State grants delay of hearing on fate of Dublin school board

(Editor’s note: This story was updated at 10:37 a.m. Wednesday, June 10.)

A state hearing Tuesday on whether members of Dublin City Board of Education should be suspended and replaced was continued until August.

The formal hearing before the Georgia Board of Education is required by law after Cognia, the district’s accreditation agency, downgraded Dublin City to “accredited with conditions” – the agency’s lowest status and a required step toward dropping accreditation altogether.

The state school board must decide after the required hearing whether to recommend to the governor that the local board members be suspended and replaced. The hearing was continued until 9 a.m. Aug. 12.

The law allows for a local board to ask for a continuance. Dublin City’s request passed the state Board of Education by an 11-2 vote, with member Matt Donaldson, whose district includes Dublin, voting against it.

“Nearly two months have passed since that Cognia report came out. I have been bombarded with citizens’ concerns and complaints, and people just want an answer,” Donaldson said.

Dublin City Schools attorney Brian Smith said the local board needs more time to respond to and implement recommendations and requirements detailed in Cognia’s report, which will provide the state board with “more thorough and better information” to make its decision. The board’s formal response to Cognia is due by July 1. 

He also said the district is in a “significant period of transition,” with the local board currently interviewing candidates for its school superintendent job. Smith said the board hopes to hire a new superintendent by as early as the end of June. 

Attorney David Younker, representing the state Department of Education, suggested the hearing be rescheduled as early as possible.

“You have new leadership being hired by a board facing possible suspension,” Younker said.

Tuesday’s hearing was at the Hyatt Regency in Savannah, where the Georgia School Boards Association is holding its annual summer conference this week. The Dublin school board, however, is not attending this year because of a freeze on travel spending.

The school district has struggled financially for years, but the severity of its most recent cashflow problems were revealed last fall when state officials determined the district owed more than $6 million in overdue payments to the State Health Benefit Plan. State School Superintendent Richard Woods later said officials found widespread issues with budgeting and spending controls that had put the district on a “path to insolvency,” with a projected deficit of $13.4 million. 

A subsequent examination by the state Department of Audits and Accounts revealed a widespread lack of financial controls, patterns of overspending, over-hiring and lax bookkeeping and even personal usage of district credit cards. Also, for at least eight months the district withheld insurance and benefit premiums from employees’ paychecks, but never paid that money to the state until it got caught.

The school board could face further scrutiny from a new state law passed in response the district’s money-handling troubles. 

That law allows the state auditor to recommend the suspension of local school board members if audit findings indicate significant financial mismanagement or misconduct.

The district’s most recent monthly financial report showed the school system had about $725,000 in its general fund, as of April 30, but still with about $6 million in liabilities. According to the report, the district began the fiscal year last July with an almost $4 million deficit, but had spent about $2.4 million less than at the same time the previous year.

The district cut more than 50 teaching and other staff positions, but still had to rely on advances of its monthly allotments of state funding to meet payroll and other expenses during the school year. 

Its finance director, Chad McDaniel, resigned in late August after state officials disclosed the money owed for unpaid health plan contributions. Superintendent Fred Williams stepped down to take an early retirement in September.

In addition to its money and accreditation troubles, the school district faces more challenges on several other fronts – such as pending lawsuits from fired teachers and an ongoing criminal investigation – that could have major ramifications on how the district moves forward.

Although no large sum of money has ever been confirmed as missing or taken, the Georgia Bureau of Investigation was called in at the request of Dublin Circuit District Attorney Harold McLendon in January, after a special state exam of the district’s finances raised questions of that funds at the least might have been mismanaged. 

McLendon asked the agency look into “financial irregularities associated with the Dublin City School District,” and the GBI has confirmed it has an active investigation. 

Audits show the district used to an influx of emergency COVID funds to pay for salaries, positions and programs it could not afford. Because the funding was federal dollars, there were restrictions on how the money could be spent, which has led some to wonder if the Federal Bureau of Investigation is involved.

An FBI spokesman would neither confirm nor deny an investigation.

“The FBI is aware of the situation and takes potential allegations of federal law violations seriously. However, it is the policy of the FBI not to confirm or deny whether or not it is conducting an investigation,” said Tony Thomas of the FBI in Atlanta. “The FBI reviews allegations of criminal conduct for their merit and, when warranted, conducts further investigation. I want to be clear, though, that a review of allegations does not necessarily result in the opening of an investigation.”