Arthur McDonnell

TE School District – You Still Owe GEM Mechanical Services for Work Completed in August 2019! What does it take to Get Paid?

Last month I wrote about money owed GEM Mechanical Services, a TESD vendor for a boiler project work at Devon Elementary and Beaumont Elementary completed in August 2019.

Following my May 2020 post, the District paid $24K of the $36K balance and presented GEM with a punch list (nine months after the completion of the work); withholding the remaining $11,850.  Sean Gaffney, the VP of Construction at GEM quickly scheduled the punch list work and it was completed on the morning of Friday, May 29.  He has subsequently spent countless hours in an attempt to collect the debt from the District.

Each of the many follow-up emails from GEM regarding payment has included copies to the District’s business manager Art McDonnell and facilities supervisor Colm Kelly, its architects at Heckendorn Shiles (HSA), TESD School Board and myself. Although the work is long completed, no payment was received.

Where is the TE School Board on its follow-up? Just like me, they received these numerous payment requests from Gem Mechanical Services. Why doesn’t Michele Burger, the School Board president or Roberta Hotinski, School Board VP and Finance Chair respond to the situation?  Where is the TESD Superintendent Rich Gusick on this matter? According to the District’s “org” chart, Dr. Gusick is in charge of the District and Art McDonnell, the business manager reports to him not the other way around. And Dr. Gusick reports to the TESD School Board. The lack of resolution is wrong on so many levels — Why doesn’t someone direct the final payment to GEM Mechanical Services?

It is no surprise that low bidder turnout continues on District projects, which compromises the competitive bid process and ultimately hurts the taxpayers. Simply put, why should a vendor work in a school district where you struggle to be paid? Is it any wonder that there is decreasing interest in District projects?

The TESD taxpayers received a 2.6% tax increase and the business manager received a raise in the midst of high unemployment, small business failures and an uncertain future, yet the school district cannot pay its bills. 

Our collective voices should have mattered regarding the tax increase, elimination of ERB testing and salary increases but as we saw, it didn’t.  And now we learn that paying a vendor for services rendered is not important either — what’s it going to take?

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Ignoring Community Outcry, TE School Board Approves 2.6% Tax Increase, the Elimination of ERB Testing & Salary Increases to Administrators

The voices of Tredyffrin Easttown School District residents were unified in their message to the school board.  It took the District solicitor 1-1/2 hours to read into public record over sixty well-written, meaningful comments from residents and far less time for the School Board to ignore!

Resident comments focused on the District’s proposed 2020-21 budget, the proposed 2.6% tax increase, the elimination of the ERB testing as a cost-savings measure and the administrator raises. One lone resident supported the proposed budget; the remainder of the comments loudly and eloquently opposed.

To the many residents who spoke out during the 2020-21 budget process, thank you.  Your collective voices do matter but, sadly, not to the TE School Board.  Although technically the budget vote occurred during the meeting, it could have easily occurred before the meeting even started! Elected to serve the residents of the Tredyffrin Easttown School District, the Board remained unmoved by the outcry from the community.

At midnight, the School Board approved the 2020-21 budget (7-2) with a 2.6% tax increase – the largest increase permitted this year, marking the 16th straight year of tax increases to T/E residents.  The Business Manager and some on the Board actually had the audacity to mention that it was the lowest tax increase in years – the truth is that 2.6% is the maximum tax increase permitted by Act 1, making those remarks ridiculous!

I would be remiss if I did not salute TE School Board director Scott Dorsey, the only real voice for the community. From the start of the budget discussion in January, Rev. Dorsey declared his opposition to any tax increase. Again, last night he highlighted the additional suffering in the community due to the pandemic – the increased unemployment, the struggling small businesses, etc. but gained no support for a zero tax increase. We heard you Rev. Dorsey and your words mattered to this community.

Although the proposed budget materials clearly listed that ERB testing (and associated $85K cost) as a cost-savings strategy, several Board members argued that the elimination was not a strategy to save money. To the viewing public, the remarks were ridiculous (and untrue). Nonetheless, with the approval of the budget, the District eliminated ERBs for the 2020-21 year.

In part, my comment to the School Board read, “Eliminating ERB testing is eliminating accountability…”  It was no surprise to hear that TEEA (the District’s teacher union) supported the removal of ERB testing. There was much talk that that the elimination of the ERBs was for the 2020-21 school year only, leaving open the possibility of the testing to return the following year. If anyone believes that there is a remote chance that ERBs will reappear in future budgets, I think there’s a Brooklyn Bridge for sale.

Another consistent remark from residents was opposition to administration salary increases and bonuses for 2020-21, asking for fairness and shared sacrifice n the budget.  A number of residents cited the past failings of the Business Manager and called for his removal.  Not surprising there was no response from the School Board and Art McDonnell continues as the District’s Business Manager with a raise and bonus. All Administration, Supervisory and Confidential employees will receive salary increases for 2020-21.

Because of the Covid-19 crisis, we are all suffering.  Residents have lost their jobs, and every segment of our economy, including our local small businesses, are feeling the effects of the pandemic. Almost all of us are in worse financial shape and a tax increase under these conditions was wrong.

Our voices should have mattered — Shame on the TE School Board for ignoring the residents and shame on the School Board for approving the maximum tax increase of 2.6% and eliminating the ERBs.

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T/E School District Board Meeting Update: 2.6% Property Tax Increase, Proposed Suspension of ERB Testing, Unpaid $36K Vendor Payment (the Saga Continues)

Watching the virtual school board meeting for nearly three hours last night was not for the faint of heart.  A few of my takeaways —

With the sole exception of school board director Scott Dorsey’s vocal opposition, it appears that the TESD 2020-21 budget is on target to include a 2.6% tax increase, the highest permitted within PA Act I Index guidelines. (The TESD school board votes on the 2020-21 budget on June 8).

Recently at a May 19 press conference Governor Wolf was asked the question, “”Do you believe school districts should be raising taxes during the pandemic?” Wolf’s response, “We’re in a pandemic and this is not a time to burden any Pennsylvanian with additional responsibility or tax…we should be looking for ways to lighten the load; not the reverse.”  This response does not support the District’s proposed 2.6% tax increase!

Some PA school districts, including Unionville Chadds Ford are approving 2020-21 budgets with zero tax increases. Supt. Brian Polito of the Erie School District is appealing to its school board for zero tax increase. Polito understands that his district is facing challenges but “now is not the time” for tax increases as residents struggle.  Southern York County School District approved a budget cutting savings by freezing wages for its employees for one year to avoid a tax increase in its 2020-21 budget.

One of TESD budget strategies contained in the proposed 2020-21 budget is to suspend ERB testing for one year for a savings of $85,000.  A form of assessment to guide instruction in math and reading, ERB testing has been used in the District for many years to measure students’ progress.  Many pro-ERB test support letters from parents were read at the end of the board meeting. **

Several times during the meeting last night, the school board suggested that residents contact the District with comments regarding the budget, proposed budget cuts (including ERBs), distance learning, etc.  There is a Finance Committee meeting on Monday, June 1 — in advance, I suggest that you send your comments to schoolboard@tesd.net.

No update on the District’s unpaid balance of $36K to GEM Mechanical Services was included in the meeting agenda but surprisingly at 10:20 PM, Colm Kelly (head of TESD facilities) offered prepared remarks regarding GEM and asbestos in school buildings.

Kelly’s comment on asbestos at Beaufort Elementary School was circular and difficult to follow – my takeaway was that asbestos mediation was done in the building. TESD is required to keep copies of asbestos abatement reports up-to-date and on file in sll of its buildings.  Although I am not sure where the reports are located in the buildings – I suggest concerned parents contact the school district directly for a copy of the report for their child’s school.

Kelly’s response to the 2019 boiler project at Beaumont Elementary and Devon Elementary schools skipped right over many facts and left the biggest question about the District’s outstanding payment to GEM Mechanical Services unanswered.

Earlier in the day (a few hours prior to the school board meeting and Kelly’s remarks) there was communication between Sean Gaffney, of GEM Mechanical Services and Colm Kelly, both on the phone and through emails.  Many people were copied on the following email between the two, including the District’s business manager Art McDonnell, its architects at Heckendorn Shiles (HSA), TESD School Board and myself. Here is a copy of that follow-up email from Sean Gaffney to Colm Kelly which was sent a few hours prior to the school board meeting:

As per our phone conversation this afternoon, TESD will be cutting a partial payment check in the amount of $24,895.00 that will be available from the TE business office this upcoming Friday 5/29/20.

GEM Mechanical will be on site that same day (5/29/20) to complete our FINAL punch list items at which time we will request the remaining $11,850.00 that is being withheld by TESD and a check will be released no later than the following Friday 6/5/20.

I look forward to TESD and HSA’s cooperation in closing out this project.

It was fascinating that Kelly offered none of this information in his remarks. He no mention made of the outstanding $36K balance which TESD owes GEM Mechanical Services; or that the final punch list items would be completed on Friday. Furthermore, there were NO questions from the school board to Kelly or to the business manager about the money owed GEM or when it would be paid.  This is wrong on a lot of levels.

A review of the Facility Committee agenda materials from May 14, 2020 lists three vendors with outstanding final balances from the 2019 school boiler project: (1) $36,295 to GEM Mechanical Services for mechanical services, (2) $16,460 to Five Star, Inc. for plumbing services and (3) $20,075 to AJM Electric for electrical services. Based on the experience of GEM Mechanical Services, it makes me wonder if Five Star and AJM Electric are faced with similar issues.

An interesting Community Matters comment received on this topic —

… As for the districts “reputation” when it comes to paying, GEM is not the first to have payments withheld and they definitely won’t be the last. I am 100 percent sure that there is a job from 2018 that still has an outstanding balance against the district who has slipped thru the cracks by changing the punch list every time payment is questioned.

What exactly is going on with facilities in the school district regarding vendor payments.  If a vendor asks the District about their final payment,  are they faced with an ever-changing punch list until they finally just walk away.  If this tactic is used by the District, it certainly explains the decreasing list of vendors willing to work in TE School District.  Sean Gaffney has stated that GEM Mechanical Services will never work in TESD again – I wonder how many other vendors feel similarly.

Why isn’t the school board concerned? Where is the leadership for accountability and oversight of the facilities department? The school board had an opportunity to ask Colm Kelly questions about outstanding vendor balances last night but remained silent. The school board had an opportunity to ask Art McDonnell when GEM Mechanical Services would receive its long-overdue payment but again … they said nothing.

The school board is elected to be the community’s watchdog, ensuring that taxpayers get the most for their tax dollars. Where is the school board’s accountability to us?

____________________

** I have received many emails and calls from parents regarding the District’s distance learning as required by COVID-19.  The next blog post will look at distance learning and the District’s proposal to suspend ERB testing for one year as cost-savings in the 2020-21 budget.

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What Does it Take for a Vendor to Get Paid in T/E School District … GEM Mechanical Services Owed $36K+ for Work Completed in August 2019

About three weeks ago, I was contacted by Sean Gaffney, VP of construction at GEM Mechanical Services regarding TE School District Renovations Project PO 19102724 and an unpaid balance of $36,295 (of a $700K contract). The boiler project work at Devon Elementary School and Beaumont Elementary work was completed in August 2019.

Before reaching out to me, either Sean or other employees of GEM had sent 30+ emails to Heckendorn Shiles Architects and the District during the past nine months seeking payment. To date, the final payment for the work remains unpaid.

As a result, I sent three emails to the District’s business manager Art McDonnell (with copies to the school board and superintendent) inquiring about the final payment due GEM. Mr. McDonnell’s response to the first two emails was dismissive and unsatisfactory.  My third and final email on this subject received no response from the business manager.

I naively assumed that there was a simple explanation – a misunderstanding – and that TESD would send GEM Mechanical Services its final payment.  Unfortunately, promises of the “check is in the mail” remain unfulfilled. Other than for me to publicize the situation, it is unclear what else I can do to move the matter forward although legal options are available to the construction vendor.

From the time last August when GEM completed the boiler project, a punch list was requested and final payment sought.  Months went by and GEM was only very recently presented with a punch list (long past its legal due date), which included installation of gauges. It makes me wonder if this a tactic by the District to delay payment on a project by waiting nine months post-completion and then come up with a punch list?  And for what purpose – what’s the endgame?

Although Heckendorn Shiles placed an associated value of $7500 for the gauges on the punch list (and without explanation increased the value last week to $11,850), it does not explain why the District is withholding the remainder of the $36,295 final payment. It is my understanding that there are legal ramifications for withholding payment to a vendor for services rendered. In addition, the District will owe interest to GEM on the unpaid balance.

GEM Mechanical Services has worked in many neighboring school districts and the Philadelphia School District but this was the company’s first experience in TESD. And, according to Sean Gaffney, it will be the last. What is that saying, the “more you know, the more you wish you didn’t know”? In speaking with him, I have learned a lot about the reputation that the District has with construction vendors.

In an email last week to Heckendorn Shiles Architects and TESD, Sean Gaffney wrote the following,

GEM went above and beyond to complete your project on-time and the job has been completed for nearly a year…There were multiple project delays caused by existing and faulty equipment in Devon Elementary and asbestos in Beaumont that was uncovered and not included in the ACM reports. GEM is also due interest for TESD’s repeated late payments. All said, if HSA and TESD truly want to close out this project then they should consider releasing GEM’s final payment immediately and contact me to schedule one day for GEM to come out and complete the two remaining punch list items.

Have you ever wondered why there are so few vendors bidding the construction jobs in T/E? As Sean Gaffney says, “Some people at TESD want to continue to play by their own set of rules. GEM (and many others) will not bid construction projects for TESD”.

Based on GEM Mechanical Services’ experience, it is no wonder that there is decreasing vendor interest in working in TESD.  The low bidder turnout on TE School District projects compromises the competitive bid process; which is ultimately damaging to TESD taxpayers. For competitive bidding to work successfully, outside vendors need to feel confident that they will be treated fairly if hired by the TE School District.

In the TE School District, all roads lead “to” or “through” the business manager which I believe is a problem and indicative of a far greater issue. This is the same business manager who has yet to satisfactorily explain the $1.2 million accounting error. And these are the folks in charge of the $35 million high school expansion project!

In closing, I would be remiss not to remind TESD residents that the 2020-21 preliminary budget includes a property tax increase of 2.6% – in the midst of high unemployment, small business failures and an uncertain future! For the record, the school board approved the preliminary budget 8-1 (Scott Dorsey was the sole dissenting vote). The final vote on the 2020-21 budget is June 8.

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TESD Auditor to Attend Finance Meeting Monday, Dec. 9 – Will the Public Receive Answers to $1.2M Accounting Error? Some Taxpayers are Suggesting Fraud & Cover-Up!

As the T/E School District launches its $40 million high school expansion plan and new parking lot, there remain unanswered questions and concerns about the District’s finances and budget process – particularly the unanswered status of the $1.2 million accounting error.  Six months ago the school board voted 6-3 for the District to take responsibility for the accounting error and to correct the audits and annual financial reports for 2016-17 and 2017-18 years.

At the Finance Meeting on Monday night (7 PM TEAO), the District’s audit report and updates is on the agenda and will be presented by Auditor Donald J. Pierce, CPA and partner at Maillie, LLP. Former school board President Scott Dorsey previously assured members of the public that they would be able to ask the Auditor questions directly – it is assumed that newly elected Board President Michele Burger will honor that commitment.

Since the District’s accounting error was first identified in early 2019, residents in the community, including financial professionals, have attended meetings, asked questions, voiced concerns and followed up with emails to school board directors. To date, there have been few answers.

In advance of the finance meeting tomorrow, one of the community’s financial experts Neal Colligan sent me an email detailing specific concerns/questions re the District’s accounting error. Neal is convinced that the accounting error was intentional on the part of the District (I read this to mean the Business Manager) and wants to know specifically when the Auditor learned about the error. It was previously established that the Administration did not tell the school board of the accounting error.  Neal states the following in his email –

The Administration has always maintained that the Auditor was aware of this timing error when the decision was made (by the Business Office) to post them in the wrong year.  Some of the Board has parroted the same story.  On April 22, 2019; the Superintendent read a statement into the record that included, “once the invoices were found, they were booked, according to GAAP, in the 2017-18 year…” and that this information “was shared by the auditor at the time..”.  On August 26, 2019; the District Solicitor wrote this statement of Fact: “concurrent with the processing of the invoices and recording of the expenses in the 2017-2018 fiscal year, the District informed its independent auditor of the found unpaid invoices….” and “the independent auditors verbally advised that the invoices did not meet their test for materiality…”

Over the course of the last year it was apparent to the public that some members of the school board were not interested in the correction of the accounting error (remember three members of our school board opposed the vote in June).  It appeared that they expected the public to quit asking questions about the accounting error; probably in hopes that the problem would just go away. The good news is that Neal and others in the public may finally get the answers from the Auditor tomorrow night!

Aside from simply “doing what’s right”, why should this error in the District’s accounting be important to the school board (and the taxpayers)?  Neal answers that question here –

The Auditor is hired by, and works directly FOR, the Board.  They are reviewing the Business Office and their internal controls.  Mistakes or break-downs in controls MUST be reported directly to the Board (by the Auditor if the Administration does not share with the Board as in this case).  The Auditor has NEVER mentioned this “timing error” in their Management Letters report to the Board; they will certainly address it THIS year.

An audit is an expensive (cost of the audit) check on the Administration.  IF the Administration is not honest with the Auditor, this important control does not exist.  There’s plenty of written evidence that this accounting error was engineered by the Administration and that they never informed the Board or the Auditor.  If that’s the case: this is extraordinarily dangerous to the Community.

Board Members must then consider the likelihood that this has happened before and assure that it does not happen again.  An audit can never catch Management Fraud.  The reason is obvious; Management can commit the Fraud and then cover it up.  Did this happen here?  If so, the Board needs to take serious action and remove the individuals who engineered this financial mis-statement and non-disclosure.

There are plenty of documented statements like the ones above indicating those involved in this saga and (???) cover-up.  The timing of the Auditor’s “notice” of this November of 2017 event is a critical piece of information.  The Board wants to be trusted by the Community, can they trust their Administration/Solicitor?  Maybe we’ll find those answers when the Auditor speaks.

Here’s hoping that Neal is able to help to find the community’s needed answers from the Auditor at the Finance Committee meeting!

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In Advance of Election Day – Audit Letter Related to TESD $1.2 Million Accounting Error Arrives

At the T/E School Board meeting last night, there were a number of questions from residents about the District’s finances, budget process, etc. including a question that I asked about the status of the $1.2 million accounting error. If you recall four months ago, on June 11, the school board voted 6-3 for the District to take responsibility for the error and to correct the District audits and AFRs (annual financial reports) for 2016/17 and 2017/18.

It is now over 4 months since the school board voted to direct the District to correct the audit and AFRs but neither the board nor the administration has provided an update on this important accounting issue. Although the business manager bristled at my use of “accounting error” (what else should you call it?) after some back and fro between the school board president and the business manager, the upshot was that it should be completed by November 15 – 5 months since the vote took place.

Facing a lengthy agenda, I left the meeting about 9 PM. However at the end of the meeting, there was school board discussion about a letter from Maillie LLP, the District’s auditing firm.  It was agreed that the letter would be made available to the public.  So … today at least two residents reported they went to the Administration Building and were told that the letter would be released on Friday.  It was impossible for me to understand WHY it should take four additional days for the letter to be released – was it because the contents of the letter needed to be slow-rolled in advance of Election Day on Nov. 5?

As luck would have it, we don’t have to wait until Friday – I have a copy of the October 16 letter written by Edward Furman, CPA from Maillie.  From my vantage point, it looks like the District business manager has a lot of explaining to do about the $1.2 million accounting error and the timeline  – some of his stories are not lining up! Furman’s letter contains extremely important financial information related to the $1.2 million accounting error but I leave the specifics of what it all means to our “financial experts”.

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T/E School District goes from a $1.5 Million Deficit to having a $4 Million Surplus Four Months Later – A $5.5 Million Discrepancy! How is this Possible Mr. Business Manager?

How is it possible that in June, the TESD Business Manager claimed a projected deficit of $1.5 million for the 2018-19 year and then based on that, the taxpayers received a 3.91% tax increase for 2019-20?  Then fast forward less than four months later and this same Business Manager tells the school board at the Finance Committee meeting this week that not only did the District not have a deficit for the 2018-19 year but instead it magically had a $4 million surplus — A $5.5 Million discrepancy! How is this possible?

In the T/E School District, residents have faced annual tax increases for the last fifteen years.   If you recall, in mid-December 2018, the District first presented the 2019-20 budget with a proposed 6.1% tax increase and that 6.1% increase hung over taxpayers heads for six months! Finally in June the proposed tax increase was lowered and the school board approved a 3.91% increase. And with the 3.91% tax increase, our school district received a special distinction … we had the second highest tax increase in the Philly region!

Do you fully understand what happened?  To recap … from December 2018 to June 2019, taxpayers were faced with a 6.1% tax increase. In June 2019, taxpayers ended up with 3.91% tax increase due to a projected deficit of $1.5 million. Now four months later, the taxpayers are told that the District didn’t end up with a deficit after all. Nope, actually the 2018-19 year ended with a $4 million surplus. Again, I ask why is there a $5.5 million discrepancy and and why did taxpayers receive a 3.91% tax increase?

I don’t know about you, but as a taxpayer I find the “fuzzy math” approach wholly unacceptable! And let’s not forget, the Business Manager received a new 5-year contract starting July 1, 2019 with a base salary of $210K plus annual raises and bonuses.  Oh, and he is also the responsible party for the $1.2 million accounting error from the year before; which to date remains unresolved (although the Board voted to have the Business Manager make the correction months ago).  As a top-notch school district, don’t the taxpayers of T/E School District deserve better?

Although I did not attend the Finance Committee meeting, I watched the video (the District does not tape Finance Committee meetings but fortunately residents now do!) Neal Colligan did attend the meeting and provides the following commentary.

It appears to me that taxpayers should have received ZERO tax increase. And somehow the District’s update of $4 million “found money” and the $5.5 million discrepancy was not worthy of making it on to the Financial Committee agenda. School board, where is your outrage?

From Neal Colligan —

The Finance Committee meeting started with a quick review of minutes and a presentation of year-to-date financials.  The committee received an update on Special Education costs.  Seemed to be on track but this report was not posted in the Agenda so I can’t comment on the details (for fairness, the report should make the Agenda for future meetings).

The next section of the meeting was the most eye-opening.  Couched under the item Capital Planning- the Board was informed that their 2018-19 projected deficit (last year) of $1.5 MM is now a $4 MM SURPLUS. 

It was difficult to follow the Business Manager’s explanation of the changes (and I watched the video twice – thanks Doug Anestad and BUILD T/E).  Seems to be greater revenues of $1.6 MM-increased interest earned, State revenue increase, transportation subsidy received and increased State funding for Special Ed ($500,000).  On the expense side another $1.6 MM in savings in non-instructional items under the categories of supplies and repairs and a savings in Special Education purchased services of $760,000.  I know this doesn’t add up to a $5.5 MM swing but the details were not complete and not included on the Agenda items.

The discussion was centered on “what to do with this new-found surplus” but certain Board members (Murphy and Sweeney particularly) seemed surprised (as was the audience) at the BIG swing from deficit to surplus in the just completed (June 20, 2019) fiscal year.  Mr. Sweeney correctly noted that this knowledge in real-time would have certainly influenced his vote on the last tax increase (3.91%).

Some of the discussion on what to do with this money and “below-the-line/above-the-line” differences, transfers to other funds (Capital), and the relation of the surplus to authorized spending was a bit painful to watch … but I’m speaking as an accountant so I know these are easier concepts for me.  This decision will be tabled for another meeting but, IMHO, the Board needs to quickly become familiar with the process here as it relates to what they can do with their surplus after the year is completed.  They can be forgiven as they are not “financial” people but they’ll have to get up to speed fast on the rules.  Not a single Board member (although Sweeney touched on this) considered the taxpayer in this discussion (i.e.: could surplus be used to offset future tax increases).

The final part of the meeting briefly touched on the Committee’s goals going forward.  Mr. Sweeney had suggested changes to the budget process as well as additional detail be required from the Administration to help the Committee understand the District finances.  This was also tabled for a future meeting.  Mr. Dorsey supported the discussion of changes in the Board/Finance Committee process and the importance of this initiative.  Comments from the audience included: getting real-time financial numbers from the Administration; on-going busing issues and suggesting a format for review of Budget variances over a longer historical time frame.

Thank you Neal! Here’s a link to the Finance Committee video.

Make sure to watch the video to the end for the resident comments.  Sadly, some District parents are still experiencing transportation issues – young children sitting on the buses for a long time, including on school grounds. Parents continue to ask the District for a tracking app (for buses) which “may” happen at the December Finance Committee meeting.

The “kick the can” mentality is allowed to continue with no sense of urgency. Where is the accountability and demand to fix the busing problems … right, the Transportation Director reports to the Business Manager. Why is it that so many issues in this school district lead directly the Business Manager (and then sadly, HE is allowed to prioritize).

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Apply Now — Vacancy on Tredyffrin Township Board of Supervisors, District 1 (East) and Region 3 Vacancy Filled on T/E School Board

A vacancy on Tredyffrin Township’s Board of Supervisors was announced at its meeting this week. The vacated position of Township Supervisor in District 1 (East) was held by long-serving supervisor Paul Olson, who recently sold his home and moved from the township.

A Republican, Olson was first elected as a Tredyffrin supervisor in 1976 and has served 43 years, losing only one election.  Committed to serving the community, Paul was involved with many organizations, including the Red Cross, Tredyffrin Library, Surrey Services and the Carr School in Mt. Pleasant, to name a few.  On a personal note, the ongoing support of Paul (and his wife Andrea) to historic preservation was much appreciated by myself and the other members of Tredyffrin Historic Preservation Trust Board of Directors. As an elected official, he truly understood the importance of our local history and its preservation!

The Tredyffrin Board of Supervisors will make an interim appointment to fill the District 1 (East) seat. Persons interested in being considered for the appointment must be residents of District 1 (East) and voters of the E1, E2, E3, E4, E5 or M2 voting precincts. The Board of Supervisors will accept letters of interest (with resumes) through Friday, July 26 addressed to Tredyffrin Township, c/o Murph Wysocki, Chairman of the Board of Supervisors at Tredyffrin@tredyffrin.org.

The Personnel Committee of the Board of Supervisors (3 supervisors) will interview the candidates in a public meeting on Monday, August 5 at 7 PM at the township building. The Personnel Committee will make a recommendation to the Board of Supervisors and the Board will vote on the appointment at its next meeting, on Monday, August 19.

It will be curious to see what happens with this supervisor appointment – will the Board of Supervisors, which currently holds a Democrat majority (4-2) honor the long-held Republican seat and appoint a Republican candidate? Or would the Board stick to the party line and appoint a ‘D’ to fill the vacancy?

The District 1 (East) seat is on the November ballot, making the vacancy an interim appointment. Although Julie Gosse (D) and Raffi Terzian (R) are the endorsed candidates for the seat in the November election, all residents of District (1) and registered voters (E1, E2, E3, E4, E5 or M2 precincts) are eligible to apply for the interim appointment.

Perhaps not wanting to appear partisan, the Board of Supervisors could appoint an ‘Independent’ registered candidate and make history – the township has never had an ‘I’ as a member of the Board of Supervisors. Of course, that assumes a registered Independent in District 1 (East) applies for the position.  Over the last few years there have been many new people moving in to the township — applying for the interim supervisor position would be a great way to get involved in the community!

On the same night as the Board of Supervisors officially announced its vacancy on the Board, the T/E School District Board interviewed and appointed to fill its Region 3 vacancy – if you recall, last month Heather Ward (D) from Easttown resigned from the school board after serving 18 months of the 4 year term, stating that she would be taking a new job and moving out of state.

Ray Clarke attended the July 15 school board meeting and offers his comments on the interview and selection process and notes from the regular meeting.  Although the school board agreed at its June meeting to correct the $1.2 million accounting error, it is noted that a month later the issue remains open.  As has been stated repeatedly, there is a process with the PA Department of Education to make the necessary correction so the question from the public, remains WHY hasn’t it been done? The District’s Business Manager Art McDonnell was missing from the meeting – certainly not working on fixing the District’s accounting problem, guess it summer vacation for him. Remember folks, McDonnell received a new 5-year contract (with a raise!) starting July 1.

School Board Meeting Comments from Ray Clarke –

 The TESD Board of Directors held special meetings on Monday; first to interview candidates to replace Heather Ward and second an official Board meeting to select one of them.  Six Easttown residents applied and all presented themselves well, having relevant (but different) experiences and skills, with a good general understanding of the issues confronting TE and the role of the Board.  In the formal Board meeting, three of the candidates were nominated and in the first round of voting Mary Garrett Itin was selected in a party line 5-2 vote (Tina Whitlow was out of the country). She has a social work and child mental health background and spoke of favoring a fact-based, objective and transparent approach. Kate Murphy and Ed Sweeney nominated applicants with legal and financial backgrounds who I thought might have been very well equipped to hold the Administration to account, but they were the sole supporters of their nominees.

The need for that oversight was starkly demonstrated in response to public comment during the remainder of the board meeting.  Many different tacks were taken in an attempt to ascertain any information about actions taken in response to the Board vote to correct the Annual Financial Report filings with the state.  All approaches elicited the same response: we’re working on it (in some unspecified manner) and you’ll find out more in the next scheduled Board meeting on August 26th.

Both aspects of the meeting then led to a round-about discussion of the ways to include qualified and motivated community members (such as the Board applicants) more directly in Committee deliberations.  As a specific example, involved parents continued to advocate for their participation in the direction of the reading curriculum and spoke of insights from a recent academic conference. Ed Sweeney moved to include the general question of Committee make up as part of the strategic planning process, but in the end it was agreed (Kyle Boyer excepting) to consider the issue in the first Policy Committee meeting of the new academic year (perhaps a quicker forum).  There are different approaches (eg voting/non-voting) and pros and cons to this, and it is a question well worthy of discussion.

Notably, at the end, the Solicitor reported that an Executive Session was held last week to discuss collective bargaining.  The teacher contract is up for renewal at the end of the coming school year.  In the new normal of budget deficits and cost pressures the usual issues of process transparency and compensation/program trade-offs may be more contentious than usual.

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T/E School District News: 3.91% Tax Increase, District to Correct $1.2M Accounting Error & School Board Member Resigns

The five-hour marathon school board meeting last night lasted until 12:30 AM, albeit the audience was kept waiting with a 30-minute late start.  For those community members who stayed the course until the end of the school board meeting, thank you!

Although I was unable to attend the meeting, I received multiple updates throughout the evening followed up with several phone calls today. The significant takeaways from the evening included the (1) 2019-20 tax increase decision of 3.91%, (2) the Board vote for the District to take responsibility for the accounting error and to correct the Annual Financial Reports (AFR) with PA Department of Education (although sadly all Board members were not in favor of “doing what’s right”) and (3) the announcement of the resignation of a school board member.

Luckily, we have Ray Clarke providing comments on the school board meeting until he left at 11 PM (following the 3.91% tax increase vote). At that point, Mike Heaberg picks up the commentary until the meeting finally ended at 12:35 AM.  See their remarks below — thank you both!

From Ray Clarke:

– Dramatically larger attendance than a typical meeting, which multiplied the persistent disregard for the community’s time when the meeting started half an hour late

– A long plea from the rugby club for Varsity status, but notably none stayed for the Budget discussion which might have suggested funding limitations

– The Board based its discussion around just the 3.91% tax increase, not all the other options (2.8% or 4.33%)

– The Board agreed to amend the 3.91% budget motion with an investment in the new elementary reading program as a $300,000 one-time “below-the-line” expense, contingent on a number of conditions. This did not satisfy parents who are advocating for parent involvement in selection of any new program

– The amended motion passed 7-2, with Kate Murphy and Ed Sweeney allied for a lower number. Todd Kantorczyk and Roberta Hotinski reluctantly went along with a lower number than they would prefer, the former (correctly) noting that budget and actual deficits cannot continue, while the latter continues (inexplicably) to want to move the following year’s – potential – exception forward into the coming Budget year.

All Board members seemed to agree that the Budget process is broken.  Board President Scott Dorsey wants to separate the budget from the routine Finance process. He spoke forcefully about his outrage at this and the $700,000 expense surprise revealed at the last meeting.  He warned of “someone paying the price” for any similar issues in the future.

– The District’s Solicitor (reportedly with financial experience, not Ken Roos but from the same law firm, Wisler Pearlstine) advised the Board that Annual Financial Reports to the state CAN be corrected, provided that there are new audited statements and if certified by a new auditing firm or individual.  The Business Manager reported logistical, cost, PDE and outcome risk issues with this, although to the audience it seemed that those were grossly over-stated.

– A wide cross-section of community members spoke compellingly in favor of the District basing its decisions on the correct financials, about the pattern of behavior that has got us to this point, and about the need for process and personnel changes

– Unfortunately many had to leave at 11pm after the budget vote, but the AFR revision discussion continued.

Mike Heaberg picks up the commentary on the school board meeting at this point, including the Board’s acknowledgement of the administration’s accounting error and subsequent vote to correct the District audits, the Annual Financial Reports (AFR) and resubmit.  Thanks so much Mike!

From Mike Heaberg:

– After the Board acted on the consent agenda, other action items, and “final” public comments, Ed Sweeney made a motion to begin the process of correcting the District audits and Annual Financial Reports for 2016-17 and 2017-18.  Kate Murphy seconded it.

A long Board discussion ensued including input from the District’s Solicitor, Business Manager, Superintendent and the public. At one point, Todd Kantorczyk made a motion to table action until a future meeting – the next scheduled is August 26. On a roll call vote, his motion failed 5-4.  After more discussion, the vote was held via roll call. It won 6-3.  Voting in favor of correcting the audits and AFRs were Ed Sweeney, Kate Murphy, Scott Dorsey, Michele Burger, Heather Ward, and Tina Whitlow.   Todd Kantorczyk, Roberta Hotinski, and Kyle Boyer voted against correcting the audits and AFRs.

– At the very end, about 12:15 AM, Heather Ward announced she is moving out of the District and resigning from the Board effective 6/16/19.  The Board has not sorted out the replacement process. Heather made gracious comments and her colleagues offered thanks and praise for her service to the District.

The 2019-20 budget process was one for the books with final changes and decisions coming in at the eleventh hour (or in this case 12:30 AM!).  I am appreciative that in the end, school board member Ed Sweeney had the resolve and courage to push forward for correction of the District audits and Annual Financial Reports.  I thank him and the other five Board members (Kate Murphy, Scott Dorsey, Michele Burger, Heather Ward and Tina Whitlow) for “doing what’s right” and voting to correct the District audits and AFRs but simply do not understand why the other three Board members opposed the action.

Over many months, much time and energy was expended by the public in urging the Board to do “what’s right” — I’m left wondering why it took months of meetings, emails and phone calls (many by resident financial experts) plus an official letter of complaint to the PA Dept. of Education to finally achieve this goal.

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 and the 2019-20 budget process debacle was a direct  result of his actions.  The Board (and the District’s taxpayers!) are ill-served by this business manager and we deserve better!  When is enough, enough?

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

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?

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