July 28, 2014

Elyria
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State audit criticizes charter board compensation

COLUMBUS — A group of Northeast Ohio taxpayer-funded charter schools paid some board members multiple times for attendance at a single meeting, a business practice that was legal at the time but was classified as abusive in a review by state Auditor Mary Taylor.

Taylor also found improper credit card purchases, faulty documentation and misallocation of purchases in the audit of the 19 Hope Academy and Life Skills schools, which all have the same fiscal officer, Ohio Community School Consultants of Dublin, and the same board president, Robert Townsend.

The schools are managed by White Hat Management, whose president, David Brennan, has been a big contributor to Republican candidates and causes, including Taylor, who has received $60,000 from Brennan and his wife since 2005. White Hat spokesman Robert Tenenbaum said the audit targeted the boards and were not against White Hat.

Many of the charter schools were governed by the same four to six board members, who each received a base pay of $125 per meeting, said the audit released Tuesday. In some cases, board members were paid 17 times for their attendance at a single meeting, at a rate of $2,125, the audit found.

Seven of the boards had recovery findings, 17 were cited for overcompensation of board members, and all were cited for undocumented credit card purchases and bookkeeping errors.

“What this audit shows is there needs to be improvement in management of public funds across the board,” said Taylor spokesman Steve Faulkner.

Brian Adams, the president of Ohio Community School Consultants, said the number of dollars referenced in the audit was minuscule compared to the $57 million budget across all 19 schools.

“The picture that was painted that they got paid so many times for just coming to one meeting is just not anywhere close to the truth,” Adams said. “It does not represent the totality of hours they spent relative to the work they did.”

The money was not ordered to be repaid because a new law limiting the number of boards that someone can serve on and the pay they can receive had not yet gone into effect. The audit covered the period from July 2005 through June 2006.

The law, passed by the Ohio Legislature in 2006, went into effect in March, and members of some of the charter school boards have challenged the law in Franklin County Common Pleas Court

April Hart, a lawyer for Townsend, said the state overstated the case because the $2,000 paychecks were rare.