Police investigating school’s finances
February 7, 2007
AVON ” The Avon police have started an investigation probing alleged missing funds from new charter school Stone Creek Elementary, police Chief Brian Kozak said Wednesday.
Kozak said he couldn’t give any details about the investigation, including the amount of money in question, but said he would release any future findings.
Detective Paul Arnold said police were approached by members of the Stone Creek board of directors who were concerned about discrepancies they discovered in the school’s financial records when they took over just a few weeks ago.
Newly elected treasurer Kevin Randel said he and other board members weren’t prepared for the mess they found in the books. The records were scattered, incomplete and didn’t quite add up.
“We saw a lot of unaccounted for funds ” checks written without matching receipts or invoices,” Randel said. “It’s about $68,539.”
The announcement adds to an already serious situation for Stone Creek, which is figuring out how to dig out of a deep financial hole that Randel and other board members attribute to major financial mishandling in the school’s opening months.
First, enrollment numbers were overestimated, meaning the school received more state funding per student than it should have. The school is now having to pay that back.
There were also unanticipated construction costs and about $400,000 in grants and fundraising that were budgeted for but never came in.
The total debt is about $1.8 million, although about $1.2 million of that is the cost of the school building, which Randel said is unavoidable for any new school buying a home. The rest of the deficit, he said, is pretty normal for a start up charter school.
Still, there are immediate deadlines to meet.
Stone Creek has to come up with $260,000 to pay off their modular trailers and an outstanding balance with Wells Fargo by Feb. 13. After that, they’ll go deeper into survival mode, hoping to raise up to $440,000 more to cover operating expenses for the rest of the year, including teacher salaries.
Board member Laurie Liddick said it will be hard to pay teachers in a month.
“We know we’re going to have shortfalls, but this is a five-month digging out process,” Randel said.
If the full amounts aren’t met, board members hope to make good faith payments to buy more time.
Randy DeHoff, director of the Colorado Charter School Institute, told parents that this type of crisis isn’t uncommon for startup charter schools and that many have been able to pull out of even worse situations.
Parents and teachers are heading major fundraising efforts to make up the shortfalls. More than $80,000 in parent donations have come in, and board members are actively seeking corporate sponsors. The school has also organized major fundraising events, such as a Valentine’s Dinner Dance on Friday and a Kentucky Derby in May.
Staff writer Matt Terrell can be reached at 748-2955 or email@example.com.