Greece Central School District audit details waste

Meaghan M. McDermott – Staff writer
Local News – February 9, 2010 - 6:00am

A forensic audit of the Greece Central School District found that contractors overcharged the district during an early 2000s construction project and a former superintendent of schools not only saddled the district with hundreds of dollars in cell phone bills but also took days off from work while collecting his regular salary.

The audit, obtained by the Democrat and Chronicle through a Freedom of Information request, also found other instances of financial waste, abuse and excess, including a $10,000 work order to install a $150 drinking fountain and more than $100,000 spent on a Steinway grand piano and its heat and humidity controlled storage room.

Many of the audit’s findings have already been discussed during Board of Education meetings, but this is the first time the full report has been made public.

The Eldredge, Fox & Porretti audit followed a scathing state Comptroller’s Office audit of the school system that found numerous instances of waste, fraud and abuse of taxpayer monies within the district. In August 2008, the Board of Education hired EFP to scrutinize the $119.5 million capital improvements project, and to probe expense reimbursements and financial transactions involving former Superintendent Steven L. Walts and his employee cabinet.

Regarding Walts, auditors determined that while he may have had high cell phone bills during the months he was preparing for a new job in Virginia, the Greece school district was obligated to pay those bills under his employment contract. Auditors did criticize him and other former district officials for “excessive” travel expenses, including out-of-town hotel stays with room costs of $350 per night and up and a California trip that cost the district $2,100 in airfare.

Auditors found nothing out of order with a controversial contract addendum that has Greece taxpayers still picking up Walts’ health care costs although he now works in Virginia, and found that because contract terms were ambiguous, he was legally entitled to the $53,367 in compensation he took for unused paid time off when he left on July 8, 2005. Since the district’s fiscal year reset after June 30, Walts received his full allotment of paid time off for 2005-06 even though he worked only one week of that school year.

Auditors also found Walts made several trips to Virginia between March and July 2005 and did not record those days as vacation days, something auditors called “a consistent pattern of activity” that cost the district nearly $10,000. Auditors said Walts “essentially spent the last week of his (Greece Central School District) employment conducting personal business.”

Walts could not be reached for comment.

Overall, the EFP auditors reached the same conclusion state Comptroller’s Office auditors did: the Board of Education in the early and mid-2000s did not properly oversee the district and the district lacked policies and internal procedures to prevent waste, fraud and abuse.

In a written response to the EFP audit, current Superintendent Steven Achramovitch said the district has put new policies and procedures in place to safeguard the district and taxpayers. And, he said, the district has aggressively pursued reimbursement from the overcharging by contractors and is working with its attorneys to recoup the funds.

District officials turned over all information related to Walts to their attorneys and to the Monroe County District Attorney’s Office to see if any legal action could be taken against him. The district attorney declined to take any action and on the advice of their attorneys, Greece’s Board of Education voted in July to stop trying to cut off Walt’s lifetime health care benefits.

“We are confident these issues have been addressed and we are moving forward,” said Achramovitch.

MCDERMOT@DemocratandChronicle.com

Audit findings

Contractors during the $119.5 million capital improvement project from the early 2000s over charged the district at least $143,000 due to excessive markups for contingency allowances.

The project was hastily planned in order to meet state Education Department deadlines for funding. As a result, “many details were overlooked or inaccurate.” And, district officials also made “a substantial number of design and aesthetic changes” after the project began, contributing to an “unusually high” number of change orders.

While state Comptroller’s Office auditors said they believed district management ordered change orders split so they would fall below a $20,000 threshold that would have required Board of Education approval, the forensic auditors disagreed. They said that was possible, but “change orders greater than $20,000 did not receive board approval either.”

In several instances, district officials submitted travel expenses that were “excessive,” including six instances of hotel rooms in excess of $350 per night, and airline tickets that cost $2,100.

Under his contract, the $53,367 paid to former Superintendent Steve Walts for unused paid time off when he left in July 2005 “was accurate and appropriate.” What do you think of the audit? Click on this story to comment.