TPS performance audit revision projects $90.8 million in savingsWritten by John P. McCartney | | email@example.com
Editor’s Note: This version corrects several editing errors in dollar figure amounts.
In her consulting firm’s presentation of Toledo Public Schools’ (TPS) revised performance audit on June 4, Evergreen Solutions’ Linda Recio informed the Board of Education (BOE) that it could expect $10.7 million less in savings than what Evergreen projected two months earlier.
The original projection of $101.5 million dropped to $90,784,870. Evergreen also eliminated two recommendations and made significant dollar revisions to five others, Recio said.
Recio attributes the decrease in savings to additional data the board “wanted us to use that we didn’t have the first time. Also, [the savings] vary across six or seven recommendations, all of which are affected by [the new data].”
Projected total net savings range from $16,680,432 for the first year to $18,756,206 for the fourth year with a one-time savings of $103,700.
Evergreen’s elimination of two recommendations resulted in a loss of $4,146,625 in savings.
The two eliminated recommendations were:
- Recommendation 3-16 — the reduction of school psychologists from 24 to 15 for a five-year projected savings of $4,131,540.
- Recommendation 9-9 — the elimination of five surplus and unused vehicles in the Safety and Security Department for a one-time projected savings of $15,085.
The audit reported that in many cases, employees receive supplemental pay for tasks they no longer perform while others are hired and paid supplementals (the stipend paid for performing duties as varied as chess club adviser to basketball coach) to perform those tasks. As a result, Evergreen reported that TPS frequently pays for the same work twice.
In the original audit, Evergreen, using the figure of $6,224,958 and eliminating a minimum of 25 percent of supplementals (the total number of contracts of additional stipends), reported that TPS would save about $1.6 million annually or $7.8 million over the audit’s five-year projection.
However, Evergreen estimated far greater savings if supplemental duties underwent careful scrutiny of seven factors it identified.
In completing the revised audit, Recio said Matthew Cleland, project coordinator, provided Evergreen five different sets of data regarding the total number of additional stipends.
“Some of this [need for revision] might be Evergreen not being given sufficient data, but some of it is we just got wrong data to begin with,” Recio said.
Using the most current documentation, Evergreen reported that TPS spent $3.2 million on supplemental contracts for fiscal year (FY) 2012 — $3 million less than the figure used in the original audit — and is projected to spend in excess of $3.6 million for FY 2013.
Recio said that one-year increase of $400,000 underscores the need for oversight and accountability in the completion of the tasks described in supplemental contracts.
Evergreen reported that it wanted to make TPS’ board acutely aware that:
- supplemental contracting costs the district funds over which little oversight and accountability are exercised and often for responsibilities that should be an expected part of normal position-related duties.
- drilling down to actual costs that are certain is challenging at best.
In Recommendation 3-11 of the revised audit, using the $3.6 million figure and eliminating a minimum of 25 percent of supplemental contracts, Evergreen reported that TPS would save about $900,000 annually or $4.5 million for five years, a $3.3 million difference in what Evergreen projected in the original audit. Again, Evergreen reported that with careful scrutiny, TPS could save significantly more money.
Recio said Evergreen was originally given the wrong count of clerical staff at schools. Recio said when Evergreen received the adjusted count, projected reduction in clerical staff at the elementary level went from 15 to a minimum of 12.6 employees. Recio said the savings became $2.058 million, down from the original projection of $5.1 million.
Recio also said the decrease in projected savings in assistant principal (AP) salaries is a prime example of Evergreen’s making a recommendation based on inaccurate data. Evergreen was originally given an AP salary of $92,000, which has since been reduced to $85,000. Recio said that when that $7,000 difference is multiplied by the recommended reduction of 15 AP positions, and then multiplied by five years, taxpayers will see a reduction of $525,000 in savings, from the original projection of $6.9 million to the revised projection of $6.4 million.
Recio presented the board with four implementation strategies:
- Create an implementation chart that includes the recommendation, steps for action, a timeline, the person or people responsible for implementation, committee comments and recommended modifications and the completed implementation.
- Create an implementation committee of 15-20 BOE members, staff and community members in which committee members understand that they are a monitoring, not a decision-making, group.
- Monitor results and savings.
- Share results with the community in a quarterly report card.
Board President Brenda Hill said she hopes to have the skeleton for creating the implementation committee ready at the board’s regularly scheduled business meeting June 25.