Fayette County Public Schools board member Doug Barnett recommended Monday that a trust fund at issue in a state audit be used to help the Lexington elementary school with the lowest test scores in the state.
Money from the fund has been used most recently for educational loans to staff, loans to prevent financial hardship while traveling for professional development, and loans to obtain certifications, according to state Auditor Adam Edelen's recent examination. Edelen questioned whether the trust, established by a former teacher who died more than 50 years ago, was being used in accordance with its charter.
"Instead of using this as a travel-allowance program, I think this money should go back to the lowest-performing schools to provide more resources for those students," Barnett said at a board meeting to discuss the district's response to the audit.
No final decision was made Monday on whether the money would go to William Wells Brown Elementary and other low-performing Fayette schools, but Superintendent Tom Shelton said the board had flexibility to use the money to benefit students. He said members could use the money to address inequities among schools.
When former Lexington school teacher Mary K. Stoner died in 1961, she directed in her will that a $150,000 trust fund be set up for the "enhancement and enrichment of educational programs." Stoner said she was confident the board would carry out plans and projects that "would be beneficial to the students."
In findings released Sept. 17, Edelen's office cited chronic financial mismanagement of the district and specifically questioned the use of the Stoner Trust.
Herald-Leader archives show that in the early 1960s, the money was used to equip Fayette County Schools with televisions.
On Monday, financial services director Rodney Jackson confirmed that previous school boards never made a decision to earmark money from the Stoner Trust for loans to the staff. Jackson said the decision was made during the administration of former Superintendent Stu Silberman so teachers would not have to put expenses for district travel on personal credit cards.
As of Sept. 30, there was more than $1.1 million, prior to market value adjustments, in the fund. and the available cash balance was more than $400,000.
Board member Daryl Love said that if the board gave the money to William Wells Brown, board members should be certain they would be able to continue to help the school in the long term.
"When you add something, you've got to be able to pay for it long term," he said.
Love said he didn't want district officials in two or three years to say, "we have to cut back because we don't have the funds."
Barnett and Love talked about how the district could measure the outcome at low-performing schools that receive the money.
Meanwhile, Shelton said officials had a meeting with the Blue Grass Community Foundation in Lexington to discuss moving trust-fund management to that organization.
In general, Shelton gave board members a status report on a plan for corrective action that the district is making in response to Edelen's audit. Edelen's audit detailed 10 key findings, including weaknesses in budget and financial-management processes, administrative and management salary increases that outpaced those of other district employees, excessive and unnecessary travel, the possible misuse of the trust fund, and conflicts of interest.
Shelton suggested some possible district responses and told board members what had been done. Board members made additional recommendations. Shelton said he was working on the corrective action plan daily and would meet with the board again before the plan was final.
Shelton said Kyna Koch, former associate commissioner at the Kentucky Department of Education, was assessing the current structure of the financial services department and the budget department. Koch is interviewing the staff, evaluating work flow, and making a recommendation about the organizational structure of the budget and financial services system. A conflict resolution consultant, Mike Thompson, is working with directors of both departments, whose relationship was described in Edelen's report as "toxic."
On another front, officials in the district's human resources department are working with the financial services department to ensure transparency in selecting job candidates. There was a recommendation that district staff could give the board more details on out-of-state training and travel. Also, the district could take several measures to better inform the board and make sure the board has oversight on revisions to the annual budget and the transfer of funds.
Also, Shelton gave the board a detailed salary analysis, which he said showed auditors had inaccurately concluded that administrative and management salary increases outpaced that of other district employees.
"While the district leadership team has embraced the audit as a whole and is committed to implementing recommendations for improvement, it is critical to lay this inaccurate finding to rest, because it has impacted employee morale and become a source of controversy," the document said.