Audit: BC made improper gifts to employees

The reserve was already planned to be exhausted in the coming year's school budget.

BC fires back on fiscal practices critique

BC officials "vehemently object to" a third set of criticisms set forth in the audit dealing with the district's purchasing practices.

The comptroller's report cites BC for awarding contracts to two companies owned by district employees and for not following competitive bidding guidelines.

BC made an order for custodial and maintenance uniforms and an order for "scrubber batteries" during the audited period from companies owned by district workers for about $5,000 and $800, respectively.

"When District employees have an interest in contracts with the District, there are increased opportunities for favoritism, extravagance, and/or fraud. There is an increased risk that taxpayers' interests will become secondary," the report reads.

Kehoe said that in these instances the orders were placed with companies owned by part-time district employees, and after bids were solicited from other sources. The orders were placed with the lowest bidder, she said.

Similarly, the report states the district did not seek out competitive pricing on over $700,000 of purchases during the audit period, the largest being the purchase of general liability insurance.

Kehoe said BC had worked with its carriers to compare quotes for this and the other services identified in the report, but had not issued formal requests for proposals.

"That's typically the way insurance is procured. ... I don't know if they fully understood that," she said.

Kehoe said the auditors made several positive comments about the district's business office practices, including the wide use of competitive requests for proposals and the level of documentation and internal controls, but these were not included in the report.

The comptroller's office launched a rotating, statewide audit of school districts in 2004. BC was last audited in 2007, when auditors identified issues with the district's internal auditing structure and payroll.

The district is also reviewed by an independent auditor and by agencies like Standard and Poor's. Tebbano argued that BC has set a high bar for transparency, especially in the amount of information that's on the district website.

"We accept the recommendations from the comptroller, and are moving forward," he said "The little bit of things we have done aren't major crimes.""

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