Auditor General DePasquale Says Connellsville Area School District Finances, Academics, Leadership All Raise Cause for Serious Concern
Auditor General DePasquale Says Connellsville Area School District Finances, Academics, Leadership All Raise Cause for Serious Concern
Questions leadership decisions since audit’s conclusion, plans to discuss with state education secretary
CONNELLSVILLE, Fayette County (March 3, 2016) – Auditor General Eugene DePasquale today said the recent audit of Connellsville Area School District and events that have taken place immediately afterward raise concerns about the district’s long-term financial stability and leadership ability.
“This audit threw up red flags all over the place,” DePasquale said. “We see a revolving door of superintendents, a former administrator criminally charged with theft, and a district that’s struggling financially and academically.
“I’m so concerned about this district that I am meeting next week with the state Secretary of Education to discuss what assistance can be provided. The students and parents in this district absolutely need help now to turn the school around before it is too late.”
Leadership Challenges
The audit, which covered fiscal years 2008 through 2014, showed that a former superintendent — one of five that it’s had in six years — authorized payment to the former network administrator for unsubstantiated overtime in the amount of $2,494.92, as well as granting him compensatory time, which is against district policy. The overtime payment was made outside of the regular pay cycle despite payroll staff objections, the audit found, and the network administrator received double the rate he should have been paid.
“We already know from the Pennsylvania State Police and news reports that the former network administrator has been charged with stealing district technological equipment,” DePasquale said. “Now our audit team discovers more questionable activity on the part of this individual and a former superintendent. This is no coincidence.
“I have already forwarded a copy of the final audit to the Fayette County District Attorney’s Office to determine if further investigation is warranted.”
DePasquale said he is extremely concerned not only with the high turnover rate among superintendents, but also with the way the new superintendent was hired just after the audit period ended.
“In the last six years, Connellsville has had five superintendents, three of whom were ‘acting,’” DePasquale said. “When our audit team spoke with district administration on Jan. 20, they assured our auditors they were conducting a nationwide search for a new superintendent.
“However,” DePasquale continued, “just days later, the board hired the acting superintendent — who had been the business manager with the district only five months before he was made acting superintendent — for the full-time superintendent spot under a five-year contract without publicly advertising that the vote would occur at the Jan. 27 meeting.
“Unless I’m missing something, it’s impossible to vet a nation’s worth of candidates in just a few days. This is outrageous, especially since the public was not notified before the board voted on the superintendent’s hiring.”
Financial Problems
The recent audit showed that Connellsville has financial issues that many other districts share:
• a declining General Fund balance,
• increasing long-term debt obligations, and
• increasing charter school payments.
“Connellsville is already facing a tough financial situation,” DePasquale said. “Its General Fund balance declined from $14 million in 2008 to $3 million in 2014, and officials anticipate a $2.1 million negative fund balance for 2014-15.”
The district also has already borrowed $9 million because of the state budget impasse and is prepared to borrow more if the full 2015-16 state funding continues to be delayed.
But auditors also determined that Connellsville set in motion a unique financial drain when it established its own career and technical center years ago.
“The largest strain on the district’s finances is supporting its own career and technical center, which educates only about 5 percent of the student population,” DePasquale said. “The CTC — the smallest in the state — is for district students only and costs the district millions each year to operate.”
Between 2008 and 2014, the district transferred $20.5 million from its General Fund to the CTC fund because the center doesn’t generate enough revenue to cover its costs. District officials also transferred $28.8 million from the General Fund for debt service, some of which is for the center.
“I grew up in Pittsburgh, so I know that the Fayette County Career & Technical Institute, which is just 17 miles from Connellsville, is a very well-respected school,” DePasquale said. “Realistically, Connellsville can’t just close its CTC’s door and transfer all its career and technical students. It’s not that simple.”
Because the district took on a bond issue to pay for construction on the CTC facility, the district is piling up debt while it waits for reimbursement from the state. If the CTC doesn’t stay open, there will be no reimbursement money forthcoming.
“Every dollar Connellsville transfers from its General Fund to cover the CTC’s costs is a dollar that can’t go toward educating the other 95 percent of students,” DePasquale said. “And Connellsville needs to be focusing on educating all of its students, because its annual test scores need to improve.”
Academic Struggles
Connellsville’s academic scores continue to lag behind state minimum requirements by as much as 10 percentage points.
“Connellsville is not a small school district,” DePasquale said. “There are thousands of students relying on its district leaders to provide them with the tools they need to succeed as adults.
“Righting this district will create hope for the students’ futures.”
District Response
In response to the audit, district officials outlined steps they said they are planning to take to analyze and hopefully alleviate some of the district’s financial problems.
“I am glad to see that many of the steps are in line with what our audit recommends,” DePasquale said.
For example, officials said they are reviewing options to consolidate schools and decrease expenses based on a 10-year trend of declining enrollment.
“District officials also said they are pursuing bringing more kinds of programming to the CTC, which should increase enrollment and help it become more self-sufficient,” DePasquale said.
Overall, however, DePasquale remains dubious about the district’s leadership and board’s ability to implement meaningful changes that will put Connellsville on the path to financial and academic success.
“Steady, consistent, solid leadership is absolutely needed in this district to help it heal and move forward effectively,” DePasquale said. “We will be keeping a close eye on this district and talking with the Department of Education to help the students.”
The Connellsville Area School District audit report is available online at: www.PaAuditor.gov.
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