The long-awaited outside audit by the firm of Clifton Larson Allen of the Lowell Public Schools was released late Friday night and according to an Elizabeth Dobbins story in the Lowell Sun (“Audit confirms Lowell schools’ fiscal quagmire”) it is a devastating indictment of fiscal mismanagement by the past school administration and, by implication, of the lack of oversight by the Lowell School Committee. The full audit is available to the public as part of this week’s Lowell School Committee packet. The audit begins at page 22 of that file.
Here are some of the highlights – or lowlights:
The audit “identified numerous instances of noncompliance with laws, regulations, contracts and/or grants”
The audit identified “a significant lack of internal controls surrounding accounts payable, payroll, budgeting, journal entries and transfers, and procurement”
The audit found “$3.4 million of budget shortfalls in the Lowell Public School Department’s 2019 originally approved general fund budget (emphasis in original – also a reminder that while the federal government can run a budget deficit, state law prohibits state and local governments from doing that)
The district overspent its budget for FY18 by $1.4mil;
Separate revolving funds established by state law for specific purposes “were significantly depleted and are currently unable to support the expenditures for which the revolving fund was intended, causing a serious deficit in available funding going forward.”
An employee who took leave under the Family and Medical Leave Act was improperly paid $35,400 while on leave; the money has not been recovered. (“Based on our interviews performed, there were other allegations of other instances of employee overpayments reported. However, we were not provided with documentation surrounding those instances. Current condition reflects a significant weakness in internal control over payroll disbursements.”)
In the fall of 2017, the school department cancelled its existing special education contract with SP&R. When the School Committee then awarded the new $9.3 million contract to Pridestar, the Superintendent failed to inform the School Committee of an existing and competing bid from NRT Bus Inc that would have saved the city a substantial amount of money over the life of the contract.
The audit also raised questions about the School Department’s lease of space at 60 Carlisle Street in Chelmsford for use as a special education school. That property was owned or controlled by the Daly Group LLC (the same entity that owned Pridestar, the transportation provider mentioned above). According to the audit: “The oral and email communications [between employees of the Daly Group and employees of the Lowell School Department] suggest The Daly Group LLC was materially involved in identifying the space and having an understanding of what the LPSD was looking for prior to solicitation. In the spirit of the law, this would appear to give The Daly Group a competitive advantage over any other entity submitting a bid. Whether it actually resulted in an unfair advantage is unknown.”
The audit ends on page 41 of the school committee packet.
The school committee is supposed to discuss the results of this audit at Wednesday night’s meeting. The most pressing question is how does the committee plan to bridge the $2.8mil deficit in this year’s budget? Thus far, it seems that some school committee members won’t even acknowledge that a deficit exists. The era of “fake news” hasn’t just hit Washington. We now have local elected officials who, if they find incontrovertible accounting information inconvenient, just choose not to believe it.
But beyond this immediate crisis, the larger question is how did the city let itself get into this predicament. There’s long been a culture in Lowell politics that dispenses with long term, strategic planning in favor of short term political gain. Instances of the short term approach might be nudging a contract to a friend or campaign contributor; using public meetings to grandstand for political gain; or obtaining city employment for a current or future campaign supporter.
Regarding the quest for city employment for friends and supporters, we have this from school committee member Bob Hoey. Here’s exactly what Hoey said at the August 16, 2017 school committee meeting:
If you notice, most of your motions, most of our arguments, most of anything about HR is everybody wants a job for somebody.
(The video of this meeting is available on LTC’s website with this segment beginning at 1:05 of the recording).
“Everybody wants a job for somebody.” No need for circumstantial evidence to prove that point. But it’s a dynamic not limited to Hoey, nor is it limited to the Lowell School Committee. It’s an attitude and approach that permeates city government and the community, at least among those segments in the community who understand the process. When a job comes open, those in the know don’t update their resume, they pick up the phone and call friendly elected officials for support. All too often those elected officials pressure the hiring authority to select the chosen candidate. Not wanting to incur the retaliation of an elected official whose job candidate is not selected, the hiring authority may succumb to the political pressure.
The lawsuit now pending against the city in U.S. District Court alleges violations of the Federal Voting Rights Act based on the city’s method of electing councilors. But to prove the negative consequences of that method of electing councilors, it seems that the attorneys for the plaintiffs are making a close study of city hiring practices.
To the extent details of this case have been discussed publicly, there has been frequent mention of the extensive discovery requests made by the plaintiffs. In the context of a lawsuit, “discovery” is the process of requesting information from the other side in the form of written questions (“interrogatories”) or requests for production of documents, both of which must be answered under oath. Hiring practices and history across city government seem to be a big part of these discovery requests. Should the case go to trial, the evidence will be illuminating.
Besides limiting the pool of candidates, this approach to hiring leads to skewed priorities when it comes to getting work done. Rather than follow some kind of strategic plan that treats everyone the same or prioritizes work on some rational basis, work gets done based on having an elected official “make a call.”
We got a glimpse into that culture last Tuesday night when Rick Underwood (who is an employee of the Lowell School Department who oversees custodians) was present to answer questions about a written report about the state of maintenance of the grounds of Lowell public schools.
While discussing budget cuts that have reduced the size of staff and the availability of functioning equipment, Underwood repeatedly said “If there’s a problem, just call me.”
Councilor Ed Kennedy – to his credit – pushed back against that approach, saying he wanted a system that worked, not one that didn’t work until a city councilor had to call someone.
Unfortunately, some of Kennedy’s colleagues and predecessors have embraced the “call a councilor” approach to local government. A constituent who is dissatisfied with the overgrown grass at the Riley School calls Councilor X to complain and suddenly the grass gets cut. Councilor X looks great and wins the loyalty and vote of the person filing the complaint. In a perverse way, inefficient operations become a campaign strategy for elected officials. Consequently, there’s no incentive to make the system work properly for everyone.
And then there are elected officials who grandstand on issues to score political points instead of seeking real solutions. The most recent example of this was Councilor Dave Conway’s performance two weeks ago on his motion about damage that was done to Shedd Park by a bicycle race held at the park on the Sunday before Thanksgiving (November 18, 2018).
Here’s Conway’s motion at the December 4, 2018 city council meeting: “Request City Manager provide a report regarding the Joseph Cady Bicycle Race held at Shedd Park on 11/18/2018; include estimated costs to repair the damaged areas of the route to its original condition.”
Now at the preceding council meeting, Rodney Elliott asked for the exact same report. Here’s what I wrote in my notes from the November 20, 2018 council meeting:
Councilor Elliott asks to suspend the rules to bring up an issue related to a bicycle race at Shedd Park this past Sunday. Says it’s an 8-hour event organized by an outside organization, but the running track has essentially been ruined. It will cost the city much to make repairs. Manager Donoghue says they have received numerous reports. They had gotten a permit from the Board of Parks but the weather made it inappropriate to use the facility for that purpose at this time. Councilor Kennedy and Manager Donoghue both believe that the same group last year actually paid for full repairs but that will be in the report.
So if the City Council already on November 20 voted to have the City Manager provide a report and the Manager said she would provide such a report, why was it necessary for Councilor Conway to put a request for the exact same report on the next council agenda?
It seems like the only thing new Councilor Conway brought to this issue was to urge the City Solicitor to pursue charges of Malicious Destruction of Property against the bike race organizers. He noted that Massachusetts law punished that crime by incarceration for up to 2½ years in the House of Correction.
After Conway said this, the camera cut back to City Manager Donoghue, an experienced criminal defense attorney. The Manager did a masterful job of controlling her reaction. She neither rolled her eyes nor burst out laughing, which would have been the two most appropriate responses to the absurdity of that request.
But while Councilor Conway was showing his ignorance of criminal law, he was adopting one lawyerly tactic. There’s an old saying among lawyers:
When the facts are on your side, pound the facts. When the law is on your side, pound the law. When neither is on your side, pound the table.
Every other councilor who spoke on this matter adopted a measured, reasonable approach (more on that below). None of them chose to grandstand for political gain. All took positons aimed at finding a solution to a problem.
Here is some context: The bike race under discussion was organized by The Boston Road Club. According to its website The Boston Road Club “is a developmental bicycle racing team and club in the Metro Boston area . . . The Club also organizes an annual Cyclocross race at Shedd Park in Lowell.” The 2017 webpage about the Shedd Park event described it as “a fast course around Shedd Park consisting of a cinder track, grassy flats, barriers, some steep climbs, and a couple of stretches of single/double track, spectator friendly with plenty of onsite parking.”
This year’s race was held on Sunday, November 18. Unfortunately for all concerned, there had been higher than average rainfall leading up to that day with a few inches of snow on top of everything. The race – or rather an all-day series of races – was held despite the wet conditions.
The following photos which are on the Boston Road Club’s Twitter feed from that day, give you a sense of the conditions:
As you can imagine, the condition of the course deteriorated through the day and by the end of the event much of the park was reduced to muddy ruts.
But this was the fifteenth year that this race has been held at Shedd Park and the leading organizers – who are Lowell residents who have always received the proper permissions from the city’s Board of Parks including this year at the Board’s June 27, 2018 meeting – have apparently returned the track to its pre-race condition at no cost to the city in each of the previous years and have promised to do the same this year.
I’ve never been to the race and know no one involved in organizing it or participating in it, but in digging around the Internet after all of the commotion over this year’s race, it seems like a pretty big event. I found reference to the race on a blog called Until the Snow Ends which said
Shedd Park is one of the best local races on the New England calendar, and like many local races, it’s hard to really pinpoint WHY. But for some reason, EVERYONE shows up, so the Cat 1/2/3 race is highly entertaining . . .
The blog post includes a video taken from a participant’s helmet camera during the race. I urge you to watch it because if you do, you’ll see why it’s such a popular event.
One way this City Council has thought strategically is to fully support festivals and events that will draw people to the city, reasoning that if we can just get people from outside of Lowell to come here for some event, they will be delighted by what they see and will come back. This is sound economic development strategy. For the previous 14 years, this bike race accomplished those goals.
According to the application to the Board of Parks, this year’s race was expected to draw 600 participants who would be at Shedd Park for eight hours. But for the wet conditions and the resulting muddy ruts, this event would have been deemed a huge success for the city.
The damage to the park was indeed unfortunate. But this race has been held every November for the past 15 years. Through all that time, there have been wet conditions and resulting damage. But presumably the organizers each year made good on their promise to return the park to its original condition, otherwise why would the Board of Parks allow them to keep coming back?
The timing of this year’s bike race is a complicating factor. This year it was held on Sunday, November 18th which was just four days before Thanksgiving (since Thanksgiving fell on the earliest possible day this year). Each year on the day before Thanksgiving, the Lowell High Cross Country team holds its annual Alumni Race in which past members of the team compete against current members – at Shedd Park. Undoubtedly the damage from the bike race just three days earlier had an adverse impact on the Cross Country event which was unfortunate.
But the proper response to that is the one taken by most city councilors: to seek a reasonable solution that continues to allow a substantial outside event (the bike race) to continue drawing hundreds of people to Lowell while at the same time ensuring that Shedd Park sustains no lasting damage and that other activities, including the annual LHS Alumni Cross Country Race, are not unduly inconvenienced.
The wrong response was to threaten to criminally prosecute the organizers of this bike race which has drawn thousands of people to the city through the years. Doing that is an example of political grandstanding that should not be rewarded by the voters.