One of the poorest elementary school districts in the state will have to shortchange its own students because its administration has so carelessly mishandled public money.
The Arizona Department of Education is forcing Roosevelt Elementary School District No. 66 to give up $180,000 because district staffers couldn't explain how they spent those federal funds over the past three years. Roosevelt has already paid back $6,000 that would have helped disabled children, and the rest -- federal Title I funds that pay for instructional aids, extra books and after-school programs for children in poor districts -- will be withheld by the state this year.
But the problem goes deeper. A routine audit required by the state auditor general, as well as an internal investigation commissioned by the board and an additional audit of the district's purchasing department, reveal severe financial mismanagement, ranging from incompetence at the hands of an untrained staff to shady decisions by top administrators. Now, board members and teachers are wondering how so much negligent spending will cloud the district's financial outlook, and what price students will pay.
"I don't see how any other district could be worse than ours," says Ben Miranda, a member of the Roosevelt Elementary School District No. 66 Governing Board. "We know that we have some very, very serious bookkeeping and procurement issues."
Phoenix Suns vs. Portland Trail Blazers
TicketsWed., Nov. 2, 7:00pm
Arizona Coyotes vs. Nashville Predators
TicketsThu., Nov. 3, 7:00pm
Arizona State University Sun Devils Hockey vs. University of Michigan
TicketsFri., Nov. 4, 7:05pm
2016 Charles Schwab Cup Championship
TicketsWed., Nov. 9, 9:00am
An audit completed in September by Heinfeld and Meech, the accounting firm hired by the district, turned up more than $11.2 million in purchasing and accounting errors. The state auditor general is giving Roosevelt until December to get its financial practices back in order, or face reprisals by the state, which could include withholding more funds from the district.
"This [audit] has opened a Pandora's box," says Esther Sanders, president of the Roosevelt Educators Association, a union representing the district's teachers and classified employees. "If our goal is student achievement and we can't get adequate help from the top, some heads need to roll."
In the case of one contract for technology upgrades, the district was found to have given $9.1 million to contractors without having any proposals in hand to show just how the money was going to be spent. Sherry Celaya, the district's former chief financial officer, says the district had these proposals and followed them, but the documentation must have been misplaced.
In another case, Gopher Sports, a supplier of athletic gear, won a contract with Roosevelt even though it never submitted a bid. Todd Jennings, vice president of marketing for Gopher Sports, says the company has done business with the district since 1995, but he had no idea how the company got its contract with Roosevelt last year.
And in one of the most egregious cases, auditors discovered that a $15,612 federal grant earmarked for disabled children was used to feed teachers at a summer in-service day in June.
The problem, board member Miranda says, is ignorance on the part of the board and incompetence on the part of administration.
"My concern is that the district doesn't have a handle on its financial status," he says. "We tend to rubber-stamp recommendations made by the superintendent's office."
But Roosevelt's financial problems existed before they trickled down to the board. In the audit conducted by Heinfeld and Meech, accountants specifically questioned the dealings of Superintendent Russell Jackson, who resigned suddenly last summer.
Jackson, who did not return phone calls and e-mails from New Times, was cashing in on a $400-per-month "community affairs stipend," a perk on top of his $101,000 salary intended to cover expenses at educational functions. But no receipts were given to the district to show how he used the money. The audit also found that Jackson billed the district for his eyeglasses and medical and dental bills, even though his contract included health care benefits. And he also was found to have collected a $350 car allowance each month, while at the same time getting reimbursed for gasoline, car insurance and auto repair bills.
But the biggest questions surrounded Jackson's involvement in Roosevelt's bidding process. An internal personnel investigation commissioned by the district documented actions taken by Jackson to ensure that a firm run by Richard Erdman, whom the report describes as a business acquaintance, had the advantage to win a contract with the district worth up to $100,000.
According to the probe, Jackson framed the bid based on materials Erdman gave the board during a presentation about what his company, Flying Rhino, could offer in the way of computer-based learning programs. And when an invitation to bid was issued to all vendors, Jackson made sure the invitation got to Flying Rhino in time to make the bidding deadline by having them sent by Federal Express.
"In light of his prior business relationship with Mr. Erdman, Dr. Jackson should have let the process play itself out without any personal involvement," the report states. "He exhibited extremely poor judgment."
John Harris, the district's assistant superintendent, had the board cancel the award of the contract to Flying Rhino. But escaping the district's deeply ingrained purchasing problems would not be so easy.
Difficulties in the purchasing department began several years ago, when the board voted to decentralize the district's warehousing services, staffers say. The move shifted purchasing duties to individual schools, often leaving secretaries who weren't trained in the state's bidding process in charge of the buying. Meanwhile, Roosevelt's one remaining district-wide purchasing agent, who herself had no experience, struggled to handle the bids for services needed by the district's 20 schools.
Now, parents and teachers are preparing for how they will pay the price for the administration's failures.
The loss of Title I funds in particular will be hard-felt in a district that struggles for every cent to help its students, 85 percent of whom qualify for free breakfasts and lunches.
No one knows that better than Sanders, who teaches at Roosevelt's Maxine O. Bush Elementary School, where three kindergarten classes have 28 students. Crowded classes mean kids need more of the after-school tutoring and extra resources that Title I funds pay for.
"We're going to see no change in [the size of] classes, less supplies and programs cut drastically. That raises some big concerns for me because of how important some of these programs are to help students," says Sanders. "That's a little scary."
Get the This Week's Top Stories Newsletter
Every week we collect the latest news, music and arts stories — along with film and food reviews and the best things to do this week — so that you'll never miss Phoenix New Times' biggest stories.