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Ledger report


Allegations of a ‘slush fund’ emerge when a state audit finds questionable accounting practices under the former state schools superintendent.

Clifton Adcock March 21st, 2012

A recently released investigative report by state Auditor and Inspector Gary Jones’ office accused the state Department of Education under former Superintendent Sandy Garrett of maintaining a secret “slush fund.”

Garrett, however, contends the report actually showed the opposite: that the department took steps not to illegally comingle private and public funds in order to pay for its annual leadership conference and other events.

The report, released March 7, came about after Superintendent Janet Barresi asked Jones to look into questionable travel expenses by former state Department of Education employee Misty Kimbrough. That audit revealed that much of the annual leadership conference was paid for by the nonprofit Oklahoma Curriculum Improvement Commission, or OCIC.

A spokesperson for the state Attorney General’s Office said it has received the report and is reviewing it.

According to the audit’s findings, state education department employees solicited, collected and deposited funds in the nonprofit group’s accounts during working hours and expended those funds with little to no public oversight.

right Sandy Garrett

Moreover, the audit found that the nonprofit group’s board had little or no knowledge of the separate accounts that were being used by the agency. The report stated that department employees who were responsible for delivering financial information to the OCIC did not disclose the accounts in audit presentations.

Conference call
The audit stated the funds came from vendors that operated booths at agency events — as well as corporations and individuals — after being solicited by education department employees. Funds were then deposited in an OCIC account.

In addition to funding conferences, money from the accounts was used to purchase wine, beer, refreshments, food and other items, according to the report.

Between 2000 to 2009, expenditures from the accounts totaled $2.3 million, the report stated. When OCIC shuttered in 2010, the audit said, education department employees transferred the money over to a second organization.

“We find it noteworthy the funds collected by the [education department] officials were maintained as the ‘private’ funds of OCIC until the accounts were closed,” the report states. “In the process of moving the funds from one nonprofit organization to another nonprofit organization, the funds somehow became [education department] funds and state Superintendent Garrett now had the apparent authority to transfer those funds.”

right Gary Jones

However, in an interview with Oklahoma Gazette, Garrett said the department long ago consulted the state attorney general prior to setting up the accounts. Because mixing private donations with state money is illegal, the money generated from vendors and donations could not be put in state coffers, she said.

Professional relationship
Garrett said she had wanted to transform the leadership conference by expanding attendance.

“They had previously been held in smoke-filled rooms,” she said. “We wanted more than just superintendents and principals to be aware of all the laws that were made in the spring.

“The auditors told us you could not co-mingle private and state funds. This was a way of doing it, expanding it and making it very professional.”

Garrett said she was not aware of any solicitations for funds by department employees on state time, and that she never directed any employees to do so.

“I don’t agree with that, and certainly that was not my directive,” she said. “The only way our employees would be involved, from my vantage point, is that some sponsor called them.”

Garrett said she did not know why OCIC board members would be unaware of the group’s involvement in the leadership conference. She said it was board members who first opened the conference account in the 1990s, and pointed to the conference’s 2009 agenda that listed the group as a partner, along with the state agency and trade show exhibitors.

“We knew that was the only way we could provide adequate professional development, and OCIC knew that,” she said.

Garrett bristled at the idea that the accounts were slush funds. She said the events noted in the audit were not lavish affairs with open bars serving hard liquor and extravagant food.

“There was never a slush fund,” Garrett said. “I know there are people that do bad things, but I can guarantee you none of our people did bad things.”

Sandy Garrett photo by Mark Hancock

 
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