YELLOW SHEET
Office of the State Auditor of Missouri
Claire McCaskill
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YELLOW SHEET Office of the State Auditor of Missouri |
April 22, 2002
Report No. 2002-31
The following problems were discovered as a result of
an audit conducted by our office of the Lonedell R-14 School District.
In January 1999, the Lonedell R-14 School District
purchased 25.8 acres of land for $98,900 ($3,833 per acre). Although there were no formal plans on how
the district was going to finance the construction and operation of a new
school building, school district officials indicated the land was for a future
middle school to relieve the overcrowding at the current school. An appraisal of the land was not obtained
prior to the purchase. According to the
Franklin County Assessor's Office, the land purchased is appraised at
approximately $28,380 ($1,100 per acre).
At the time of this purchase, the district's financial situation was
poor and the district was placed on the financially stressed list by the
Missouri Department of Elementary and Secondary Education the following year.
The district paid $2,083 to the father of a board member
to clear the new property without adequate support for the cost. The board approved paying up to $3,050 to
this person to clear the land; however, there was no documentation indicating
how this amount was determined or that the district had obtained price quotes
from others for this service.
In July 2001, the school district refinanced $475,000 in
general obligation bonds. The district
sold these bonds through a negotiated instead of a competitive sale. In addition, the School Board did not select
the bond underwriter competitively, but used an underwriter they were familiar
with. The School Board relied upon the
advice of the bond underwriter instead of seeking open bids assuring the most
competitive rate of return for the taxpayers.
The district currently does not have a formal bidding policy and bid documentation was not retained by district personnel. In addition, the district does not have a contract with its attorney outlining the types of services that are to be provided and at what cost. The district also does not require the attorney's office to submit detailed bills indicating the number of hours and the hourly rate charged to the district. During the year ended June 30, 2001, the district paid over $6,000 for legal services. Without documentation, the school district cannot ensure the validity and propriety of the amount billed.
The audit also includes some matters related to the Superintendent's benefits, fixed assets records and procedures, and petty cash procedures, upon which the school district should consider and take appropriate corrective action.