Auditor Forum: Davies Shines, McGuiness Blunders, & Williams Rants

Delaware Election 2018

Last night, the Kent County Democratic Committee hosted a forum for the Democrat candidates for State Auditor at the Kent County Levy Court in Dover.  The well-attended debate was clearly won by candidate Kathleen Davies.

Why Does Our State Auditor Only Find Things Like The Sussex Tech Fraud From Tips? Are There More Sussex Tech Situations We Don’t Know About?

Delaware State Auditor Tom Wagner

Boom! Jack Wells sent one hell of an email to Delaware State Auditor Tom Wagner today.  This is one for the record books and opens up a whole new ballpark on the question of financial oversight of our school districts and charter schools!

TO: Mr. Thomas Wagner, Auditor of Accounts

This report reveals numerous problems that were “only” revealed because the Office of Auditor of Accounts {AOA} received an anonymous complaint on 1 July 2014. 

While I am concerned about the findings, I am even more troubled why these findings were not identified in the State of Delaware Statewide School Districts’ Construction Projects Attestation Engagements conducted in fiscal years 2012, 2013, 2014, 2015, and 2016.  

Question: Since these reports did not reveal the problems identified in the report conducted by your auditors as a result of an anonymous complaint, can you inform me the purpose of these engagements/examinations?

Comment: Some findings were revealed, however the report ending June 30,2015 states: “Our examination disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Hopefully your answer to my question will disclose what must be reported under Government Auditing Standards.

While I am troubled by these findings, I have to wonder if these findings and others problems are not being revealed by the engagements/examinations that are being conducted each year. Provided below are the number of districts that are audited each fiscal year.

Fiscal Year     # of  School Districts  Audited

2012                   18

2013                   17

2014                   18

2015                   18

2016                   16

I have to wonder if the findings on Sussex Technical are only the tip of an iceberg.

Finally and even more troubling is the fact that audits required by law to verify expenditures of $2.3 billion annually for the education of our children were legal and used for the purpose provided are not conducted.

Amen Jack!  I am dying for these questions to be heard.  But I fear we will only hear the empty vacuum of space on this.

A Delaware Citizen Hits The Bullseye With The Scandal At The State Auditor’s Office

Delaware State Auditor Tom Wagner

I’ve mentioned Jack Wells a lot in the past few weeks.  He is a good guy.  He has some very strong opinions about the mandated “leave” of Kathleen Davies, imposed by Delaware State Auditor Tom Wagner.  We all do these days.  I have yet to hear anyone say “Wagner did the right thing”.  It just reeks of corruption!  But enough babbling, let’s hear it from the good Jack!

During the last 6 years the Auditor of Accounts has expended $29,500.27 for Lodg-Hotl-Out of State, of this amount Kathleen Davis expended $1,953.01 or $325.50 a year.  Three other employees expended $1,262,55, the Delaware Online Checkbook does not identify the employees who expended the other $26,284.71.


The article that appeared in yesterday’s News Journal did not reveal what Kathleen Davis did wrong, it did not contain the above facts nor did the article identify;

a.       Who approved Kathleen Davis travel.

b.       Who approved Kathleen Davis request for reimbursement that have to be supported by invoices/hotel bills.


Hopefully The News Journal will, in a very short time write a follow-up that provides the answers to the above questions and  informs the readers if funds were misused.  I would think since two months had passed since she was placed on leave, this could have been determined before the information was released to the News Journal. 


The article stated that using the P Card provided more oversight, however when I checked the P Card for this category of expense, it identified the hotel not the individuals.  {Marriott, Chicago received $893.96. FY2016},%20MOTL%20OUT-STATE&Fis_Q=FY%202016&Div_Name=AUDITOR%20OF%20ACCOUNTS


Over the last several years under Kathleen Davis supervision detail reports have been written on fraud, waste and abuse.  The Performance Reviews on Entitlements reveal big problems, as have audits on the used of Petty Cash in some of our Charter Schools.  The report on DDOE procedures on verification of student enrollment by category revealed a major problem, that DDOE made no effort to verify funds were being used for the purpose they were provided.  The report also revealed DDOE requested Auditor of Accounts conduct a review to verify funds were used for the purpose provided, but AOA refused. {This report was rescinded by AOA, no reason have been provided.}

I find it unacceptable that hundreds of hours are devoted to verify the state is not providing more funding to our children than they earn, while both AOA and DDOE provide NO oversight to verify the expenditure of these funds are legal and used for the purpose the funds are provided. 


While I support audits on travel and use of petty cash to reduce fraud, waste and abuse, I find it obscene NO oversight is being provided on the expenditure of 2.4 billion annually the public has provided for the education of our children.  Clearly the lack of oversight on $2.4 billion annually provides opportunities for fraud, waste and abuse, and based on the findings in audit reports conducted under the supervision of Kathleen Davis on the used of credit cards, it is clear we have fraud, waste and abuse. Last year our children with special needs represented 14% of our enrollment, however these children earned 33% of Div. I Regular and Special Education Units and many other units.  Are we sure all this funding is used for the purpose the funds were provided? 


Jack Wells

Well said Jack, well said!

Family Foundations Investigation Released By State Auditor, The Damage: $141,000 Verified, $1.2 Million “Unverifiable”

Family Foundations Academy

Delaware State Auditor Tom Wagner’s office released the Family Foundation Academy full inspection report a year after it was revealed their office was investigating them.  The biggest finding: Ex Head of School leaders Sean Moore and Dr. Tennell Brewington, as well as other employees of the school, racked up $141,000 in personal purchases with over $1.2 million unverifiable whether it was business or pleasure.  The report talks about the settlement agreement Moore and Brewington and the Board of Directors for a little over $85,000.  There is a mountain of abuse and violations in this report!  Even some that occurred well after East Side Charter essentially took over the school at the end of last year.  This is really, really bad.

AOA’s inspection revealed the administration at Family Foundations Academy  (the Academy) seemingly operated in its own universe during the period July 1, 2011 through January 31, 2015.

Updated, 3:45pm: with the press release from State Auditor Tom Wagner’s office:


Delaware DOE By The Numbers: Where Does The Money Go?

Delaware DOE

Aside from the Division of Health & Human Services, the Delaware Department of Education is the second biggest expense in Delaware.  So what do they spend all that money on?  For Fiscal Year 2015, the DOE spent the below funds in many different areas.  This is all based on figures from Delaware Online Checkbook.  Their biggest expense should not be a surprise, but some others may very well surprise you.

Association Dues and Conference Fees: $723,107.30

Auditor of Accounts (Dover): $31,387.00

Casual and Seasonal Salaries: $56,346.95

Common Carrier In State: $995.30

Common Carrier Out of State: $115,152.39

Computer Equipment Software: $12,604.76

Computer Services: $5,289,454.15

Computer Supplies: $336,305.01

Consultants: $1,501,789.18

Council of Chief State School Officers: $242,166.00

Delaware Teacher Corps: $273,500.77

Employee Charitable Contributions: $14,873.86

Employee Compensation (funds sent to schools to pay for staff): $1,990,812,872.14 editor screw-up, to be determine, but will fix.  Thanks to Avi with Newsworks for pointing out my colossal error!

Employee Garnishments: $37,292.95

Employee Recognition: $786.75

Employee Union Dues: $15,343.57

Federal Grant Returns: $23,690.00

Fleet Rental: $112,402.55

Food (not food sent to schools, spent using purchase cards): $7,580.55

Food Service: (funds sent to Delaware schools, including many private schools, for food) $64,911,964.82

Freight: $63,913.47

Governor’s Workforce Development Grants: $1,181,672.54

Grants: $16,738,068.65

Grants In Aid: $363,923.00

Health Insurance Employers SH (within DOE): $2,593,414.63

Indirect Cost (within DOE): $207,736.63

Instructional Supplies: $1,936,082.17

Legal Services: $29,375.16

Lodging Out of State: $111,126.96

Lodging In State: $4,711.40

Meals Out of State (within DOE): $21,052.65

Meals In State (within DOE): $7,972.60

Mileage Out of State (within DOE): $9,380.23

Mileage In State (within DOE): $39,623.76

National Association of State Directors: $26,634.00

Office Equipment: $32,713.99

Office Supplies: $559,922.49

Other Professional Service: $36,767.871.52

Other Rental (i.e. Dover Downs): $1,008,787.95

Other Travel In State: $3,100.19

Other Travel Out of State: $23,795.68

Pension Employer’s Share: $4,748,014.37

Postage: $30,628.44

Printing and Binding: $89,092.20

Promotional Supplies: $21,118.21

Salaries Wages-Employees (DOE Employees): $23,020,983.56

Stipends: $2,215,942.96

Telecommunication: $122,059.00

Temporary Employment Services: $256,645.73

Termination Salaries/Sick Leave: $116,839.20

Termination Salaries/Vacation: $238,417.97

Training: $695,165.98

Training Supplies: $31,246.75

Transportation Equipment (funds for actual buses): $3,337,161.00

Tuition Out of State or Private (residential treatment centers, typically, DOE pays 70% and districts pay 30%): $4,721,434.89

Wages To Inmates (Special Needs Programs): $35,797.51

Workmen’s State Compensation: $375,175.01

This is your taxpayer dollars at work!  The biggest expense is salaries for teachers, administrators, and staff at the public schools of Delaware (doesn’t include private schools), and after that it is funds for food at schools.  Some of these expenses are paid through federal dollars, but the bulk of them are paid through the state.

Some of my favorites in here are the Council for Chief State School Officers, nearly a quarter of a million dollars for the Mark Murphy club.  As well, the employee recognition doesn’t even break the four figure mark.  That says something right there!  But then again, it’s not like the employees are giving back that much as their employee charitable donations are less than .001% of their salaries.  Yes, they could be giving outside of their paycheck, but geesh!  The one that probably shocked me the most was their “rentals” of over $1 million dollars.  I know they use Dover Downs a lot for their different banquets and award dinners and Common Core Pep Rallies, but that is a lot of coin.

The biggest wastes would appear in “consultants” and “other professional services”.  A consultant is just that, but other professional services can be just about anything.  This where the bulk of their vendor costs get sucked up.  It is very telling that they spend more on outside sources than in house.  I’ve been told this is to remove bias on important projects, but come on!  We all know the bias of the companies they contract with.  Most are full-fledged education reform companies!  I think for funds totaling over $36 million dollars, it should be broken down more, by vendor and what they do.  Should a vendor be a consultant on other matters at the DOE?  Do we even know what the difference is?

This is not every cost at the DOE, but these are the main ones.

My Email To Kendall Massett With Delaware Charter Schools Network Over The Scandals & Fraud In Delaware Charter Schools

Delaware Charter Schools Network
  • Today at 10:23 PM

Dear Kendall,

I am the writer of Exceptional Delaware, and I would like to know why your organization is objecting to House Bill 186 and other legislation that would provide the essential oversight Delaware charter schools so desperately need.  This isn’t about protecting the finances of these schools, it is about making sure the students in these schools get the best education possible. 

What is occurring in so many of our schools: Academy of Dover, Family Foundations Academy, Providence Creek Academy, Odyssey Charter, Thomas Edison and others is a direct result of financial mismanagement, boards not properly trained in oversight, and allowing administrators to cut the board out of important decisions.  It isn’t the boards that suffer or the admins.  It is the students and teachers. 

If your organization truly represents school choice, then you need to make sure the schools under your purveyance are effectively able to run those schools.  Because we both know the DOE isn’t able to.  You have the backing of millions of dollars and several huge companies, but at the end of the day none of that matters if the charters are involved in all these scandals.  I would ask that you allow transparency to rule the day and that your organization backs House Bill 186 and House Bill 61.  Parents should have choice, but only when everything is crystal clear and out in the open.  It is completely inappropriate for any school to conceal finances or other important matters that can impact children.

I’m sure you don’t like me, and I’m okay with that.  I don’t like a lot of the underhanded tactics I have seen your organization perform, like having parents mass email representatives to block a bill that would actually allow the charters to escape from the financial malfeasances and show why they can be just as good as traditional schools.  I don’t understand the need to protect them, because it always comes out.  If it isn’t me, it will be the next blogger or reporter.  Things are reaching a crisis point with education in Delaware, and serving the will of money over students is not going to help these kids. 

Many people say the entire goal of the education reform movement in the past 10 years has been about the eventual destruction of traditional school districts and the “privatization” of schools, making them all charter or private schools.  I believe this point of view is the goal, but I also know it is a system that will never work.  Because along with that comes the notion of power and people will abuse that.  If you truly want charter schools to survive in our state, than I would strongly consider a different approach.  Because this way, it doesn’t work.  Charters will never take over.  Now it needs to become a matter of co-existence.  The way our schools are funded, with funds coming out of local funds from the traditional school districts does not work.  Fighting for scraps will always cause fighting.  We all need to come up with a better way and stop the fraud, waste and abuse going on in our schools.  For schools that only represent a small percentage of our students, I have never seen such so much chaos and disruption coming from anything in education as I have with the charter school movement.

The next move is yours.  And since I am a firm believer in transparency, I will publish this email.

Thank you,

Kevin Ohlandt

Comparing Charter Schools and Sub-Prime Mortgages #netde #eduDE

Charter School Enrollment Preference

This is dead on! EduNews posted this video on Youtube last week.