JOHNSON COUNTY, TN (WJHL) – State auditors believe two Johnson County Schools’ employees used taxpayer resources to make an extra $60,000 in untaxed compensation since January 2015.
According to a newly released audit, the Tennessee Comptroller of the Treasury believes some of the money those employees made should’ve went to the school district. Auditors said a lack of management oversight is to blame for what appear to be multiple violations of state law.
“There are certain things here that aren’t just us saying, ‘This is how it should be done,'” Tennessee Comptroller of the Treasury Public Information Officer John Dunn said. “The state law dictates that certain things should be done a certain way and in this case, we’re finding that they’re not always done in those ways.”
The single audit finding focuses on a contract between the district and the state to perform skills testing for people who apply for commercial driver’s licenses. The audit found no evidence the school board ever approved the contract and no proof employees gave any of the money they collected to the county trustee.
“The department was allowing the transportation director and another school employee to keep all of the fees associated with these tests,” Dunn said. “In some cases, these employees were supplementing their incomes by tens of thousands of dollars over the last year-and-a-half providing these tests to folks that the school board had no knowledge of. We could find no evidence that the school board ever looked at this contract, ever approved this contract, ever gave their blessing to allow these school employees to provide this testing and collect the fees from it.”
Over a 17-month period, state auditors determined Johnson County Schools’ transportation director and another employee completed at least 800 CDL tests between the two of them. Auditors said the tests allowed the school district to charge up to $75 per exam plus an additional $50 for use of school equipment.
Due to the lack of accounting, Dunn said auditors could not identify an exact amount of money earned.
“It was very hard for us to figure out exactly how much money was given to these employees, because there were no records, there were no receipts,” he added.
Director of Schools Dr. Mischelle Simcox would not talk on-camera, but in a statement reiterated what she told state auditors.
“The Johnson County Board of Education has been made aware of this situation and the recommendation was to continue the practice that is currently in place with receipt documentation procedures implemented,” she said. “The receipt documentation procedure will include both completed receipts and a collection log and will be reviewed monthly by the Director of Schools and the Finance Director. Many of the tests were given at no charge to government and county employees. Any testing in which fees were collected was done during non-work hours. The Board is in agreement that when the current contract expires, board approval will be required for any future contracts.”
In a rebuttal by auditors, they determined that response wasn’t good enough and urged the district to take immediate steps to come into compliance with state law.
“…it remains a concern that employees of the School Department could use taxpayer funded facilities, equipment, and resources to supplement their income, over a 17-month period, by as much as $60,000,” auditors said.
“What we really need to see happen here is that the fees collected are then sent to the county trustee,” Dunn said. “The school department may keep a portion of the revenue that’s collected for the use of its facilities and any money that’s given as compensation to these two school employees should go through the school’s payroll system so that appropriate taxes and deductions can be taken.”
Dr. Simcox said she did not discipline the transportation director as a result of the audit.
“No disciplinary action was needed or taken,” she said.
She added the CDL testing occurred for several years and “the board was aware of this.” In her response to the audit, she also said former management signed and submitted the contract in question and current management was unaware of the details.
School Board Chairman Kenny Gregg said board members “knew all about” the CDL testing and said they stand behind the director’s statement.
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