Confronted by too many unanswered questions about the financial viability of the school district – particularly, a shortfall in the projected balance in its general fund – an exasperated School Board member blurted out at last week’s meeting what everyone in the room was thinking.
“What a mess!” said Jackie Rosario, clearly dissatisfied with Superintendent Mark Rendell’s explanations for a budget so obviously mismanaged that some board members are calling for a spending moratorium.
Well, it’s about to get messier.
Before resigning in December, then School District finance director Julianne Pelletier sent a six-page email to School Board members, alerting them to Rendell’s involvement with the budget mess and challenging his attempts to blame her department.
Then this week, Pelletier took her case to the Florida Department of Education, filing a complaint with the Inspector General’s office and asking for an investigation into her allegations.
If the IG’s office follows up, it would be the first investigation launched by an outside agency of the school district’s current financial chaos.
“I first looked at the DOE website after Rendell publicly said my numbers regarding the general fund were wrong,” Pelletier said of the superintendent’s remarks to the School Board last month. “I remember clicking on the ‘Complaint Form’ link and thinking: That box isn’t big enough.”
She was referring to the section of the digital form where schools employees are asked to “describe in detail” the issues and circumstances that prompted their complaint, identify witnesses and provide any evidence pertaining to the case.
As fate would have it, the DOE’s electronic filing system failed Sunday night, so she submitted her complaint via email Monday. And if her correspondence with School Board members is any indication, Pelletier had plenty to report.
Her Dec. 10 email to the board included six attachments containing spreadsheets, journal entries, memos and other relevant documents that offered a vigorous defense of her former boss, School District Chief Financial Officer Carter Morrison, who resigned in December to take a private-sector job.
Pelletier said Rendell tried to make Morrison – and later the entire finance department – a “scapegoat” for a lack of control in school district spending. She also believes Rendell wanted to “get rid of Carter” because he was a holdover from a previous superintendent’s staff.
“Carter was the last assistant superintendent he didn’t hire,” Pelletier said, “and he wouldn’t let Rendell run free with the money like he wanted to.”
Morrison’s departure came after Rendell accused him in July of wrongdoing and mismanaging the budget, suspended him with pay and wasted $50,000 of the district’s funds on an unnecessary, four-month investigation by an outside law firm.
Rendell later reversed course and reinstated Morrison as the district’s CFO in December – despite his earlier claims that Morrison had done wrong and deceived him.
Morrison submitted his resignation the day after he was reinstated.
So did Pelletier, who has since moved back to her previous home in New Hampshire and taken a job as a business administrator with the state’s Public Utilities Commission.
Unlike Morrison, however, she’s not going away quietly. In her email to the board, Pelletier praised her former boss and cited his many professional certifications, affiliations and accolades, writing:
“Carter Morrison has always adhered to the utmost ethical, legal, moral and the highest professional standards of conduct in all aspects of his career and the responsibilities of his position … His documentation is meticulous, his work ethic profound … He is humble and kind and a pleasure to work for.”
For those reasons, Pelletier, who also had great affection and respect for her colleagues in the finance department, was upset by the allegations of wrongdoing that Rendell included in his charging letter against Morrison.
“None of us appreciate the statements that Dr. Rendell made about the finance team in his Nov. 15, 2018 letter to Carter Morrison,” she wrote in her email. “What a great way to destroy the morale of possibly the only functional department remaining in the district since Rendell took over.”
In his charging letter, Rendell alleged that Morrison, without authorization and “in an effort to undermine me and the School Board,” included in his tentative budget the transfer of $2.3 million from the general fund to 12 schools for positions that didn’t exist.
That transfer reduced the projected, year-end balance in the general fund to as low as 3.5 percent of the district’s overall budget – just above the 3 percent cash reserve mandated by state law but well below the 5 percent required by School Board policy.
Rendell publicly blamed the shortfall on Morrison, saying the CFO admitted he had moved the money from the general fund to the schools’ accounts to cover a long list of vacant teaching positions he received from Mike Smeltzer, the district’s position control specialist.
What no one knew at the time was that Smeltzer had dumped 65 vacancies into Morrison’s lap late in the afternoon of July 20, the day Morrison was required to deliver to Rendell a tentative budget for a School Board workshop.
Morrison, who in a written statement to investigators said he was “shocked and taken aback” by Smeltzer’s request, calculated that the salaries and benefits connected to those vacancies totaled $4.1 million, which needed to be added to the budget only hours before it was due.
Adding that amount, however, would’ve dropped the district’s cash reserves below the state threshold. So believing Smeltzer had significantly over-budgeted, Morrison opted to add only $2.3 million for the vacancies, which put the projected general fund balance at 3.5 percent.
“Why did this happen at the last minute?” Pelletier said. “Why wait until just hours before the tentative budget needed to be submitted? You’re telling me the district still had all those vacancies three weeks before the start of school and nobody knew until that afternoon?
“It was ridiculous.”
Morrison said Rendell was aware of the transferred money, and Pelletier claims he was much more involved with the budget than he let on to the School Board.
Pelletier contradicted Rendell’s claims that he saw the budget only twice a year, saying Morrison regularly kept the superintendent up to date on the district’s finances.
She said Rendell would say in cabinet meetings that he wanted money for different programs, and Morrison would give him a spreadsheet showing how those expenditures would impact the general fund balance.
At the School Board’s budget workshop last week, Rendell said the projected end-of-the-year balance is at 4.2 percent and promised to provide a full report on how he would get to 5 percent.
To meet that number, however, he’ll need to shift teachers’ salaries, transfer $1.4 million from the capital projects millage fund, defer the purchase of buses and rely on more long-term substitutes to fill full-time teaching vacancies.
Despite all that, Pelletier said the general fund remains in danger of a shortfall because of pending expenditures that include $600,000 in state fines levied for miscounting bus riders, $90,000 for “additional legal fees” and $70,000 to clean up a generator fuel-tank leak and replace the generator.
She also cites the potential loss of $1.1 million in transportation funding the state likely will withhold because of additional rider counting errors.
“Rendell stood up there a couple of weeks ago and said my numbers were wrong,” Pelletier said. “If my numbers were wrong, why has he been scrambling for three weeks and moving money around – and they’re still at 4.2 percent?”
Rendell did not respond to an email sent last week through the district’s public information officer, who was asked if the superintendent wished to comment on Pelletier’s email.
School Board Chairman Laura Zorc said she could not comment on Pelletier’s email until Friday. She didn’t say why, though the reason almost certainly is connected to an investigation being conducted by an outside law firm.
Zorc did acknowledge that Pelletier provided information “that put us on alert,” and said she valued her input.
Pelletier believes her, and she’s encouraged by the questions School Board members are now asking Rendell.
“I watch the meetings,” she said, “and they’re asking the right questions.
“There’s too much power in the superintendent’s hands,” Pelletier said. “This whole thing is a mess, and it shouldn’t be allowed to happen again. I can only hope that what I’m doing helps.”
