October 31, 2007
HAPPY HALLOWEEN
On Halloween it seems right to tell a few stories that I have dug up over the last few years about the Memphis City Schools, that huge TAXZILLA monster that eats up our tax money without returning much in the way of benefits or results. The Central Nutrition Center is only the tip of the iceberg.
One of my favorite incidents is the one involving Roland McElrath, our current City of Memphis Director of finance. After the City Council passed the disastrous January 2001 pension resolution allowing elected and appointed officials to retire after 12 years, regardless of age, and after Tom Marshall said that this was a really good ordinance which would help to get and retain good people, Roland immediately retired under the resolution. He started to receive his pension immediately and went to work for the Memphis City Schools at a salary of over $100,000.
• The next I heard, he was involved in the following boondoogle at the Memphis City Schools where he was involved in the School Trans contract which is shown below.
The internal audit found that John Britt left the board out of the loop when he increased SchoolTrans Inc.'s contract by $4.5 million in September 2002.”
We investigated and got a copy of the Internal Audit Report mentioned above. Here are some of the pertinent facts.
• In 2001-02 Memphis City Schools (MCS) began using SchoolTrans for medically fragile students because Laidlaw did not have air conditioned buses.
• In July 2002, Mr. Roland McElrath (as mentioned above he resigned from the City and took a job with the MCS and also took with him a $32,000 immediate pension under the January 2001 pension resolution) negotiated a two year contract with School Trans along with Mr. John Britt of MCS. All buses by SchoolTrans were to be air conditioned and were to have basic medical staff in transit. Ten exceptional children were assigned to six buses at a contract amount of $652,428.
• 34 days after the original contract was signed, Mr. Britt signed Addendum #2 which was written by Mr. Michael Jones of SchoolTrans and signed by both him and Mr. Britt but was not brought before the board as was previously agreed. This addendum specified that SchoolTrans had been directed to transport additional Specialized Exceptional Students increasing the minimum July 1, 2002 agreement by 15 additional buses. In addition, as also requested by MCS, SchoolTrans would be responsible for hiring nursing staff for all students requiring nursing at no more than $42.50 per hour (2 hour minimum) per bus per day. The terms of Addendum 2 would increase the benchmark amount of the original contract by $4,569,539.
• Finding #1- Clearly, Addendum #2 required Board approval but it did not get its approval. Addendum #2 was invalid.
• Finding #2- In February 2003, SchoolTrans was operating nine bus routes and carrying 21 students. On 2-16-03 SchoolTrans began invoicing the District for 21 buses and 21 CNA’s (Certified Nursing Assistants) per the agreement set forth in Addendum #2 which was never brought before the School board for approval. During an interview with Mr. Jones on 12-8-04, he was asked why MCS was being charged for routes not being operated. He stated SchoolTrans was contracted by buses, not routes. Mr. Jones contended that Addendum #2 gave SchoolTrans the authority to make buses available. He stated that SchoolTrans always billed by the benchmark number of the contract which he maintains was increases to 21 by Addendum #2.
• According to the Audit, MCS should request $529,703 from SchoolTrans for buses charged but not actually operated and for all CNAs charges but not supplied since February 2003.
• The cost per child was $207 a day in 2002-03. In 2004 the cost had dropped to $115 per day.
According to the contract, the District was to conduct a survey at the end of each school year to evaluate the services provided by SchoolTrans. If the survey resulted in an approval rating of 95% or greater, the District would award $10,000 to SchoolTrans. Guess what? They did their own survey and billed for $20,000 and got paid. According to SchoolTrans, they did not maintain copies of the surveys. The MSC is requesting the return of the $20,000.
The other story that is appropriate is the MGT report which was a $500,000 study done for the Memphis School System to report on possible savings and to report on things that went wrong and things that they were doing right. Shown attached is the report showing that for new construction and renovations projects, the budget overruns amounted to $81 million dollars. Happy Halloween.
Click here to see how $82 million of our tax dollars got wasted on school projects
HAPPY HALLOWEEN
On Halloween it seems right to tell a few stories that I have dug up over the last few years about the Memphis City Schools, that huge TAXZILLA monster that eats up our tax money without returning much in the way of benefits or results. The Central Nutrition Center is only the tip of the iceberg.
One of my favorite incidents is the one involving Roland McElrath, our current City of Memphis Director of finance. After the City Council passed the disastrous January 2001 pension resolution allowing elected and appointed officials to retire after 12 years, regardless of age, and after Tom Marshall said that this was a really good ordinance which would help to get and retain good people, Roland immediately retired under the resolution. He started to receive his pension immediately and went to work for the Memphis City Schools at a salary of over $100,000.
• The next I heard, he was involved in the following boondoogle at the Memphis City Schools where he was involved in the School Trans contract which is shown below.
The internal audit found that John Britt left the board out of the loop when he increased SchoolTrans Inc.'s contract by $4.5 million in September 2002.”
We investigated and got a copy of the Internal Audit Report mentioned above. Here are some of the pertinent facts.
• In 2001-02 Memphis City Schools (MCS) began using SchoolTrans for medically fragile students because Laidlaw did not have air conditioned buses.
• In July 2002, Mr. Roland McElrath (as mentioned above he resigned from the City and took a job with the MCS and also took with him a $32,000 immediate pension under the January 2001 pension resolution) negotiated a two year contract with School Trans along with Mr. John Britt of MCS. All buses by SchoolTrans were to be air conditioned and were to have basic medical staff in transit. Ten exceptional children were assigned to six buses at a contract amount of $652,428.
• 34 days after the original contract was signed, Mr. Britt signed Addendum #2 which was written by Mr. Michael Jones of SchoolTrans and signed by both him and Mr. Britt but was not brought before the board as was previously agreed. This addendum specified that SchoolTrans had been directed to transport additional Specialized Exceptional Students increasing the minimum July 1, 2002 agreement by 15 additional buses. In addition, as also requested by MCS, SchoolTrans would be responsible for hiring nursing staff for all students requiring nursing at no more than $42.50 per hour (2 hour minimum) per bus per day. The terms of Addendum 2 would increase the benchmark amount of the original contract by $4,569,539.
• Finding #1- Clearly, Addendum #2 required Board approval but it did not get its approval. Addendum #2 was invalid.
• Finding #2- In February 2003, SchoolTrans was operating nine bus routes and carrying 21 students. On 2-16-03 SchoolTrans began invoicing the District for 21 buses and 21 CNA’s (Certified Nursing Assistants) per the agreement set forth in Addendum #2 which was never brought before the School board for approval. During an interview with Mr. Jones on 12-8-04, he was asked why MCS was being charged for routes not being operated. He stated SchoolTrans was contracted by buses, not routes. Mr. Jones contended that Addendum #2 gave SchoolTrans the authority to make buses available. He stated that SchoolTrans always billed by the benchmark number of the contract which he maintains was increases to 21 by Addendum #2.
• According to the Audit, MCS should request $529,703 from SchoolTrans for buses charged but not actually operated and for all CNAs charges but not supplied since February 2003.
• The cost per child was $207 a day in 2002-03. In 2004 the cost had dropped to $115 per day.
According to the contract, the District was to conduct a survey at the end of each school year to evaluate the services provided by SchoolTrans. If the survey resulted in an approval rating of 95% or greater, the District would award $10,000 to SchoolTrans. Guess what? They did their own survey and billed for $20,000 and got paid. According to SchoolTrans, they did not maintain copies of the surveys. The MSC is requesting the return of the $20,000.
The other story that is appropriate is the MGT report which was a $500,000 study done for the Memphis School System to report on possible savings and to report on things that went wrong and things that they were doing right. Shown attached is the report showing that for new construction and renovations projects, the budget overruns amounted to $81 million dollars. Happy Halloween.
Click here to see how $82 million of our tax dollars got wasted on school projects
posted by watchdog at
9:32 AM
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