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Activists call for independent auditor for school district

By David Scharfenberg Daily Planet staff
Tuesday June 25, 2002

Two weeks ago, the Board of Education voted 4-1 to ask voters for a pay raise from $875 to $1,500 per month. Tonight, the City Council will decide whether to put the request on the November ballot. 

But, as Berkeley ponders pay raises for the school board, a small group of community activists say the city should think about adding a new layer of accountability as well. 

Parent Yolanda Huang, a frequent critic of the district, is leading a push for a full-time, independent auditor, who would not only review the troubled district’s books but also conduct periodic performance reviews of various administrators and school programs. 

Huang said she will ask the City Council to place the issue on the November ballot in the coming weeks. 

Proponents say an independent auditor, similar to the City Auditor, would help to right a troubled ship and restore public confidence in the school system. But critics say the proposal is unnecessary and would be far too costly for a district that faces an estimated $2.8 million deficit next year. 

Furthermore, City Attorney Manuela Albuquerque said it is unclear if the Huang measure, which calls for an amendment to the city charter, is legal. The city has the right to set compensation for school board members, she said, but it may not have the power to intervene in the “internal affairs” of the school district. 

Independent auditors are in place in two-thirds of city governments around the country, but in only a handful of large school districts, according to Mark Funkhouser, City Auditor for Kansas City and author of a dissertation on independent auditing. 

Critics of Huang’s proposal say it is not only expensive but redundant. A state advisor called the Fiscal Crisis Management and Assistance Team has been working in the district since October, and under a piece of legislation authored by state Rep. Dion Aroner, D-Berkeley, the organization would remain in place until 2005. 

“At the present time, the district can ill-afford to hire an auditor, especially when the county and the state, through FCMAT, are already providing these services,” said school board President Shirley Issel. 

School board member Ted Schultz said the district should have the opportunity to correct its problems, with FCMAT’s assistance, before considering an independent auditor. 

Nancy Riddle, a school board candidate who serves on the district’s budget advisory committee, agreed that an independent auditor might be redundant while FCMAT is in place. But she said the office would be useful once FCMAT leaves. 

“People are looking for some sort of checks and balances that will be a permanent part of how we do business,” Riddle said. 

She said voters might even be willing to dedicate a small portion of the Berkeley Schools Excellence Project, a special local tax, to the independent auditor. Such a provision, which would have to be approved in the next voter reauthorization of BSEP, would avoid funding concerns for the district. 

But critics say an auditor is not needed.  

District spokesperson Marian Magid said that the district already makes use of “many kinds of audits.” Magid cited, among others, the work of a series of parent advisory committees, the critiques of the high school offered by the Western Association of Schools and Colleges, a regional accrediting organization, and an annual financial audit, required by law, by an outside accounting firm. 

But supporters of the independent auditor say the annual financial review is not enough. Riddle, a former auditor, noted that in the past, outside firms have signed off on a payroll system that, at one point last year, issued some employees double-pay. She said a full-time independent auditor could look at the budget more closely. 

PTA Council President and school board candidate Derick Miller added that, while auditing firms look at the numbers, an independent auditor could move beyond “financial auditing” to “performance auditing,” examining individual programs to see whether they are serving students. 

“A straight financial audit simply tells you whether or not the financial statements are presented fairly,” added Mark Funkhouser, the Kansas City auditor. “It doesn’t tell you anything about how well the money was spent.” 

But Magid said the district reviews program effectiveness every year in applying for state and federal grants.  

Issel said the annual financial review and a host of other consultants over the years have provided the district with plenty of information on both the larger financial picture and individual programs and issues. She said the real issue is that the leadership has not had the will to address the problems identified by the consultants. 

“Absent that, no safeguard is going to work,” she said. 

City Council members reached by the Planet Monday had not extensively reviewed the idea of an independent district auditor, but said they were open to it if it passed legal muster. 

In September, Berkeley City Auditor Ann-Marie Hogan wrote a letter to the editor that appeared in the Planet and two other area newspapers calling for a “performance audit” of Berkeley Unified. Hogan could not be reached for comment Monday.