State finishes audit of DeKalb County School finances Channel 2’s Richard Belcher said while it’s mostly good news, the audit showed some room for improvement.
DEKALB COUNTY, Ga. — The latest state audit of the DeKalb County School District’s financial management gives school officials something to celebrate at a time when things haven’t been going so well.
The audit doesn’t give the district a completely clean bill of health, but there are no major findings of mismanagement (what auditors call material weaknesses).
In a statement, Interim Superintendent Vassane Tinsely said the report includes what she called “encouraging feedback,” but added “there are also deficiencies…we must address.”
It’s good news for DeKalb taxpayers who send the troubled district hundreds of millions of dollars in property taxes each year, as well as hundreds of millions more in a special sales taxes for capital improvements. Just 18 months ago, Channel 2 Investigative Reporter Richard Belcher asked an independent forensic auditor to look at the state’s latest findings about DeKalb. Our expert was blunt:
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“The gaps in the financial reporting system leave the school board completely wide open for fraud.” But not this time.
The district has been beset by controversy in recent weeks. A student video of the deplorable conditions inside Druid Hills High School was an embarrassment that triggered a split on the school board and complaints about schools all over the county. The board’s sudden decision in late April to fire Superintendent Cheryl Watson-Harris — not even two years into her contract — was fresh evidence of instability in a system now on its 8th superintendent in 12 years.
Other problems included the release of a report prepared by an outside company quietly hired by the school board and headed by a retired FBI agent who had specialized in organized crime and public corruption. The report found no wrongdoing by Watson-Harris, but did conclude that two of her cabinet members made important decisions about promotions and pay supplements without bothering to notify the superintendent.
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Channel 2 Action News reported that DeKalb spent $86.3 million dollars of federal CARES Act money on employee pay supplements. That was almost 18% of all the CARES Act money the district received, a far higher percentage than what was spent on pay supplements by school districts in Gwinnett County, Fulton County and Atlanta.
When the state dropped its latest findings about the way DeKalb manages huge sums of local, state and federal tax money, the risk of another embarrassment loomed — but passed.
“My overall take is that this represents a big improvement, and the county should take a victory lap, at least for the time being,” independent forensic accountant Jesse Morton told Channel 2.
Morton acknowledges that the report includes some criticism of the district, including criticism of the system’s management of CARES Act money. The auditors sampled payments to employees and found a lack of documentation to support some of the payments. They estimated as much $959,493 may have been questionable.
“To me, this was not surprising at all because under the CARES Act, there was a lot of money that went out fast. There wasn’t a lot of guidance or regulation when the money went out. I’m seeing pretty widespread — both in the public and the private sector — similar types of issues as were identified here,” Morton told Investigative Reporter Richard Belcher.
Auditors found one employee who received a $10,000 pay supplement for having a doctoral degree. But the employee didn’t have such a degree. Auditors singled out HR and payroll departments for a lack of oversight.
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Morton says finding problems is the purpose of any audit, and he was struck by the district’s response.
“A lot of times I see pushback from management, almost refusing to accept the issues. Here at least from the tone that I read, it did seem that management fully acknowledged and put a corrective action plan in place. I think it’s absolutely critical the district keeps up this positive momentum. I wouldn’t be surprised if in next year’s audit there are still a couple of significant defiencies identified, but so long as there’s not a slide back into material weakness or more significant issues, I think it’s representative of the way forward and continuing to progress in a positive way,” Morton said.
In her statement, the interim superintendent said, “I’d like to highlight that the auditors pointed out that the district has made great strides. Many previously reported findings had been resolved and cleared.”
The improvements took place under Chief Financial Officer Charles Burbridge, who was hired by Watson-Harris. Burbridge told Channel 2 in December of 2020 he was confident he and his team could make significant progress after several years of embarrassing findings from the state.
Channel 2 Action News first reported on Burbridge when he took on a similar financial rescue mission at Atlanta Public Schools 15 years ago.
Burbridge is leaving in two months for personal reasons.
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