Guest Post: “Kathleen Davies Vindicated But Delawareans Still Lose”

Kathleen Davies

Last week, the News Journal reported Kathleen Davies won her Merit Employee Review Board appeal hearing.  She will be reinstated at the Auditor of Accounts office after a two and a half-year ordeal.  She ran for State Auditor but lost to opponent Kathy McGuiness in the September 6th Primary.  McGuiness won the General Election so the two women will soon be working in the same building.

Eric Morrison wrote a guest piece on this saga and what it means for Delaware:

Candidate Message: Kathleen Davies, State Auditor, Democrat

Kathleen Davies

The Delaware State Auditor race has been one of the hottest tickets of the election season.  There are many reasons for this in what is usually a quiet race.  The biggest factor is long-time State Auditor Tom Wagner not running after a 29 year stint in office.  Kathleen Davies served as Tom Wagner’s second-in-command for many years and announced her run to take over Tom Wagner’s seat.  Davies faces her Democrat contenders Kathy McGuiness and Dennis Williams in the Primary next Thursday, September 6th.  The winner of the Primary will face Republican James Spadola for the General Election.

Grant Thornton Contract States Can’t Be Released Without Company Permission & Default Language Shows Tom Wagner Could Edit The Report

Kathleen Davies

Kathleen Davies just released the agreement for the Grant Thornton contract.  The contract was commissioned by Delaware State Auditor Tom Wagner to look into Kathleen Davies, who many feel was ousted from Wagner’s office for doing quality audit investigations. The contract is a bigger bomb than the report because it proves the report is bogus.

Breaking News: Kathleen Davies Issues Press Release On Slanted News Journal Article

Kathleen Davies

Kathleen Davies, a Democrat candidate for Delaware State Auditor, issued an official press release today about the very controversial News Journal article that appeared online and in print over the past couple of weeks.  This answers many questions I’ve had and confirms many suspicions I’ve harbored over this matter.

Recent Changes At Delaware State Auditor’s Office A Very Bad Omen

Kathleen Davies

Editor’s Note: I was going through my drafts folder today and I found this little gem from June 20th, 2016.  I wasn’t able to fully verify the reason Kathleen Davies was ousted from State Auditor Tom Wagner’s office.  Nobody really knew except Tom Wagner and he wasn’t talking.  I had my suspicions.  Turns out they were just part of the reason.  As Davies continues to get wrongly persecuted by the News Journal during an election, I thought this would be an opportune time to publish this “lost in the drafts folder” article:

For the past couple years, Kathleen Davies has been very busy.  As the Chief Administrative Auditor, she had her hands full with education audits, specifically those dealing with charter schools.  She was in charge of the investigations for Academy of Dover, Family Foundations Academy, Providence Creek Academy, and the recent September 30th Count investigation.  Recently, however, there have been two glaring omissions from State Auditor Tom Wagner’s website: Kathleen Davies and the September 30th Count report.  Where did they go?  Are the two connected?

This is Delaware.  Of course they are.  Word on the street is the Delaware Department of Education didn’t like the September 30th report, even though they requested it.  When they asked Davies to make changes, she refused.  This caused an impasse, and the result… Davies and the report are gone.  Apparently the DOE’s influence now stretches across State of Delaware Departments.  All the way to the Auditor’s office.  Ironically, their central offices are both located in the Townsend Building.

News Journal Shows Bias And Fails To Publish Key Document In Kathleen Davies Fight Against Tom Wagner

Kathleen Davies

The Delaware News Journal came out with an article today about the ongoing battle between Kathleen Davies and the Office of the Auditor of Accounts.  Even though the hearing with the Department of Labor ruled State Auditor Tom Wagner terminated Davies without cause, that only determined unemployment funding for Davies.  Now the battle is heating up with the Delaware Merit Employee Review Board (MERB).  But the News Journal article is missing or failed to report some vital facts.

Kowalko Endorses Kathleen Davies For State Auditor

Kathleen Davies

Delaware Representative John Kowalko issued the following statement this afternoon:

It is not often that I choose to make an endorsement in a primary election, but sometimes a candidate stands out from the rest and earns my recognition and support. An individual of impeccable integrity, experience and intelligence best describes Kathleen Davies. Ms. Davies stands above the others in my opinion and will administer the affairs and responsibilities of the Auditor’s office with an exceptional consideration for fairness and honesty.

I am proud to endorse Kathleen Davies as the Democratic candidate for the office of State Auditor. Kathleen Davies has more than 25 years’ experience in state auditing with six years as the second-in-command at the Office of Auditor of Accounts. Davies has the expertise to perform independent evaluations of state funded programs. She will work to identify recommendations for process improvements including work to support quality education and to provide recommendations to advance public health and human services. Davies has the qualifications, experience, and commitment to providing transparent public reporting and fiscal accountability.

Representative John Kowalko

I couldn’t agree more Rep. Kowalko!  There is only one choice for State Auditor in both the Primary AND the General Election, and that is Kathleen Davies!  To see what Davies is all about, please go to her campaign website.

Exclusive: The Kathleen Davies Mystery Solved! What Role Did Tom Wagner, The Delaware DOE, & The News Journal Play?

Kathleen Davies

For over two years, Delaware citizens wondered why Kathleen Davies was put on leave by Delaware State Auditor Tom Wagner.  Now, finally, the truth can be told.

State Auditor Race Heats Up As Kathleen Davies Files As A Dem For Three-Way Primary

Kathleen Davies

One of the biggest events next September will be the primary race for the Delaware State Auditor.  Current State Auditor Wagner is retiring and so far, three have filed to run under the Democrat banner.  Today, Kathleen Davies filed.  Facing off against Kathleen McGuiness and Dennis Williams, I see Davies as the strongest candidate with experience that leap-frogs and catapults over the other two.  She is EXACTLY what Delaware needs and will by far do the best job should she win.

While there are some unanswered questions regarding her paid leave from the Auditor’s office, you simply do not pay someone for that long if they did something as egregious as what appeared in the News Journal in 2016.  I firmly believe there is much more to that than meets the eye and someone wanted her to shut up and took swift action.  But it is a new day and a new administration in Delaware.  It is past time the sun shined brightly on The First State and the best place for that is in the State Auditor’s office.

Exclusive: Kathleen Davies Files To Run For State Auditor

Kathleen Davies

Delaware’s next General Election is still over a year away, but a surprise filing with the Department of Elections today made it very interesting.  Kathleen Davies, the former Chief Administrative Auditor for State Auditor Thomas Wagner, is running for the elected position in 2018 as an Independent.  To say this isn’t huge news would be an understatement.  While Davies cannot publicly talk about why she was run out of the office in the Spring of 2016, the fact she is running for the State Auditor title shows there was definitely some funny business with her ouster.

I wrote extensively about the situations around her removal last year.  I always knew there was more to it.  The News Journal wrote a story involving Ann Visali and travel expenses that never made a lick of sense.

Tom Wagner, who has held the position of State Auditor for the last three decades, has not announced his intention to run again.  A couple of weeks ago, former State Rep. Dennis Williams announced he would run but nothing has been heard about that since.

I know, without a moment of hesitation, that Kathleen Davies will get my vote on Election Day in 2018.  Without a doubt in my mind.  She is easily the most qualified and her resume involving work with state audit agencies goes beyond Delaware, to Pennsylvania and New Jersey.  I firmly believe Davies will one day be vindicated for the horrible treatment she received in the Spring of 2016.  But even better, it is my fervent hope she will see that vindication while holding the office of State Auditor.

Change is needed in the Auditor’s office.  That change was there when Davies held the title of Senior Audit Manager.  She was the first to conduct audit investigations against Delaware charter schools.  From Delaware Military Academy, to Academy of Dover, Family Foundations Academy, and Providence Creek Academy.  The last big audit she had a major role in was a September 30th Count audit inspection which found some pretty glaring errors with a few charters.  That report was pulled from the State Auditor website the same time Davies was placed on administrative leave.  Wagner released a new report a few months later but the actual procedures from the first audit were not used in the second report.

I can imagine some in the Delaware education world will begin rolling up their sleeves when they hear this news.  My suggestion to the people of Delaware: ignore them.  If you want an auditor who will serve that office above and beyond and believes in their work 100%, that person is Davies.

Kathleen Davies for Delaware State Auditor 2018!!!!!

The Kathleen Davies Mystery Deepens As Charter School Petty Cash Letters Come Out & Many Charters Get Sue-Happy

Charter School Petty Cash Letters, Kathleen Davies

Delaware is missing one of the key players in transparency thanks to a deliberate campaign orchestrated by one or many.  Because of this, it may have cleared the way for many charter schools to launch a lawsuit in Delaware.

Delaware State Rep. Kim Williams exclusively released the letters sent to five Delaware charter schools about their petty cash practices last night.  They showed some very extreme violations of state code.  As well, letters were sent to four other state agencies.  These letters were sent by Tom Wagner, the publicly elected Delaware State Auditor, on June 21st to the following charter schools:  Odyssey Charter School, Delaware Military Academy, Charter School of Wilmington, Sussex Academy, and Delaware Academy of Public Safety & Security.  The state agencies Wagner sent letters to addressing the petty cash violations of state code were the following: Department of Education (Secretary Godowsky), Department of Finance (Secretary Tom Cook), Division of Accounting (Director Kristopher Knight), and the State Treasurer (Ken Simpler).  These letters were never publicly released from Tom Wagner or the Delaware Auditor of Accounts office.  Originally, this was an audit inspection and that report would have been released.  But before that happened, the Delaware Auditor of Accounts top official, Kathleen Davies, was put on leave last spring.  Now we can clearly see why.

Before I get into the results of the letters to the five charter schools, we need to look at motive.  The key to any mystery is “Who benefits”?  That benefit could be the ability to keep something hidden or being able to reap some type of positive outcome from the situation.

We have so many who could have done it: Ann Visalli, Secretary of Education Dr. Steven Godowsky, Kendall Massett, Senator David Sokola, Charlie Copeland, Nick Manolakos, and others as well.  We can’t forget the potential role Greg Meece may have contributed either.  State Board of Education Executive Director Donna Johnson and Kendall Massett are very tight and the DOE is in the same building as the Auditor of Accounts Office.  It could be a combination of any of these people.  It could have even come down from the very top, Governor Markell himself.

Out of all these entities, one of them leads the pack in Delaware when it comes to offering charter schools advice and protection.  That would be the Delaware Charter Schools Network, led by Executive Director Kendall Massett.  When it comes to charter schools, I have no doubt Kendall is in a key position to communicate issues to charter school leaders.  Some charter schools are run by ex-legislators in some sort of capacity.  Former State Rep. Nick Manolakos is the Head of School for Odyssey Charter School.  Delaware GOP Chair Charlie Copeland is the President of the Board of Directors for Delaware Academy of Public Safety and Security.  Both are prominent Republicans in Delaware.  Many on the Sussex Academy Board of Directors are also Republican.  Odyssey Charter School and Delaware Military Academy clearly had the most egregious of petty cash violations out of the five charters.  I can imagine the pressure on Tom Wagner from all sides could easily have prompted his decision to make Kathleen Davies go away.

 

Odyssey Charter School:

  1. petty cash fund not approved by State Treasurer and checking account used for petty cash not approved by State Treasurer
  2. 53 petty cash checks over state limit of $500.00, totaled $303,451.65
  3. 57 debit transactions from petty cash account over state limit of $500.00, totaled $326,574.05
  4. maintained petty cash account over $5,000 limit, average monthly balance was $88,979.83

Delaware Military Academy:

  1. had no written policies and procedures for petty cash
  2. never had account reconciliations done by Account Custodian
  3. checks signed with two signatures but each check signed by Account Custodian who can’t sign checks
  4. 30 petty cash checks over state limit of $500, totaled $114,111.08
  5. maintained petty cash account over $5,000 limit, average monthly balance was $20,589.31
  6. failed to provide receipts or invoices for check of $1000.00 for “lunch start-up costs”

Charter School of Wilmington:

  1. had no written polices and procedures for petty cash
  2. never had account reconciliations done by Account Custodian, was performed by Chief Financial Officer who was not the Account Custodian
  3. no checks signed with two signatures, only signed by CFO who was not the Account Custodian
  4. 13 petty cash checks over state limit of $500, totaled $11,228.90
  5. had debit transaction from petty cash account for $4,000, well over the $500 limit, which was transferred to another CSW account
  6. maintained petty cash account over $5,000 limit, average monthly balance was $6,174.10

Delaware Academy of Public Safety & Security:

  1. had no written policies and procedures for petty cash
  2. never had account reconciliation done by anyone, including the Account Custodian
  3. no checks signed with two signatures, only signed by CFO who was not the Account Custodian
  4. 8 petty cash checks over state limit of $500, totaled $6,440.11

Sussex Academy:

  1. 5 petty cash checks over state limit of $500, totaled $16,377.05
  2. maintained petty cash account over $5,000 limit, average monthly balance was $26,689.95

 

So let me get this straight.  Kathleen Davies was working on finalizing this report, showing five Delaware charter schools breaking the law, but she got put out to pasture?  And all the charters got was these “don’t do it again” letters?  That were NEVER released to the public, until now?  And look at the cc: on the letter to Godowsky.  All charter school leaders and board presidents.  My theory that Kathleen Davies was put on leave for bogus purposes is actually proven in the letters to the charter schools.  As the News Journal wrote, Ann Visalli with the Office of Management and Budget followed up on a complaint by unnamed individuals at the Auditor of Accounts Office.  As a result, Davies was placed on leave (six months after the tip was submitted to OMB) because she failed to use a procurement card for travel purposes and went through the also-existing state reimbursement program.  But in the letters to the charters, that standard doesn’t seem to exist because Wagner writes:

We also recommend using a State-issued procurement card (PCard) or direct claim through First State Financials when possible.  Regardless of the method of payment, supporting documentation must be maintained for all transactions.

So by Wagner’s own advice to the charters, what Kathleen Davies did is perfectly acceptable.  She followed the procedure.  Maybe not a preferred procedure, but a procedure nonetheless.  Which makes Ann Visali’s actions a complete and utter crock.  A complete and utter lie meant to disgrace the one person at the Auditor of Accounts office who was doing their job, and doing it well.  But no, instead we get these non-transparent letters from Tom Wagner.  And he has the gall to ask Godowsky to collaborate with him on “an event” to make sure all the charter schools know this, even though their leaders and board presidents were included in the letter to Godowsky?  How much more special treatment and hand-holding do the charters need to understand the law?  Do they need circle time to get this right State Auditor Wagner?  This obvious fraud going on in our State Auditor’s office is completely out of control, matched only by that of the Department of Education.

This whole debacle comes down to this: someone or maybe even a group of individuals is protecting charter schools in Delaware.  They have enough power and clout to make things disappear or just focus on other aspects surrounding it to cloud the issues.  We are seeing this with the charter school lawsuit and I have to wonder if the petty cash information was not made public because of that looming timebomb.  One can only assume the charters were given some type of direction in their process for having the DOE review exclusions districts submit for their local funding formulas.  They clearly knew the results before the districts did as evidenced by the emails between the finance office of the DOE and charter school leaders.  They also had to have known there would be some major blowback from the districts and advocates for the districts based on that.  If not, they are complete and utter idiots who truly underestimate the will and resolve of people in Delaware traditional school districts.

This is my new working theory: the charters knew they would wind up filing suit on the local funding formula.  I think they knew Godowsky was intentionally kept out of the loop on this and when the public found out about the new charter bills going out to the districts with very elevated amounts, Secretary Godowsky would be forced by public pressure to reverse course.  As a result, they would be free to sue the Christina School District and the Delaware Dept. of Education for something they wanted to happen in the first place- a big, fat, and juicy lawsuit.  They knew the only thing that could happen for them to get more money would be to create the conditions for a lawsuit to happen.  Which they did.  Delaware is a very corrupt state.  If people don’t see that in this day and age with everything I’ve written, along with many others, they need to get their eyes checked.  There are good people, fighting the good fight, but they are overpowered and outnumbered by those who are either corrupt or lend their ears to those who are corrupt.  If some cities get a moniker of “Sin City”, then Delaware clearly qualifies for the “Sin State”.

But the charters and their friends had to clear a very real obstacle in their road to the lawsuit.  One Kathleen Davies.  The same person who was doing the petty cash audit along with other charter school audit inspections.  One of those inspections was a tip I sent to the auditor’s office on Newark Charter School and their failure to submit non-profit 990 tax forms to the IRS.  While they met the criteria once upon a time for being exempt from filing their 990 tax returns, they knew the conditions which allowed for those exemptions no longer existed.  Something the IRS issued very strongly worded guidance to all American charter schools that participate in these exemptions.  NCS knew they could not look like a victim in a lawsuit against their feeder pattern district if that audit inspection came out.  It had to disappear.  We all know true compliance with properly making sure all our schools in Delaware are truly funding student needs is an exercise in futility, despite what the law already requires.  But an audit inspection into NCS’ finances would be a much deeper probe.  It could have offered a great deal of transparency with their money and what they are doing with it, far past the scope of their annual audit or what appears in their financial statements.  But given the pull they seem to have, with the Delaware Charter Schools Network, the Chair of the Senate Education Committee (Delaware Senator David Sokola), to some extent the Chair of the House Education Committee (State Rep. Earl Jaques), other members of the Delaware General Asssembly, select members of the Delaware Dept. of Education, lobbyists, and companies within the Newark area, I could easily picture Greg Meece being able to rally enough force to make things happen in regards to Kathleen Davies.  Once again, I stress, with utmost importance, this is only a working theory of mine and is not grounded in documented fact.  I imagine a paper trail that could conceivably supporting this working theory would not materialize no matter how many FOIA requests I might ask for.

Lest we forget, as clearly documented in the above-linked News Journal article, Senator Sokola was the prime sponsor on a bill meant to give charter schools more authority over the choosing of their annual auditors as opposed to the State Auditor of Accounts office.  This was in complete contrast with Rep. William’s original bill which would have had the auditor’s office doing the job.

She publicly supported Williams’s bill over an alternative proposal from Sen. Dave Sokola, D-Newark, which would strengthen the rules charters have to follow in picking auditors but leave them with the authority to do so.

Eventually, Rep. Williams and Senator Sokola compromised on a charter school audit bill but the charters still get to pick their own auditor.  What the new bill also accomplished was any charter school under investigation by the State Auditor of Accounts office would also be audited for that fiscal year by the Auditor of Accounts.  By making the petty cash audit turn into letters instead of a full-blown inspection report, those five charter schools will not get a full financial audit by the Auditor of Accounts office this year.  There are also other stipulations in which that office can do a full financial audit on a charter, including the following, based on the text from the signed House Bill 435.

Has failed to maintain a current status with the Internal Revenue Service Form 990 filings, if said filings are required of that charter school.

All of this legislative language serves to expose charters who do not comply with the law.  But discovery of something like an exemption of an IRS 990 filing not being practical based on the current conditions of the only Delaware charter school in the state to not file said return, would come from something like an audit inspection of the school.  Something that is not happening from the Auditor’s office because they got rid of Kathleen Davies and my request to them seems to have vanished into the ether.  Even though I provided clear documentation to John Fluharty about this.  Granted, the Office of Management and Budget received a “tip” from other officials in the Auditor of Accounts office with the allegations of Davies “not following procedure” with travel expenses in November of 2015, the OMB did not act on this until the petty cash audit neared completion and the NCS 990 audit would have been under way.  As well, there was the pulling of Davies’ September 30th Enrollment inspection which was reworked by Wagner and released in September.  That report was released two weeks before Davies was put on leave.

At a bare minimum, the Auditor of Accounts office and the Office of Management and Budget must be made accountable for their actions regarding Davies.  If she was put on leave for something as trivial as not following suggested procedure while charter schools run amok with their petty cash accounts and the results of which were not made public, even if it was switched from an inspection to non-transparent letters, we have a major conflict of interest going on here.  This conflict of interest reaches to the Delaware Dept. of Education and the Red Clay Consolidated School District.  As the charter authorizers of these five charter schools, they failed to even publicly broach the subject going on four months since the letters went to them, much less put the charter schools on formal review to address the financial violations of their charters, as they have the ability to do so under Title 14:

  • 515 Oversight and revocation process.

(a) The approving authority shall be responsible for oversight of the charter schools it approves.

(b) In addition to the review required by § 514A(a) of this title, the approving authority may notify a charter school of potential violations of its charter and submit the charter to formal review to determine whether the charter school is violating the terms of its charter and whether to order remedial measures pursuant to subsection (f) of this section.

Both the Delaware Department of Education and the Red Clay Board President, Kenneth Rivera, were well aware of the situation because they were included in the letters sent from Tom Wagner.  Bloggers like myself exist because of what amounts to severe issues with education in Delaware.  Our state has, is, and will continue to fail the most important stakeholders in education, the students themselves, because they fail to adequately provide oversight to make sure our schools do the right thing.  Instead, Delaware does its level best to cover up issues with no transparency and institutes polices and measures that have no basis in reality.  They are what outside interests want.  These “poverty pimps”, corporate education reformers, ed tech charlatans, and those hiding behind the cover of “non-profits” and “community organizations” should not be involved in education at all.

This is what I want to see: Kathleen Davies immediately reinstated, the original charter school petty cash audit inspection completed, and any other pending charter or district audits done with fidelity.  As well, anyone else who played a role in this absolute cover-up and smear campaign against Davies needs to be named and held accountable for their parts in this.  As State Rep. Kim Williams asked, who audits the auditors?  I believe it is time to find out.  It is past time the feds got involved in Delaware’s finances.  Corruption, fraud, waste, and abuse are rampant in Delaware.  If left unchecked, as it has been for some time now, the situation will only wind up costing the taxpayers of the state even more money than they have already doled out without even realizing it.

In the above picture, the people in the “Brady Bunch” format are as follows:

Top- Kendall Massett, David Sokola, Governor Markell

Middle- Tom Wagner, Kathleen Davies, Nick Manolakos

Bottom- Charlie Copeland, Secretary Godowsky, Ann Visalli

The Smear Campaign At The Delaware Auditor’s Office & What The News Journal Didn’t Tell You

Delaware State Auditor, Kathleen Davies

Revenge is ugly business.  When it takes place at a very high state level and the object of that revenge gets a whole article about it in the state’s biggest newspaper, it is really ugly.

Today, James Fisher and Matthew Albright published an article about the Auditor of Accounts, Kathleen Davies.  The article claims Davies was put on leave over two months ago due to not using the state procurement card for travel expenses.  According to the story, sources who would only be named as “state employees” contacted the Office of Management and Budget, then run by Ann Visalli, in November of 2015.  They alleged Davies spent over $7700 in travel expenses (over four years) and received personal reimbursements instead of using the state p-card.  She did do this.  But was it wrong?  Absolutely not.  I’m not buying any of this.  Let’s take a close look at what else was going on at the time these “sources” (as the News Journal calls them) filed this complaint.

Davies had just come out with a report on many charter schools, not just Delaware College Prep (the only school mentioned in the article).  Kuumba Academy was also named in the report on personal reimbursements as using funds against the accounting policies of the state.  Two other charters did not have any inappropriate use of state funds: Odyssey Charter School and Thomas Edison Charter School.

But there was more going on at that time.  The reports on Family Foundations Academy and Providence Creek Academy had not come out yet.  The September 30th enrollment inspection was just beginning (which was published earlier this Spring and pulled from State Auditor Tom Wagner’s website after Davies was put on leave).  Another Delaware charter school, The Delaware Met, was under formal review.  Hearings and meetings with the Charter School Accountability Committee took place in November and December of 2015.  One of the big questions surrounding Delaware Met was how they were spending their money.  And by default, their operation management company, Innovative Schools, would also be looked at.

There was also an inspection released by Davies on December 7th.  This surrounded an anonymous tip about Delaware Department of Education employees abusing travel expenses.  No wrongdoing was found in the inspection report.  But why would the News Journal not mention such an important part of this timeline in their article as well as the actual inspection?  If this accusation by sources who have now become “whistleblowers” was made to the OMB in November of 2015, this would have been the same time when Davies would have been working on the DOE travel expense report which came out on December 7th.  The timing on this is uncanny!

If it took six months for Davies to be put on leave, what was the OMB doing for six months?  Why did Davies just happen to be put on leave at the same time the DOE was pitching a conniption fit about the September 30th Inspection Report written by Davies?  The report, published by Wagner’s office on May 5th, can be found here.  Why did Wagner pull the report which had absolutely nothing to do with her supposed reasons for being put on leave?  Which other pending audits was Davies working on?  I do know the answer to a couple of these, especially one that I submitted to the auditor’s office.  John Fluharty, the policy analyst from the Auditor of Accounts office, contacted me on March 17th to discuss the tip I sent that office.  I talked to him on March 18th with what I knew.  No follow-up has taken place since then nor has any report been released on my tip.  I find that to be very odd…

And then we have the charter school audit bill crisis.  Delaware State Rep. Kim Williams released three different bills in the first part of the 148th General Assembly.  The first two were stricken in lieu of the third one which passed the Delaware House on June 30th, 2015.  It’s next destination was the Senate Education Committee, chaired by Delaware Senator David Sokola.  Prior to the second part of the 148th G.A. beginning last January, rumors began circulating that Sokola was going to introduce his own charter school audit bill.  With his friends at the Delaware Charter Schools Network, Sokola crafted new legislation which weakened Williams bill considerably.  Williams and Sokola battled publicly on Facebook over the bill, resulting in an eventual compromise a few months later.  They both met with Davies, who supported Williams bill, and the Delaware Charter Schools Network.  The new legislation, House Bill 435, passed both the House and Senate and awaits Governor Markell’s signature.

But the biggest question is this: what did Davies do that was so wrong, that would warrant such a drastic action?  While the guidelines regarding travel expenses published by the News Journal said the state prefers state employees use the p-card, it doesn’t rule out personal reimbursements.  Furthermore, the article states she told employees she was doing this.  If you have something to hide, you don’t tell everyone in the office!!!  The only way she would have been reimbursed for those travel expenses is if someone approved it and saw the receipts.  Who approved the expenses?  More importantly, where is the fire here?

Davies was not put on leave over this.  This is a cover.  The whole thing reeks of corruption at a very high level.  Tom Wagner won’t talk about it because it’s a personnel issue.  So how did the News Journal get the story?  I can tell you this: I was contacted by an employee of the Delaware Department of Education who asked me if I heard about Kathleen Davies.  This was on May 26th, a week after the September 30th report disappeared.  This employee said “word is she had a falling out with Tom Wagner.  And won’t be back.”  Now I hear from sources all the time about different state employees.  But how is that a DOE employee would have intimate knowledge of a situation between Tom Wagner and his second-in-command?  And how in the world would they know Davies wouldn’t be returning?  That would indicate a conversation took place with someone from the State Auditor’s office with either an employee of the Delaware Dept. of Education or an employee of the State Board of Education for that much knowledge to come out for what we are being told is a “personnel issue”.

This is my firm belief: someone was very frightened about an audit inspection Davies was working on.  Something that would make someone or several people look very bad.  This person would have to have the power to be able to pull strings with an elected official to get Davies put on personal leave.  Because this fabricated nonsense about personal reimbursements is absurd.  Other state employees do it.  Even our own Governor was mentioned in an audit report for not following state accounting rules with travel.  Was he put on leave?  Hell no!  Was Tom Wagner put on leave when it was announced he “accidentally” let his own house go into foreclosure?  Nope.

I’ve been going through all district and charter expenses the past few weeks and I can say with certainty that any travel expense amounts incurred by Davies are a drop in the bucket compared to what they spend.  And I seriously questioned one district about an outrageously high amount in one coding area.  No response on that one over two weeks later.  So why target the one person who has the ability to produce reports that can put others in a very bad light over financial abuse?  I believe I just answered my own question.  To pull this off, that takes a serious amount of cunning and guile.  Someone with pull and motivation.  I would have to think Ann Visalli would know that other state employees use personal reimbursements for travel expenses.  I don’t know much about her, except to say she resigned shortly after Davies was put on leave.  The Director of the Office of Management and Budget.  Who resigned before the budget passed.

As for Kathleen Davies, I hope she gets the vindication she deserves from this oh-so-obvious smear campaign against her.  This is a woman who has spent most of her time at the Delaware Auditor of Account’s office finding actual situations of financial abuse and scandal.  Most of them have been against charter schools.  Delaware Military Academy report in 2013.  Academy of Dover, Family Foundations Academy, Kuumba Academy and Delaware College Prep reports in 2015.  Providence Creek Academy, EastSide Charter School and Prestige Academy in 2016.  And potentially more.  But for those reading this smear article on Davies in the News Journal today, they won’t know all of this stuff going on behind the scenes.  So if you read this, please share it so all Delawareans can know that Kathleen Davies is deserving of much more respect than this.  I am positive she has enemies in this state.  Those who expose the truth often do.  Those who do wrong fear exposure more than anything.  So who did Davies frighten so much that they would go to these lengths to remove her and tarnish her good name?

Updated, 6:12pm, 7/31/16: This article has been updated to reflect there was no wrongdoing on the part of Gateway Lab School in any audit report.  This was an error on my end, and I did write an article to apologize to Gateway regarding this.

15 Who Made An Impact In 2015: Kathleen Davies

Kathleen Davies

Behind the scenes in Delaware is a woman who had a VERY busy 2015.  Kathleen Davies is the Chief Administrative Officer at Delaware State Auditor Tom Wagner’s office.  She is the name on all the inspection reports for Delaware charter schools.  Academy of Dover.  Delaware College Prep.  Kuumba Academy.  And yesterday’s Delaware Department of Education inspection (of which they were cleared).  She even has a pending audit investigation with Family Foundations Academy.

These actions did not go unnoticed by one Delaware State Representative.  Kim Williams introduced House Bill 186 (after going through a few revisions) to mandate charters go through the State Auditor’s office when contracting for auditors.  It became one of the lightning rod bills of the season, which prompted Davies to testify to support the bill.  She told the Delaware House Education Committee the situation with the charters was worse than they could imagine.

During this time, the Academy of Dover audit inspection was finishing up.  When the report was released, all the Delaware major media picked up on it.  Former Principal Noel Rodriguez had used well over $160,000 in school funds for personal purchases, along with numerous other egregious activities.  In October, Davies released a report on four charters.  Two were cleared of any wrongdoing, but Delaware College Prep and Kuumba Academy had some nasty findings.  And apparently, while that was finishing up, her office was working on the report on the DOE!

With Delaware Met’s pending charter revocation, will the auditor’s office step in?  While their closure has more to do with academic and organizational reasons the financial picture is not pretty at this point.  And that whole real estate deal is begging for an investigation.  I hope though, for Davies sake, her charter school audits decrease in 2016!