UPDATED: Karen Carson rebuts use of “slush fund”

Board of Education member Karen Carson called yesterday to dispute Knox County Commissioner Jeff Ownby’s calling the PPU fund a “slush fund.”

She did agree that Ownby has the authority to call for an audit.
karen carson
“It’s irresponsible and grandstanding to come to the conclusion and publicly declare a slush fund when an audit hadn’t already begun,” she said. “That’s disrespectful, that’s not civil, and it doesn’t accomplish anything. Those are words that you can’t take back, irregardless of what this audit proves, you can’t take back those words.”
She said that she and Knox County Commissioner Amy Broyles posted on Facebook about the audit Ownby called for as well. Here was Broyles’ post, copied and pasted. Go to her page for the full thing:

As a member of the Knox County Audit Committee, I fully support this audit. However, I don’t expect it to be the barn-burner that some seem to be hoping for. I also want to applaud Commissioner Jeff Ownby for bringing this to the Audit Commitee last week, rather than going straight to our Internal Auditor or bringing it up initially before the full Commission. That is how our process is supposed to work – good job, Jeff! However, I will also offer a little loving constructive feedback to Jeff and to Superintendent Jim McIntyre: If a Commissioner is requesting information from the school system and hitting road blocks, they should contact the Superintendent – that is their responsibility, not the other way around. And the Superintendent should be informed by his staff when these kinds of requests are made. If that wasn’t done, the Superintendent needs to address that with his staff.

I also disagree with Dr. McIntyre’s statement that “This conversation today goes counter to everything that they’ve (the Joint Committee on Education) been doing.” It’s true it doesn’t help, but nor does it hurt – and I’m sure we’ll discuss it at our next meeting (I serve on that committee as well). The Audit Committee was the correct forum for this discussion.

Additionally, there have been some comments made that the school system is not regularly audited, or has not been audited for a number of years. As a member of the Audit Committee, I can tell you this is false. The school system is included in Knox County’s Comprehensive Annual Financial Report (CAFR), which is the responsibility of the Audit Committee, and which is conducted yearly by an outside Auditing Firm with which we contract. It is a huge document, and requires a great deal of work to complete, and to process. However, it is not an in-depth audit of any particular department or fund; we use the results to focus in on possible issues that need to be addressed, and that is one area where our Internal Auditor comes into the picture. She will also be handling the PPU audit, and I have complete faith in her and her staff’s ability to do it well and in a timely manner.

From there, Carson and Broyles have a chat about inflammatory comments, etc. Go check it out if you’re so inclined. It’s public (best as I know, because you know, Facebook).

UPDATE: While you’re clicking away, check out Mike “whatever nickname he’s been given by the local media gadflies lately” Donlia’s blog for some transcript of schools Supt. Jim McIntyre, and some analysis that I won’t get into here.

McIntyre says a lot of what he told us, and what the schools admins told us in today’s story – basically, there’s room for more clarity, and once money is approved and in the PPU fund, the schools uses it as they wish.

Overall, the main issues here appear to be these:

  • There appears to be some question about whether land can/should be bought out of the PPU fund.
  • The fund includes things that may not be at the heart of the intent/purpose of PPU when it was originated.
  • People want more detail on the stuff being spent out of the PPU, and some better alignment with county records and school records (this, paraphrased from a few conversations with county staff and commissioners).

My observations, for what they’re worth:

  • Special funds exist for incidental costs in many public agencies/bodies.
  • So do contingencies, especially in construction contracts.
  • It’s not particularly common for the two – special funds and contingency funds – to commingle (I’m not implying that the schools have done this, by the way).
  • Usually, public bodies have a reserve – the fund balance – that they can pull from for major cost overruns, or contractors on projects have some kind of insurance or incentive against cost overruns. (And I have no idea what kind of arrangement KCS may have with its contractors, so this is not speculation about the schools, mind you.)
  • Public bodies also usually have a capital fund budget that can include major renovations – however that’s defined. What’s major to some – say, roofs or HVAC work – may be minor jobs for others.
  • To put it in a sentence, maybe even oversimplify things, it appears that commission and others are looking for some defining on what the PPU does exactly. The audit will very likely accomplish that.

About Gerald

A journalist in Knoxville, TN. Work (mostly) inside and play (mostly) outside. I'm a part of the X or the Y generation. None of us claim the other.
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