00130. >> Can you take the role, please? >> Yes, sir. >> Mr. Fishell >> here. >> Mr. Keiny >> here. >> Miss Brewster >> here. >> Mrs. Graassy. >> She's not here. Miss Krenninski >> here. >> Four present, one absent. >> Okay. Stand for the pledge, please. >> I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. I make a motion to amend the agenda. Two items. one for 2B, the special report by the board president to go after the Steel Nicholas and Company item and also to remove item 3B, the transfer of funds. Can I get a second? >> Second. >> Can you take the role? So to to be clear, we're we
002are removing the transfer which is which is B >> 3B. Yeah. >> And what was the other one sir? >> Uh 2B special report will go after Steifil Nicholas and company. >> Okay. 2B >> which is 3D and then it'll >> follow. Got it. Miss M Miss Mrs. Kreninski. >> Hi. >> Miss Brewster. >> Hi. >> Mr. Keaney. >> Hi. [clears throat] >> Mr. Fishell. >> Hi. >> Motion carries. 40. >> Was there a second? I'm sorry. I just want to make sure. >> Mr. Keany. >> Mr. Keaney. Was a second. Okay. Special report. Mr. Brisco. >> Can y'all hear me? Okay. >> Maybe. >> Testing. Testing. >> Okay. Straight. >> Maybe it'll work better if I hold it. Testing. Testing. Everybody good? >> All right. Perfect. All right. Uh good evening. Uh my name
003is James Brisco. I am uh from the Brisco Consulting Group. Uh we're located in Houston, Texas. Uh my work is specialized in the public education sector. Um my work is my work is simple. It is vetted in making sure that we design and we give recommendations around financial mechanisms that uh look through a lens of keeping the student first. So that this is why we uh do this work. I do want to clarify um what we've been invited to do and what we've done is an independent financial review of the Riverside uh school district. Um this is not an audit nor am I an auditor. Uh how does difference the difference between the financial review and the audit? Uh my consultant firm we don't build financials nor do we sign off on financials. What we
004do is use a forensic style and it's different from a forensic audit. We use a forensic style investigation where we look on past data that includes your uh audited financials, your general ledgers, your check registers, uh your monthly reports. Um we look at things like uh your your purchasing reports. We look at uh your top vendors, meaning um the money that was spent per vendor. and we look at other exhibits that are given to us by your business office and we examine those for best practice solutions recommendations and what we also like to do is point out the strengths of the district. Before I get started, there's no criminal activity has been noted. Again, we're not an investigative firm. When those types of things happen, we turn those over to the proper authorities so they
005could handle their business and do their due diligence there. um there's no mal any type of malpractice or necessarily any misappropriations. What we do is take the work that was done in your district and we build upon the shoulders of that work of your state auditor. And again, we like to hand over a practitioner model that is a collective of recommendations that are not mandates but options and to look through multiple lenses as we examine your financial health. And think about the multiple lenses as such. Your hand, it has many bones in it, right? and you can break a bone on the bottom of your hand, but if the X-ray doesn't X-ray the bottom of your hand, you won't be able to locate that bone. What we know about school finance is it's a collective
006of many funds that are all allocated for different purposes, but those funds come together to work together to ultimately empower your school district. So, with that, I'd like to get started. That's kind of the uh overview. What I would like to do is start with some of the observations and concerns that were identified as I um navigated through your financials to fill this report. Uh first budget uh your your your key budget observations and your budget management observations were as followed. current B I'm sorry, current budget materials provided a detailed line item with a limited narrative explanation and visuals for the board. And what I'm referring to is the monthly board packets that I was uh presented with. they were good. But again, our goal is to find best practices to go from good to
007great or to improve all of your um financial activities. There were no uh regularly structured uh variance analysis. I didn't see a midyear budget to actual review. The board should understand variance spending within functions. Now, uh, as I go through this report, I do want the, uh, board, administration, and the public to understand. You're going to hear me refer to, um, coding. And there are three main takeaways from coding there. You're going to hear me mention fund, and fund is where the money is legally housed. You're going to hear me uh, reference function. Function tells the purpose of the dollar. So each each expenditure or a revenue will have a function code and it identifies the it identifies the purpose of the expenditure or revenue stream. And then you're going to hear me say object
008and object just basically tells you what it is, what was purchased or what was received in that object code. So you're going to hear me refer to those three pieces of your code segment often. [snorts] Next observation, uh the district currently maintains a strong uh general fund reserve, but these are on a downward trajectory to a uh planned spending deficit in the coming years. Continued reliance on the reserve on the fund balance reserve may end up in a situation where adjustments may be made. You may have to look at staffing. uh we may have to look at things like your uh uh teacher to student ratio to make the um proper adjustments if we continue to see a downward trajectory as it goes to your fund balance. Next, your check registry. The check registry review
009entries with zero quantity negative unit price missing descriptions reduce what that does it reduces transparency and weakens audit trails. So when you use this resource to identify uh purchasing activity, it makes it difficult to uh audit to have an audit trail and to identify what, when, and how things were purchased. Next, several accounts consistently appeared over budget or minimal use after year after year. Um what this does when account codes aren't reconciled at least on a monthly basis it's hard to present accurate financials to the board and it limits the autonomy that the board will have to make ondemand decisions. And next, there were there were transactions that appeared to be made without the proper board authority. Meaning that there were some individual account codes that had no budget but transactions. Typically from the lens
010of a third party, when that type of activity is seen, it again, it's not criminal. It's not necessarily against ward policy. However, this type of activity should be disclosed uh justified and clarified when you have a budget code that is operating without a budget assigned to it but it has transactions. Next, misaligned account codes. We had some account codes that included operational service codes under instructional accounts. So again, you're going to hear me talk about account codes. Um, instructional codes are codes that affect affect the classroom that impact the classroom. So these particular codes should not have a code that's accompanying a object code that accompanies that code that identifies an operational service. It should have a matching code that identifies it as an instructional instructional expense. uh the PI funds, the permanent improvement funds.
011Um there were some expenditures that were not coded according to your uh financial accountability guide as well as some descriptions that did not meet the criteria of what uh PI funds should be used for and there was a lack of routine internal um reporting when it came to errors. Typically, when uh codes get out of whack from an accounting perspective, there's a report called an exceptions report that's typically provided to your board or typically provided to your auditors at the end of the year. And it describes the anomalies or the irregular use of codes that are not in alignment with your financial accountability guide. Next um we ran a historical analysis over your functions. There were incidents of under spending when it came to uh certain functions and we will cover this later in the
012uh presentation. Uh there was a portion where instruction was underspent um in one particular year that I pulled that I'm going to consider an anomaly and we'll examine that in detail. And there were some situations where the again the uh conservative practice of underbudgeting again can decisionm if it's not disclosed to your board properly. For example, uh any situation where um we're building conservative budgets, meaning that we're building reserves or we're planning to try to retain and save money, those things should be documented in a narrative style report and presented to the board accordingly. >> [snorts] >> Next uh financial data and operational decisions are disconnected in the transportation um area. There were some codes that I flagged that we will get into later that um they could they could be transportation related but there
013were some inconsistencies in the object code there. Um and the district lacked some formal dashboards again board approved guard rails when it when it came to this uh account this accounting activity and without the proper dashboards and proper documentations again the board should always make decisions when budget is not um operating within the plan that it was approved to operate in. So my comprehens my comprehensive summary of the findings are Riverside maintains uh compliance and strong reserves but faces structural and operational and transparency challenges. Um critical areas require required attention including your uh PI funds and transportation and some instructional uh areas. organizational capacity and segregations of duties were at risk and we'll talk about that in the next section. Um again the alignment of coding was off. Uh there needs to have increased oversight
014over the check registry. Uh budget development and methodology in a variance reporting will be critical. uh long-term uh solveny pressures as expenditures are beginning to out outpace revenues in the general fund and these observations will be disclosed in sections 2 through 10 in my report. Okay. Section two did an analysis of your business service organization. So your business office always like to start here. Now this is typically a wishlist item. Um again I've worked in the capacity of the CFO. Uh typically school districts run lean on a organization because the goal of the school district is to move outcomes in the classroom, educate [clears throat] children, make sure we have teachers. So general administration is typically uh very lean and the business office is usually one of the leanest areas in the school district and
015I'm sure Steve would agree with me on that because that that's typical in school districts. Um, but what I noticed is that you have clear financial stewardship and oversight because your treasure, you have a treasur and assistant treasurer. Of course, your uh treasurer rolls up to your superintendent. Again, I believe goal I believe budgets should be uh goal- driven outcomes that are based off of student achievement and having that relationship between your treasurer and your superintendent is uh very important. uh there are dedicated roles to payroll and accounting. Of course, this enhances your compliance and ability to meet your uh regulatory standards and you have operational directors that specialize in their expertise. We're talking your child nutrition directors and directors like transportation. These are uh huge operating cost centers. And again having that uh ex
016uh directors I call them executive level management is critical. However, the weakness of this organizational struct structure is the over uh reliance of your treasurer and your assistant treasurer. Um I didn't see uh any like I didn't see any budget uh analysts or grant managers in the uh hierarchy and I didn't see any positions that were dedicated to strategy. Uh, typically your treasurer is going to be split between your day-to-day operations and your strategic functions, but typically the day-to-day operations will monopolize strategic functions if the business office isn't staffed accordingly. So that of course is going to limit the way you budget, you reconcile, and you plan. And since the those big cost centers like transportation and child nutrition don't report or they don't have a liaison that's reporting or that's supporting those uh those
017cost centers, it will limit the ability for those areas to communicate and plan accordingly. [snorts] So key obser key observations and recommendations the current structure ensures compliance but lack strategic capacity. Recommendations include adding mid-level roles such as a budget manager or a grant compliance officer. Of course, we want to encourage integration between finance and operational departments strategic planning. Section three, evaluation of revenue streams. What? So, what this slide does, this this is going to break down your general fund revenue streams over uh the five years that's on the screen. And I just want to point out to the total the total revenue column all the way on the right. As we can see, there is positive growth there, which is great and outstanding. And uh we see state aid, which is kind of uh flat.
018State aid, as we know, is typically a supplement to your local property tax. Uh like many school districts all across the country, uh the local property tax is the revenue stream that makes up the majority of your revenue. And again, other revenue streams are typically small. So again, state aid is a complement, not a driver. Um as we know um we are all operating as school district business professionals in the uh postcoid era. So many school districts have um experienced what we call the er cliff meaning that er funds have been expensed to the fullest or they're all gone. And what we have to make sure and analyze and be careful there is that we are um when er funds disappear the expense drivers will need to disappear with those funds or in the event
019that we want to keep uh post esser services we have to have clear planning to make sure that those services are observe absorbed by the general fund. Um other revenues and market sensitivity as as you saw on the slide other revenue streams are extremely small and volatile and runtime revenue streams should be identified always disclosed and planned accordingly and long-term or multi-year decisions should never be made on one-time revenues or revenues with expiration dates. Sustainability and risk assessment. Okay, so structural sustainability of revenue streams. The district benefits from a strong property tax base providing consistent and stable revenue sources. Property taxes constitute a significant portion of the overall revenue reducing dependency on more and volatile sources. Again, you have very strong uh local revenue. So you could you can supplement or you can get away
020with absorbing costs as onetime revenues expire. Growth constraints and future challenges. State aid has remained relatively flat over the years limiting growth and potential and potential from this source. Federal revenue while helpful is subject to the esser cliff uh meaning that upcoming reductions could create a revenue gap. Uh sensitivity to market conditions. Other local revenue sources such as investment income are influenced by market conditions and of course will be very uh will vary depending on those revenue sources. uh proactive financial strategies uh emphasizing the need for strategic adjustments to address the reduction of federal funding um exploring alternative revenue streams and building stronger local support to maintain fiscal health. [snorts] So, here are some strategic questions for competitiveness that uh I would definitely recommend as a best practice for our our district leaders. Benchmarking against
021peer districts. How does districts revenue per pupil compare with similar districts? So, how does your revenue per pupil here compare with your with your neighboring districts? Identify areas of shrint and opportunity for improvement by looking at peer performance. local tax effort and community support. Evaluating the current local tax rates and uh making sure it's comparable to your neighboring districts. Sustainability of revenue growth. Assessing the potential for growth in local revenues such as property tax increase or increases sorry or new funding sources. Identify opportunities for strategic revenue expansions and diversification impact on policy changes. analyze how state and federal policies could shift impact to revenue streams preparing and prepare for potential changes and developing flexible financial strategies. So as we know or as many of you have heard enrollment and revenue are parallel and enrollment and
022the relationship between enrollment and and uh revenue is extremely critical. While uh the district experienced growth from growing from 55.2 million to 62.3 million at the end of 2024, enrollment did decline from 4 4,000 to uh 3,900 in 2022. Then it stabilized near uh 3,940 students in financial year 2024. However, once we saw the revenue drop, what I did notice is that your per student spending did increase from $14,025 to $15,812 in uh financial year 24. So again, that's one of those situations that school district professionals should monitor. Is it a true um cost driver that students are costing more to educate or is it something that as a district we need to do something different to make sure that we are adjusting the cost as we see enrollment drop and revenue shifts in in
023our uh in our financial environments. Key observations and revenue and enrollment in context again strengths safer property tax base ensures consistent revenue weakness decline in enrollment could create could create concerns in staffing and facilities if it remains unchanged. And again uh declining revenue uh I work all over the country. Declining revenue is a US problem is not a Riverside school district problem. This is happening all over the country. Of course, the risk the expiration of ESSER which again this is affecting many school districts highlights um it just highlights the vulnerability of those one-time revenues and of course the opportunity a higher per pupil funding offers a chance to strate to strategically target resources towards student achievement meaning if we're spending more money student outcome should follow uh should follow the trend of spending more money
024[snorts] recommendation ations for revenue and enrollment strategies. Align staffing and programs with enrollment. Adjust district operations to match current projected student counts. Regularly review uh class sizes, building utilization and programs offering for efficiency. Monitor per pupil revenue. Track the track the revenue per student as a key as a key indicator to make sure that we are making e equitable decisions when it comes to your students. Use this matrix in routine of board oversight and financial reporting. So, this is another section that I would recommend that is included in your monthly financial reports. Scenario planning. Build multi-year projections that incorporate enrollment changes and their effects on state aid. Test what if scenarios. What if enrollment declines? What if the state remains flat? What what informed decisions can you make with the information that you have? And
025I always recommend that these scenarios are also presented with your uh monthly board reports or at least quarterly and transparent communication. Clearly demonstrate the link between revenues and enrollment and student outcomes and community reporting. Use these connections and levy campaigns to explain the need to build and sustain public trust. [snorts] Section four, solveny and fund balance analysis. Now, as you can see, again, your fund balance. I want to I want to point to the column that says unencumbered for all of those who can see that do apologize. It may be small, but um you fund balance is declining. And this is your general fund number. And I want to disclose this. You're going to see a situation where I'm going to I'm presenting information that is showing a decline a decline in fund balance, but
026you're going to see later that I'm going to show under spending. Remember, there are multiple lenses that I'm examining your financial um state and your position under. This is just a general fund like I started off. Remember your your school district budget and allocations or are a combination of many funds. This is just isolating your general fund. However, uh the district remains extremely solvent being at 125 days. So that is a that is a very uh decent and a very good fund balance for a district of this size. So my conclusion on fund balances is my key message. Riverside remains financially stable and above key benchmarks, but its cash cushion is eroding. due to the uh conservative deficits budgets which I will cover later in the uh presentation. To safeguard solveny, the district must implement
027spending discipline and target e uh effective and efficient initiatives closely monitor health care and personal costs which are definitely uh costs that are driving up costs in many school districts. As we know, typically a school district is 60 to 85% people and uh salaries, benefits are a big part of your budget. Um align future budgets with realistic and and a sustainable growth revenue. Bottom line, without intervention, the district can can risk reducing a healthy fund balance and reducing their thresholds. It can limit it flexibility to support poor educational priorities and respond and respond to future shocks. All right. Section five, overview of the budget management process. Uh I apologize for that little bitty um image on the screen. However, it is just there for cosmetic use. It is it is just a picture but is
028a picture of the appropriations uh report that is turned into the board. So I do apologize for the uh size of that but what we're going to talk about here. So Riverside Local School maintains a legally compliant and structurally sound budgeting process. Temporary appropriations are adopted in June. Permanent appropriations follow later in the fiscal year. This cycle allows adjustments based on updated state allocations, uh, federal grant awards, property tax collections, processes emphasize, uh, fiscal discipline, but reporting is orient is oriented on um, moving forward towards statutory compliance rather than proactively understanding the government's and community understanding. So here are the strengths of the current budget process. Comprehensive coverage appropriations consistently included all major funds uh general fund bond retirement PI um food service uh federal and state grants. Um there is a very there's conser
029there's a conservative nature in the expenditure control in financial year 22 and 23. the general funds expenditures remain below appropriation levels reflecting prudency and cost containment. Uh responsiveness to change me adjustments show that the district can respond to evolving financial conditions. So here are some gaps in the budget monitoring reporting. uh monthly board reports provided detailed financial data but it did not uh have an optimized tool that I was able to identify the decision-making support. Um my key limit the key limitations are there are limited narrative explanations of significant variances. I was unclear if under spending is a saving tactic, a delay just from vacancies or if it's just some variances that were failed to be reported to the district. A minimum use it was minimal usage of visuals to highlight trends in fund balance,
030daily cash on hand, and program level balances. There is a lack of performance indicator linking spending to instructional priorities and student outcomes and limited use of forwardlooking indicators such as uh projected use of fund balance starting in 2024. My recommendations are quarterly narrative variance analysis. So what that means is that in your board reports there'll be a narrative describing any variances and the board can have the opportunity or the administration can have the opportunity to set targets. For example, if we're evaluating just let's say curriculum the curriculum function we can set a variance we can set a variance target there. If it's under a over spent 10%, there's some type of written justification that should be provided in that particular board packet. Uh federal grant and program dashboard to track all federal grants. I think
031those should always be in everyone's face because those particular funds have an expiration date. So it's it's crucial and critical to understand where we are, how we're spending those funds and grant funds and state funds have a specific usage as they are allocated for a specific uh source. So they have a restriction as general funds are not restricted. And of course, community face summaries. One one pager is plain language of overviews and charts showing revenues, expenditures and fund batch fund balance challenge changes and it will of course transparency and public understanding. Part two is recommendation integration of performance indicators incorporate uh metrics such as per pupil expenditures, staffing ratios, cost of transporting students, so the transportation formulas, uh other uh effective and efficiency measures that are unique to your district. Link dollars to service levels
032and educational outcomes. Have a formal midyear reallocation review. Conduct a structured review, ideally in January. Uh reassess appropriations based off of enrollment, revenue, and expenditure trends. Present recommendations and budget adjustments to the board to give the board the ultimate uh autonomy and opportunity to make adjustments as needed. Recommendations on the monthly report. This is just a structure of uh monthly reports that I've done in the past. typically will include an executive summary. Again, I talk about those different lenses. We're going to have a summary by fund. Uh again, these are going to break out the fund. Remember, the fund is where the money legally resides. Uh a view, we're going to view the lens or have a view by function. Remember, the function is the purpose is is the purpose of the expenditure or revenue.
033Uh we're talking about instruction, administration, transportation, operation, and maintenance, support services. um expenditure by object that identifies exactly what was purchased. Was it a payroll cost? Was it a contracted service? Was it a supply? A revenue detail? Again, local, state, federal sources, grant allocations, uh payments included taxes, a variance analysis. Again, that's that's typically identified as a exceptions report. charts and visuals that are um that are very that are legible to the non- finance professional. So they can see where they're um so so so taxpayers and administrators can see where the funds at at all times looking at the uh looking at the information through a novice lens and of course recommendations and next steps. I always like to when I mentor our CFOs um we always talk about bringing recommendations to the board and
034to uh your high level administration. Although the CFO and the treasures we don't typically make the decision we should have recommendations ready to guide those board members and our administrators. Next uh imple implementation guidance and report improvements frequency monthly reporting typically is going to run from August through May and your comprehensive year end summary in June will probably be presented along with your audit. Um the audience versions of course there's there's there's different expertise that are looking at these uh reports for a cabinet and internal leadership uh version as well as a board and public uh version as I kind of just described and formats include include in board packets as a PDF post on transparency web page uh as it allows as the capacity allows and the interactive dashboard for a draw down or
035drill down analysis. Kind of like how the Ohio checkbook page works. You can kind of drill down and have multi-year uh views on demand of your uh of your financial information. Conclusion, uh budgeting as a strategic tool. Riverside budgets and reports are compliant but remain too compliant focused. What I what do I mean by that? By by inserting narratives, visuals and outcomes and base indicators, the district can provide the board with actionable insights rather than raw data. We can re reduce uh financial risk through early identifications and trends and variances. We have to think of it like this. If it's May and we see we have a variance in any one of our functions, it's a little too late to make that adjustment. So having a more strategic um structure to your reports will give
036the board and administration opportunity to make those adjustments accordingly. And of course it strengens public trust. It it shows how the funds are allocated or managed in real time instead of waiting till the end of the year. So bottom line, transforming budgeting reporting from a statutory requirement into a strategic management tool will improve decision making and better align resources with student outcomes. Section section six, general ledger analysis summary. All right. Section section six, tongue twister. This compliance review examines your general ledger uh data from uh 2019 to 2024. The primary objectives is to evaluate the integrity of budget allocations, identify fible irregularities irregularly uh and assess the internal controls in your financial management standards. And of course, we wanna we want to focus we want to focus on extreme transparency or what I call absolute
037transparency and make sure that our general ledger has what I like to uh coin this term as good ledger hygiene. And I'll describe what that looks like shortly. So uh in examining the general ledger report here's some things that I um I observed and these are more serious in nature as I would I would like to state that these are more serious in nature and I'll tell you why. So, dormant accounts, dormant accounts are account codes that have budget but no transactions. Meaning that when we look at the budget column or if you look in your system, you'll see budget there, no transactions. And when you get to the end of the year, uh the money hasn't been transferred or reconciled. Um we had a total of 6,930 accounts over those periods uh with a
038total of $55 million in budget. Uh again in no transactions overbudgeted accounts we have 15,086 accounts that were overbudgeted. Uh the total budget was 27 million but we spent 132.9 million of out these accounts. Again this is not criminal. This is not fraud. This happens regularly in school districts. However, it should not happen without the proper explanations and justification because what we understand when the board adopts a budget, the board typically is the budget manager. So when appropriations change and allocations change, the board should either be notified or should grant the per the permission for those accounts to go over budget and budgets should be adjusted by way of budget amendments. uh and of course transactions with no budget. We had 11,555 uh transactions where we had no budget but we had transactions again this
039this can happen as we create account codes throughout the year of your treasurers and CFOs may identify a unique need that was not planned for at the beginning of the year. However, uh I think best practice is to disclose that and to make sure that the board and the public understands that hey, we need to create a new account code and move budget over here and we need to make those accounting judge uh those accounting adjustments. Now, while this is critical, um this type of accounting activity throws off monthly reporting. um it's difficult to have an accurate variance report if your accounts aren't reconciled. So in my professional opinion when we look back at June and we have this many accounts that haven't been reconciled I think it can be uh problematic and definitely should
040be monitored and addressed. And again um I kind of touched on this slide but uh again it should We should always be able to justify unused uh lines because they could serve as an informal contingency or appear to be an informal contingency. Um enforce budgetary controls uh have situations where you can have hard stops. I don't um one thing I did not examine is the software system. I don't know the safeguards there. The safeguards can be set on the system to trigger a notification or stop spending accordingly or simply when this activity happens it should be disclosed and reconciled immediately. [clears throat] Trending controls again create that exceptions report um have some type of uh goal to fix dormant accounts. Again this is normal accounting it happens but at that frequency I think that frequency
041is a little higher than it should be. Um ne negative uh uncommitted balances should be reconciled and clean. Uh transactions posted with our budget should definitely uh be included in this uh exceptions report. Um we need to shrink the audit trail required document documented justification and approval ringing for all expenditures processed outside of the budget adoption. Meaning the only way you can get a dormant account, a over a budget with no transaction or overbudgeted account. These are accounts that are moving outside of the scope of which the budget was adopted because when the budget is set, it's set in each account code that is turned over to your board when the board raises their right hand to adopt those budgets. and maintain documentation for internal and external audit review um that can be submitted to
042your auditors and having this type of having a high level of accounting hygiene definitely makes your audit go a lot smoother. Conclusion [clears throat] here, the multi-year review confirms that Riverside maintains a robust leisure documentation and has received clean external audit opinions. However, consistent anomalies, dormant accounts, budget overruns, and underbudget expenditures indicate the need for stronger internal controls and more proactive monitoring of the budget execution. Bottom line is implementing a monthly budget exceptions report will tighten budgetary enforcement, will enhance accountability, it will safeguard, it will create safeguards against compliance risk, and it will help ensure that resources are used as intended to support student learnings and discipline. And I emphasize use as intended because the account code tells the story. The account code tells you exactly where those funds are supposed to go and what
043they were meant for. So again, having these this type of report that's added in your monthly report will only increase the uh intended use of those funds. Section seven, here we go. Account code misalignments and compliance with Ohio law. We're going to get into the PI funds and transportation coding risk indicators. So uh there were three tests that were conducted. Uh the PI funds were tested. Uh the instructional codes were in tested and transportation were was tested and u there was a some inconsistencies in how these three areas were coded. uh based off of your USA manual, which is your financial uh accountability guide. This has all of the list of codes in the descriptions, and it gives scenarios on how codes uh should use. Now, all all dollar amounts represented uh testing populations, and
044it did not confirm misstatements, meaning that the dollars were spent and things were received. So again there no criminal activity, no fraud, just simply inconsistent coding and some things that were not coded according to uh your US your USA manual Ohio law. Okay. So structural limitation coding test andru and structural limitations uh the general ledgers the general ledger check register and monthly board rep reports did not fully reconcile analytic test um swept in these areas revenue postings uh transfers and journal entries and there was um there were some coding patterns that just didn't match like for example we would code a set of employees in transportation and use a certain series of codes and then we would have the same type of employee use a different series of codes and both could be right but
045typically um there is an outline in your financial your financial manual that's an internal document or board policy could set how things should be coded and presented or your state auditor may have some preferences on how certain things need to be uh coded. The final conclusion required an invoice level test and supporting documents to review. So the uh PI test at this level came back inconclusive due to um one the the way the reports were originally pulled. I I didn't have the knowledge that the PI funds were in two different funds. That's number one. And the check u the check register we had to manually construct it. meaning that we had all of the data but I had to work with the business office to include the account codes manually. So it did not reconcile
046the check register and the general ledger did not reconcile which we did do uh uh independent review of the PI funds which which I will cover last in the presentation. So, so again um the PI funds the problem the first problem that I saw that it was a lot of expenditures that did not meet the criteria. Uh there are more operational expenditures. They didn't meet the uh capital spending that typically uh has a 5year lifespan and beyond. Um there were many um transactions that did not contain the 600 series object code which is used to identify capital spending. Um and same went for uh your transportation as well. And then there was a big discrepancy on the first review of the check register and there were some general ledger discrepancies. So instruction I want to
047I want to talk about instruction and get away from PI funds. I want to go to instruction first. So in the instructional function carry operational and purchase service account codes. So there were about there were about uh let's see $510 5.7 million worth of instructional codes that had an object of 510. And this is a general purchase of service. Uh my interpretation that this typically doesn't align with an instructional function. So I flag those for your district administration review. Uh there were some 520 insurance related costs and there were some 526 uh data processing and technology service. There's a function for technology service. So these particular codes didn't align. So there I flagged about $6.8 million worth of uh transactions for your administration's review on the uh coding of those particular um of of those
048particular um operations and funds. Next transportation I flagged about $25.6 million in transportation expenditures. Again, most of these were in the personnel category, meaning that uh they had benefits codes for certified and non-certified uh employees and without requesting and that's typically I we typically try to stay away from the uh employee staffing models because it's personal information involved and what we do is a highlevel view of your finances. But these could be and probably are transportational transportation expenses. But these are flagged so that your administration can review these past transactions and develop a strategy to code these expenditures going forward if it hasn't already been done. Transportation miscoding. So again, I kind of just touched on this slide. There are likely transportation staff benefits that just did not meet the coding alignment that is laid
049out in your financial accountability guide. There were some purchase service codes that were used in the 400 series that did not um meet the alignment of the transportation function and there were some capital expenditures paid out of transportation that uh I flagged and question should that have been a PI expenditure. Uh again, so the key questions, do these costs truly and solely support uh transportation spending? Should this be rec or should it be recorded in operation maintenance administration or capital projects? So they're flagged and was submitted over for your administration to review. Um conclusion, the analysis identified coding patterns and risk groupings not proven to be truly misstated. However, um the PI analytic test did not um the the tools that I was sent initially did not um reconcile. So the test was originally inconclusive.
050However, uh the goal the goal here is to move to a standard of coding in this area in this area that suffices Ohio law and that is easily uh that will easily allow anyone that's using this information to quickly identify those expenditures. Now, on the PI side, again, there were some descriptions that did not meet the criteria of the PI fund levy usage that we will disclose later in this presentation. Section 8, the check register uh dispersement review. Okay, so we reviewed the uh check register from years 2019 to 2024. The purpose we wanted to test the integrity and identify anomalies that may indicate fraud or or irregular activity that may in input and record errors. and we wanted to make sure that there were no weakness in internal control and documentation. Uh results were
051fed into the Brisco Consulting Group uh purchasing risk model and a vendor heat map which was turned over to the district in uh I believe exhibit 16. And what that heat map does it identifies uh high value purchases. It it uh identifies purchases that may not have a description or purchases that did not have quantity and each the top 20 vendors we give them a score and it is handed over to the district for internal auditing and monitoring uh usage. Here again, here are some key anomalies with the check register had about 939 payments uh with a unit price greater than $10,000. Uh again, this is again this is uh could this is normal activity, but what I like to do is make sure that we note those um transactions. That way uh your internal
052audit service, which is your business office, can review those um that activity accordingly. and make sure that things are properly documented and of course test those uh transactions as they see fit. However, there were uh zero quantity entries. Um this could vary from district to district. However, typically um best practice is is to assign quantities when you're cutting checks. Even if it's a service, it's usually a one will go in that particular uh slot in your system when you're identifying the quantities that are being purchased in order once you issue that PO. But we had about 50,385 there. Uh zero negative unit price. Uh we had about 200 2,434 entries there. Now, some could be credits and adjustments, but that should be documented in that uh particular report. and missing descriptions. There are about 20
053payments with no descriptions. Again, this uh definitely uh defeats the purpose of the report if we cannot look at a description and identify what that particular purchase is. And what that does is creates more time for the business office personnel to go investigate and research what that purchase is. And again the um what the risk model shows it it it shows the highv value checks it shows duplicate and near duplicate payments. So, uh, anytime I see duplicate payments, um, that are on on the same PO or if I see duplicate payments that are monthly that exceed the, uh, frequency of utilities or reoccurring payments, I flag those for review to make sure that those are true expenditures that should be paid. Just short story and my experience. I've investigated and worked with a district that
054had a contract for a technology a a software technology software and they had two contracts but only they only needed one contract for the service but they were paying uh they were paying them on a double contract and the second contract was useless and that district ended up wasting $1.5 million over six years. So again, I like to flag those duplicate um those duplicate transactions for internal auditing purpose and of course I produced that executive level heat map which is in the uh drive that you can examine to test those vendors accordingly. Of course recommendations uh department level audits again uh always advise uh administration to find time to test to test their purchasing. Purchasing is extremely important because purchasing is one of the absolutes in finance, right? U in finance you can fix things.
055If you mess up an account or if you have a dormant account, you can journal entry to fix it. But when you purchase things, you've done one or two things. You've either done something correct if you've done it wrong. So purchasing, you're either you're either letting compliance in or fraud out. So you want to make sure that uh your purchasing and your uh your POS and your purchasing standards are tested regularly and this tool will definitely give um your business office the road map to do that and again to make sure that it's ongoing at least test anomalies on a quarterly basis and have some type of reporting that is in your quarterly report that's turned over to your board to guarantee that purchases are made uh efficiently and accurately. ely section 9 budget versus
056actual expenditures. Okay. So, uh what we did here uh we compared adopted appropriations to actual expenditures in the general ledger. Um objective was to test budget the the budget integrity and appropriation controls. Big picture uh fund level compliance is maintained but there are patterns of early overspending and later structural underspending that could that did raise a concern. So uh here we want to plan transparency and want to have alignment between appropriations and real spending needs. So here is it this is a highle look of the um the compilation of all funds and it's what's budgeted versus what's actual as we can see in 2020 over spent by 12.3 million all the way down to 2024 where we started to see trends of underspending. Again, this is um this is no neither wrong nor right, but
057it should be planned. It should be disclosed and it should be um detailed in your reporting on instances of this type of activity. So key concerns overspending shift to uh structural over budgeting. FY 20 and 21 actual expenditures exceeded appropriations uh signals appropriations control risks and and potential uh statutory non-compliance if not backed by timely amendments. So, so again there uh usually there 12 times that u districts get opportunity to amend those the budgets again uh under spending or overspending could be a tactic but it should be disclosed and addressed accordingly. Um, sorry about that yellow. It's very bright, but FY, uh, that's FY2022 through 2024. Uh, trim reserves budgets consistently, uh, were higher than actuals. Uh, indicates structural over budgeting rather than a tight plan. Uh, implications. uh is is safer from a legal
058compliance standpoint, but it erodess transparency by overstating expected spending and can mass uh the available capability that could be used to redirect uh priorities such as instruction. So, here's a deeper dive into 2023, which I want to uh recognize as an anomaly when it came due to the functional spending, but I definitely want to point out instruction was underspent by 4.3 million. Again, this type of activity is not uh it doesn't violate compliance, nor is it criminal. However, I do believe that it should be disclosed and this should not be a surprise when you're presenting this information at the end of the year. This should definitely be captured by your annual audit functional spending. But again, it's it's extremely important to understand where you are in instruction because this is the opportunity that districts have
059to make adjustments in that category to push student outcomes to teacher development, classroom supplies. I mean there are many things that the instructional budget can do that will uh touch and help students uh achieve greatness right again support services again it was underspent school administration was over spent um that's one of the areas where we school districts typ typically get scrutinized so it's always a good idea to keep your eye on that particular function operation and maintenance under spent that year transportation under spent and all other the combination of smaller functions were all under spent mean being in that year was uh the budget was underspent by 6.2 2 million again which could been a strategy but I didn't see any documentation in the audit nor I didn't see I did look through some of
060the uh board reports I didn't see any documentation that that was a strategy so I do I do want to definitely point that out and highlight and say definitely issue a recommendation that that type of activity should be noted and passed off uh in your monthly reports and we shouldn't wait till the end of the year to disclose this type of information uh strategic IC uh implications and recommendations. Uh legal safeguard, tightener appropriation control and and the amendment process to avoid overspending beyond adopted limits. Uh budget rec calibration review chronically unders functions and adjust appropriations uh downward to the alignment I'm sorry to to the align with realistic execution. Pri prioritize instruction. Instruction is the most important thing that any school district does. It should be watched and there should be constant reinvestments in classroom
061student support and learning recovery and variance transparency. Implement a quarterly board level variance report with narrative explanations for major over and under spending. Link variances discussions to strategic priorities rather than treating them as technical accounting issues. Section 10 conclusions and strategic recommendations from the uh Riverside Finan Financial Foundation. Again, strong property tax base uh historically a healthy fund balance, which is awesome. Uh consistently clean audit opinions uh that adheres to state appropriation law, which is extremely important. However, I do want to highlight the uh importance of understanding how your money works. So, a audit checks for compliance, your financial statements to make sure the money there. What we're investigating is how your money works. Did the money go where it was supposed to or and and how transparent is the district when it comes to
062um disclosing and um um um um illustrating financial help. Um next uh con conservative um financial posture demonstrates a commitment to compliance and fiduciary responsibility which it does. However, the independent review identifies systemic issues that require timely and suitable attention uh persistent under spending and transparency risk uh material under spend and dormant accounts. Again uh just to retouch on on account coding. Account coding uh is adopted along with the budget and when accounts when transactions move outside of the adopted budget they need to be disclosed justified and reconciled immediately. U again uh if it doesn't it reduces transparency for the board and community and it ultimately would obstruct the decisions that the school board can make. a general ledger check and check registry ru risk factors expenditures appearing in accounts without clear or sufficient budget
063authority meaning if we um if you're overspending or if you're spending out of account with no budget you didn't have the authority in the first place to use that account so again that should be disclosed and the board should be included in that type of activity um I'm going to skip the PI funds cuz we're going to dive into those next. Uh transactional level anomalies in your check register, zero quantity entries, negative or zero unit prices, and incomplete descriptions all need attention and need to be monitored going forward. These issues weaken the audit trail and raise questions about internal control, design and execution, strategic re recommendations, uh five priority areas, uh general ledger, exception reporting, and cleanup. monthly board monitoring and public transparency, purchasing dispersement review, budget uh development reform and organizational capacity and role
064uh clarification. Uh shrinton controls and budget practices. Uh again, develop a GL exceptions report and cleanup and and increase the shrint of your monthly board reporting and transparency. uh at least had starting it off with a one to two page executive summary that kind of details your financial uh health and activity and disclosed uh this information in the board meeting which is done. I did do some research on my own and I watched the uh November board meeting. Steve did a heck of a job illustrating your financial position and those are the type of recommendations that I recommend for all school districts. uh procurement integrity in organizational capacity. Uh purchasing and dispersement review align uh process with board policy and state procurement requirements. Uh tie high dollar and high-risisk payments directly to contracts, POS, and
065board actions. Meaning that all of the support documents should always be linked to those uh purchase orders. Uh resolve zero quantity and negative price entries. uh shitten uh data entry validations because this is happens on the data entry side. Budget development and reform move towards a uh performance informed budget that links dollars to programs and outcomes. adopt formal contingencies in a reserve policy which uh boards and administration can do that meaning uh if we do build contingencies for example I've used dormant accounts to build my contingencies however I disclose those contingencies to my uh administration and my board and when those contingencies move or don't move I uh definitely uh have a rec a reconciliation report that I will um submit with my u board packets again organizational capacity create uh wish list items but
066create mid-level roles budget manager uh compliance manager design a fiscal system data analysis for uh coding and integrity and dashboards provide cross trainining and professional development on coding procurement grants and control from a compliance to strategic financial leadership and fi final opinion riverside has a solid compliance foundation and a strong balance sheet. Current budgeting and reporting practices however do not meet the expectations for transparency and strategic agility. Uh reoccurrent underspending and misalignment again dormant accounts act as informal contingencies limiting the board's ability to see available resources debate tradeoffs and direct dollars to where they should go. Uh implementing the recommendation reforms will align financial planning with execution, will support more intentional and equitable deployment of resources, and move Riverside from a conservative compliance towards a strategic driven model of financial leadership that shins both public
067trust and student outcomes. Okay, we're going to dive into the PI funds. Okay. So, a comprehensive transactional review of the PI funds were conducted from uh financial year uh 2019 to 2024. Uh this focused on the PI funds and fund number 003 and 033. Again the time frame I just stated uh purpose to assess compliance with the OC5705 which is uh your again your financial manual that that uh displays and that uh describes coding your coding integrity and stewardship of restricted capital resources. So again, uh permanent improvement funds are restricted funds that are uh allocated for the purpose of those capital assets bill and this bills on phase one's findings regarding budget integrity and coding misalignment. All right. The PI funds legal framework. PI dollars are statutoily restricted under the O RC5705. Allowable uses, capital
068improvements, and long-term assets with a greater than 5-year useful life. Not allowable. Uh routine repairs and maintenance. uh short life technology and software consulting administrative services, freight or operational expenditures. All PI expenditures should use a capital object code series 620 to 660 which is uh assigned to identify those expenditures and should be linked to an identified capital project. So, um, typically there's an extra step that in the PI purchase, that purchase order should be accompanied with some type of support that links that purchase to um to um that project. And again, that's not law, that's not law, that's not statutoily required, but I will say that's definitely a best practice recommendation. PI revenue and expenditures. Here's the summary. So, uh, the PI funds revenue from 2020 to 2024 was 14 million. However, expenditures exceeded 25.1
069million, which all the expenditures has been itemized and handed over to the district administration. Uh, expenditures exceeded PI revenue by 11.06 million. Um there was a um reclassification that I was made aware that made uh the purchase of grouping of Chromebooks u made that an allowable expense and what I understand about that is that you can't purchase a individual laptop but you can purchase a group of them together and capitalize them. So uh the original finding of misalignment was 5.1 million but after the removal of those laptops the misalignment of PI expenditures was 4.62 million. Non- capital uh and here's how the breakdown and how things were identified. So uh non- capital objects routing charged to PIs include uh codes 510 supplies and minor equipment. We had uh expenditures textbooks and instructional material. We had
070some expenditures coded to 573 non- capital furniture and and and fixtures. We we had uh 423 419 610 repairs and maintenance. We had some 800 800 series codes 819/8 uh29 shortlife technology principle and interest. and we identified expenditures that were coded under 845 and 849 administrative fees. Again, this demonstrates weak coding governance and a lack of PI a PI specified review process. Um here here's a view of the groupings. Uh I did my I definitely uh did my best to group these funds together so we can break down that 4.6 6 million. Um there was a other unclassified uh which I'll break that other unclassified down more to a macro level, but uh there were $2.3 million of other unclassified uh signage and branding. We spent uh 4.1 I'm sorry, 1.4 million uh out of
071the PI funds there that was coded to PI funds. Classroom furniture, uh, $349,44.37. Repairs and maintenance, we spent, uh, $248,1787 cents. administrative fees uh which included uh like some audit fees, tax assessors, uh 181,72857 shipping and handling costs that could not be uh linked to any capital projects $27,437.38 and textbook and instructional materials came in at $19,55.15. again uh removing the technology the group of laptops that was uh purchased at $480,24 94 cents and the chart here is just a chart to give you a visual of the impact. Okay, here's a deep dive into the other unclassified um has some transactions that could have been uh by description potential capital but was unable to link to capital projects through account coding. They were coded as operational expenditures and the problem there is we have PI
072funds that are allowable that we coded correctly. So these were coded outside of what PI funds should be used for. Uh some some uh engineering and environ environmental services uh at 698,63 transactions of a lease lease purchasing finance. At 85,000 there were nine transactions there. And again, I'm breaking down that other and unclassified category, which is the bulk of the uh PI fund spending that's misaligned with the PI fund criteria. Operational and non- capital service uh 830K 78 transaction uh insufficient fund detail is at uh 332K and there was 37 um transactions there and again the miscoding and documentation gaps. I'm u noting that as a it's a systemic problem. Um board approval use of PI funds for student device. Again I mentioned the laptops. These are allowable. Again if they're bought in groups they're
073allowable. Bought as individual as an individual item. They're not um restoring capital capacity. A historic use of PI PI funds for operational cost reduces capital capacity meaning that you can't do what these funds are meant to do. Uh under the uh OC 5705.14 and 5705.16 will does allow uh perspective transfer from general to PI. uh recommendations is to classify or to journal or to document because the books are closed on these but to document these PI charges is operational and to uh make an initiative to restore your capital funds by transferring $4.6 6 million dollar back to PI to be able to um take on the capital projects and from there I suggest you develop a multi-year PIS sustainability plan for future projects. Trenton governments and the coding discipline establish a treasurled review committee to
074vet all PI expenditures and pre-approval meaning to get preapproval before these expenditures even happen. And I don't know if there are safeguards that are actually in the system that can prevent uh PI funds from even being spent if the coding is not aligned. So that that would be a IT uh that that it would be a IT conversation or your uh system administrator question but I have seen uh districts where that can happen to where you can set in the system to where a transaction won't even happen if the code is outside of what is programmed to use in the live budget system. require full documentation package packages for you know your architectural and engineering because that as we know those are associated with uh capital projects. However, there are operational expenditures and expenses that
075happens with these types of vendors as well. So they need some type of checklist or documentation practice to identify which is which. uh implement a PI coding decision tree uh again and restrict the PI coding rights to trained staff only meaning that P identify someone as your PI uh fund expert and let them be the final approver or the enterer of those uh expenditures and enforce exclusive use of 620 to 660 for this will give you that consistency that your district uses anyway for capital object code in the PI and block uh non- capital objects in funds 003 and 033 require project numbers on all PI requisitions to enable projectbased accounting capital project accounting oversight oversight and corrective action again move to a projectbased accounting uh with a dedicated cost centers for each capital projects
076maintain support documentation, POS, contracts, invoice, justification for at least 10 for uh over 10 years, a maximum of 10 years and beyond. I require a treasure a treasurer level approval for all PI coded purchases confirming the five the greater than fiveyear useful life of the capital Nature and project alignment. treat misaligned PI expenditures as operational then restore them through the PI through through the uh restore them through the general fund and through those uh transfers uh implement a multi-year PI sustainability plan for capital project priorities uh training accountability and professional opinion conduct quarterly PI trainings for staff invol involved with the coding purchasing and capital project management issue an annual PI compliance report to the board summarizing its use projects and corrective action. Again, the Brisco Consulting Group professional adjustments PI usage reflects a material
077breakdown and control and stewardship of these restricted capital funds. The misalignment of the 4.62 million over 5 years is systemic, not incidental. immediate corrective action. It should be required is required to restore compliance, protect capital uh integrity, and rebuild public trust. With that, that is my presentation, and I'll take any questions you may have. >> I know I'm gonna have to speak loud. I will try very hard. So, if you can't hear me in the back, let me know. Um because we did not have an opportunity have any conversation with you prior to your engagement? Um, can I ask you a couple of questions about your background and experience? >> Um, sure. Thank you. Um, are are you a licensed CPA in the state of Texas or Ohio? >> I'll start off. I'm not a
078CPA. >> Okay. So, do you have any certificate in internal audit or fraud examination? >> I I am I have a certification through the Texas Association of School Business Officers. It's a It's a Texas credential. >> It's a Texas credential for school business officials. But >> I'm asking, do you have a certificate in internal audit or fraud examination? >> I do not. Started off with that. >> Um, do you do you work at a school district? >> I do. >> Okay. Thank you. Um, so I I have some questions on how you have compiled your data. Um it is my understanding that our staff provided you with some downloaded information from the USS um is that correct? >> Yes, your staff the data that I used came from the district. That is correct. >> And
079so did you visit our district at any time during your engagement >> physically? No. >> Okay. So did you request any supporting documentation >> for any of the transactions? >> Uh yes. Can you elaborate at all on what you looked at? >> Um, the supporting documentation is when I had to request the PO ledger for the PI funds. >> Okay. Did you look at any invoices, purchase orders, physical documentation? >> No, I looked at I looked at the dashboard which contained the purchase order number, date, transaction number, and had descriptions of the purchase. >> So, it was an Excel spreadsheet basically. >> Yes. >> Okay. Thank you. Um, If you if that's all you looked at and you did not look at any um pure documentation, how can you flag data for coding if you
080didn't re um sorry how how did you flag data for coding if you didn't look at any underlying documentation? And you're not going to have a microphone for response. >> I'll speak loud. Um simple. Um, the coding is attributed with the transaction in the Excel spreadsheet, but the spreadsheet is a data dump out of your system because that's what I requested. So again, the code is associated with the transaction. I >> I understand that, but you're saying that that some of the documentation didn't align and I'm confused as to how that would happen if you if you didn't look at the underlying documentation. And how do you know, for example, if an engineering fee is for a regular purpose that's not outside that's outside of the PI or if it's included in the PI? How
081would you know that? >> From the account coding. >> Just from the account coding. >> Correct. >> Okay. So, I'm going to go to to the account coding if you don't mind. >> Sure. Um, so according to the state of Ohio's auditor's office, account coding, um, for the object code doesn't necessarily mean that it's PI or not PI. 600s are not the only things that are allowed in a PI fund. Um, there's many instances where there are other items that you can have coded that are not 600 object codes. And I'm going to give you an example just as one is the um county treasurer's tax collection fees which would be coded as an 800 and that has to be in the PI fund that's citable by the Ohio State Auditor's office and if you
082don't include those kinds of things you're going to get cited on audit. So that's just an example of one item that's not a 600. I'm also going to read some information in section uh Ohio Revised Code section 133.15 which is more or less about borrowing but it's got the best definition in Ohio state law about what a permanent improvement really is. So if you don't mind without limitation as to other costs properly allocable to the permanent improvement the costs of acquiring constructing reconstructing rehabilitating installing remodeling renovating enlarging equipping furnishing or otherwise improving permanent improvements. Site clearance improvement and preparation acquisition of real or personal property. All related direct administrative expenses and allocable portions of direct costs of the subdivision, engineering, architectural, legal and other consulting and professional services, designs, plans, specifications, feasibility or rate studies,
083appraisals, surveys and estimates of cost, interest or interest equivalents on any securities that have to do with permanent improvements, whether capitalized or not financing costs, title work, title commitment, insurance and guarantees. And then it says some other things here that are not relevant. Then for the payment of any of any item or items of cost of the permanent improvements and all other expenses necessary or incidental to planning or determining feasibility or practicality with respect to permanent improvements or necessary or is incidental to the acquisition, construction, reconstruction, rehabilitation, installation, remodeling, renovating, enlargement, equipping, furnishing or other improvement of of the permanent improvements, the financing of the permanent improvements and the placing of the permanent improvements in condition for use and operation and all like aer related costs including any one part or combination of the subdivision's
084share of those costs or expenses. So that's that's the state's definition of permanent improvements. Like I said, it's very lengthy, but it goes into um to discuss that there are many things that are allowable in the permanent improvement fund that are not capitalizable and capital expenses are coded to 600 as an object code. Um I also want to go back and just make sure that the public understands that this district appropriates dollars at the fund level. If I am correct, we we appropriate at the fund level. We do not appropriate at the budgetary expense account level. Um and so hence the reason why we have a lot of accounts that don't have a budget associated with them because we're basically budgeting at we're appropriating at the fund level and we basically budget at the object
085code level. So all the accounts that are underneath that, the hundreds and hundreds and hundreds of accounts, we don't budget that. So, if we have an account that says, "Hey, this is teacher salaries for third grade at Buckeye, that's an account that we use that we code people's expenses to, but we budget to salaries. So, it's up here and all those other accounts are down here." I I think it's misleading to the public to give them all this information and not explain that. Um, I just think it's misleading. I have some other things I would I would like to ask if you don't mind. I It's interesting that you want the board to get pictures of our expenses, but we do get monthly expenditure reports and we get lots of board reports on a monthly
086basis. We already do that. We already also have somebody who takes care of our federal grant programs. um they provide monthly reports and we don't get reimbursed after we spend the money. So every month somebody has to go in and report that out to the federal government and that way we get our reimbursements. So we're already doing that. Again, I just think there's a lot of inconsistencies in here with what we actually do. Um we get a fund balance report every single month. Give me a moment. Um I I would like to know how you tested again tested some of this data as it relates to you say you audited you tested it or did you just sort it based on object codes? Again I I I don't understand. >> Well sorting is level one
087for all the accountants in the room. Sorting is level one but the testing is Oh my sorry. All right. So I start over. So yes, sorting is I mean that's level one to organize your data. But testing is to evaluate the data using like your financial accountability guide to see how things are coded and to test them against other financial mechanisms to see if things tie from your general ledger to your check register to your monthly reports to your audit. So that's that's the testing of the of the numbers in your financial mechanism. [clears throat] >> You want more transparency. >> Sorry. You want to have more You want us to have more transparency to the general public, but you also want the board to get less reports. So that's conflicting. >> Um >> that's
088inaccurate. I've actually said increase reporting. So that's that's inaccurate. So, um I would like for the past 10 years, this district has received um a financial audit award from the state of Ohio for excellence in financial reporting. I would like to read part of what the standardized audit report says um from the state of Ohio auditor's office who actually does our audit every single year. And I'm not going to read the whole thing because it's pretty lengthy, but I want to give some idea of what they do. Um they audit the business type activities of each major fund. Um they state in their audit reports in their opinion and this is the state of Ohio the accompanying financial statements referred to above present fairly in all material respects the respective financial position of the governmental
089activities the business type activities of each major fund and the aggregate remaining fund information of the Riverside local school district. Just so that everybody is aware, the general fund and the PI fund are both major funds of this district. So they get extra scrutiny. They have conducted their audit in accordance with auditing standards generally accepted in the United States of America GAS and the standards applicable to financial audits contained in governmental accounting standards auditing standards sorry issued by the comproller general of the United States. Their objective is to obtain a reasonable assurance about whether the financial statements as a whole are free from material misstatements whether due to fraud or error error and to issue an auditor's report that includes our opinions in performing an audit according to generally uh government auditing standards. They will
090identify and assess the risks of material misstatement of the financial statements whether due to fraud or error and design and perform audit procedures responsive to those risks. They will obtain an understanding of internal control relevant to the audit in order to design auditing procedures that are appropriate appropriate in the circumstances. They will evaluate the appropriateness of accounting policies used and the reasonleness and significant accounting estimates made by management as well. Um, one of the other things that they also do is they do look at our internal control um, policies and procedures. Um, they have at the end of the audit report a schedule of findings and everything has a no. Um, were there any material weaknesses in internal control reported at the financial statement level? The answer is no. Were there any significant deficiencies in
091internal control reported at the financial statement level? The answer is no. Were there any reported material non-compliance issues at the financial statement level? The answer is no. Were there any material weaknesses in internal control reported for major major federal programs? The answer is no. Were there any significant deficiencies in internal control [clears throat] reported for major federal programs? The answer is no. The answer is no. So for the past 10 years, [applause] >> So for the past 10 years, the answer has been no. the past 10 years that I'm aware of, at least over the past 10 years that I looked at, I haven't gone back and looked at previous and I've been here a long time and we've never had an unmodified or an unclean opinion in this district. I I would like to
092assure that the people of this community that this report that that Mr. Brrisco is putting out um while while I don't know it's it's data that you can pull from an Excel file provided by our our accounting department that can be done by anyone and sorted by object code. I'm not exactly sure what you're telling us. I listen to the report and at the end of the day this is this is information that we've gotten from our treasurer every single month. It's nothing new. [applause] I get it. These are not questions. This is just a statement from me. Um, this is my profession. This is what I do for a living. And and to misrepresent that to the public, what it is that my profession does is there are many words >> and I'm not
093going to say them right now, but it's it's disheartening. That's all I have. >> Anybody want this? >> Do you have anything to say? >> Yeah. Was it a question? >> Yeah. The statement ended. Okay. Uh Steve, do you have any questions? >> Are you kidding? Really? >> Okay. So, if you're going to interrupt the meeting, you're going to have to leave. So, please don't interrupt the meeting. So I I I want to start off first by apologizing to the board because it's not good practice of a treasurer or superintendent to present information that you haven't had an opportunity to share with the board. Um the the challenge was we received we had 36 hours to put this together and review it. And I will say without question there is information on here that will
094be very beneficial for me and very beneficial for our department that you can take any department any organization and you can make it better. So we will take everything from that report and we're we're scouring through but I just wanted to show you a few things or not really show you anything actually just put a visual up Mr. Brisco, if you could help us understand because part of it is just simply understanding what what we're seeing. So if Mike, if you could or could you push go to the next slide, please? So again, just like Mr. Brisco, I didn't count on uh a crowd this large, but what what what you're looking at is some the dormant accounts. You heard a lot about dormant accounts. Um in 2024, this is straight numbers from the report.
095The dormant account said there was 1,442 dormant accounts for a total budget of 11.94 million and total uncommitted balance of 11.94 million. That's so of course that got our attention. So um Mike has worked very hard, both of us have worked hard to get this together. Again, it is not comprehensive. It we aren't even close to being through all the data, but we're trying. So, and we took the exact same data looked in USAS off our per our records and instead of 1,442 dormant accounts, there are 98 total dormant accounts of which 21 of them are from the general fund. It's not 11 It's not 11.94 million. It's 1.54 million of which um of that 1.54 million 1 million of it was encumbered carrying over from the year before which might not have been easy
096to see from his vantage point. uh TW overbudgeted in 2024. He said there were 3,367 accounts overbudgeted at 6.54 million with total transactions at 33.1 million to run a deficit of 26.56 million. Those are from um his report. Uh we went through that. There are not 3,367 accounts. There are four accounts. um that total $267,000, but they were what's called advances. And in Ohio, you can do an advance, legal advance. I don't like them. They our f our finance department knows I don't like them and we're going to do the best we can to reduce them, but you can't always foresee it. But in advance, it's not budgeted. So, it's not going to show up as a budget. So that $267,000 is actually total uncommitted balance is zero. transactions with no budget. Uh the report
097is 2414 at 23.84 million with a deficit of 23.84 million. There were actually 16 accounts. Four of them were advances what I just explained to you and 12 the other 12 were a carryover from the prior year and that was largely due to construction and the total cost of that was $440,000. [snorts] Go to the next slide. Um and then we the last piece that we took a look at we went where where that where there was that variance uh that we focused on overspend. So when we appropriate for a budget, we hope we underspend. By God, I hope we do. Um that's how you build your cash balance. So we're and and it's hard to know like for example, >> if we take um John's uh uh maintenance, we look back the last three
098years, try to best guess how much we're going to spend, but I don't know if a roof's going to fall in. He doesn't know if a roof's going to fall in. There can be expenditures that you just simply miss because you couldn't budget for them because you didn't know they were coming. Uh we do our best not to, you know, be as close and as accurate as as we can. So coming under budget is not a concern to me. That's how we build our reserves or eat into our reserves at a slower pace. But so I we we just focused on the two um over and in 2020 there was 55.6 million appropriated um with expenditures that he at 67.9 million. So of course that easy math. It looks like we overspent $12 million. But
099the reality is 17.8 8 million of it was carryover encumbrances from fiscal year 2019 construction projects. But you wouldn't didn't catch that part. So in fact we actually were under budget not over budget [applause] in 2021 57.2 million um 58.6 million uh is was the expenditure. So that's a 1.36 million overspend in 2021. Uh our data was we appropriated 63.1 million. So we don't have the same number for what was appropriated. I'm not sure how that happened. And then expenditures, we we do have the same number for expenditures, but that ends up being a $4.5 million under spend with $2.4 million additional dollars that were actually carryover. So that ended up being pretty close to $7 million um in under spend that was reported as a overspend. So again, there's no question and I want
100to make sure you you all understand there's some really good stuff in there and there are some stuff that we some things pointed out in that report that we need to do and we need to execute and and so this isn't beat up Mr. Brisco, but this is my job is to reflect the facts and that's all I'm trying to do is just report what I know. And so this is what I know to this point. [applause] >> Thank you. Thank you for that. and also um board of education business uh the Brisco financial analysis a resolution to accept the report from the Brisco Consulting Group regarding its financial analysis and related work for the Riverside local school district. Can I get a second? >> Second >> discussion. >> I haven't had a chance to
101review it yet in completion. Um do appreciate the walkthrough, but I would still like to dig into it more. So I would like to see if somehow we could postpone this so that we have time to look through it before we accept it. can always make adjustments later if you want to, but I would suggest we accept it. So, can you take the role? >> Can you take the role, please? >> Yes, sir. Uh, Mr. Fishell, >> hi. >> Miss Brewster, >> hi. >> Miss Kreninski, >> nay. >> Mrs. Grassy, >> nay. >> Mr. Keaney, >> I. >> Motion [snorts] carries. 32. Okay, next item we have uh roof connect resolution to award construction contract to roof connect logistics inc DBA roof connect for roofing improvements at Riverside High School Jr. Williams Junior High School,
102Lemouth Middle School, Parkside Elementary School, Riverview Elementary School under Ohio Revised Code 167.081. Can I get a second? >> Second. I have some questions obviously. Uh where are we paying for this from? >> Um so this will be paid for out of the general fund. >> So um I would just like to read this sentence that's on I don't know there's no page numbers on this. Um do we have a total amount on this contract? >> Mr. um McIntyre just brought something over to us that the pricing had changed. Can you She wasn't available. >> Yeah, there's a copy in front of you, Belinda. But the uh total contract is 3,65,365. >> So3 million. Can we say that again? Where is it? >> Yeah. 3 million65. >> 3,65,365. And I want to read something out
103of this out of this contract. Once the project is awarded, any required architectural or engineering services as well as builder's risk insurance will be invoiced for immediate payment. Payment in full will be due within three business days of signing. >> Okay? If you're going to interrupt the meeting, we're going to clear the room. That's the last warning. >> One more one more time. We're going to clear the room. Don't interrupt, please. If the customer cancels this agreement at any time for any reason, the customer shall pay a cancellation fee equal to 50% of the total contract price. Customer Yeah, this is and customer acknowledges and agrees that all payments are irrevocable and non-refundable. So within 3 days of the signing of this contract, we are going to fork over $3,65,365 to somebody we have never
104even had an opportunity to discuss, vet, nor anything else. Are you kidding me? In an irrevocable contract that we can't get any money back, and if we decide not to go forward with the work, we are going to pay an additional 50% penalty. That's a terrible contract, folks. >> Okay, Miss Lennahan is here from Roof Connect >> and so could you go ahead and explain what we're doing here? >> Sure. >> Sorry. >> Yeah. So, is this on? Is it on now? You hear me? Um, good evening everyone. Um, I Is it okay? You hear me? Okay. Um I'm here just to share with you um this opportunity that is very unique and very timely for this school district. Um we are looking to do 25 year roofs that are sustainable without a tear off
105for a very aggressive price. And we have confirmation that after me for a year and a half trying to find an investor for solar to do a power purchase agreement with this school district. The savings opportunity through this is upwards of $10 million. I understand um Miss Graassy, I understand your concern and I'd like a minute to explain it. Um I don't know if Alice is here, but I talked to a a constituent earlier today and I shared that I am not your adversary. I um I'm from Youngstown, Ohio. I [clears throat] graduated from Corbin, Ohio, and I have a heart for this part of the state. Um, there are solar deals going on in other places all the time because they're not up here. The problem with solar up here is not that we
106don't generate enough power, it's that we don't use enough power. So, the investor can never get their money back because you're not using enough power. So, it's very hard and I have in a year and a half I was unable to find an investor that would do this in your district. The reason being what I was trying to do on the front end was get them to incorporate your roofs into the PPA and um they wouldn't touch it because the numbers just wouldn't blend. So as we got closer to the end of the inflation reduction act, so the inflation reduction act was admin was put into place by the Biden administration and what it did was it allowed for very significant rebates on solar programs [snorts] to be available to the public sector whereas previously
107it had only been available to the private sector through tax incentives. The public sector doesn't pay taxes so it wasn't available to them. But the administration put um something in where you would get a direct rebate check of a minimum of 30% with possible adders based on economic conditions of your community or um if you were a former energy community, you know, like coal community um anything like that. So, um, as soon as that inflation reduction act was put into place, took the IRS, um, a little while. Did it go off? >> Did I Did I do something? I'm sorry. I think it died. Is that possible? I'll try to yell. I'm a little nervous, I have to say. Um, um, so once that inflation reduction act came into place, it took the IRS quite
108a while to figure out the tax ramifications. And as soon as that happened, I was like, I got to get this to the schools in Northeast Ohio because this is an amazing opportunity. A lot of them are having a lot of trouble. They can't pass levies and they can't do anything with their buildings. This is an opportunity for them to get free roofing. Essentially free. I can't use that word because in the power purchase agreement, it pays for it, right? But essentially with the 30% rebate that the investor was getting on the roofing and the solar, it was a very, very good opportunity. And I told everybody, if I can find an investor, you can't lose. No investor will touch a project unless they're going to be able to come out of the shoot selling
109you electricity for less than you're paying and having um an accelerator that's significantly less than you're going to be paying. So, they don't want to have buyer's remorse, right? So, nobody would touch the projects up here. I couldn't get anything. And I know this sounds crazy and I apologize for this timing, but we had I the IRA is coming to an end. As you I don't know if you realize this, but the Trump administration cancelled it. It's over December 31st. Done. But you we can we can get under the wire. There's something called safe harboring. And it's it's just a bunch of legal stuff that I I I don't want to get into. But at the end of the day, I was able to find an investor that couldn't carry all the roofs. But if
110Riverside could cover that much of it, they would go into an agreement. The roofs you have, just for the record, I had three subject matter experts on your roofs summer of 24. They're really bad at the campus here. I mean, really bad. We're they're very close to being completely saturated and and needing a tear off, but they're not there. They're not there yet. And we can put the So, these solar investors approve of certain roofs and they approve of of these roofs that are water resilient and we build the roof when we're up there and they mandate a 25-year roof. That's not cheap. So, we have to buy warranty, right? We have to buy warranty above manufacturers, right? So, but the investor has to have that because their panels are 25-year panels and they we
111can't be moving panels for roofing. Okay? So, this investor was willing to enter into a power purchase agreement with this school district if they carried that much of the roofing. Those roofs would cost you way more than that. You would fill probably 200 to 300 yards of dumpsters with that roof. This makes it a sustainable roof. You will never have to replace it. You will never have to tear it off. It is sustainable and it doesn't count as a roof. That's a permit situation. So, what's happening here is the investor is holding my feet to the fire. We are coming to the end of the inflation reduction act. The only way you're ever going to get solar in this district is with the IRA because the investor gets the 30% rebate on the 5 million
112he's putting into your project, right? He gets that rebate. But here's the good news. you guys get a 30% rebate on what you're putting in. So, as soon as that solar project starts going, you're going to get a million dollar back. So, you're going to end up spending $2 million replacing 75y old roofs, making them completely sustainable, putting solar on, getting reduced electric rates. At the end of the day, your output is going to be $2 million because you're getting back I'm not doing the exact math, but you're getting back 30% in rebate dollars from the inflation reduction act. These are all part of the opportunity, but the investor, you know, we have to show that the roof is paid for. They have to know that or they're not going to do it. And so,
113we're hurrying to do that. I have the PPA, by the way, ready to be signed. Once that roof is is is committed and paid for, you'll get back 30%. You'll get solar on all of those roofs. You have a power purchase agreement starting at less than you're paying now with a 2% accelerator. And I have worked a year and a half to find this and to get them down into a place that would make you very happy and save your district a lot of money where that money that you would have been spending on power and roofs, you can reinvest in whatever is is needed. I see a thumbs down and I see a shaking head, but that's the reality of it, guys. It's the best deal you're going to ever see. You will never
114have solar without it. You will never get those roofs for $2 million. Your roofs are 75 years old. I don't even want to think about the kind of mold, the moisture it's holding. You have leaks all over your building. You have to get a roof. You have to. You're almost in emergency situation quite honestly. So, this is a great opportunity for your district to save upwards of $10 million. >> Yes. Can you explain a little bit more about the solar panels? >> Yeah. So, the solar investors willing to pay and put solar panels and absorb a little bit of roofing cost >> put solar panels on all >> what goes beyond the solar panels. Solar panels. >> Yeah. >> But they have to collect the energy. So, >> yeah. >> What is incorporated with the
115solar panels? >> Okay. Okay. If I think I understand you, the investor pays for inter those are his panels. He is relying 100% on those being used by you and the amounts that we have collected. We've collected data for over a year, right? They have to be functioning perfectly. He you are only paying for what you use, right? You [laughter] are not paying for the panels. You are not paying for interconnection. You are not paying for engineering. You are not paying for any of that. the the the investor takes care of it all. He ensures them. He checks them every year. He checks your roof every year. Roofing on those buildings is off your budget for 25 years. But let me add to that. So, with the solar panels and with us getting a lower
116rate per kilowatt hour, when you project that over 20 years or so, it's about a $2 million savings in electric use. Okay. with prices going up the way they are. A lot of people say it's from the AI uh whatever it's going to we are seeing accelerated increases in electric costs. So the $2 the $2 million is probably low. The other thing is the roofs. I think the B biowski engineers report showed we had to do like seven or eight million not had to but it would cost about seven to eight million to replace the roofs and uh so we're already having approximately 4 to5 million in savings upfront and that doesn't count the million dollars that would be projected to come back. So this opportunity is never going to happen again. >> This is
117a once in a lifetime and we either do it or lose it. So, can I ask a couple of questions? Mr. Allesk, have you reviewed this at all and in your Okay, so we've talked about roofs many times. Um, is I have two questions. First of all, if I understand this correctly, we're basically leasing our roofs to the person who's getting the tax credit and then we have to pay for the right for them to use our roof and then we also have to pay for the electricity that's generated by the solar panel that he's pro that the investor is probably going to take the excess electricity and sell it. Is that how I understand these deals to work? >> Um, I wouldn't say that. Um what I would say is so these solar investors
118there are many of them and they're they're you know doing these these projects all over the United States. Um what they do is they um there are situations where they do do it as a lease. In Ohio we can't do that. So, they do a power purchase agreement and basically what they're doing is they they're their panels are getting the power, right? They're paying $5 million to put panels on your roof. They're they're insuring their panels. They're maintaining their panels. They're connecting. They're dealing with the grid. You don't have to deal with any of that. It's what they do every day. The power that they're collecting, they are providing to you, you're using that power. So, it's it's very nice. One thing u I was sharing with um one of your residents today is when
119the power is generated at the point of usage, it's not coming through those dirty lines. So, if I don't know if anybody knows any electricity comes through very busy lines and it's dirty and um it reduces the life of everything that runs off of it because it has like it's like dirt in there. This power is being created right at the point of usage as clean as clean can be and all of your everything running off of it will last longer. That's a savings we don't really talk about. But if your HVAC units get two extra years on them, that's a lot because the cost of ownership of HVAC stuff is is a lot. So, so they've basically done their math. how are we going to pay for everything upfront? And they figure out, well,
120we'll only do the project if we can charge less and save them money. So, they create a power purchase agreement. Everybody's a winner. Are they making money? Yes, they're making money. They're investors. Um, are they paying in? Yes, they are. But at the same time, you're saving money. So, we don't own we don't own the solar [clears throat] panels. We also don't own the battery cells that the solar energy goes into to create the electricity. So, we don't own the electricity that's being generated by the solar panel. So, I don't think I don't know if there'll be any batteries in your arrays because batteries are super expensive and your demand we'll we'll they'll figure out the best way to do it because remember they got to get their money back, right? So, they're going to
121figure out the most efficient way to do this. It's It's on them. >> I know. Again, maybe I'm not asking my question clearly. We're We are not using all of the electricity generated by the solar panels on the roof. There's extra. >> Yes, you will. Yeah. You're going to use all the panels. See, the the power company won't let them put more on than you use. So, so they they can't do that. Now, you're talking about are there times when they'll go back to the grid? I don't think so. the the development we've had here, you're going to use it all. You're going to use all [snorts and clears throat] because they won't let us develop more than you're going to use at this time. Um maybe someday down the road they will. Um and
122if they do, they give you they pay you. >> And that I have a couple of more questions. Dr. Thompson, is there is there any legality to us paying in advance for something we haven't received yet? I would imagine that a contract of $3 million in nature, we're not going to be able to pay an expenditure of that nature now for something we don't have. >> I would defer to our attorney. >> Yeah. So, the way we protect the district from a default is to have what's called a shity bond, a performance bond, and it is where the uh contractor, the vendor uh purchases through a qualified insurance company uh an insurance policy that guarantees the performance of the work in the event of a default. >> But does that allow us to actually sign
123a purchase order and write a check on I >> I've not I've not been in a situation where we're actually allowed to write checks for things that we don't haven't received yet regardless of insurance. Like >> I won't tell you other school districts do a lot of time. >> So and and I guess part of my problem with this whole thing is that we as a board of education haven't not ever once talked about this at a board table and it's being sprung again here at the last minute so that we could we can spend $3 million. And I'm not saying that this is a bad project. Don't get me wrong. Like I would have no idea because we haven't talked about it and we're trying to talk about it now but we're really not
124talking about it. This is a long-term conversation that this district should have been having and we're not having it. And here at the last minute, they like people want us to sign $3 million. I I I can't do that. I can't do that without seeing some of that data. WITHOUT [applause] SEEING WITHOUT seeing some of those reports that like that tell us how much savings we've done when we did our windows even though like it might under house bill windows HBC I can't remember what it was like don't >> bill 264 >> so >> you know what I mean >> thank you we we researched that for a long time we had lots of conversations with the vendor and the people who were coming in to do that project for us we that was [clears
125throat] a that lengthy. It wasn't just it wasn't a fiveminute conversation. And again, I'm I'm not trying to be disrespectful to you at all. It's just this is crazy stuff. Like we we can't we can't do this at the board table yet. >> Okay. Is there is there anything else? >> Yes. I would like to ask Dr. Thompson um can you show us how this impacts our general fund? Well, all I mo all I modeled again is not whether or not the project is is a good thing or a bad thing. I didn't I I can't model that. And I don't know that I modeled the right dollar amount. I modeled what was in the Brisco report, which was $4.6 million. So, I modeled that uh along with the $1.2 $2 million reduction that we're
126seeing in fiscal year 26 from the county commissioners and the tax relief. So those two things I put together and modeled that I can show that but it is not a it's not a statement of whether roof you know doing this project is good or not good. It's just what is the financial impact. What's your experience with I mean have you had experience with this? >> I've had experience in going about as far as you've gone here in a previous district. Um we didn't have to put roofs on. It was when we built all of our new schools. That's when they wanted to come in and do the solar, but um it just at the end at the last minute, I guess they couldn't get the investors to do it >> and so we didn't
127do it. That's the reason we didn't move forward. I would have moved forward with it. But >> but again, I don't think it's a question. This could be a good opportunity, but this bring a $3.6 million contract on us. I I mean, literally solid >> 3 million60. >> Sorry. >> Well, what does that look? Yes. What does that look like to our general fund at the end? and you'll get a million back. No, don't forget that. >> Well, when is the million? >> Again, please understand when I you know, I built this [clears throat] just we built this just over the last 35 hours or so. So, can you So, the the the goal was there was a question to me proposed to me from a the board to provide a board with a clear
128financial assessment uh regarding the proposed transfer of $4.6 million. I thought this was about from my perspective was the transfer of the funds to the general fund to the PI and um and then the associated resolutions as I understood them. I didn't know any I didn't know about at that point uh the million dollars coming back. That is not modeled in here. That's not modeled in here. Go ahead. So, the board is considering this transfer. Um, and certainly they're they're legal. Uh, they do materially uh impact based on what I know here, not necessarily what I heard here tonight, but what I know what I knew previously, it has a material disruption to our financial standing. Go ahead. So I com So I we're look I looked at five different things and the impact of
129the county property tax which has nothing to do with the conversation tonight. You may not even be aware that it occurred but our county commissioners what less than a month ago roughly somewhere in there uh voted to approve a tax relief for certain tax or homeowners inside of Lake County. Uh so the impact for for Riverside schools is one a reduction of $1.2 million a year starting this fiscal year. We'll we'll lose 600,000 the following year. 1.2 million 1.2 million 1.2 million. And I want to make sure you understand there are compounding expenditures and one-time expenditures. A compounding expenditure means 1.2 million, 2.4, 3.6, 4.8. It's compounding itself. This is compounding. Doing roofs is a one-time expenditure. So, they're they're different. Okay. Uh there is uh likely a permanent revenue loss not previously incorporated into
130the cap into that um capital planning or the 5-year forecast because what what the county commissioners did was they have to they they can reconvene next year and take the roll back back. But we we've been advised to financially look at it as if this is going to be a continuing loss of revenue. So that's how I modeled it. Um uh we are currently in deficit spending. Again, we're not in a deficit. We have cash reserves, but we're currently spending more money than we bring in. Um the proposed transfer would immediately reduce the general fund cash balance of course by $4.6 million. Okay. Um and based on current modeling of the combination of the $4.6 million and the $1.2 million um annual revenue reduction um and ongoing structural deficits. So, the combination would likely require
131the district to place an operating levy on the ballot as early as November of 2026. The PI projects identified, they are legitimate and they are needed, folks. There is zero question. I'm sorry I missed your name. >> Melanie. >> Mel. Melanie is I I know she's spot on. Our roofs are bad. Our buildings are not all of them. Some of them are gorgeous, but one you're sitting in to me as the new guy are is unacceptable. It's unacceptable and I think it's hurting student enrollment. I think it's hurting the economic development of this community. It it needs to be addressed and it's unfair to the students that the experience isn't what it should be. Let's just say that. Okay. Um, but they're not emergency repairs. At least not yet. Could be tomorrow. [laughter] Could be
132tomorrow, but it's not right today. Um, and of course they don't support instructional instruction, unless of course it's leaking in the classroom, then it certainly would. Um, so the opportunity for the treasur's office to present an inepth indepth update of the 5-year forecast. Um, and what we need to take a look at and we're we're starting that now. This is what I'm showing you now. We'll show you in a minute is just a very quick, very rough overview, but um, you know, there are definitely new revenue conditions. Uh, we have the capital projects that need done to include these roofs. Uh we'll go into negotiations with the teachers you all the unions soon. Um we have long-term solveny projections and then um and then it gives the board an opportunity to fully digest all of
133this which is a lot. So um so this is really the bottom line. So when you see the word pause um that means that means this line this first column is with the $1.2 million in reductions. That's in both. This one just This one just absorbs a $4.6 million transfer. But what you see is I would I'm projecting in fiscal year 26 that we would have a $716,000 overall deficit. The state does not let you have a deficit. >> Just one thing. You said 26, but you mean 28. >> I'm sorry. I I No, thank you. No, I meant 28. Sorry. My bad. 28 shows a $716,000 deficit. So, obviously, we wouldn't let that happen, but we'd have to make significant reductions to keep out of that or pass a levy or both is probably
134the likely likelihood. Um, now it we have the same we have a $4 million deficit in 29 which I'll be projecting whether we do these roofs or we don't do these roofs. Um, so we are levy eminent either way this but I was asked what does it do? This is what it does. So that's either palatable to you or it is not palatable to you. maybe the tradeoff of roof set and roof set if we were to get the million dollars back to do that much square footage on a roof um and I'm no I'm no roofing expert so I don't really I I don't claim to understand what they're doing exactly but I can tell you that one high school in that where I worked where in 2020 we put a new roof on
135a building probably maybe 3/4 the size of just Riverside High School 5 years ago was $2.8 million to put a new roof on it. So clearly to have that many roofs done at that price is is a is a good is a good thing. But you have to justapose that against the reality of right here f the very last minute you if you can be on the ballot and not be this is called state receiverhip. This is the state coming in and taking you over. The very last year we would have to avoid that would be fiscal year 27. We'd have to pass in fiscal year 27 or we would be in in major financial trouble. We'd be taking over. >> Okay. So this is based on the 4.6. So can you rework this? And
136then also um it doesn't factor in if there is an expenditure of 3 million that when does the 1 million >> 30%. >> I'm sure you're familiar with the IRA rebates. >> So% what's the timing of that return? >> As soon as as soon as the solar project is turned on, you know what when when as soon as the interconnection happens >> and and what do you consider the time frame of that happening? So, um, your roofs will be put, in fact, you were talking about the expenditure and I will tell you that as soon as this, uh, as soon as this check goes through, you will have 1.4 million of product delivered to your facility. You will be in you will be in possession of it. So, you will have it. Um, and um,
137and then it with this particular product, it's a little different than all ours because we build it on top. So, I have to be at 50° and climbing. So, as soon as that's ready, as soon as we're at 50° and climbing and it's okay with your schedule. Now, this also is very quiet. No chemicals, no awful smells, nothing like that. So, we put this roof on all the time with the kids at school. It's not it doesn't interfere. Uh, and it's not noisy, you know, because we're not banging and everything. So, um, 50 and climbing the roofs will go on. We'll use as many crews as is as necessary to move along in the while that's going on. As soon as this is signed, as soon I will have power purchase agreement in your hands
138and when you agree to that, everything goes the they start with interconnection. So, during the winter, they'll be able to do all that stuff that doesn't involve [cough] any [clears throat] kind of construction. um in and then we're at the mercy of the utility of course. However, in Ohio, they are very uh they're a little more cooperative because our grid is toast. So, they're happy to get it off off the grid. They're happy to get the help. So, it'll it should move along fairly. >> So, you're saying year? >> Oh, yeah. Oh. Oh, >> within a year, that's the answer. >> Probably September or so. >> Oh, yeah. Oh, yeah. >> And then just looking at the >> as soon as connection. So, we we'll help you with all the IRA paperwork. We would help
139you with that. And [clears throat] then as as soon as interconnection and you you fill it up, you send it off to them and you show we're connected. Our solar project is we're on [clears throat] we're on the grid is rebate time. >> Okay. So, >> so this so that everybody understands this includes Riverside High School, John R. because it's the whole complex, Blammouth, Parkside, and Riverview. >> The question I have is why are we looking at all the buildings? Do we have options to look at one building? Do we, you know, like that's that's what we haven't had time to talk about is this roof. Yes, we know this roof. >> Yeah. >> Needs some love, but we've never talked about it. We've never had a chance. you've done a great job explaining it
140to us, but I I don't know. It's like somebody coming to your house and saying, "Hey, we spent $3 million." Uh, I need a little time, right? Um, this isn't [clears throat] even our money. It's our taxpayers's money. So, >> this is unfortunate because the IRA ends and I apologize for that. And, um, I will tell you, I was shocked that we got an investor to bite. It's been out there in the portal for a year and a half, >> but I don't think get a bite. >> I don't think it's unfortunate. What I think is unfortunate is that somebody has probably been having these conversations, but it certainly hasn't been all board members. >> So, we haven't had that conversation at buildings and grounds that I'm aware of. We haven't had that conversation here
141at the table. >> Our director of maintenance is not aware. >> And if if those conversations were happening, they should have been happening with this school board so that we could have been fully aware of what's happening so that we could have been ready to make a decision at this point. But we are not because we haven't done that. We haven't done our due diligence. And I regardless of the tax implica implications and too bad for the investor, but like I'm not the investor. Who is the investor? >> Yeah, I I can't say that right now. Sorry. But but I'll have as soon as one more time. Okay. One more time and you're going to leave. So please do not interrupt. Okay. This isn't a community involvement. This is a board meeting and you're observing.
142Okay. You can't be interrupting. Please. We have that for you by the end of the night. Okay. By the end of the night, >> okay, be respectful to the person who's here. >> We just we just haven't had we haven't had time to absorb this data. We haven't had time to say, well, you know, maybe we should just do one proof. Maybe we do maybe we do it as a as a so, you know, like as a as an example and let's see what happens. Let's let's test it out. I mean, it's not like it sounds like a bad idea. I've often thought maybe I should do that to my house. Yeah. I would agree. Yeah. >> But but >> I will tell you these investors won't touch projects that small. This was as small
143as >> well. I I understand that like I I'm very well aware of of how tax credits work in in all kinds of different scenarios and environments. But again, we are not a we are not an investor and we are dealing with public funds. That's a that's that's just a big decision to be making about what our what our general fund is going to look like. So, we are going to be saving at least $8 million and and so this opportunity will never come again. >> And so, uh I I've been in the roofing industry for 49 years now and worked uh very hard and and our maintenance director, Rich Arlesic, we've had discussions. We've had different people from different companies out here looking at the roofs. We've spoken about that in buildings and grounds.
144So, there have been conversations going on for a year. Okay? Actually, more than a year. But if they talk about >> and this type this type of opportunity, you don't bring it to the table and talk about it when it's not available yet. Okay. So now with the changes in the uh inflation reduction act and it it being terminated and in this particular location in northeast Ohio, we don't get a lot of sunlight. There's not going to be very much opportunity for solar solar investors to do this sort of thing. Solar investors are charging us zero. we are getting the benefit and we are not paying for it. This is this doesn't get any simpler. So that's what I would add. >> Okay. >> I just want to remind you that you've got to get
145new roofs anyway. >> Well, they're they're 50, 60, and 75 years old. Okay. We are in a dire situation on this roofing. Most of your roofs last 30 years if you take care of them. Okay. We we can't wait any longer on the roofs, okay? Water does a lot of damage. I'm sure all of you here, if you had water coming in your roofs at home and in your child's bedroom, you wouldn't just let it go, okay? Because it causes more damage and it causes more mold and it creates an unhealthy environment. And I'll just add to that, the unhealthy environment like we had with the trailers, the classroom trailers over at Buckeye had mold in the walls when we took them down. That's unacceptable when water's coming in your roofs and in your in
146your buildings. Like you see the water marks on the ceiling tile. Yeah, we have water coming in. We have water coming in a lot of buildings. In the last buildings and grounds meeting we had, Mr. Arlesic, our maintenance director said, what'd he say? We had to do a plethora of roof repairs last month. Not one or two, a plethora. He said, "Okay, we are running into the serious danger zone. We have to do something." Okay. It has to be done. >> So, so take the >> Okay, Steve, can you take the role, please? >> We're running into um Can you take the role, please? >> No, I I have We're going to take the role. >> No, I have more to say. >> We're going to take the role. >> We have been running into
147this issue where we have things that need to be addressed. However, we had the opportunity a number of years ago to get a new high school. And why would I want to put this money >> into a into a building that we should be replacing? >> Miss Kreninski? >> Nay. >> Mrs. Grassy. >> Absolutely. Nay. >> Miss Brewster. >> I motion carries 32. >> Okay. Um, >> so the motion is carried. Uh, I know Miss Bruce, are you going to be leaving? Are you? >> Yeah. >> You're going to go. Okay. So, so, uh, we're going to recess in a moment, but first we have another item of business. We have a resolution to approve and authorize a fee and service agreement with Stifel, Nicholas, and Company for underwriting services in connection with the Riverside
148local school districts certificates of participation andor tax anticipation notes. Uh, can I get a second? Second. >> Thank you. Discussion. >> Is there an amount on that? >> Uh 15 million is what the board approved. >> No, no, there is no agreement. >> Oh, I I Oh, I see what you're saying here. The Yeah. So, uh >> just motion to postpone. >> Oh, postpone this motion. You don't actually have the contract. >> Okay. My mistake. Little lack of communication and I thought we had that. We don't have it yet. >> Okay. So, that'll be the next board meeting. >> Yeah. >> Okay. So, we eliminate that. Um, cannot vote on it because we don't have it. >> Okay. So, I would take a a brief recess and did you bring the contracts worth connect? >>
149You have everybody has >> um can you just come over and we'll we'll sign them now and take just a brief recess. >> We're recessing. Are we journing? >> That's it. No, no, it's uh it's just going to be a couple minutes. Uh the 2B item is is going to be the last uh and then before adjournment and uh just take a couple moments here. and me here next to each other. >> So I just put underneath put Sorry, you can't interrupt me. You cannot if you want to leave. If you want to leave, you're not going to interrupt. You're not interrupt. You have no place to do any. You are not allowed to talk. You are not right now. It might be too early. >> Can we call it now? >> [cough] >> Dr.
150You know what I'm talking about. I mean, I haven't loed on it. notification. We don't This is amazing. Let's go. You got yourself. I mean, I haven't even had the discussion to put something like that together, but I mean, 84% of our budget is people and 16% of our budgets are children, you Um, and you know, think about a $700,000 or a million or $5 million reduction, what that means, how many people that is. I've been through it more times than I would have ever liked. And this district's been through it, too. 2013 14 somewhere in there, I think. >> Sure. Oh, okay. I guess that's Oh my gosh. I'm not calling He must be sleep. And then we just made another run around yesterday. >> I disagree. Okay. >> Okay. We're back in session.
151>> Okay. We're to the uh special report by the board uh president update. Okay. So what I'm presenting is uh already public information and can copies can be obtained through a public information request from our treasurer. [clears throat and cough] So what I will share with you is there are three documents uh that are in the record. Um and I would confirm that with our board attorney, right, Mr. McIntyre? We have a uh 20 uh August 1st, 2023 to July 31st, superintendent performance evaluation. So that's in the record and you can get that uh that was uh written by Miss Grassy and uh there's a point person and that person gathers the information from the board members and they author a report which includes some other items u ideas of improvement and and things like
152that. So anyway that was a u 61% grade. Um the August 1st, 2024 to July 31st, 2025 was authored by Miss Brewster and that was a 60% grade. Um the what I'm reading here is um what is termed a pre-discipline pre-termination meeting conference demand and this was put together um for an executive session on uh December 4, 2025. And while that was executive session, it is now public record. Right, Mr. McIntyre? Yeah. So it can be shared. Um [clears throat] so it has some verbiage in it and then it says [clears throat and cough] at this uh predisipline pre-termination meeting conference you shall have the opportunity and this is of course to Dr. Ratino uh to respond to the following allegations which are serious in nature and set forth below in no particular order. You
153currently hold a five-year professional superintendent license, a five-year professional high school 7 through 12 license, and five-year professional principal license with the Ohio State Board of Education, each of which expires on June 30th, 2028. You are currently appointed and employed [clears throat] by the board in the position of superintendent pursuant to RC 3319.01 employment contract that expires on July 31st, 2026. Pursuant to RC 331901, board policy 1100, board policy 1120, board policy 1130, board policy 1200, board policy 1210, board policy 1220, board policy 1230, and other applicable laws. You serve as the professional advisor, executive officer, and administrative officer for the board. Pursuant to RC [clears throat] 3319.01, board policy 1240, board policy 1240.01, board policy 1210, and other applicable laws. The board has adopted procedures for your evaluation and has evaluated you in accordance
154with those procedures. Copies of your evaluations have been provided to you, are part of your personnel file, and are attached hereto and incorporated herein by the instant reference. Pursuant to board policy 1210 and other applicable laws, the board has established goals for you through annual evaluations of your performance. Copies of your goals have been provided to you, are part of your personnel file, and are attached hereto and incorporated herein by the instant reference. Pursuant to board policy 1210 and other applicable laws, the board has whenever possible relied upon the objective outcomes of your evaluations rather than on subjective opinions in formulating the board's position regarding your performance. Pursuant to board policy 1240.01 and other applicable laws, your services have been found by the board to be unsatisfactory. You have been notified of such an unsatisfactory
155conditions. You have been given an opportunity to correct such unsatisfactory conditions. Your service continues to be unsatisfactory and you have been notified of such continued unsatisfactory conditions. By way of example only, the board provided you with an average percentage rating of just over approximately 61% for the 2023 24 school year evaluation which addresses deficiencies in your communication with the board. A copy of this evaluation has been provided to you is part of your personnel file and is attached here to and incorporated herein by the instant reference. By way of example only, the board provided you with performance objectives for the 2024 2025 school year in the 2023 24 school year evaluation, including but not limited to your communication deficiencies with the board. A copy of these performance objectives has been provided to you are part
156of your personnel file and are attached here to and incorporated herein by the instant reference. By way of example only the board provided you with an average percentage rating of approximately 60% for the 2024 2025 school year evaluation which addresses deficiencies in your communication with the board. A copy of this evaluation has been provided to you is part of your personnel file and is attached here to and incorporated herein by the instant reference. By way of example only, the board provided you with the performance objectives for the 202526 school year in the 2024 2025 school year evaluation including but not limited to your communication deficiencies with the board. A copy of these performance objectives has been provided to you are part of your personnel file and are attached hereto and incorporated herein by the instant
157reference. By way of example only the board provided you with a midyear evaluation for the 202526 school year which addresses deficiencies in your communication with the board. A copy of this evaluation has been provided to you as part of your personnel file and is attached hereto and incorporated herein by the instant reference. Even though the board only speaks through its minutes and the board voted to proceed with the Buckeye building project pursuant to a specific plan, your actions and inactions jointly and severally amount to a deliberate attempt to sabotage the will of the board with respect to the Buckeye building project. Your s your actions and inactions jointly and severally caused the board to violate the Ohio Sunshine laws, board bylaw 0164, board bylaw 0165, board bylaw 0166, and board bylaw 0169.2 2 and other
158applicable laws by allowing a sham board meeting to be coordinated and conducted on November 8, 2025, which was initially designated as a special board meeting for the purposes of taking formal action to resend the prior formal action taken by the board with respect to the Buckeye building project. and it makes reference to a YouTube video that could be accessed to to view that. Your actions and inactions jointly and severally caused the board to violate the Ohio Sunshine laws, board bylaw 0164, board bylaw 0165, board bylaw 0166, and board bylaw 0169.2, to and other applicable laws by allowing a sham board meeting to be coordinated and conducted on November 8th, 2025, which was initially designated as a special board meeting for the purposes of taking formal action to resend the prior formal action taken by the
159board with with respect to the Buckeye building project and then immediately converting the same to a community listening session on November 8th, 2025. five to discuss taking formal action to resend the formal action taken by the board with respect to the Buckeye building project which you then caused such discussions to be recorded and disseminated to the public online. Again, it references uh and access to for viewed online. Your actions and inactions jointly and severally amounted to improper communication with stakeholders in the Buckeye Building Project, including but not limited to Satsena and Associates LLC that were intended to undermine and in fact undermine the prior formal action taken by the board with respect to the Buckeye Building Project. Your actions and inactions jointly and severally caused the Buckeye building project to not go forward as planned
160in the prior formal action taken by the board. Your actions and inactions jointly and severally caused Cena and Associates LLC to resign as the municipal adviser for the board and from the Buckeye building project. Your actions and inactions jointly and severally violated the prior formal action taken by the board with respect to the Buckeye building project. Your actions and inactions jointly and severally are not protected by the first amendment to the United States Constitution. As you are a highle employee, you were seeking to release and did release confidential information. You were not speaking as a private citizen. You were not speaking about a matter of public concern, but instead were speaking about internal personal disputes and grievances. Your speech is normally part of your job duties and or you were speak you were speaking in
161your official capacity. Your speech interfered with your job and your speech disrupted the board's interest in an efficient workplace. Your actions and inactions jointly and severally are not protected against retaliation for whistleblowing as you were not reporting to the board actions that are illegal, abusive, and/or violate specific public policies. Your actions and inactions jointly and severally amount to your failure to perform your responsibilities as the professional advisor, executive officer, and administrative officer of the board pursuant to RC 3319.01, board policy 1100 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain unquestionably high standards of honesty, integrity, impartiality, and professional conduct pursuant to board policy 11:30 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain the proper performance of school
162business and administration through the service of integrity, high ideals, and human understanding pursuant to board policy 1200 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain high standards in your working relationships in the provision of your professional leadership in the Riverside local school district and community and in the performance of your duties to recognize basic dignities of all individuals with whom you interact in the performance of your duties pursuant to board policy 1200 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain high standards in your working relationships in the provision of your professional leadership in the Riverside local school district and community and in the performance of your duties to seek and apply the knowledge and skills appropriate to
163your assigned responsibilities pursuant to board policy 1200 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain high standards in your working relationships, in the provision of your professional leadership in the Riverside local school district and community, and in the performance of your duties to keep in confidence legally confidential information pursuant to board policy 1200 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain high standards in your working relationships, in the provision of your professional leadership in the Riverside Local School District and community, and in the performance of your duties to refrain from using your position or public property or permitting another person to use a public per position or public property for partisan political purposes pursuant to board policy.
164120 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain standards of exemplary professional conduct and conform your behavior to [clears throat] the code of ethics as adopted from the American Association of School Administrators' statement of ethics for school administrators by fulfilling your professional responsibilities with honesty and integrity pursuant to board policy 1200 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to maintain standards of exemplary professional conduct and conform your behavior to the code of ethics as adopted from the American Association of School Administrators statement of ethics for school administrators by implementing the board's policies and administrative rules and regulations pursuant to board policy 1200 and other applicable laws. Your in actions and inactions jointly and severally amount to your failure
165to maintain standards of exemplary professional conduct and conform your behavior to the code of ethics as adopted from the American Association of School Administrators statement of ethics for school administrators by avoiding the use of your position for personal gain through political, social, economic, and or other influences. is pursuant to board policy 1 1200 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to administer the policies of the board pursuant to board policy 1210 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to serve as the professional advisor, executive officer, and administrative officer to the board pursuant to board policy 1210 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to take responsibility for the development, supervision, and
166operation of the school program and facilities under the oversight of the board pursuant to board policy 1210 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to properly administer the Riverside Local School District pursuant to board policy 1220 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to strive to achieve the Riverside Local School Districts goals pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to act as a proper role model both in the school and outside the Riverside local school district pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to act as the professional advisor, executive officer, and administrative officer
167of the board pursuant pursuant to board policy 1230 and other applicable laws. [cough] [clears throat] Your actions and inactions jointly and severally amount to your failure to direct and supervise the work of all the schools, offices, and employees of the board except the treasurer pursuant to board policy 12:30 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to take responsibility for any task performed by any designated subordinate employee pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to make all reports and recommendations to the board through your office pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to serve as the professional advisor, executive officer, and administrative
168officer of the board and be directly responsible to the board pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to support the majority position of the board when officially enacted pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to perform such duties as cooperatively identified and discussed with the board pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to with the aid and cooperation of those directly concerned issue such publications as are deemed necessary for the effective administration of the Riverside local school district pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your
169failure to outline procedures which will provide interpretive information about the schools to citizens pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to be directly responsible to the board for the performance of assigned duties and responsibilities pursuant to board policy 1230 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to comply with the statement of philosophy of the board pursuant to board policy 2110 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to comply with the facilities planning of the board pursuant to board's policy 71 0 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to comply with the public relations objectives of the board pursuant
170to board policy 9110 and other applicable laws. Your actions and inactions jointly and severally amount to your failure to comply with the public relations objectives of the board pursuant to bo board policy 9120 and other applicable laws. Your actions and inactions jointly and severally amount to violations of your employment contract with the board, including but not limited to the model conduct provisions of paragraph 16 of the same, which provides that the superintendent acknowledges and agrees that the superintendent will maintain model conduct professionally and personally during the existence of this agreement or any extension of it. The superintendent's conduct to the contrary, including but not limited to unethical, immoral, or dishonorable behavior, will materially impede the superintendent's ability to supervise the public schools of the Riverside Local School District and discharge the other responsibilities of the
171office of superintendent in the manner required by the board. and the superintendent's breach of this provision will be grounds for termination under this agreement and Ohio law. A copy of this contract has been provided to you is part of your personnel file and is attached hereto and incorporated herein by the instant reference. Your actions and inactions jointly and severally amount to violations of your job description. Your actions and inactions jointly and severally amount to your failure to behave as a professional. Your actions and inactions jointly and severally amount to your failure to serve as a positive role model. Your actions and inactions jointly and severally amount to your failure to be responsible for preserving the dignity and integrity of your profession. Your actions and inactions jointly and severally amount to your failure to practice your
172profession according to the highest ethical standards. Your actions and inactions jointly and severally amount to your failure to adhere to the lensure code of professional conduct for Ohio educators. Your actions and inactions jointly and severally amount to your failure to accurately report information regarding the Buckeye building project. Your actions and inactions jointly and severally amount to your failure to take responsibility in whole or part for the allegations set forth herein. And instead you have asserted that any and all culpability rests with the board including but not limited to board members Belinda Glavic Grassi and Lorie Krenniski, treasurer Steven Thompson, and board general counsel Daniel M. McIntyre, but not you. Any action taken by the current board, including but not limited to discipline, termination, and/or non-renewal, will simply be undone once the new members of the
173board are sworn into office in January 2026, i.e. Belinda Glavic Grassi, Joseph Audino, and Jimmy Lee Vyers, and you are engaged in constitutionally protected speech. Your actions and inactions jointly and severally amount to violations of the lensure code of professional conduct for Ohio educators, including but not limited to principles 1, 1, 3, 3, 8, and 8b, which can be viewed at, and it gives a place where you can go online and view them. Your actions and inactions jointly and severally amount to violations of written rules and regulations. That's set as set forth by the board, including but not limited to board bylaws 0164, 0165, 0166, and 0169.2. Board policies 1100, 1120, 1130, 1200, 1210, 1220, 1230, 1240, 1240.01, 01 1541 9110 and 9120 and all applicable administrative guidelines which can be viewed at and it
174gives a website. Your actions and inactions jointly and severally amount to incompetency. Your actions and inactions jointly and severally amount to inefficiency. Your actions and inactions jointly and severally amount to dishonesty. Your actions and inactions jointly and severally amount to insubordination. Your actions and inactions jointly and severally amount to discourteous treatment of the public. Your actions and inactions jointly and severally amount to neglect of duty. Your actions and inactions jointly and severally amount to mi misfeasence which is generally defined as the unintentional act of engaging in an action and/or duty but failing to perform the duty correctly. Your actions and inactions jointly and severally amount to malfeasance which is generally defined as intentional conduct that is wrongful andor unlawful especially by public employees. Your actions and inactions jointly and severally amount to non-feasence which is
175generally defined as the omission to perform a required duty and/or the failure to act when a duty to act existed. Your actions and inactions jointly and severally amount to just cause to both discipline you and terminate your employment with the board. And so that is the public record and a copy can be re received uh upon request from our our treasurer. And that ends my my special report. And then we come to uh the next meeting announcement which is finance and personnel December 11th 8 a.m. buildings and grounds December 16th 7:30 a.m. Board of Education meeting December 18th at 6:00 p.m. And I make a motion to adjourn at 7:30. Can I get a second? >> Second. >> Can you take the role? >> Yes, sir. May I speak Mr. >> Mr. Hi Mr. STAND
176WITH your reputation. MISS BREWSTER, >> YOU'RE DONE. >> I'M SORRY. >> MRS. GRASSY, >> RIVERSIDE. >> OKAY. I didn't hear my name. >> Oh, I'm sorry. [laughter] >> I thought I did, Mr. You're a piece of