Pattye Benson

Community Matters

Month – May 2019

T/E School District Tax Increase — Will it be 2.8%, 3.91% or 4.33%? “To Be Continued”

May 31, 2019
35 Comments

On the eve of June 1st and days away from the end of school year, the school board still does not have an agreed up tax increase number for the budget! How is that possible? What we do know is that the tax increase will be less than the 6% that we have heard since the middle of December and the increase was approved in the draft final budget. However, we are left with three numbers — 2.8%, 3.91% and 4.33%. Exactly how did the Board come up with these various numbers? What are the numbers based on? And how does the incorrect accounting of the Special Ed expenses factor into the tax increase?

Although I was unable to attend the school board meeting this week because it was the same night as the digital billboard appeal, Doug Anestad attended and offer his remarks below. Plus the video of the May 29 school board meeting is now available on the District’s website, click here to view.

After reading Doug’s comments, my first takeaway is that maybe the TESD 2019-20 budget process should be renamed, “To Be Continued …”!

The school board met Wednesday night. The agenda was very light.

What was interesting was that no new budget discussions happened. It is very late in the game not to come to a final tax rate increase. Therefore, the 2.8%, 3.91%, and 4.33% tax increases are all still on the table.

The board proposed changes to Regulation 2110: Job Responsibilities for Superintendent of School. The proposed change says that if one or more invoices from the same vendor above $200k is accounted for in the wrong fiscal year, the Superintendent must be notified and the Superintendent must inform the school board.

Of course, this proposed change in regulation came about because the administration didn’t tell the the school board about $1.2M in special education expenditures from 2016-2017 that were wrongly recorded against 2017-2018. I spoke about the regulation and said that if you have to tell the administration when $1.2M is misstated they should notify the board, it is not a policy issue, it is a personnel issue and they should treat it as such. Kyle Boyer also had concerns about it being a personnel and not a policy issue. The vote was 8-1 on the regulation change.

When the administration started discussing the launch of updating the Strategic Plan at a cost of $50k, some of the board members raised concerns. This is highly unusual as this item is not even normally voted on as a separate item. Multiple board members said that they thought that the district was not in a position to deal with a Strategic Plan. The final vote was 5-4 with Michele Burger, Kate Murphy, Ed Sweeney, and Heather Ward all voting against the motion. I believe that this close vote demonstrates that multiple board members are not happy with the current situation and the administration.

Major kudos to Ed Sweeney for bringing up the issue of revising the finance numbers for the prior years to be the actual numbers. He asked, and the board agreed, to look into the financial and legal ramifications of fixing the numbers to be the real numbers. They seem to be most concerned about double dipping next year since they already got a higher taxing authorization from the state based on the wrong numbers.

I am not sure why so many on the school board continue to be so hesitant to figure out the truth. Why have they still not asked the auditors when Art McDonnell informed the auditors about the $1.2M account error? Why haven’t they already figured out what the process is to correct the numbers? Why haven’t they asked the state how revising the financial statements to be the real numbers will impact their taxing authority?

Digital Billboard Appeal to be continued … until July 9

May 31, 2019
9 Comments

Thank you to those residents who joined me on Wednesday night for the Zoning Hearing Board meeting. With the tornado warnings and loss of power for many, it was a challenge to attend!

There was bad and good news from the meeting. The bad news is that we sat through three hours of testimony and only heard from the Catalyst attorney John Snyder from Saul Ewing and his two witnesses. The good news is that the Zoning Hearing Board meeting continues on Tuesday, July 9 and we will hear from the township attorney Tony Verwey from Gawthrop Greenwood and all township residents who wish to comment.

Unfortunately Snyder set a bad tone early in the proceedings by objecting to all but one resident who asked for party standing in the case (including myself), claiming that we would not be personally impacted by the proposed digital sign.

My argument to receive standing was that ‘ALL’ the township residents (and beyond) would be impacted (due to safety concerns in that intersection) and therefore should have standing. Needless to say that argument went nowhere with Snyder. To the credit of Zoning Hearing Board chair Dan McLaughlin (and much to the chagrin of Snyder) we were told that a determination of “standing” would be decided at the meeting on July 9. All residents who wish to comment may do so at the next meeting (and you do not need standing to do so!).

Linda Stein from Main Line Media News attended the meeting and gave a review of the proposed billboard and update. (Thank you Linda for braving the tornado warnings to attend!) To read the full article, click here. Below are excerpts from the article:

Snyder called on Jesse White, an engineer for Watchfire Signs, a Danville, Ill. company that sells digital billboards to Catalyst, to testify. White explained how the proposed LED billboard would work. Questioned by Snyder, White said LED billboards are “almost like a TV.”

Residents who requested to be a party to the case were permitted to ask questions. Paul Drucker asked White if he thought that 10 images a minute would be a distraction for drivers. Snyder objected to the question and Daniel McLaughlin, the zoning board chairman, asked if Snyder planned to call a witness regarding drivers being distracted.

“No, I don’t think it’s relevant,” said Snyder. His response drew laughter and gasps from the audience, many of whom object to the billboard on the basis that it would distract drivers and make the busy intersection less safe.

Yes, remarkably there will be no safety expert called by Catalyst because they don’t think there is a safety issue for a digital billboard at the intersection Rt. 252 and Lancaster Ave! In my opinion (and in the opinion of many others) much of the widespread opposition to the digital sign is focused on safety! Also, it also did not escape many in the audience that the ‘expert’ witness Jesse White is a vendor employee of Catalyst! Certainly does not make that expert unbiased – he even admitted that his company Watchfire Signs would probably have the contract for this digital billboard, if approved!

The other crazy remarks came from Catalyst witness and employee Tim Earle who compared the proposed digital billboard with its constantly changing face to the gas price sign across the street at the 7-Eleven and to the sign at Conestoga High School! We can only hope that the so-called expert testimony of Earle will be thoroughly examined by the township attorney at the next meeting!

Although I was hoping that the Zoning Hearing Board meeting would resolve itself in one night – the good news is that the public will have a chance to be heard on July 9 and hopefully without the threat of a tornado keeping some home!

Susan Stein closed her article with a quote from me – it accurately sums up my feelings on this proposed digital billboard. Onward and upward to Tuesday, July 9!

After the hearing, Benson said, “The intersection of Routes 252 and 30 in Paoli is no place for a digital billboard. The bright, constantly-changing digital billboard is designed expressly to attract and hold the attention of drivers. I do not support a digital billboard at this location as it will promote distracted driving and affect public safety, especially given the extremely congested intersection.”

T/E Finance Committee Meeting w/no decision on tax increase – School Board Meeting Tonight at 7:30 PM, Conestoga High School … A School Board Divided

May 29, 2019
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Unfortunately for T/E taxpayers, the District’s Finance Committee meetings are not videotaped. With the open budget issues, looming June 10th deadline, in addition to unresolved $1.2 million accounting errors related to Special Ed expenses, the public really needs to know what’s going on in the process – especially in advance of the important School Board meeting tonight!

I was unable to attend the Finance Committee meeting and will miss the School Board meeting tonight as it conflicts with the special Tredyffrin Township Zoning Hearing Board. At 7 PM at the township building, Catalyst Outdoor Advertising will present its appeal on the township’s denial of their application for the digital billboard in Paoli. My BAN the Digital Billboard campaign has been 9 months in the making so need to attend the ZHB meeting. However, also important is the School Board meeting tonight (7:30 PM, Conestoga High School) – the proposed tax increase, the accounting errors and how the business manager (Art McDonnell) factors into the situation.

After speaking with several residents in attendance at the Finance Committee meeting, an update would be useful. (Remember, the meetings are not videotaped and I was unable to attend). Resident Doug Anestad did attend the Finance Committee meeting and offers his personal commentary below.

Reading Doug’s remarks, it sure sounds like the Finance Committee and its Chair Todd Kantorcyzk are a ‘school board divided’. And just when you thought ALL the numbers are in for the proposed budget, the administration announces that “ … special education expenses were going to be an additional $700k this year with $500k of that as a recurring expense” as reported by Doug. My question is WHY is this information coming in at the eleventh hour of the budget process!

Last night’s Finance Committee meeting was a late one ending after 10:30 pm.

At the beginning of the meeting, an undated letter from the auditor was distributed to the audience. The Business Manager, Art McDonnell, stated that he asked the auditor after the last finance meeting to make the letter after the community questioned the $1.2M in special education spending that was incorrectly applied to the wrong school year and in order to respond to the complaint directed to the Pennsylvania Department of Education.

Neal Colligan pointed out that the letter clearly stated “Management made all decisions regarding how and when these transactions were recorded.” I pointed out that the email chain for the document clearly stated that it was sent on May 10 – three days before the last finance meeting, not after it as stated by Art. The letter also mentions the question of the $1.2M being raised in April 2019. Was that when the auditors were first made aware of the misstated $1.2M? We still don’t know the answer to this or other questions because the auditor did not show up to yet another meeting even though school board members have requested that they show up repeatedly for quite some time. It seems that Art does not feel the board members are entitled to talk to their auditor.

The administration then did their presentation on the current status of the budget process. This is when the Director of Individualized Student Services, Chris Groppe, stated that special education expenses were going to be an additional $700k this year with $500k of that as a recurring expense. As this is a recurring expense, the administration then suggested that the $500k be added to next years budget.

This was followed by a long conversation on where the board members stood in regards to the budget. The school board members then went around and stated where they were in terms of tax increases. Even though the Finance Chair, Todd Kantorczyk, wanted to have the school board members express what they were comfortable with in regards to a projected deficit, most of the board members seemed to want to express where they were in regards to a percentage tax increase.

Here is a summary of where the board members were:

2.8% – Kate Murphy, Edward Sweeney

3.91% – Heather Ward, Michele Burger, Tina Whitlow, Scott Dorsey

4.33% – Roberta Hotinski, Kyle Boyer, Todd Kantorczyk

Kyle Boyer stated he was willing to go down to 3.91% and offered to do so in order to have five votes for the 3.91% to move the process along. Todd Kantorczyk did not take him up on his offer so all three options will be presented at the board meeting tonight.

Many of the school board members showed their displeasure with administration during their comments. Words like frustrated, distressed, pissed off, and trust were used by board members. They really did not like $700k in expenses being added to this year with $500k of that as recurring expenses for next year being dropped on top of them at the last minute.

It would appear that many of the school board members are starting to see the manipulation the administration uses with the school board and don’t like what they are seeing.

The committee then approved the following strategies for deficit reduction. Reducing the budgeted amount for the school safety coordinator position between $50k to $70k. Remove the elementary mental health specialist for $96,000. Delay new reading program $300,000.

The meeting ended with one last appeal for the school board by former Tredyffrin Township Supervisor Mike Heaberg. Mike made the case that by not fixing the incorrect financial numbers, the district might lose some of the trust of the community and that the school board should do so at the meeting tonight.

Say NO to Digital Billboards in Tredyffrin Township – Your VOICE Matters! Zoning Hearing Board Meeting, Wednesday, May 29 at 7 PM!

May 28, 2019
3 Comments

Zoning Hearing Board Meeting TONIGHT!

It’s time to focus on the important Zoning Hearing Board meeting coming up tomorrow, Wednesday, May 29, 7 PM at the Tredyffrin Township Building. Catalyst Outdoor appealed the denial of their application for the digital billboard at the intersection of Rt. 252 & Lancaster Ave in Paoli and now the case will be heard.

If you OPPOSE a digital billboard in Paoli, NOW is the time to stand up and be counted! Please plan to attend and share with neighbors and friends.

This is it folks — this meeting will determine the future of digital signs in Tredyffrin Township, your VOICE MATTERS and your attendance is critical!

2 Weeks to Final Budget Vote & T/E Tax Increase Remains at 6% — Community needs to ‘Trust’ School Board Oversight!

May 27, 2019
14 Comments

With just two weeks until the final budget is approved for the school district, where is the school board in the process? We know that the 6% tax increase proposed in mid-December has not changed. Rumors continue that the school board will approve a lower tax increase yet the public remains in the dark.

For months, community members have requested school board action regarding the Special Ed $1.3 million accounting errors that impact the proposed (and future)budgets without resolution. Requests for the auditor to attend a public meeting are met with “not available” responses by the District’s business manager Art McDonnell. Then this past week we learned that the District posted a job opening for a new controller with a start date “ASAP” – apparently the District’s current controller is leaving for another job. Any secrets can remain safe if the controller is absent from public meetings and the controller leaves the District.

In my opinion, there is an imbalance in power and control in the school district administration. All roads lead back to (or through) Art McDonnell, the business manager. Many on the school board seemingly depend on (and support) the words of McDonnell, even when presented with evidence and opposing facts from financial experts in the community. Why is that?

We need to trust the school board as our oversight – to demonstrate leadership, courage and the will to govern on our behalf. At the core, the associated budget issues, including accounting errors, revolve around trust. As taxpayers, how are we supposed to trust the accuracy of this proposed budget (read “tax increase)?

We need a brave school board member to honor their responsibility to the community by making a motion requiring the administration to correct the $1.3 million Special Ed accounting error.

As a lead-up to the final budget vote on June 10th, there are two important meetings for school board members (and the public!) to speak out this week. There is a Finance Committee meeting Tuesday, May 28, 7 PM (click here for agenda) and regular school board meeting on Wednesday, May 29, 7:30 PM (click here for agenda).

Below Ray Clarke provides his personal commentary on the budget and related Special Ed accounting problem and his thoughts on the District’s business manager Art McDonnell.

Another month has gone by in the annual cycle of operas that is the TESD budget process. On Tuesday the Finance Committee holds it last meeting before the June 10th vote on the Final budget. It is increasing clear that the Board is ill-served by its Business Manager and that it is time for a fresh approach.

A few more facts are on the table. In the last two weeks, the budget deficit for the current year has jumped by $700,000 of “Other” expenditures. The Administration now presents a range of tax increases from the Index 2.3% to the erroneous Exceptions of 5.964%, and appears to be promoting 4.64%. This is based solely on creating a budget deficit equal to the average of the last five years’ budgets without any further program changes.

Also, the auditor’s Management Letter that accompanies the wrong financials for both years is quite clear that “our audit of the financial statements does not relieve you [the Board] or management of its respective responsibilities”. The Letters for both years make no reference to the CCIU invoice mis-classification, even though dated in December of both following years, a month to a year after the issue came to light.

Some questions that arise:

  • Is the Administration proposing a $1.3 million budget deficit because they know that expenses are over- and revenues are under-budgeted?
  • What caused the last minute increase in projected expenses for the current year, and further, what impact does that have on next year’s budget?
  • How can the Board make informed budget decisions when the basic information about departmental level trends underlying that budget were presented so long ago (and in very broad strokes) and have been impacted by the disconnected list of programs under consideration? Most important, those financials are in one case just plain wrong.
  • Is the Board comfortable with basing a tax decision – impacting both this year and next – on authority granted by PDE based on erroneous information?
  • Has the Board received confirmation from its Auditor that, per its Management Letter, in December 2018 it either did not identify the CCIU error that was identified over 12 months earlier, or that it considered the matter “trivial”?
  • What is the Board going to do about Mr. Sweeney’s suggestion two weeks ago that the Budget process should be improved?

The mis-representations, cover up and associated taxing and budget debacle is the culmination of years of the TESD Board being treated by the Business Manager like a set of the proverbial mushrooms. Other districts provide models for informed decision-making. It’s time for the Board to exercise its contractual rights and make a change.

T/E School District’s $1.3 Million Accounting Error/Act 1 Violation discussion continues – Taxpayers facing large tax increase with less than 30 days until School Board’s final vote!

May 14, 2019
32 Comments

In addition to other residents, I attended the T/E School Board Finance Committee meeting last night. The meeting lasted nearly three hours but we stayed; hopeful for resolution on the District’s $1.3 million Act 1 accounting error and its impact on the proposed 6% tax increase. Sadly, the evening ended no closer to a solution than when it began.

With less than 30 days before the Board must take a vote on the final budget, much of the meeting was spent discussing budget strategies to reduce the District’s spending and increase revenue. Possible budget strategies ranged from increasing student parking and activity fees to delaying the new reading program. All the discussion about cost-cutting measures was a bit like getting the cart before the horse since the large “elephant in the room” was the $1.3 million accounting error and its impact on the current budget process and the proposed tax increase.

Residents who had attended the finance committee meeting in April (including myself) expected answers from the auditor. School board member Tina Whitlow had asked Art McDonnell, the District’s business manager to have the auditor attend last night’s meeting but (according to McDonnell) he was not available. Actually the absence of the auditor was no surprise; as his responses to taxpayer questions would probably not have bolstered the business manager’s position on the District’s serious accounting mistake.

The most disturbing part of the meeting was the response by Todd Kantorczyk, the finance committee chair, to residents Doug Anestad and Mike Heaberg regarding the District’s erroneous accounting of $1.3 million Special Ed invoices to the Pennsylvania State Board of Education.

Both Doug and Mike cited the “Manual of Accounting and Financial Reporting for Pennsylvania Local Educational Agencies (LEAs)”, Principle 9 – Measurement Focus and Basis of Accounting in the Basic Financial Statements (pg. 15), which states, in part that “Revenues should be recognized in the accounting period in which they become available and measurable. Expenditures should be recognized in the accounting period in which the fund liability is incurred …” (Clearly, this means that the $1.3 million Special Ed invoices need to be accurately reported in the year in which the expenses occurred.)

Kantorczyk dismissed the state’s accounting practices as referenced by Doug and Mike, as if to suggest that somehow the T/E School District was exempt from these regulations! A remarkable moment – he remained unmoved by the follow-up comments questioning the Board’s actual taxing authority, possible Act 1 violation, the prospect of legal action and pleas to “just do the right thing”.

The evening ended with a discussion by Board members about the proposed tax increase which; to be clear, is still 6%. Certain Board members stated that they needed counsel by the District solicitor Ken Roos, regarding the accounting error and possible legal ramifications, before finalizing their thoughts on the proposed budget. Finance committee member Kate Murphy was particularly thoughtful; sharing her concerns and need for further information. Likewise, Heather Ward, also a member of the finance committee, shared those concerns.

Resident Neal Colligan attended the meeting and offers his notes on the Board members ideas regarding the final tax increase:

  • Todd Kantorczyk indicated that he was comfortable with the District’s taxing authority at 6% but did not want to see the entire amount imposed in one year; he did not offer another number but seemed inclined to a tax increase short of 5%.

  • Michelle Burger wanted to sleep on the discussion points but was quick to point out that “she heard what the community said in their comments”.

  • Kate Murphy acknowledged that there’s “too much noise” surrounding the Special Education Exception. She can only, at this point support a 2.32% tax increase (Act 1 allowance and the Special Exception for PSERS cost increases). In the sanest approach of the evening (my opinion); she related that if she can’t explain it to the constituents she meets at the Acme; she’s not voting for it.

  • Heather Ward echoed those thoughts and again asked for a meeting with the District’s auditor (that Tina Whitlow requested a month ago). She seemed willing to possibly accept a 3.91% tax increase…maybe (this would be the full taxing authority of the District IF they had submitted correct Special Education spending amounts to the Department of Education).

  • Tina Whitlow again raised questions of the District’s taxing authority particularly related to the Special Education Exception and again mentioned in her comments a 3.91% possible tax increase.

  • Roberta Hotinski is in favor of a 4.72% tax increase; this number would include the 3.91% mentioned above AND .81% increase derived from a calculation of what Last Year’s Special Education exception would have been if the numbers submitted to the State were correct.

  • Scott Dorsey, ever the Board Member balancing the fairness of a tax increase vs. the needs of the schools, favors an increase of 3.91%…his position has not changed in some time.

  • Ed Sweeney leans towards the 2.3-2.5% tax increase range. He did point out that the Budget process is in dire need of change as only now, with a month to go, are we “getting into the brass tacks”. He also mentioned that a Board needs to trust the numbers it is given when considering a budget … it is clear he has doubts.

  • Kyle Boyer was the last to weigh in … his support level is around the 3.91% range but may be convinced to go a little higher. He mentioned that he keeps a District tax increase chart on his phone and that in 2008 the District raised taxes at the highest level in the last 15 years … and he’d like to stay below that 4.3% figure.

The Top Answer to tax increase percentage was 3.91%. At this level; the potential Final Budget would have an imbalance of a $2.662 MM of deficit that will need to be filled by Fund Balance Commitment. No Budget Strategies have been offered that could fill that imbalance. Board Members left the “hard analysis” behind and expressed their “feel” for the correct tax increase. The normal Budget process which could have looked delved into the need for a 5.5% spending increase OR at why the District habitually under-states revenues and over-states expenses in the Budget process has been hijacked by the Accounting Timing Error fiasco. On this point, Ed Sweeney is clearly correct. With a month to go … it’s going to be a bumpy ride.

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