Normally school districts put presentations on their Board agendas so residents can know if they should attend to learn about what is going to be said.
District 300 wanted this one under the radar.
In other words, no photos and nothing highlighted to the media. They even left it off the agenda.
What District 300 administrator wants to alert residents that it needs to fix its internal controls?
Certainly not incumbent board members up for reelection in April.
Here’s what was discussed at Wednesday’s Finance Committee Meeting.
Board policy 4:30
Operational Services
Controls and Reports. The Chief Investment Officer CIO shall establish a system of internal controls and written operational procedures to prevent losses arising from fraud, employee error, misrepresentation from third parties or imprudent employee action.
You might think the highly-paid administrators might know what needs to be fixed. Or could/would ask their independent auditor.
Instead the plan, apparently is to rely on a consultant, PMA, to do the review.
How does PMA make a lot of money?
If you guessed from school districts investing their funds with the company, that’s a pretty good guess.
Forget for a moment that Huntley District 158 used to have money invested with PMA that violated that district’s policy of requiring collateralized deposits.
Until board member Larry Snow pointed out how this either shouldn’t be done or the policy should be changed.
District 158 withdrew its uncollateralized deposits from PMA.
When I was McHenry County Treasurer collateralization was not required. I required it on the larger investments.
Laura Pauli from PMA gave a sample Investment Policy and Procedure Manual to District 300 at the meeting.
On its face, this sounds like a potential conflict of interest.
Copies were not made available for audience members.
When’s the last time you heard of a school district going out to bid for where it invests its money?
I used to do it all the time when I was county treasurer. It was good policy 40 years ago and it still is.
If a company like PMA actually pays less money than other investment options, with the lack of watchdogging and oversight that goes on in most school districts, who would ever know?
Cal,
Your post on your blog today regarding D300 Policy 4:30 is absolutely incorrect. Since you were not present, and only one member of the public was, it appears your informant has not told you the truth or you are intentionally misrepresenting what took place. By choosing to rely on sensationalism and unreliable information, you have been made to look foolish and have brought your own experience and integrity into question.
The committee’s discussion centered on the revenue and investments section of the policy (specifically investment objectives, authorized investments and collateral requirements), not internal controls, and was listed as item IV on the agenda. What your informant obviously chose not to tell you was that:
1) He arrived late and missed most of the discussion. He did not raise any questions. He only offered a comment regarding the proposed wind turbine at Hampshire HS which was not on the agenda.
2) No specific changes were brought forth by PMA, nor was any action taken.
3) PMA’s only suggestion was that, considering the volatility of today’s economic climate, D300 should ensure policy matches intention/practice in this regard. As such, my Policy Committee will begin to address this at our 12-8-08 meeting. In preparation, I have asked for an assessment to determine where we are compliant with required statutes, where we exceed them and where we are deficient (if anywhere at all). My purpose in doing so is to compare that to PMA’s boilerplate to expose any self-serving recommendations it may contain.
Your closing trial balloon statement implies that rate of return is the most important criteria in a BOE decision as to where to place its investments. As Vice Chair of the Finance Committee, I can assure you, that for D300, its 3rd behind preservation of capital and liquidity.
Joe Stevens, Allison Smith and I just gave a presentation Friday at the IASB annual conference entitled: The New Democracy: School Districts Go Online. D300 is recognized as one of the, if not the most, proactive SD’s in the state in regard to posting public info on our website – whether FOIA’d or not. Rest assured, I will see to it that the supporting documentation from the recent Finance Committee meeting will be available on the web in a timely fashion.
In the future Cal, please feel free to check with me if something doesn’t make sense to you prior to publishing something you are now going to have to clarify.
John Ryan
D300 Board of Education
PS Cal insinuated incumbents up for re-election were behind this. None of these BOE members serve on the finance committee.
John,
It is so great to see you standing behind the work D300 does to be responsible and accountable to the public. Your work towards this end is also very much appreciated.
It is also great to see you acknowledge the “intentional misrepresentations” that seems to flavor many articles about D300.