Sunday Notes August 7th 2016

The School Admin spent $1,000,000 or more without a School Committee Vote and made numerous transfers without any SC votes that appear to violate Mass General Law

If I am understanding Mass General Law Chapter 44 section 33B correctly, it appears to me that the School Administration by law CANNOT make any transfers without a vote of the School Committee 2 months prior to the end of a fiscal year or 15 days into the beginning of a fiscal year.

If that is the case (which I’m pretty sure it is )and in fact the Supt. / CFO made as many transfers as I believe they did, it appears they broke the law and someone needs to address this ASAP since the majority of the Lowell School Committee including the Mayor wants to ignore these transfers and instead reward this Superintendent with a contract.

Maybe we (taxpayers,parents) need to ask the Inspector General, DESE or DOR to come in and look at the real finances for the end of the year before anything gets submitted to the State. This isn’t just a Supt. being arrogant and not wanting the City to take back money anymore, this has reached the point of a clear violation of the law.

While that in itself is shocking I’m hearing that the School Administration did not want to give the City any opportunity to take back any “free cash” has the city did last year taking $50,000, so the Supt and/or CFO authorized a bunch of transfers that the School Committee never voted on and had purchase orders cut for $1,000,000 or more without a public vote of the school committee in order to keep all available funds.

That is inexcusable appalling disrespectful and violates the role of the School Committee. Yet all we read about this week was that a majority of this school committee wants to give him a contract! Bob Gignac and yesterday on WCAP Connie Martin are the only two who have expressed any concerns about the finances.

This committee and the gang of 4 that hired this Supt. owe the taxpayers an apology for unleashing this financial chaos on the School Department. The City Council must act. The Supt without authorization spent money that should or at the very least could have been returned to the general fund.

The City’s Auditor has his year end report in the Council packet this week.

The City Councilor’s need to ask the Auditor about the policy of how transfers are made and verified. He works for them not the Manager. Don’t transfers need to have paperwork that shows committee authorization? I believe on the city side he receives that. What’s the process on the school side?

The silence from Steve Gendron is worrisome, he should be a leader not a follower! Same with the Mayor who seems to not care about the SC not having the opportunity to votes on transfers and the expenditure of a $1,000,000.

He would never let a City Manager spend a MILLION Dollars without a City Council vote, why is the Supt. allowed to?

Mass General Law Chapter 44/ Section 33B – Transfer of appropriations; restrictions – among other things states: (BOLD MINE)

33B (a)In addition, the city council may, by majority vote, on recommendation of the mayor, transfer within the last 2 months of any fiscal year, or during the first 15 days of the new fiscal year to apply to the previous fiscal year, an amount appropriated for the use of any department other than a municipal light department or a school department to the appropriation for any other department, but the amount transferred from 1 department to another may not exceed, in the aggregate, 3 per cent of the annual budget of the department from which the transfer is made. Except as provided in the preceding sentence, no transfer shall be made of any amount appropriated for the use of any city department to the appropriation for any other department except by a 2/3 vote of the city council on recommendation of the mayor and with the written approval of the amount of the transfer by the department having control of the appropriation from which the transfer is proposed to be made. No transfer involving a municipal light department or a school department shall be made under the previous sentence without the approval of the amount of the transfer by a vote of the municipal light department board or by a vote of the school committee, respectively.

33B (b) Alternatively, the selectmen, with the concurrence of the finance committee or other entity establish under section 16 of chapter 39, may transfer within the last 2 months of any fiscal year, or during the first 15 days of the new fiscal year to apply to the previous fiscal year, any amount appropriated for the use of any department other than a municipal light department or a school department to the appropriation for any other department or within a department, but the amount transferred from 1 department to another or within a department may not exceed, in the aggregate, 3 per cent of the annual budget of the department from or within which the transfer is made or $5,000, whichever is greater.

There has been no public transfers of the the $150,000 that I noted last week from the SUPT’s Salary – Asst Supt. Finance (CFO) and HR Director on any published School Committee agenda.

In addition the Supt. legally cannot be paid a portion of his salary from the Food Service Acct. The Supt. made $175K not the $99K shown in the Auditors end of year report supplied in this week City Council Packet. How will the state and independent auditors address these issues?

Taxpayers of this city are spending over a quarter of a million dollars in combined salaries for the Supt. and CFO how do they justify breaking State Laws and making transfers and spending a million dollars without the vote of the Elected Officials who they work for?

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The Supt declared the Auditor doesn’t care about anything but the bottom line. While that may be true, the current Auditor’s inexperience in Municipal Finance may have contributed to him NOT ASKING FOR SCHOOL COMMITTEE VOTES AUTHORIZING THESE TRANSFERS.

The current “bottom line” shown by the Auditor after the Million dollars plus expenditures (ignoring all the other overspent individual accounts) shows that the remaining total “Free Cash” will end up at $39,703.74 from a budget of $158,010,396.

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How is this NOT a Contract?

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The Supt’s agreement includes an annual salary of $185,000, a $300 monthly travel allowance, and health benefits. There is no provision for him to receive sick-leave buyback, which is standard in newer Lowell union and administrative contracts.

No set term of service is specified for Supt. Khelfaoui. The School Committee will notify DR. Khelfaoui by Dec. 1 if it does not wish for him to stay in the district for the following school year, according to the agreement.

City Manager Kevin Murphy has a similar work agreement, negotiated with the City Council, that falls under city ordinance to address benefits such as health care.

The Manager’s agreement which present Mayor Kennedy was in full support of, all of a sudden isn’t good enough for a school superintendent? Why ?

In addition it’s been reported that during the Executive sessions to hammer out the above, DR. K stated he did not need the 3 year contract Steve Gendron was pushing hard for. So why does he need one now?

Financial Reporting

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It appears the School Committee shares some of the responsibility for the poor reporting on the school finances. The above is from their own Policy and Procedure Book. However if you look at the on-line SC meeting packets there is no financial report to the Lowell School Committee in March (March 3rd meeting is missing, the March 16th meeting is posted twice labeled once as March 3) April or May.

Maybe had they bothered to follow their own guidelines, the July numbers and transfers would have jumped out at them and they would have asked for better explanations at the July meeting.

I still have seen nor heard any explanation as to how funds could be moved to an “suspension account” or used to purchase technology without a vote from the School Committee.

How much “Free Cash” actually existed and how much was used in the June Purchase splurge?

Is the fear that since the city has met and exceeded (in their view which I thank could be debated) NET School Spending that the City was going to take back all the “Free Cash” which is allowed under State Law justification for breaking the law?

Was any discussion had at an open public meeting about year end monies? Did the Supt. / CFO meet with the Manager / City CFO to discuss “free cash”? What does /did the Mayor know? When did he know it? and did he okay any of these expenditures without a vote of the full committee?

Will the School Committee continue to sit quietly by and allow this action without reacting?

Would you or your boss accept an excuse that the CFO is new to Mass Municipal Law or that Supt. K didn’t completely understand the Committee’s rules? At $185,000 a year shouldn’t he??

The upcoming fiscal year is worrisome enough but the blatant disregard and disrespect for the school committee and violation of the state law and is even more troubling as is the lack of action / reaction from the current School Committee.

By issuing “Press Release” did Kennedy out himself as being “confused” or violating the Open Meeting Law?

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If you listen to the last 3.5 minutes of the last City Council meeting (104:11) when Councilor Elliot ask for a suspension of the rules to discuss the “A Communication from the City Manager” it is very clear that what is being presented to them is a draft.

Elliott:The Yellow Highlighted item, Have those been negotiated or are they the City’s proposal to UMASS Lowell and are these is still up for discussion?

The Manager clearly states: The Yellow Highlighted portions are OUR Proposal – it’s what we want – it includes revenue protections plans. We are just looking for basic things

So unless he tuned out both Elliott and the City Manager how is the Mayor confused into thinking that this was ” A draft of an accord that had been reached between the two parties”?

How many Councilors did he ask or discuss this press release with? A quorum would violate the Open meeting law. Less than that and Councilor’s should ask why he felt it was okay to speak for them. Unless he spoke with 4 Councilors (Plus himself) how could he factually state in the press releases: I believe that most of the City Councilors were under the impression that the proposed agreement was a draft of an accord that had been reached between the two parties

Is this a sign that Kennedy is acting like a strong Mayor and doing and saying what he feels is in the Council’s best interest with little input from his fellow councilor’s? (Something Elliott was accused of but not until late into his 2nd year as Mayor)

This release with no public discussion makes me even more nervous of what the Mayor may be doing on the School side out of public view and with no public discussion.

Sample Primary Ballots on-line at City of Lowell Website
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