Bad feelings linger after school audit

Bad feelings linger after school audit

NORTH SMITHFIELD - Both town and school officials agree that the community should be "outraged."

But the question is, at whom?

If residents hoped the results of B & E Consulting's report on the financial status of the North Smithfield School Department would help to mend the strained relationship between town and school officials, they may be disappointed.

The report found that the School Department has gone from a $470,000 deficit to a $441,000 surplus, and both sides in the ongoing dispute over funding took elements of the document as confirmation of their previous arguments.

"We have a lot of reasons to be proud of the North Smithfield School Department but fiscal management isn't one of them," said Town Council President John Flaherty. "I'm angry and I'm frustrated."

School Committee Chairman Robert Lafleur, meanwhile, pointed to language in the report stating that the town's budget board went beyond its scope in their effort to get things right.

"The Budget Committee chairman and Budget Committee owe a personal apology to the NSSD and to the children and residents of North Smithfield," Lafleur said. "Further, the Town Council needs to take action about the future role of the Budget Committee, or their lack of action and or inaction will be a detriment to the future success of the district and the reputation of the School Committee and the Town Council."

The Town Council commissioned the report - aimed at investigating the $470,000 deficit - in January as part of an agreement to send the department $240,000 to resolve the problem.

Auditors from B & E emphasized that they found no wrongdoing on the part of school officials last week, and announced that the pendulum has swung, with the district now on track to end the year $441,000 in the black.

They described the fiscal status as a "snapshot" that would undoubtedly change by June.

According to auditors, the district's special education budget was a major source of the financial confusion. The budget, which was originally compiled by pupil personnel services director Joseph "Rusty" Brown, a nine-year employee of the district, was reduced by $168,000 in August, but was later found to have 17 unfunded students, along with a variety of organizational problems and miscalculations.

School Business Manager Lisa Marcotte pointed to the pupil personnel budget in announcing the deficit in January, and the consultants identified additional issues, ultimately finding that the business manager had overestimated the projected shortfall from out-of-district placements by around $140,000. Brown resigned from the position last August.

Flaherty, who had opposed sending the department supplemental funding, but ultimately agreed under the condition that the deficit would be further investigated, said someone in the School Department should be held accountable for the special education budget, described by auditors as the result of either "bad guesses" or "total lack of effort."

"Between the nonexistent deficit and the projected surplus, we're talking about a swing of nearly $1 million," he said. "If the General Assembly were having a debate about a $200 million problem in the Statehouse, this would be a big story, wouldn't it? It would be two 38 Studios. That's the scale of the problem that we're talking about in a town the size of North Smithfield. It is a big deal, and think: what would $1 million buy in this community?"

"I understand all of the reasons why, but I hold the (school) administration accountable for that," Flaherty said. "With all due respect Mr. Lindberg, I do expect more of you as superintendent. The buck stops at your desk sir."

Lindberg responded "You've taken everything out of context in terms of what transpired. You want your pound of flesh, you're more than welcomed to have it, but you know what? You need to take some responsibility too sir."

In addition to examining financial data, B & E consultants took the role of arbitrators in what has become a divisive battle over the town's budget process and the procedure for how funding of schools was handled during the 2014 fiscal year. The Budget Committee, led by new Chairman Michael Clifford, took a detailed look at line items in a procedure that has been both hailed and criticized. While finding the committee was "spot on" in many of their assessments, B & E auditors found that at times, the board had stepped outside their purview. And the decision to ultimately level fund the district, they said, was unjustified. "B & E does not normally review all of the communications between a budget committee and a school department for a budget review," the report stated. "However, because there was so much angst between the two bodies, it was important for B & E to try to understand why."

"Clearly all lines of civility were broken," it continued.

"I'm sorry if you're disappointed and frustrated and angry," Lindberg told Flaherty last week. "I think a lot of people are for a lot of reasons, including the process that was employed last year."

Lafleur said "the report clearly substantiates everything that the School Committee has been saying all along. The Budget Committee chair and some members of the Budget Committee need to have their role explained again and the Town Council needs to stand up to the bullying tactics continuing to be exhibited by them."

Town Councilor Edward Yazbak, who voted against the financial plan adopted by the town last year, said he also believes the budget board did not use the right procedure.

"There's a right way and a wrong way to do it," he said. "Nobody took a solid look at the responsibilities and what that School Committee had to do and equated that to money to put it in the budget."

But Merredythe Nadeau, who has served on the budget board for three years including last year under Clifford, said 2014 was the first time in her experience that budgeters have even looked at school funding.

"The first two years I was on, we actually never reviewed the school budget," Nadeau said.

Former Budget Committee Chairman Paul Vadenais had also previously served as head of the School Committee, and according to Nadeau, assured the other board members that the district's budget was lean.

For all other departments, budgeters examined every line item.

"I felt like we were being irresponsible," Nadeau said. The process under Clifford, she added, has been "enlightening."

Clifford said his work on the School Department budget was no different than what was done for every other town department.

"I take definite offense to the statement that we weren't trying to find an appropriate budget," he said. "We weren't cutting programs for children, we were looking at line items that were grossly inflated."

In a statement, budgeters said the surplus identified by auditors was no surprise.

"We advised the Town Council not to transfer funds. The Budget Committee believed a line item review of the following was warranted prior to making any money transfers: out of district placements, projected end-of-year expenditures for all line items, payroll costs including related fringe benefits, and revenue projections," the statement said.

"Why would we apologize?" Clifford asked. "We recommended to the Town Council that they not transfer money until they verified there was a deficit and now there is no deficit, and the School Department owns the money."

Budgeters said they were never comfortable with the numbers submitted for out-of-district placements, and that the special education budget presented in August was different than the one vehemently defended by Brown earlier in the year.

"When we met with him last spring, he was adamant that he couldn't make any cuts," said Nadeau.

Both Clifford and Nadeau pointed out that Brown resigned right after the new numbers were submitted, but is now being blamed for the problem.

"I find that very hard to believe in light of how adamantly Rusty defended his budget," said Clifford.

Flaherty said he feels someone needs to own responsibility.

"Many of these issues seem to be the function of people who weren't doing their job correctly and you know what? There's got to be accountability for that," he said. "These folks aren't here anymore and I expect more."

Lindberg emphasized that in coming to North Smithfield, B & E had found a well-run district.

"The accusations and allegations that have been thrown at the School Department over the past year, to say it has taken its professional and personal toll is putting it mildly," Lindberg said. "To me the accusations and the allegations that were made were unfounded and to continue to perpetuate that - I am disappointed."

The complete report is available online via the town website at http://www.nsmithfieldri.org/ .