District 150 has just released a 
statement (reprinted below) and a copy of the audit by Clifton Gunderson of the District’s Grade School Activity Funds.
DISTRICT STATEMENT – For Immediate Release – Wednesday, April 29, 2009
- First, we need to clarify that Julie McArdle was not fired. Her contract was terminated without cause, pursuant to her employment contract.
- The Board of Education and Administration stand behind their decision to terminate Principal Julie McArdle’s contract without cause. As an employer, we are bound to personnel laws that prohibit us from discussing or outlining reasons behind the decision to terminate her contract.
- Regarding financial reviews – as part of routine procedures, our district used an outside accounting firm to conduct random, routine financial reviews of school activity funds. These reviews occur on a rotating basis every three-to-four years at all of our schools. We also request a review of these funds each time a new principal is named at a school or a building is closed.
- On April 24, 2009 – (last Friday) – a police report was filed because 2007-2008 Lindbergh MS financial records are missing. These documents were reviewed in the summer of 2008 by the accounting firm during a routine review of the fund, which found no misuse of the school’s funds.
- District staff members are diligently working with multiple sources to find documentation, receipts and statements that will assist in the reconstruction of the missing Lindbergh 2007-2008 financial documents. We are also hoping for a rapid conclusion of the Peoria Police Department’s investigation into our two filed reports.
- Regarding the use of personal credit cards and District issued credit cards:
- It is routine practice for school or District personnel to use a personal credit card to purchase items for our students, classrooms or other needed supplies, so long as appropriate and detailed documentation is kept.
- There are currently nine different district-issued credit card accounts. The statements for these accounts are reviewed by the Business Manager and payments are processed by the District.
- A decision had been made to recommend the termination of Mrs. McArdle’s contract prior to receiving any allegations of misconduct under the Illinois whistleblowers act.
My take: The report from Clifton Gunderson is not exactly a clean bill of health. Notice this statement near the end:
The above procedures were performed at the request of the Controller/Treasurer of the District. We make no representation regarding the sufficiency of the procedures for any purpose. We were not engaged to and did not conduct an examination, the objective of which would be the expression of an opinion of the financial statements of the Student Activity Funds of Lindbergh Middle School. Had we performed additional procedures, matters might have come to our attention that would be reported to the District.
So, if I’m reading this right, they’re not offering an opinion of the financial statements. In fact, given the parameters of what they were asked to do, it’s unlikely that they could have detected any fraud that might have been perpetrated, unless someone had actually written “stolen funds” in the ledger or on the memo line of the check. They pulled 20 disbursements at random and found two that had no supporting documentation. That’s ten percent of a random sampling that were defective. Shouldn’t that have been a tip off to the Controller/Treasurer that the controls in place were deficient?
As for the statement from the District, the last point is the most interesting. According to their statement, the decision had been made to terminate McArdle’s contract “prior to receiving any allegations of misconduct under the Illinois whistleblowers act.” This is pretty shaky. Obviously it’s designed to try to absolve the board of any impropriety; it says, “hey, we didn’t know anything about the charges against Mary Davis before we decided to terminate McArdle, so we should be held harmless.” But they did know about the charges before they voted to terminate the contract. The police reports were made on Friday, and the termination took place on Monday. Once they heard the charges against Davis, they could have held off and investigated the matter first. Instead, they went ahead and terminated the contract for reasons they cannot publicly by law disclose.
Why should they have held off? Because Davis is McArdle’s superior, and it’s most likely that the information on which the board based their termination decision was evaluative information received from Mary Davis and her supporters. If Davis were involved in wrongdoing as alleged, it stands to reason that she would have tried to keep that information from coming to light. One way would be to undermine the potential whistleblower (McArdle) and try to get her discharged. Caution should have been the order of the day.
Sharon, yes, lots of questions. We don’t have all the necessary facts (evidence) to draw conclusions. That’s what the police and the administration should be doing. Anything that was paid with D150 monies is OUR money. There should be full disclosure beyond any criminal issues.
BTW, if it was MY personal credit card statements I for sure would have explained the card was personal/business combined and asked for the statements to be given to me! I wouldn’t want my personal CC records available to someone else. The fact that that did not happen troubles me. A lot. Especially with the late payments. Embarrassing (they would be to me anyway).
YUK!!!!!
Click on the link to the C.G. audit report. Note that it was ok’d as of May 2008.l The funny checks were written on June 30th. Hmmmmmm. Davis’ bookkeeping skills leave something to be desired…..wow. very intersting reading…..lots and lots of red flags from that report. Yet Davis is still sitting at her desk, hmmmmmmm.
I can not think of any other business or public office where a staff person who seems to be implicated in discrepancies in financial matters is allowed to remain in that position while an investigation is ongoing. A leave, whether paid or unpaid, needs to happen immediately.
The fact that Mary Davis is currently sitting at her desk, business as usual will give McArdles attorney cause to question much of the districts defense. A reasonable person would know that her continued access to office records and technologies allows her the opportunity to tamper with evidence. Is the district lawyer on crack or what?
Anon, not only that, but it is the District’s established past practice and protocol that when an employee is alleged to have engaged in wrongdoing, they are placed on paid Administrative Leave pending the result of the investigation. Why is Davis receiving different or preferential treatment by Hinton?
Sharon, did you notice that there were no deposits recorded for the activity fund – only disbursements? So where did the money come from?
The language in Ex. 4, “We had a credit card and always paid it in full but I closed it” could be taken as an affirmation that the alleged district/school credit card did exist. She certainly doesn’t deny that it was a “company” card. A good attorney will use her own words against her. I don’t know of any credit card company that would send copies of account statements on an individual account to a stranger, and if they did, and the account owner was damaged as a result, they would be sued. However, if it is a “company” account, they would release the records to an authorized representative of that company.
Another thing to note about Ex. 4 is Davis stated she closed the account. The email was dated 12/08. A charge to One World Cafe is posted as of 01/30/09. Obviously the account wasn’t closed as Davis represented she had done. Second thing, in 01/09 Davis was no longer a Lindbergh employee and was working in the Administration. Why did she still have and use a LMS card?
I keep reading the article in the journal star and the statement from the district . . . is a “review” the same thing as an audit? Or is the district just using their typical “verbage” ,their word not mine, to dance around the truth. hmmmmm
There has been a great deal of speculation as to whether or not the cc was a business or a personal card. It is pretty easy to figure out the answer. On this site http://samsclubanswercenter.custhelp.com/app/answers/detail/a_id/330/kw/discover%20business%20credit/r_id/100001
it indicates that business accounts start with a 6001137 number and personal accounts start with a 600136 number. Which number did the account start with???
Upon reviewing the the exhibits further it appears it is a business account. If you look at the exhibit that includes the statements you will see a reference number on the same line as payments. The number 601137 is embedded in the refernce number.
If it is a business account like it appears she has problems on her hands. She clearly used the card for personal uses (Peoria Toyota). Look up Lyn Howard case (past mayor from Pekin), he was charged with a felony for using city credit card for cash advances. He paid the balance each month on his own but was convicted of official miscounduct for “using public credit for personal gains”.
Has anyone phoned any governmental legal agency to question why this person has the right to engage in district business as opposed to being placed on administrative leave?
So it appears it was in fact a business account meaning it was opened using the district’s tax identification number and therefore charges made on that card were exempt from paying Illinois sales tax. Personal charges to avoid tax were illegally made besides being apparent fraud! Will someone please tell the police department?
Joshua commanded his children to SHOUT, and the walls came a tumbling down…
Raise up your voice Peoria…. the walls NEED to come down.
Whoa – there is little doubt now that it was a district card – because of privacy laws, etc. credit card companies/banks are very careful with their records. If it is coded a business account, then it must be a business account.
Guess Hinton, Walvoord, Wolfmeyer, Davis & Co. aren’t tap dancing quite so fast now, are they?
If it’s a business card, then the above mentioned group needs tap dancing lessons for sure. What about all those late fees and high interest rates–good way to spend taxpayer money!
Diane, you were so right; what was I thinking? Of course, these little stashes of district money are important. I am ignorant of these financial arrangements–so I’ll ask. Does any of the activity fund money (or money that would have been spent at LMS on this account) come from Education Fund monies?
I assume (despite Weland’s possible ties to the district) that if this card is a business card (or even if it isn’t), then the investigation would include finding out which purchases were personal and which were district or school-sanctioned (not just related). Then the investigation would have to include whether or not the tax exemption privilege was or was not used for personal expenses. Is the misuse of the tax exemption a federal offense?
I guess from reading above–it’s a state offense, not federal, right?
Heel! Toe! Step! Ball Change!
Sharon,
you’re correct it would be a state offense not federal – but don’t take that lightly! The Illinois Dept of Revenue have auditors who can be real bull dogs and the more they find the deeper they dig.
Also about the student activity funds themselves – I know for a fact that money raised at each school comes from vending machines or school “stores”, cookie sales, and a number of creative fund raisers like $1 BIKE candy bars.
The “per pupil” allocations of Ed Fund money such as what you may remember from MHS where you teachers were allocated for paper and other resources are not part of the student activity funds.
Even though I taught in District 150, I realize how ignorant I am about school finance, etc. So if the activity funds are funded by the above mentioned sources, does the district even care how the money is spent? I am sure they should, but how much oversight is there really? Obviously, as in this case, a “whistleblower” is almost necessary. Also, is it correct that the activity fund revenues and expenditures are not part of the district’s overall budget?
At the high school level, am I correct in assuming that the district does allocate a certain amount of money per year for various student activities: band, speech, athletic teams, etc? Does that money come from the Education Fund?
How about the General Fund (as in the high school’s): What is the source of that money–per pupil allocations, what else?? Then is the spending of the “per pupil” or general fund money completely up to the principal’s discretion–does he/she have to answer to anyone with regard to how the per pupil money is spent? I definitely had that question at Manual–when we told there was no more money for copy paper for teachers to use in the classroom, I always wondered if the money had been squandered on something less important than classroom needs. I would see purchases such as a smartboard, which seemed to be for use by the principal–I wondered who authorized that purchase and why it was necessary.
Just curious. However, I think it is time the taxpayers, also, ask some of these questions and get answers.
Did anyone happen to notice that the Activity Fund paid for IPA (Illinois Principals Association) dues for Davis? That makes no sense at all because the District will pay for that.
Also, the Student Activity fund paid $1020 to Lifetouch for 8th grade student pictures. That’s really weird because parents write checks payable directly to the company – not the school or district – for school pictures. So what is this about?
Unless One World Cafe has Kobe beef on the menu, the only way to explain the charges for $440.57 (01/30/09), $501.77 and $481.77 is if they were for One World’s catering service. That’s a lot of catering.
My favorite – the recurring monthly charges to this outfit – http://www.24protectplus-program.com/ – please go out and check this out yourself. You won’t believe it . . .
As Desi would say, “Somebody’s got some ‘splainin’ to do.”
Correcting an earlier error of mine: The 22-year-old who taped a student’s mouth shut was a bus monitor, not a driver. My question now: Why did the district have to wait for the parents to complain a day or so later? Where was the bus driver when all t6his was taking place? Should the bus driver be monitoring the monitor?
Good questions, Sharon. Perhaps Mike Sullivan can provide you with an answer!
Prairie Celt – So it appears she was making false entries into the Activity Fund journals for items that would look school related… to throw off an auditor, a secretary or any other person that would examine the fund.
correction *could have been*
Anon – I wouldn’t really care to speculate about that. There are several possibilities as to what might have happened.
However, a little investigation into the Sam’s Discover Card Info site (link posted above) showed there were three types of business cards available: 1) plain, no frills card; 2) cash rewards card; and 3) a travel miles card. Looking at the credit card statement, it looks like she had the cash rewards card and received at least 3 or 4 checks. Now the Activity Fund ledger doesn’t indicate any deposits, so what did she do with the cash rewards the card earned?
On the same site, you can pull down a pdf file of the business card application. There really isn’t any way a person could mistake it for a personal card application. First, the form is entitled, “Sam’s Club Business Revolving Credit Application.” Second, section 1 is “Tell us about your business” and the applicant is required to provide the company full legal name, taxpayer ID #, Company Contact, etc., etc.
As someone posted above, using the districts taxpayer ID # caused all charges made on the card to be exempt from Illinois sales tax. The Illinois Department of Revenue would likely be interested in this development and does have an online complaint link: http://www.revenue.state.il.us/fraud/
I hope the police department investigators are reading the blogs–we are certainly providing them with questions to answer. 🙂 This questions seem so obvious; I would assume they are being investigated as we write.
OK – These questions
PrairieCelt: Question regarding the IPA dues paid 6/30 after Davis’ promotion to adm. Do central administrators pay IPA dues? Just curious.
I don’t understand how simply using a credit card would result in tax-exempt purchases. Isn’t it the responsibility of the seller to collect sales tax? Sams/Discover is not the seller of goods for Amazon or BestBuy purchases. Even Sams Club says “Business Member must declare to the cashier any merchandise being purchased for resale or otherwise tax-exempt”. So you have to ask every time for a tax-exempt purchase. There is no evidence of this in any of the documents I have seen so far.
I think we all know what happens when you assume.
I hope that anyone who can do anything about the administrators in this district is reading these blogs. This is just ridiculous.
Tax Exempt purchases… now there is something that is heavily abused and greatly misunderstood.
Ms. Crews ,off the subject, I head Hannah did not get the job in Iowa. Have you heard anything more about him leaving, hope so.
sorry should have been heard
Ms. Crews, now that sounds a bit like a former student writing. Now I haven’t heard anything–I imagine I could have been wrong since nothing is for sure until it is officially announced.
Sorry, “No,” not “Now” I haven’t heard anything–I make careless mistakes, too–and I’m going to stop correcting them–I’ll just have to risk being humbled.
Sharon, really can’t say about this group but in the past, some – who were former principals – did. There was no problem with that as long as the request went through proper channels and had the proper authorizing signatures in place.
Sorry–I am going to be a little off topic. While the administration and board are looking into these allegations, who is minding the mint? What is going on with the school closings? Are they any closer to deciding which high school to close and a plan to do so? I would hope that they would announce the plan sooner rather than later along with the plan for what will happen to all interested students: Will freshmen attend or will they start the plan with having the freshmen class go to the new school or schools and then only have to divide two classes the next year. It would be in the best interest of the incoming freshmen to not start at a school that will be closed at the end of the year and have to start all over again the next year. Also, what will be done about class rank and leadership in activities and scholarships etc. If the board has been planning this for five years, then please share the plan ASAP!! Also, how is placing the teachers at Kingman and Tyng going? Where will these students attend next year. Again, the hope is that they will not place these students at a school that will close soon (or the teachers for that matter!).
PrairieCelt: So the IPA payment appears as a check for $295 from the LMS activity fund–right? Would there be any justification for any LMS fund paying for this membership? Or is there any chance that IPA stands for something school-related? Just asking–because otherwise it would seem like an obvious misuse of the fund–one that 150 couldn’t overlook. You did say the district would pay for the membership–but the LMS activity fund?
j-darcy: As far as Kingman and Tyng goes, the teachers were to turn in their 3 requests for placement for next year by yesterday. They will be interviewed by principals and sometime soon (hopefully) find out where they will land. The Kingman students will be going to Irving (which closes next year) and Glen Oak. We were initially told on April 1st by Mr. Hinton our students would be split between four schools and each family would be evaluated for placement. In the end, they took a map, split it in half and said, “This side goes to Irving, this side goes to Glen Oak.” With the plan they had in place for the closing of Kingman and Tyng (ummm, NONE), I wouldn’t expect any sort of sense to the closing of the high school. J-darcy, you are giving the administration waaaaaaay too much credit in thinking they’d use foresight and common sense to aid in a decision.
j-darcy — yes one major distraction to help take the focus away from other important decisions. Meanwhile families are impacted in untold ways.
And the insanity continues………….
So District 150 plans on shipping kids from Kingman to Irving to ??? in three consecutive years… well well well… who could possibly think that is a good idea for the students?
But what am I thinking? Since when has the District done anything that was, first and foremost, in the best interests of the students?
It has been tradition for principals to pay their memborship to IPA with activity funds. I really can’t say much more.
You are right Ms. Crews, a Roosevelt student. I have always loved and respected you.
Relle: I’m sure the feeling is mutual–those were the good old years!
There are many teachers, principals and administrators that are doing good things with kids. I feel there are two central administrators (directors) that have not forgotten the kids and understand what the district is up against and have good solid ideas on good initiatives. But they go unheard.
Principals are overloaded with the many initiatives central requires them to implement. Most of these initiatives are never followed through with to end. Alot of money, time and energy goes into an initiative then it just sort of drifts way. Never to be heard of again.
It is unethical to pay dues to a “club” for Principals with student money….I don’t care who started the tradition. As a school board member in another district I would be up in arms if I knew that was happening…,,.oh, it isn’t! How come MANY principals in 150 get “transfer” to other schools when they “make the news”. Why was McArdle fired? Could it be that she has uncovered more than just ONE hand in the cookie jar? We’ll see, won’t we…..
If parents knew how poorly these funds are handled I doubt they would be as generous as they are. Guarantee we have done our last fundraiser until an entirely new administration is in place and we feel confidant that our money is being spent honestly, wisely and on behalf of the STUDENTS for whom it was generously donated. Principals club. Pffft.
Sharon, although it may have become a practice in some schools, it is irregular. Why would student activity funds be used to pay for dues to the IPA when each school and department has a budget line item for Dues and Subscriptions? That is the appropriate vehicle – through a purchase order – to pay for these types of things.
j-darcy has a good point – not just for the administration – but for everyone. While everyone is preoccupied with the Davis-McArdle case, we have taken our eyes off the “ball”. This would be a good time for the administration to sneak something through.
But its all for the children.
Oh, my–C.J. has expanded his readership. I hope you all noticed (what I’ve mentioned before) that Davis reminded McArdle that it’s all about the children when Davis stated that she had spent all the money. Whenever the administration wants someone to sacrifice–teachers, students, parents–Hinton pulls out the “it’s all about the children.” His decision to fire a LMS principal a month before school is out isn’t all about the children–he had to know that such a decision would bring about unnecessary conflict and chaos, not a good environment for children to put them in the middle of a fight among adults. None of the school closings are “about the children.” It might be about the budget, but it’s not about the children. Just transferring a bus monitor (because of parental complaints) to another route where he tapes shut a child’s mouth is not “about the children.” I contend that Wacky Wednesdays were not “about the children”–they were all about saving face when the community forced Hinton to give up his original plan for a 45-minute per day and loss of special teachers.
Yes, we have to remember not to take our focus off the school closings and all the plans that are not well-thought out.. Meet at Godfather’s tomorrow night.