June 26, 2016

Intermittent clouds

Educational Service Center proposes stricter oversight of funds

MEDINA — A proposal for greater oversight and tighter controls over school district funds managed by the county Educational Service Center includes a requirement that school board presidents sign off on checks greater than $10,000.

The proposal was discussed at Monday’s meeting of the Medina County Schools’ Educational Service Center governing board.

ESC board member Dan Shumaker said, “There is a need for transparency; we’ve read about that.”

The Educational Service Center has come under public scrutiny as part of a growing controversy over Medina Schools Superintendent Randy Stepp’s compensation, which includes more than a quarter-million dollars spent on his college education in the past three years.

The controversy also has drawn the attention of Ohio Auditor Dave Yost.

On Friday, in response to questions from The Gazette, Medina school board members acknowledged they didn’t know how big a bill Stepp had run up: nearly $172,000 in back college loans and more than $93,000 for a master’s of business administration from Case Western Reserve University.

All the money for Stepp’s education payments came out of a “carryover” fund maintained by the ESC.

The “carryover” fund contains money left over after districts pay the ESC for a variety of services, including school nurses, interpreters for the deaf, bus driver training and computer specialists.

Although the money belongs to Medina Schools, board members never saw the records of the spending because the checks were issued by the ESC.

ESC Treasurer Michelle McNeely said she collaborated with Medina Schools Treasurer Jim Hudson to come up with tighter rules for handling the money:

• Checks less than $10,000 would require the approval of the school district superintendent, the treasurer and the human resources director.

• Payments greater than $10,000 would have to be approved by the school board president as well.

If the proposal is adopted by the Educational Service Center, it would apply to all the school districts, not just Medina.

McNeely said she and ESC Superintendent William Koran also favored a cap on the amount in the carryover funds.

Koran said a limit of between $50,000 and $100,000 would be reasonable.

“Anything in excess of that automatically gets sent back to the school district,” McNeely said.

ESC board President Kent Patterson said he would prefer to see all the carryover money be paid back to school districts.

The proposed reforms are expected to be discussed at the next Medina Schools board meeting Wednesday evening. The meeting is scheduled for 6 p.m. at the Medina High School distance learning lab.

The Medina City Teachers Association — the union representing the district’s approximately 400 teachers — released a statement Monday harshly criticizing Stepp’s handling of the ESC fund.

The union said it issued the statement in response to a Gazette story Monday that reported Medina Schools had spent $2.8 million in the past five years from its ESC fund — nearly $1 million more than was spent by any of the county’s other six school districts.

Much of Medina’s cash went for Stepp’s education costs and for professional development for Stepp and the district’s other administrators, according to the Gazette’s analysis of ESC records.

“MCTA finds Superintendent Stepp’s choices to direct district money appalling. When he had the opportunity to spend money on students and programs, he instead chose to use ESC money for ‘growth coaching,’ administrative retreats and other expensive perks,” according to the statement.

The union also blasted the district school board for being “apparently oblivious” to how the fund was used.

“Stepp’s five-year spending spree is clearly a violation of the community’s trust and possibly a mismanagement of funds,” the union statement read.

Thomas Cahalan, who will be sworn in Wednesday as the Medina district’s newest board member, attended Monday’s ESC board meeting.

Cahalan, who was named to the board last week to replace retiring Dr. Robert Wilder, said he wanted to learn about what the ESC does.

Contact reporter Kiera Manion-Fischer at (330) 721-4049 or kfischer@medina-gazette.com.