxpayers between $2,500 and $5,000 above the base student cost. This does not include the number of students who have repatriated to their home countries. (source: DC Examiner)
The PW school population K-12 is 88,920, per the school office. The number of FCPS students as shown on their website is 186,000 or 2.1 times PW’s students. Thus, by Fairfax implementing PW’s Rule of Law policy, the school budget could be reduced by up to $25 million.
When I was in four different high schools, I had to produce a birth certificate and evidence my parents were registered in the county. Virginia’s Medicaid law requires evidence an applicant is a citizen of the U.S. and a resident of the Virginia. Why can’t FCPS do the same? An IG should study this.
Last Wednesday at the meeting of the BOS and School Board it was stated there is a shortage of teachers. The publicity about the lack of discipline in schools is keeping qualified people from becoming teachers or persuading them to retire or leave teaching early. FCPS apparently has not researched or published any studies about why teachers are leaving or the attitudes of current teachers about the discipline problems. An IG should.
A teacher friend was assaulted by an African-American kid. When the teacher, who had taught for about 25 years, reported the incident to the principal, the principal’s only comment was: “did you hit him back?” The teacher did not defend himself. The principal did not want a discrimination lawsuit and did nothing about the kid. The teacher and his wife, also an experienced wonderful teacher who was disgusted with the new poor learning environment and lack of discipline, retired soon afterward. An IG would have checked this story and others.
One or two unruly students can destroy the learning environment of a classroom. My Mexican cleaning woman, who has a Green Card, said she moved from one school district to another because there were dangerous gangs in the school.
The second school had illegal aliens’ kids who were uninterested in education, disruptive, and foul-mouthed. Who is looking at these problems, or are they being buried?
The daughter, born and raised in the USA, also had been taken out of math classes and put in an ESL class until the mother complained to the principal that her daughter spoke English as well as other kids. Her sin was to have a Hispanic name. The daughter had been failing math because she was not in the class—now she gets an A in math. She even criticized me for speaking Spanish to her. She scolded me by saying “we speak English here.” An IG should look at how widespread this problem is.
If FCPS makes it clear kids will be disciplined if they misbehave, and arrested if they assault a teacher, good teachers would flock to Fairfax. Policies continuing to dig a fiscal hole will just make the hole bigger.
In the School Board ideology seems to rule over common sense. The transgender policy is illegal, since Title IX specifies only boys and girls in the law. The policy infuriates many voters and undermines support for FCPS. Apparently, over 1,000 hours have been wasted on reviewing a transgender policy, and no policy has been developed. It is time to work on improving reading, writing, and arithmetic. An IG should examine the issue and recommend work on it be dropped.
The School Board in the meeting with the BOS last Wednesday did not mention excellence in learning. An IG should look at methods of increasing excellence. The Taxpayers’ Alliance has published studies at FCTA.org showing how the SAT scores are low for some schools, blacks, and Hispanics.
Before the auditors were fired the auditors did a comprehensive report on Student Transportation. They said in a report published February 2017: Policy 8611 Vehicle Replacement provides, “School buses should be replaced after no more than 15 years of service as bus reliability and cost are critical considerations to a successful transportation operation.” The data show that 42% of the fleet is more than 12 years old and 28% is more than fifteen years old.
The FCPS budget for FY 2018 does not seem to mention aging buses and does not propose correcting this problem by buying more buses. Kids’ safety is being ignored. The operating costs of the older buses are higher than those of new buses. An IG should follow up on why the budget did not discuss the bus ages and lack of action.
The FCPS Community and Leadership Profile Survey published in February 2017 showed dismal approval by the community and students. This survey provides more detail on the attitudes of Fairfax County people, and fleshes out why the meals tax failed. An IG should analyze the reasons for these attitudes.
The school superintendent has stated that since FY2008 the school budget was cut by over $400M and 2175 positions. In fact, the school budget increased by $487M (from $2144M to $2631M) and 1,566 positions (from 22,261 to 23,827). The Taxpayers’ Alliance published this in 2016, but the School Board and FCPS never commented on it. If an IG were in place, this would have been cause for an investigation. Why should the figures in the current budget be trusted?
The School Board has not provided an analysis of proposed salary increases compared to private sector salary increases and inflation. Salaries clearly have exceeded inflation since 2000.
IRS data show that middle-class people are moving out of the county and are replaced in large part by people of lower income. When teachers retire after 30 years of experience, the value of their pension is over $2M—they are multi-millionaires, retiring around the age of 55. Few county residents have that much money in their 401ks, even though they work until they are 66. The FCPS employee is taking money from the private-sector worker’s pension and putting it into his own relatively luxurious pension. Fairness seems to require that school and county employees get no more increases in salary and benefits than the middle-class private-sector employee gets. In addition, the retirement age of the school employee should be increased to the retirement age under Social Security, again to gain parity with the private-sector employee.
These are the sort of analyses an IG should do. The School Board and FCPS have failed to do these types of analyses. These issues were briefly raised last Wednesday, but not discussed in detail. Financial savings from implementing these policies need to be analyzed and published by an IG.
Until an intellectually honest, unconstrained IG makes a tough examination of school policies and practices, the School Board will continue to be the enemy of the students, teachers, parents, and taxpayers.
Continuing the same policies without major reforms, like hiring an IG, will result in decreasing support.
Thank you for considering my proposal for an IG, who could lead to increased support for FCPS.
Thomas L. Cranmer, Financial Consultant. First V.P. of the Fairfax County Taxpayers’ Alliance. Fellow, American Center for Democracy. Former Treasurer, Mobil Corp. New Exploration Ventures. B.A. Yale, MBA Columbia (McKinsey Scholar).
P.S.: After I presented this paper, I received the following transcript of resignation remarks made on December 14, 2016, to the Audit Committee by Mr. Greg Cohen, one of two independent citizens on the Audit Committee
I’ve been on this committee for 15 months now and don’t believe that there’s a commitment from the majority of the Board nor management for a strong Auditor General or Audit function. Removing the auditor general (AG) and replacing her with a part time non-qualified interim AG with absolutely no audit experience is just another example of this. It’s my opinion that citizen members were added to this committee without the full buy-in from all of the Board, and that has resulted in our role being marginalized. I’ve been purposefully excluded from discussions on key matters related to the Audit function, including the decision to put the AG on leave and the decision to hire the interim AG. Now it appears that we won’t be able to participate in the interviews to hire the new AG. I’ve been told what I can and can’t say or ask about at meetings.
I volunteer my time with many organizations that need and actually want my involvement. For these reasons, I’m resigning from the Audit Committee effective at the end of this meeting.