Grand jury: NCSOS employee spending lacks policies, oversight | TheUnion.com
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Grand jury: NCSOS employee spending lacks policies, oversight

A Nevada County Civil Grand Jury report released Friday found that the Nevada County Office of Education does not have clear policies in place to regulate employee spending on office-issued credit cards, and raised concern over the lack of financial oversight on such spending by the county’s Board of Education.

The grand jury’s investigation was triggered by a citizen complaint received in July 2014 over a lack of transparency and oversight on the credit card purchases and receipts of Nevada County Superintendent of School employees dating back to 2008.

In its initial investigation, the grand jury interviewed the complainant, employees in the county Office of Education and one member of the county’s Board of Education; the grand jury also conducted follow-up interviews with county Superintendent of Schools Holly Hermansen, a board member and county Office of Education personnel.



In addition, the grand jury reviewed several county Office of Education policies, including expense report and reimbursement procedures.

According to the report, the Superintendent of Schools office issues credit cards to various individuals for work-related expenses; under Nevada County Office of Education board policy, expenditures are allowed under the condition that “costs are not excessive.”




In analyzing receipts provided by an interviewee of purchases made on office-issued credit cards, the grand jury highlighted 11 purchases between August 2009 and January 2014 that “could be considered excessive because of lack of supporting documentation for authorization of those expenses.”

Those purchases included a $909.34 charge in August 2009 for dinner, supplies and literature for a retreat; a $430.66 charge at an Ohio restaurant made in October 2013 with no explanation for the expense; and a $883.38 charge made at a Monterey restaurant in January 2014 with no details provided for the expense.

Through interviews, the grand jury determined that an employee can be questioned about expense reports, but that determining what constitutes excessive spending is typically a “judgment call”; the report found that the county Office of Education’s “current rules and guidelines for expenses and expense reimbursement are nonspecific, inadequate and ambiguous.”

The grand jury also found that board policy prohibits alcohol from being purchased on office- issued credit cards.

However, in reviewing receipts and testimony by interviewees, the grand jury found that between January 2008 and January 2014, there were eight instances in which alcohol had been purchased on at least one office-issued credit card; all of those receipts were approved for payment.

In addition to finding that the county Office of Education lacked clear credit card expense policies, the report also found that the county Board of Education “did not perform due diligence” when it voted 3-2 at its July 9, 2014 board meeting against overseeing Hermansen’s expense reports and office-issued credit card receipts.

That vote, according to the report, came after two occasions in which board members requested Hermansen’s expense reports for review.

The report also found that a member of the board submitted a public records request to review charges made on credit cards; though the Superintendent of Schools office complied with the request, the report found that the information it submitted was incomplete.

The grand jury also recommended that the Board of Education implement a policy manual to address credit card expenses, consider the use of an independent auditor to check for accuracy in credit card expenditures and reimbursements and be proactive in its oversight of expenditures, specifically in its oversight of credit card charges made by Hermansen, who reports directly to the Board of education.

The report requests a response from Hermansen on one of its recommendations by Aug. 24, and a response from the county Board of Education on six of its recommendations by Sept. 24.

Upon the report’s release on Friday, Hermansen reached out to The Union via email, stating that “the report has inaccuracies and misinformation.”

However, she was out of the area and unavailable to comment further until Monday.

View the grand jury’s full report at http://www.nevadacountycourts.com/documents/gjreports/1415-EDU-AReviewofTransparenc.pdf.

To contact Staff Writer Emily Lavin, email elavin@theunion.com or call 530-477-4230.


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