It was another blow to public confidence in Minneapolis public schools: A Star Tribune story described how top school district employees failed to properly handle expenses.
Reporter Alejandra Matos found that over the past six months, 262 employees charged $1.5 million on district credit cards. Although it’s not completely clear how many of the purchases are questionable, a sample of 270 expense reports showed that nearly half were submitted with no supporting receipts — even though district policies require receipts for every expense.
It’s obviously unacceptable form to appear to play fast and loose with expense-account rules in accounting for the use of public dollars. It’s especially damaging for a school system whose leaders project a $5 million budget shortfall this year. And it further erodes trust in district financial management when top leaders are lax with their own accounting even as they cut budgets. Teachers say that because of those cuts, they’re spending more of their own money to buy classroom supplies.
Receipts should be submitted for all district expenses. That’s expense-account rule No. 1 for any operation — public or private — that issues credit cards or allows employees to submit expense reports and claim reimbursement for work-related spending. And even if a receipt is lost or misplaced, they are easy to replace by contacting vendors who increasingly use electronic accounting.
School officials say that the majority of the expenses were legitimate and that they involved spending on needed items, including books and school supplies.
However, the newspaper’s spot-check review revealed that thousands of dollars were spent at grocery stores, Target, Wal-Mart, and restaurants in Minneapolis and around the country. The chief executive’s secretary spent $2,000 framing high school sweatshirts for a conference room. The secretary of the district’s human resources director charged $1,000 for balloons for several days of job fairs.
Thousands of dollars were also spent on food, travel and other expenses for the district’s leadership team. Among those who did not follow district expense-report rules were Superintendent Bernadeia Johnson and CEO Michael Goar. Johnson will leave the job Jan. 30, and Goar will become interim superintendent. Both repaid the district for expenses only after the Star Tribune inquired about them. Goar owed the district nearly $500, which included two purchases from an office supply store and some meals. Johnson reimbursed $185 in food charges using a discretionary account.
That raises questions about how school dollars are spent. Why did it take prompting from an outside investigation to force reimbursements?
For their part, both top officials say that their expenses were indeed work-related and that they involved purchases of iPads and meals with job applicants. Johnson admitted that there have been times when she misplaced receipts, but said her calendar would show where she was and how much was spent for what purpose.
She said she reimbursed her unallowable expenses with funds from another account within her office, arguing that district leaders should be able to purchase work-related computer equipment and local work-related meals. In the future, Johnson said, the district should revise its credit card rules to make that clear.
Under current district credit card policies, registrations, conferences, travel, food for parent events, shipping and postage, emergency items, and field trips may be charged to district credit cards. Prohibited items include personal items such as gifts or gift cards, gas, alcohol, tobacco, printing, cash advances, software or hardware, and student T-shirts.
District officials say that they are reviewing the district’s purchasing record in the wake of the Star Tribune story and that training sessions will be held to ensure that credit card holders understand and follow district policies.
The internal review could find that most of the expenses were justified and that there was little or no abuse of public funds. And the examination may find that some expenses should be moved from the prohibited to the allowable list.
Still, current rules were violated in a district that should instead be focused on rebuilding — not undermining — public confidence. As one parent told Matos: “It’s yet another example of lax oversight in the district.’’