In Skiatook probe, findings of ‘fraud, waste, abuse’ anger Burrage
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Published: 23-Feb-2010

By Patrick B. McGuigan

Published: 23-Feb-2010

“Fraud, waste and abuse” found during an investigative audit of the Skiatook Public School District has infuriated Oklahoma Auditor & Inspector Steve Burrage -- and he says there’s more to come. In response to questions from reporters at the state Capitol in Oklahoma City, Burrage disclosed investigative audits are under way in five more districts: Butner, Broken Arrow, Wagoner, Boynton and Seminole.

The Skiatook audit found that in a 4 ½ year period the district purchased janitorial supplies and security systems from a vendor who marked up costs more than $500,000. “The school paid $60, numerous times, for $11 trash cans,” Burrage said. For three mop heads valued at $13.50, the district paid $540. In the process, “nobody compared the invoice to the delivery ticket." The average “commission” for every dollar spent on janitorial supplies was 63 cents, the audit found.

Burrage told reporters. “We usually release these audits without much fanfare. I’m making an exception this time because of the disgraceful, senseless waste of taxpayer dollars that keeps coming out in our investigative audits."

The Auditor & Inspector, appointed 18 months ago after incumbent Jeff McMahon left office in the midst of a scandal, explicitly compared the findings to a federal investigation several years ago that found government agents paying “$750 for toilet seats and $695 for ashtrays.” Burrage said results of the audit made him “angry. There are countless legitimate uses that could be made of that money, but in this instance it was wasted.”

Burrage praised the work of two members of his staff, Tom Dougherty and Wes Edems, two members of his audit team. Members of the auditor’s team confirmed they had interviewed members of the local school board. However, in response to a question from CapitolBeatOK, they declined to characterize those meetings or describe what occurred in the sessions.

CapitolBeatOK asked if any procedures could be put in place within the public school system to address these issues in advance and perhaps avoid situations like this. Burrage responded, “Last year the Legislature passed a bill that would allow me to randomly select small districts, those with than 1000 ADA (average daily attendance) to do audits. Those would not be investigative audits but audits to determine the internal controls environment and make recommendations. So the authority was passed but we were given no funding. We could use funding to make this real and I would like to see the ADA limit lifted.”

The Skiatook audit was requested by the attorney general’s office, Burrage continued, “We have completed our audit.  It is available at our website (www.Sai.ok.gov). We have turned the audit over to his office for possible follow up." Reporters immediately asked if the vendors (E&E Sales and Austin Security, and businessman Rick Enos) might face prosecution, but Burrage deferred to the attorney general’s office on that question.

Characterizing his findings, he said, “Internal oversight and controls were inadequate or non-existent” in the Skiatook district. Burrage said, “Every school board member should be encouraged to get their financial house in order or to keep it in order. They should leave no stone unturned in asking questions that need to be asked. There is no disgrace in asking questions. If they don’t ask questions they are not doing their due diligence.”

One veteran member of the Capitol press corps, Frosty Troy of The Oklahoma Observer, asked Burrage, “There is mandatory training for school board members in matters like this. I take it this means the training isn’t working?” Troy’s exchange was interrupted, so CapitolBeatOK asked if Burrage agreed with Troy’s conclusion. The Auditor carefully replied, “I’ve only in office for a year and a half, so I can’t really say one way or the other.”

In response to a request for comment from CapitolBeatOK, Brian Downs, Executive Director of Oklahomans for Responsible Government, reflected, “It’s disappointing to see yet another example of a school district misusing tax dollars that are supposed to educate our children.

As our “Blueprint for Transparency noted last year, Skiatook is one of many districts in the state that does not post their district budgets or audits online for taxpayers to see. This case also shows why it’s important to know that the tax dollars we are currently spending on education are being used properly before the state commits even more funds, as proposed by State Question 744. We commend the offices of the State Auditor and Attorney General for bringing some sunshine to the Skiatook School District’s budget.”

Burrage reflected, “Look, good people serve on school boards. Those good people need to ask questions. They need to familiarize themselves with the finances of their district and to exercise due diligence. The superintendent works for the school board. The board does not work for the superintendent.”

After press conference, Burrage elaborated: “I’ll tell you I’m very upset today. It should be obvious that this money was intended for education and to provide the right kind of schools for the children. Its just infuriating and frustrating to have the money used so wastefully.”

The press release prepared by Burrage’s office for the Blue Room conference at the Capitol reported, “Skiatook Superintendent Dr. Gary Johnson, who also served as the purchasing agent, did not exercise any cost comparison steps in his purchasing practices and did not implement internal controls to verify that products ordered were actually received.”

 


 

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