Donley: ACPS Fund Mismanagement 'Begins at the Top'

Alexandria Vice Mayor Kerry Donley took the city’s school system to task Tuesday night over the mismanagement of funds related to its Capital Improvement Program.

In November, revealed that employees no longer with the system made inaccurate initial cost estimates and expenditure authorizations that exceeded the budget.

The mismanagement was related to approximately $4.1 million in vendor invoices that had not been processed for payment. The increased costs were primarily for the installation of modular classrooms at James K. Polk Elementary and a classroom addition at Charles Barrett Elementary.

Donley brought up the issue Tuesday as City Council formally moved to allocate about $6.35 million of preapproved funds for ACPS capital improvements. Roughly $2.8 million in the allocation that was supposed to be used toward improvements at , John Adams Elementary, Samuel Tucker Elementary, and William Ramsay Elementary will instead go toward cost overruns.

“In any financial office where there’s accounting, it is not acceptable practice to authorize the expenditure of more money than you have,” said Donley, who is also an executive with . “That is called an overdraft. … I think it’s unfortunate. You’re certainly within the overall CIP, but these five other school projects are going to be shortchanged because of the problems associated with the operation of the budget office in entering into a contract beyond which [ACPS] had budget authority.”

Deputy Superintendent Margaret Barkley Byess told council that the results of the audit prompted ACPS to significantly change internal controls involved in the management of CIP funds.

“It has had some profound impacts on personnel and on local businesses because of what happened,” Byess said. “I wish there was a way to go back two years, which is as far back as we need to go, and change all this. … The appropriate levels of approval were not in place. People were approving contracts that they should not have been.”

Donley said the mismanagement also would have broader implications in the budget process involving the city and the schools. He said the issues don’t “inspire confidence” and won’t make it any easier for council to commit more capital funds. 

“Here we had the opportunity to peel off $2.8 million of that maintenance that [Superintendent Morton Sherman] at our previous work sessions just pleaded to us that we needed to spend more money doing it,” Donley said. “Here was $2.8 million where we had an opportunity and because really the lack of control and the lack of management—and quite frankly as far as I’m concerned that begins at the top—that’s the lost opportunity.”

Sherman is recovering from hip replacement surgery and was unable to attend Tuesday’s council meeting.

Council has a budget work session with the schools at 7 p.m. Wednesday at .

“Given [Wednesday] night is going to have a lot of conversations about capital, and I know there are going to be a couple of specific capital items where the schools are going be asking the city to provide additional capital resources, I think you can assume this issue is going to come up again in some form [at the work session],” Councilman Rob Krupicka said.