MASON CITY — A pending state audit of Mason City School District finances may have begun after a school board member questioned how vacation pay was given to two retiring administrators last year, according to an email obtained by the Globe Gazette.
Earlier this month, the school district released a statement acknowledging the state Auditor's Office would begin a re-audit of its finances for the fiscal year ending June 30, 2015.
Officials said in a statement they were notified by the state in a letter dated May 31. The review is expected to begin in July. Depending on initial findings, it could expand to other fiscal years, the letter stated.
60 days vacation pay authorized by Micich under Jeffrey's contract for early retirement
30 additional days authorized by Micich to Jeffrey for extending retirement.
The audit may have been set in motion after School Board member Jodi Draper emailed the state office with concerns Superintendent Anita Micich could have approved funds via purchase order for two outgoing administrators last year that fell outside of their contracts and were completed without board approval, according to an email forwarded to board members on May 17.
Draper's concerns appear to center on per-diem payments totaling $68,178 for vacation pay to former Assistant Superintendent Hal Minear and Business Manager Ramona Jeffrey in July and September 2015.
In the email, Draper questions a $35,178 payment for 60 vacation days to Minear authorized by Micich via purchase order on July 27, 2015.
She also raised concerns about two additional payments to both Jeffrey and Minear for $16,500 each by Micich for 30 additional days of vacation pay authorized on Sept. 11, 2015.
"It does not appear to me by minutes of Anita (sic) contract that she has the authority to authorize those types of payments without board action," Draper wrote.
Jeffrey's last two-year contract, signed in June 2014, gave her 30 days paid vacation per year with the option to forward a maximum of 60 unused days to cash out when leaving the district.
Minear's final two-year contract provided 30 days of vacation per year, but unlike Jeffrey's contract has no language restricting how much vacation time he could carry over to cash out when he left his position.
MASON CITY — An audit request regarding Mason City Schools has been filed with the state, ac…
Business Manager John Berg said the district did not have a "use it or lose it" policy for vacation days, meaning both would have been paid for all authorized number of unused vacation days upon their retirement.
After reviewing district records, Berg told the Globe Gazette on Friday that Minear and Jeffrey were each authorized to leave the district with a specific number of vacation days when they accepted early retirement in July 2015.
Minear was authorized to receive payment for 110 total vacation days — 80 prior accumulated days, plus an additional 30 after July 31, 2015, Berg said.
Jeffrey was approved to cash out 90 total prior days of vacation — restricted by her contract to 60 carryover vacation days. She was also allowed payment for an additional 30 days to be paid after July 31, 2015, Berg said.
Both were actually paid for 90 total vacation days each at their retirement, Micich said in an interview and according to district purchase orders authorized by her.
Micich, Minear and Jeffrey are not accused of any wrongdoing. It is also unclear if Micich's actions would come under the scope of the state review, because the payments fall outside of the dates of the its preliminary re-audit.
Micich defended Jeffey and Minear via phone and email on Sunday as "exemplary" employees and said the decision to award each an additional 30 days vacation after they chose to delay their retirement was within her authority as superintendent.
In response to the Globe's questions, she wrote, "I don’t wish to engage in a continuing process that attempts to generate smoke to give the impression that there is some kind of fire."
Both Jeffrey and Minear accepted early retirement effective in July 2015, but temporarily resumed duties that fall including assisting with the district's yearly audit, helping to prepare year-end reports to the state and training their replacements, Micich said.
The district "does not expect our employees or former employees to work for free," she wrote.
"We had to decide how to fairly compensate them for their anticipated additional work," Micich added. "They received nothing further for this specialized work they did."
You have free articles remaining.
Jeffrey and Minear both left in December 2015 after 27 and 25 years in the district, according to their early retirement contracts.
Micich cited meetings in April and May 2015, according to minutes where she informed the board of plans to keep Jeffrey and Minear employed in fall 2015 for their financial and technical expertise.
"In the course of board work sessions and meetings the board was made aware of the specific work that Minear and Jeffrey would be doing, and expressed their gratitude for the assistance of these dedicated employees."
There was an understanding both would receive compensation for that work, Micich said, but, she did not remember and the meeting's minutes do not state if additional vacation pay was specifically discussed as a means of compensation.
"There was talk of pay," she said. "We did our due diligence in this process."
Micich said on Sunday that she does not recall Draper contacting her personally with her concerns, before asking the state auditors review the payments.
"She never asked me," Micich said.
Draper did not return a call Sunday asking whether she had talked with Micich previous to sending the message to the state auditor.
In the email sent to board members in May, Draper emphasized the matter was merely under review.
"[U]ntil the State Auditor gives an official direction of these matters, they are alleged incidents and have not been founded or validated with the State of Iowa," she wrote.
When asked earlier this month if the vacation pay under question by Draper could be a focus of the state's audit, Deputy Auditor Tami Kusian said she could not yet publicly comment on what they would examine in the district's books.
Kusian also said she could not confirm publicly who requested the audit until the public report was released, but noted such as request could be made by a private individual, school employee or elected official.
Once an allegation was made, since the office found justification to investigate further, the district was notified, she said.
Typically, the auditor's office can re-examine finances for about five school districts each year. But, Kusian said, she does not recall a recent re-audit request for Mason City Schools.
“If we have it’s been over 20 years,” she said.
Once the auditor's office's work is complete, a public report will be issued.
In the statement issued last week, district officials pledged to correct any findings issued in the report.
“The district will respond, after review of the findings, to make any recommended changes found needed through this re-audit process,” School Board President Janna Arndt and interim Superintendent Mike Penca said in a statement.
Calls to Jeffrey were not returned by press time. Minear declined to comment when reached by phone.
Draper confirmed on Saturday she had contacted the state auditor's office, but that she would not comment further, because what the state would examine was not known, even to her, and the details of the pending audit would not be public information.
Two representatives from Hogan-Hansen, an auditing firm that annually reviews the district's finances, were out of the office and not available for comment on Friday.
Micich is on administrative leave in Mason City until June 29.
The Mason City School Board will meet at 5:30 p.m. Monday for its regular meeting, including a discussion on interim Superintendent Penca's contract, according to the agenda.