Shiner ISD audit by TEA causes hubbub
Friday, June 21, 2006
Barry Halvorson, Victoria Advocate Reporter
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SHINER - It was a trip that District 10 Texas Board of Education Representative
Cynthia Thornton said she hoped she would not have to make: An appearance at a
public meeting to discuss the recent TEA audit of the Shiner Independent School
District.
Thornton said her visit to the community was originally scheduled to be an
interview with the Shiner Gazette but decided late Monday to turn it into a
public meeting at the Lutheran Fellowship Hall. During her introduction, she
said that she was responsible for calling for the audit of the district and she
was aware of a movement to stop people from attending the meeting.
"But I never wanted the new school (construction project) stopped," she said.
"I'm the one who originally called the high school basement the dungeon. I'm not
trying to stop the new school."
Thornton said TEA takes such an audit very seriously. She said the audit took
three days, which she indicated was longer than she expected and raised a lot of
questions.
Referring to Superintendent Trey Lawrence's response to the preliminary audit
report, which was legally kept confidential by the district, Thornton said that
Lawrence questioned why only selected members of the school board along with
himself, the district attorney and consultant Ken Leach were contacted. In his
response, Lawrence questioned why former Superintendent Sam Atwood along with
project architect Jim Singleton and several members of the board were not
questioned to provide a more objective view.
Thornton laid the blame directly on Lawrence, saying it was his responsibility
to inform those individuals and make them available. In a phone interview,
Lawrence said that was not what the TEA requested.
"They were very secretive about the process," he said. "They would tell me they
had an interview, and I wouldn't know who they were meeting with. We gave them
all the documents and information they requested."
In addressing the issue of the school district using a lease-purchase agreement
for personal property to equip the school, Thornton said the TEA questioned the
refinancing of the arrangement, which cost the district $77,307 in transactional
costs and an additional $221,282 in added interest cost to extend the term of
the loan from 12 to 15 years. Thornton expressed the opinion that this violated
the laws calling for competitive bids on all contracts of $25,000 or more.
Due to questions raised by the district, the TEA is seeking an attorney
general's ruling in the matter. Thornton expressed confidence that the ruling
would be in the favor of the state agency.
Competitive bid issues were also raised in the audit regarding the district's
bank depository contract. Thornton said in addition to allowing one institution
(First National Bank) to change its bid while the other (Lone Star Bank) did
not, the district selected the least beneficial contract (First National) and
that the district could have collected an estimated $45,761 according to her
personal calculations.
"Shame on them (the school board)," Thornton said. "I don't care what the name
is, you should go with the best bid for the child. Why they didn't, I don't
know."
In addressing the service agreements the district has with Leach, she said that
there were no formal contracts, and the trustees should be criticized for not
having a detailed contract in writing.
"My father taught me you don't vote on a contract until you read it," she said.
She added that while the district's loan agreement with Chancellor Financial was
legal, she did raise questions about the fact that the company's president, Bill
Caraway, was the one who wrote the legislation that created that form of
financing before leaving the legislature going into the same business. She did
say that the arrangements with Leach and Chancellor were not the responsibility
of the current school administration.
"As much as I disagree with (Lawrence), I've got to give him that one," she
said.
On other points, she said the district had no option but to comply with the two
directives included in the audit, to provide training for the board and
superintendent on bidding regulations and to provide the TEA with proposed
school budgets for years 2007 and 2008. She did acknowledge that Lawrence has
announced he will comply with both requests.
During the conclusion of her presentation, Thornton said that while the district
has received a final audit report she doesn't feel the issue has been put to
rest.
"The file remains open until the attorney general opinions are received," she
said. "Is it over? No. Did the district break any laws? I believe it did, the
TEA believes it did and some of the board members believe it did. Will the
auditors be back? I don't know."
TEA spokesperson DeEtta Culbertson confirmed that while the final audit report
has been turned over to the district, the case will remain open until it
receives the attorney general's opinion regarding the bank bids and Leach's
contracts. She said the agency does not have any authority to determine if the
law was broken.
"If there is a possible violation on the bidding, we would refer it to the
appropriate law enforcement agency, in this case the county attorney," she said.
"It is for that office to determine if they want to move forward with any
prosecution. (The TEA) doesn't have that authority."
Lavaca County Attorney V'Anne Bostick Huser is married to Shiner School Board
Member Michael Huser, who was one of two board members, the other being Gloria
Reindl, who did meet with the TEA auditors.
Barry Halvorson is a reporter for The Victoria Advocate.
Contact him at 361-798-3888, or by e-mail at
hvilladv@vicad.com.
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