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Audit cites 171 overpaid in PB

$473,142 in excess school pay, missing contracts spur inquiry by ALISSA SKELTON FOR THE DEMOCRAT-GAZETTE | August 8, 2011 at 4:58 a.m.

— The Pine Bluff School District plans to investigate why 171 employees were collectively overpaid $473,142 without proper documentation during the 2009-2010 fiscal year.

The overpayments were discovered by Alan K. Minor, a certified public accountant in Pine Bluff, who was hired by former district Superintendent Frank Anthony to perform an audit of the district’s finances for the 2007-08, 2008-09, 2009-10 and the first seven months of 2010-11 fiscal years.

The audit, dated June 9, also revealed one improperly altered contract from the 2007-08 academic year and three missing contracts from the 2008-09 year.

“You can pay employees in excess, but you have to amend the contracts and the district did not create amending contracts,” Minor said. “If an employee received a stipend, it needs to be documented and be available for auditing. In this case, such documentation was not available.”

The employees may not have been wrongfully overpaid, but that is for the district to decide through its own investigation, Minor said. He said the district ignored his May 16 request for supporting documents.

Pamela Winkler, the new district director of business and finance, and Jerry Payne, new superintendent, plan to begin reviewing employee contracts and supporting documents this week, said Spencer Robinson, an attorney for the district.

“I would be surprised if those payments were not justified by documentation. I strongly suspect teachers were overpaid because they received a stipend for a conference,” Robinson said. “I have no reason to believe there was anything done improper.”

Answers have been hard to come by since the district is at a crossroads after Anthony retired and Payne took over. Central office administrators and some secretaries resigned or retired from their positions this summer.

New administrators are adjusting to their new jobs and have said they do not have much knowledge pertaining to the audit.

Winkler, who was hired recently, said she hasn’t read the audit. Winkler said Payne does not allow her to talk to the media or to give out public information without his approval.

The names of the employees who were overpaid, who had altered contracts or who didn’t have contracts were given to the School Board, Minor said. Herman Horace, School Board vice president, said he did not wish to comment on the audit, and that the School Board president, David Brown, won’t comment either.

“From my experience as a School Board member in Gould and Dumas, the action on the overpayments is in the hands of the School Board,” Minor said.

The audit also raised questions about employee contracts for the 2007-2008 and 2008-2009 fiscal years.

In 2007-2008, a district employee’s contract salary was increased by 13 percent without approval from supervisors or the School Board, Minor said.

The employee’s salary exceeded the original contract amount by $11,291 and surpassed the altered salary amount by $8,640, the audit said. In 2008-09, the same employee’s contract was missing and was not provided to the auditor.

For the 2008-09 school year, the district failed to provide Minor with three other contracts. Minor could not determine if the contracts were ever drafted or whether the employees were paid in accordance with School Board-approved contracts. By law, the payments are void without a valid written contract, Minor said. It’s not clear whether contracts exist, he said. The three employees were compensated a total of $81,228.

“I was trying to give the district the benefit of the doubt, but the district gave me no documentation of contracts I requested,” Minor said.

The district has come across a questionable financial issue before.

Lynda King, a former Pine Bluff School District central office employee, was found guilty in 2009 of stealing more than $800,000 from the Pine Bluff School District over an eight-year period. King created a fake company for the district to do business with and routed district funds to several personal accounts.

King had pleaded guilty to 1,004 counts of second-degree forgery, 23 misdemeanor counts of theft, 549 counts of felony theft, and one count of attempted theft.

Jefferson County Circuit Judge Berlin Jones sentenced King to 80 years in prison.

Last month, the Arkansas Parole Board denied clemency to King.

She is eligible to apply for parole in 2022.

Arkansas, Pages 7 on 08/08/2011

Print Headline: Audit cites 171 overpaid in PB

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