Shakopee city and school administrators are scrambling to regain public trust as emboldened local activists try to root out misconduct in the wake of a recent scandal.
Superintendent Rod Thompson resigned last summer in the midst of a police investigation that uncovered more than $70,000 in fraudulent charges and improper reimbursements since he took office in 2012.
“There’s a distrust in government, probably more than ever in this particular area,” Shakopee’s City Administrator Bill Reynolds said. “Everything we do — and rightfully so — will be examined.”
Thompson faces dozens of charges of theft and embezzlement in Scott County District Court. Groups like Friends & Concerned Taxpayers of Shakopee (FACT) pushed for a criminal probe and are now demanding a purge of the school board for failing to recognize what they call rampant and unchecked overspending.
Energized by their success, activists aren’t letting up. Some are turning their attention to City Hall.
“We were told, ‘There’s nothing to see here; everything is fine,’ ” said Carrie Ferris of FACT. She says her group was initially dismissed as a bunch of conspiracy theorists for questioning financial discrepancies in the schools. “No, they knew full well what was going on.”
In response to this scrutiny, city staff members are preparing an overview of the city’s purchasing policies so that residents can review safeguards. Additionally, city leaders have simplified the budgeting process for people less familiar with the nuances of municipal finance.
“We have the responsibility to take only what we need, make sure people know what we’re doing with it, and try not to waste any of it,” Reynolds said.
The growing city of 40,610 is showing other signs of political strain.
Even before Thompson’s resignation, infighting on the City Council started to surface.
In April, Council Member Mike Luce was censured for leveling unproven allegations of financial mismanagement against another council member. A few months later, Reynolds blamed political discord for a developer’s decision to pull out of a $24 million downtown redevelopment project.
But community unrest over spending and questions about government accountability go back further than that.
Residents first became concerned last year when the school board misjudged the impact of a $102.5 million school bond referendum, which cost taxpayers more than initial estimates. The public angst intensified when Thompson dismissed a $4.5 million school district budget shortfall as “human error.”
A group of about a dozen community members launched FACT after failing to get the answers they sought from district leaders. Jane Hochhalter, a local accountant, helped sift through financial documents for irregularities. She became skeptical when she saw entire budget items zeroed out.
“If I made this error in my job, I would be fired,” said Hochhalter. “[School board members] keep on saying that they want to move forward, but the issue for us is that we can’t move forward until we know what happened — and the people who are responsible for what happened are held accountable.”
District administrators say they’ve toughened school credit card control measures and formed a committee to monitor spending.
School board Chairman Scott Swanson said his chief mistake was trusting a man who ultimately betrayed him and taxpayers.
“I personally had no particular reason to doubt or question anything that was happening,” Swanson said. “It was happening under my feet and I was the last one to know about it.”
A wake-up call to citizens
Temporary Superintendent Jon McBroom is now facing deep budget cuts, and this month the board approved a property tax levy that’s up 9.8 percent over 2016. So far, school leaders aren’t ruling out layoffs.
“I think it’s important to be able to look people in the eye and tell them that this is what we believe the situation to be,” McBroom said. “I don’t think anything has been sugarcoated.”
The only good that has come from this painful ordeal, activists say, is that parents and taxpayers are paying closer attention.
Police Chief Jeff Tate said public officials are best served by tough critics.
“Our integrity, our reputation is up for re-election every day,” he said. “We need to be constantly reminded about who we’re here to serve.”