Fixing a Hole

I'm fixing a hole where the rain gets in
And stops my mind from wandering
Where it will go...

My apologies to John and Paul, but these lyrics came to mind as I was reviewing the RUSD board materials (for tomorrow's meeting) over my morning coffee. It would seem that the RUSD board will be addressing changes in their current governing style, Policy Governance, to address the loopholes that directly led to the recent changes in district leadership.

Over and over again, the audit report written by Reinhart-Boerner included the phrase "lack of oversight" and suggested that Policy Governance possibly left too many "holes" in the financial management of the district. The board seems to be addressing these "holes", not by throwing out Policy Governance, but by rewriting some of the language. I'm glad our current board acknowledges that some of the Executive Limitations were too broadly written, and that the board is now seeking to remedy the situation.

Here 's a brief summary of some of the proposed changes, the bolded text is the proposed change in language, the text in italics is the existing language:

Policy Type: Executive Limitations

Accordingly, the CEO may not:

Fail to publish a financial condition statement annually. Fail to provide the Board with a monthly update of the Statement of Revenue and Expenditures and Balance Sheet depicting month and year-to-date financial activity as well as a financial condition statement annually.


a.Fail to use a competitive bidding procedure for the purchase of all supplies, materials and equipment, and any contracted services except professional services, in the amount of $25,000 or more.
b. Fail to use a competitive bidding procedure for professional services in the amount of $50,000 or more except for replacement positions within the Teaching and Learning Division.
c. Execute a contract which includes financial incentives to a third party without Board approval.

Hindsight is 20/20, obviously if these changes in policy language were included from the get-go, it is very likely that the RUSD board would not have to be renegotiating terms with PBCG, the consultant group hired by the former superintendent to manage the district's business affairs, but, instead, could be focusing on the issues that might actually benefit the children of RUSD educationally.

It's about time the board "fixes the hole" and focuses their collective time and energy on achieving their goal of educating every student to succeed.

The Gunfight at the RTA Corral

Okay, so maybe my headline for this post is a tad bit overdramatic... But like that famous fight that symbolized the struggle between law and order and the rampant banditry of the American Old West, the Racine Taxpayers Association met with the RUSD Interim Superintendent and Board President yesterday for what was probably a very lively luncheon meeting.

I am coming to the realization that politics DO play a major part in education, although I still believe that education should be a non-partisan issue. In my humble opinion, taxpayers have a right to question financial decisions, after all, it is our money and we have a right to understand how it is being spent. But because the tax money is used for something that is intangible - education - sometimes lines get drawn in the sand. It becomes an Us vs Them issue - I know I have fallen into this frame of mind many times before. This is something I am continually addressing and trying to overcome.

The Journal Times reported that the PBCG contract was one of the many issues discussed - please allow me to pontificate briefly on that topic. While I completely understand the need for secrecy at this time, or as Baumgardt stated, to "keep my mouth shut" until the renegotiations are complete and voted on in an Open Session meeting, I do have some concerns.

Frankly, I am worried about any negative political fall-out from any decision that may be perceived as a bad one (financially speaking) by the taxpayers of eastern Racine County.

The district has decaying buildings that are literally stuffed to the gills with children - not the best learning environment for anyone, to say the least. (We treat our criminals better!) The district will need to address its facilities soon via spending referenda; the trust and support of the district by the citizens it serves is needed.

I have written about my feelings about the PBCG contract numerous times for nearly 2 years now - I am not going to repeat myself.

But I will say this - I certainly hope that any deal brokered with PBCG is one that the public can bear. What sort of compensation can the public bear and accept? That is the unknown; I know the amount I would give them if I sat on the board, but hey, my opinion doesn't matter.

Or does it?

Meetings, meetings and more meetings!

The RUSD board is again having a special meeting tonight, followed by a work session that will discuss the recent Special Education Study. It certainly seems like the board is working hard, at least if you look at the number of times they have been meeting lately. Let's hope these meetings are fruitful!

The special meeting will commence at 5:30PM and will adjourn to Executive Session to update the board members of the renegotiations of the PBCG contract. As many of you are aware, PBCG was hired by the district to oversee the business operations of the district, and were the focus of the recent audit done by Reinhart-Boerner, a Milwaukee legal firm. The board has trying to negotiate a settlement with PBCG since the initial results of the audit have been made public.

I only hope that a settlement is soon to come, and it is one that public can accept. The board needs to regain the trust of the citizens of eastern Racine County in a very big way.

PBCG Update

Just a quick note on the PBCG audit, the Racine Unified School Board Audit Committee will be meeting in executive session (closed to the public) on Monday, October 1st. The committee will be discussing the possibility of continuing the 2nd phase of the audit. As most of you are aware, the audit was released to the board on August 20th, so any decision made will DEFINITELY not be one made in haste.

Also, the full RUSD Board will meeting immediately after the committee meeting to discuss the ongoing negotiations with PBCG. Again, this meeting is in closed to the public, as allowed in Wisconsin statute 19.85 (1)(e). The sticking point, of course, is the $3.8M in unbilled incentives, which is based on future savings and revenue enhancements, NOT any realized savings.

Will the board send PBCG riding off into the sunset with money this district can ill afford, or will the RUSD board stand up for the children of this district? Facing another $3.8M shortfall will only hurt the children of this district with more cuts to the classroom.

The wheels of government roll slowly

The RUSD Board received the results of the 1st phase of the PBCG audit on August 20th. Today is September 18th - in other words, its been 29 days.

Do you think the RUSD Audit Committee has met to decide if a 2nd phase was necessary, or even talked about the results of the audit and possible remedial actions so the board does not make the same mistakes again?

Of course, the answer is NO. Not surprising, but still disappointing.

Update on special RUSD meeting

The RUSD board met briefly Wednesday to discuss the forming of the Executive Search committee and to formalize the PBCG renegotiation committee.

The following board members were approved for the Executive Search Committee:

Brian Dey
Susan Kutz (Chair)
Julie McKenna
Don Nielsen
Gretchen Warner

Don Nielsen and William Van Atta are handling the renegotiation of the now infamous PBCG contract.

In regards to the Executive Search Committee, Ms. McKenna posed a question. Legally, can 5 board members serve on a committee - especially since 5 board members constitute a forum? I'm glad she raised this question for the record, because I asked the same exact thing.

While the board was still waiting Wednesday evening for a legal response from counsel, it appears it may be legal - as long as all the recommendations from the committee are brought to the full board to be voted on and all meetings are properly noticed.

The board also met to discuss the search process and timeline for the Interim Superintendent and Business Manager position. The board, as has been reported on in the past, is seeking an interim superintendent and business manager to hold down the fort until permanent replacements can be found.

From what I gathered (before they adjourned to closed session), a candidate for the interim superintendent was going to be decided on that night and brought to the board next Monday to to be voted on.

On a related note, if they would only follow Kat's suggestion, we would already have the interim superintendent in place and the board could focus their attention elsewhere.

Still waiting for news on the PBCG settlement

It’s been, what, about 3 weeks now since the board received the preliminary report of the PBCG audit? Three weeks, and the public is still very much in the dark about PBCG’s future financial relationship with RUSD…

Is the RUSD board going to terminate their contract without any further payment, or will PBCG be given a lovely parting gift, courtesy of the taxpayers and the children of the district?

The way I see it is this – the board has 2 basic duties, and each of these duties are equally important. As elected officials, their first role is representing the taxpayers and the children of this community, and the second is representing the district in a professional and positive way. I fear that some board members are having difficulties addressing both of these duties simultaneously.

Trying to terminate the contract without any further payments could result in a lawsuit from PBCG – even though the audit shows that PBCG failed to perform even their most basic accounting duties. Many people believe that they have not held up their end of the bargain, so why should the district uphold theirs? Don’t even get me started on the unbilled incentives based on “revenue enhancements” (BTW, that is a code word for tax increases, not savings!)

However, lawsuits do have a tendency to get ugly and there may be some on the board who would rather try to make this all quietly go away, and spend millions doing so, in the name of bringing some kind of quick and painless closure for the district.

However, this action may have its own unintended consequences. I cannot believe that many of the Racine area residents will take this scenario lying down. Instead of having the RUSD board deal with important issues like grade configuration, busing, and other educational matters – the board may ultimately end up dealing with their own recall elections.

The alternative - standing up to PBCG and not paying them the unbilled incentives from the still unrealized savings and “revenue enhancements” - would be the righteous and noble thing to do, according to many in this community. It’s the “right thing” to do on the behalf of the taxpayers, and it’s definitely the best for the children within this district. Terminating the PBCG contract and paying them the contentious bonus will only take more money from all the classrooms in the district.

Let me put it this way – I’d rather have the district take their chances in a court fight then pay PBCG any kind of settlement outright. At least then I could respect the board for trying to represent the best interests of the taxpayers, the children they serve, and the district they represent.

PBCG under fire again

PBCG, the consultant group that manages the RUSD business office, is under fire once again – but not from the usual suspects, the angry torch-wielding public. This time it appears a RUSD board member, Brian Dey, is leading the charge. Mark Lindem, RUSD’s Chief Operations Officer, AND a PBCG employee, apparently faced problems with the last school district that employed him as its Business Manager.

For the record, I’m am going to state that being the Business Manager of a school district is a crap-shoot. A good business manager has to gamble sometimes – they have to create the schools budget before the state has completed their biennial budget. How exactly can someone plan long term for a district’s financial well-being when he/she doesn’t even know how much money the district will receive from the different taxing authorities? Factor in revenue caps, the QEO, and expensive mandates from NCLB and the average person’s head will start spinning like that little girl in the Exorcist.

However, with that said, Mr. Dey does make excellent points. He explains that because of our contract agreement with PBCG, PBCG was allowed to fill any position with whomever they deemed fit. I am fairly certain, if given a vote to extend a RUSD employment contract to Lindem, Dey and others on the board would have had some very serious concerns. In fact, Dey and others did have concerns when PBCG brought him on board last year, but because Lindem is technically not a RUSD employee, these concerns fell on deaf ears.

It certainly seems that many “concerns” have fallen on deaf ears since PBCG has taken up residence on Northwestern Avenue.

Using Google for good...

Oh, the things you find in cyberspace...

Armed with only a Pentium 4 processor, a wireless connection and a powerful search engine, one can find many, many interesting factoids on the web. While researching some information for a family member, I ran across a database referencing Wisconsin statutes; specifically Chapter 118, which covers General Schools Operations.

For example, look at this statute below:

118.24 School district administrator. (1) A school board may employ a school district administrator, a business manager and school principals and assistants to such persons. The term of each employment contract may not exceed 2 years. A contract for a term of 2 years may provide for one or more extensions of one year each.

Hey, isn’t PBCG our business manager and didn’t we give them a 5 year contract?

What gives, RUSD?

Updated @ 1:15 CST 9/7/07: I spoke with a school board member about this. He said the contract signed was a 2 year contract, with 3 1-year extensions. Perhaps an Open Records Request for a copy of the contract is in order.

I am still disseminating this information - I cannot for the life of me try to figure out why the board approved this.

Disclaimer: I am not a lawyer, nor do I play one on TV. I didn’t even stay at a Holiday Inn Express last night. I do think this needs further investigation, however.

Reading between the lines

In trying to fully understand the latest RUSD brouhaha, many in Racine look to the local media for answers. Unfortunately, even after reading numerous news articles many readers (including myself) still have questions. I am sure I am not the only one that is trying to decipher the comments of the parties involved.

For example take the following comment from Alioto, which is from the 9/6/07 JT story – he is disputing the fact that the original contract was drawn up without proper legal counsel:

"(The document) clearly proves that Dr. Hicks had provided a full copy of the proposal and contract document to legal counsel and had asked counsel to work on the contract document together with PBCG and that, based on counsel’s handwritten notes, the contract entered into did reflect many of the suggested changes," Alioto said.

Okay, I have questions. I believe Alioto is stating the initial proposal and contract was reviewed by legal counsel, and then changes were made.

What "handwritten notes" were NOT included in the final contract?

Was the final contract (with the changes) reviewed and signed off by RUSD legal counsel??

Reading between the lines is not a reliable way to get information – we deserve some real answers.

PBCG still working in Unified

This morning, while having coffee with my husband and discussing the recent RUSD events, I realized that my husband did not realize that the district has not removed PBCG from the CFO and COO positions. The board statement, as reported in the press, states “it has become clear to both parties that a consultant acting in the role of COO and CFO creates a potential conflict”, but the statement does not state that their contract was terminated, only that the contract will be renegotiated.

Granted, Mr. Alioto and Mr. Dickson may no longer work within the walls of Unified, but many PBCG employees are still very much working in Central office, including Mark Lindem, the Chief Operations Officer.

I was surprised when I realized my husband thought the CFO and COO positions were no longer PBCG employees. I am wondering if they are others out there that think the same thing.

Has the RUSD board whitewashed Hicks' record?

I have a question for all of you…

By releasing Dr. Hicks from his duties (but continuing to pay him until June 2008), has the board “whitewashed his record”? Have we really lost the last 6 years as one Racine resident suggests in a recent JS story?

I’m sure I will take plenty of heat for this, but here is my take on the matter.

First, a brief overview of the facts: Dr. Hicks did NOTHING illegal; he acted with the authority OUR ELECTED BOARD granted to him. PBCG is taking bonuses in the “savings” they found, even though most of the savings are revenue enhancements that will result in higher taxes. Again, because Dr. Hicks was granted the authority to enter this contract – there is NOTHING illegal going on here.

Slimy and unethical, definitely – but not illegal.

As far as losing the last 6 years on an academic level, this is rather hard to prove. Educational reform is rather subjective – what works in one city may not work here in Racine. Every community is unique and has its own challenges and Racine is no different.

So let’s talk about his reform initiatives. Why haven’t they worked? I challenge you to simply Google the phrase “school reform”, you will soon discover, as I have, that many districts across the country have found much success using the same concepts Dr. Hicks brought to the district. Why has it worked in other places, and not here?

There of course are numerous answers to this question – the most obvious one is the “leadership” factor. For many unnamed reasons, Dr. Hicks failed to engage the teaching staff from Day 1 and never really recovered.

So in short, I believe the RUSD board did the right thing by accepting Dr. Hicks’ resignation and “whitewashing” his record.

OK, now let me have it.

The PBCG Legacy

Thought I would pass this link along - it was written by a former St. Francis School board member. The post is somewhat lengthy, but please read the whole thing...

As many of you know, PBCG has done work with many school districts across Wisconsin and this is not the first time that PBCG has created havoc within a district.

Who's to blame for RUSD fiasco?

Everyone I have talked to about the recent happenings within RUSD is looking for someone to blame. Some blame the consulting group PBCG, some the (now former) superintendent, Dr. Hicks, and finally some are blaming the board for their lack of oversight.

Having watched all three parties in action over the years, I would agree that all 3 (Hicks, PBCG and RUSD board) are culpable in the matter. Hicks may be guilty of abusing his Executive Limitations, PBCG may be guilty of fleecing the district and the board is definitely guilty of not providing any oversight over both of them.

Policy Governance, the governing style the board adopted in January 2006, is the main culprit (in my humble opinion). This governing style is a “hands-off” approach, the board members do not approve payments on a regular basis and the superintendent has near-autonomous control over everything. The board "clarifies" their needs, and the superintendent goes about trying to meet those needs anyway he sees fit.

You can quickly understand how RUSD got itself into this mess…

But I hear very little about another party that can be blamed for this fiasco; the voters and taxpayers of eastern Racine County. If we (as a collective group) continue to vote board members in that do not understand the true meaning of accountability – this scenario will keep playing out again and again. Do yourself a favor next April; actually try to make an INFORMED vote. Go to a forum, call the candidates, but just get acquaint yourself with the candidates!!

And if you are not apprised of the issues or candidates, please do me a favor and stay away from the polls on Election Day.

120 seconds

That’s all it took for tonight’s meeting, 120 seconds. In that very short amount of time the RUSD board approved both Dr. Hicks’ resignation and removing PBCG as the COO and CFO. Talk about anti-climatic…

They also released the long-anticipated 5 page report from the legal firm that conducted the recent audit. I’m sure I will pick this report apart for days, but here are my initial thoughts on some of their findings…

Preliminary Finding C: There was insufficient oversight for PBCG payment.

The law firm points out that “nearly all the payments were based on future estimates, which contradicts the requirement that PBCG achieve “actual savings” before it is compensated.”

Ya think?? Hey didn’t I say that over 1 year ago??

The law firm also points out that Energy Education Inc, another consulting firm hired to find savings in the district’s utility bills “contacted RUSD to initiate a relationship before PBCG began working for RUSD”. This means PBCG should not have been paid a bonus on the anticipated savings.

Wait, I think I said that over a year ago, too!

Perhaps, if the board had listened to me and others like me, the district would not have had to shell out $200,000 for an audit that states that the district’s contract “problems” stem from having little oversight for the CEO.

Ya think?

Finally, some answers?

According to the Journal Times, the RUSD board will be meeting Monday at 7:00 to discuss Dr. Hicks' contract and the 1st phase of the PBCG audit.

I will not speculate on tomorrow's meeting; what I think might happen is simply my opinion and I prefer to hold my comments until after the meeting tomorrow.

However, I do hope the APATHY the permeates this district takes a permanent vacation. This brouhaha (hopefully!) has opened many eyes, and I certainly expect that the board room will be packed tomorrow evening to hear the information firsthand.