Systems, Processes and Structures

There was a very interesting District 65 meeting tonight - the finance team presented some of their new financial controls to the Board of Education. You can view the meeting here (it’s labeled as 8/19/24 but is actually tonight’s meeting).

Awarding Contracts

One issue that I’ve written about ad nauseam here are the lax policies that District 65 had around signing no-bid contracts with vendors. Examples:

• Non-Completed Contract with a Christian Educator, with a criminal record who had his background check skipped ($35,800)

• Contracts Awarded to Dr. Horton’s Former Business Partners - Three contracts for $76,500, $24,500, and $48,500 (and probably actually higher after all the invoices were paid)

• D65 School Board Members Plan to Review Policies in Light of Contract with Sagebird Consulting LLC (Evanston Roundtable) - $112,000

Technically, most of these contracts (except the one for $24,500) were required to be at least shown to the Board of Education but were often omitted from reporting.

When I asked the District at the time, the response in March 2023 was the following;

Further we are going to great lengths to put a rigorous, standardized process in place for contract requests, including approvals, which did not previously exist in District 65 and still does not in many other public school districts.

Anyway at tonight’s meeting, Dr. Grossi and CFO Tamara Mitchell presented a new set of best practices to the Board:

• Contracts >$25,000 will be presented to the Board for Approval.

• Contracts will go through a budgetary review by both the CFO and the Superintendent that includes scope-of-work analysis, review of insurance and alignment with the District’s strategic objectives (see slide below under the next section).

• Proposed elimination of “quick invoices” - i.e. invoices that are received and paid before the Board even sees them.

• Improved timeliness of reporting - they noted that there were cases were the Board was shown financials as bad as 4 months delayed. 1

I think this is great and it’s long overdue - our $150 million dollar public school district was functionally operating with less financial controls than most small businesses. I commend Dr. Grossi, Ms. Mitchell and Dr. Turner for taking steps in the right direction. I just hope the changes are for real this time.2

Purchasing Card

Just a week ago, I wrote about the systemic abuse of the District 65 P-Card under the Horton Administration, and even after he left office. The card was used for auto repairs, steak dinners, non-business travel and more. I’m still working on a few leftover stories related to expenses from that time, so stay tuned.

In tonight’s meeting, Dr. Grossi and Ms. Mitchell presented some new policies for the P-Card, in line with what you’d expect to see at any most places with basic financial controls:

• Card use requires authorization.

• Cards have limited purchase amounts.

• Improved reporting to the Board (see below)

• Department-level cards instead of individual ones.

Here’s the slide describing the changes:

The District already implemented additional reporting in the packet, which you can view here or see a snapshot below. This is more inline with how both the City of Evanston, ETHS, and other school districts display these types of expenses in their meeting packets.

I cannot stress how bad the process was before. Prior to April 2023, there was literally no P-Card reporting to the board, they would just see a single line item on the list of bills labeled “MASTERCARD BMO MASTERCARD CORPORATE CLIE” for sometimes more than $100,000!

After my first round of stories about the card in May 2022, they implemented at least a basic report (here’s April 2023). It didn’t seem to really change much, for instance, a $633.95 charge at a compounding pharmacy in Evanston (Simple Pure RX) was just labeled as “Miscellaneous”

So this process seems like a big improvement. With that said, Superintendent authorization was technically required before (you can read the policy) so what really matters is a cultural shift: from both the Board and the Administration.