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Interim supt. hires his former finance director to help with ABSS finances

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Alamance Burlington interim superintendent Dr. Bill Harrison confirmed Wednesday that his former chief finance officer from Cumberland County schools will be working with ABSS to help sort out its financial problems.

That arrangement, which Harrison describes as temporary and part-time, comes amid multiple recent departures from the school system’s Central Office and an ongoing probe into the school system’s finances by the Joint Legislative Commission on Governmental Operations (“Gov Ops”) requested by state senator Amy Galey, who represents Alamance and Randolph counties.

Galey announced the investigation on February 5, three days after then-superintendent Dr. Dain Butler, who resigned earlier this month, announced a potential Reduction-in-Force for dozens of employees due to a projected $3.2 million deficit for the current fiscal year.  Galey said in an earlier interview with The Alamance News that she hopes the GovOps investigation will be complete by the time the General Assembly convenes this year’s short session on April 24.

Frank R. (“Ricky”) Lopes retired in 2015 as the chief finance officer for Cumberland County schools.  He worked for Harrison 12 years in Cumberland County schools and was the finance officer there for 31 years, Harrison confirmed Wednesday in an interview with The Alamance News.

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Frank R. (“Ricky”) Lopes

Lopes is also a partner with HIL Consultants, a K-12 educational consulting firm that developed a controversial pay study for Durham public schools and underestimated the cost to implement new pay “schedules” for 1,875 classified employees (i.e., bus drivers, custodians, cafeteria workers, and other positions that don’t require state teaching licensure) in Durham public schools.

HIL Consultants developed and presented its recommendations for new pay schedules for Durham public schools classified employees in January 2023.  HIL estimated the cost for the raises at $10.8 million, which it described as “rough number just based on our first perusal,” according to a report released last month by the Durham school board’s law firm, Tharrington Smith.  The same firm also represents the Alamance-Burlington school board.

A presentation that the Durham school board heard on February 22 from Kerry Crutchfield – another retired public school CFO and private consultant hired last month to serve as an interim comptroller for Durham Public schools to sort out its finances – put the blame for the miscalculation on HIL Consultants, multiple media outlets have reported.

While HIL had provided a rough estimate of $10.8 million to implement the new pay schedules for Durham public schools’ classified employees, the actual cost was more than $20 million, according to a report, “The Implementation of Classified Salary Increases,” released February 7 by the Tharrington Smith law firm.

Crutchfield’s presentation to the Durham school board last month traced the miscalculation to the fall of 2022, and the hiring of HIL to conduct the classified pay study, according to a copy of the presentation posted on the Durham public schools website.

Tharrington Smith’s report alluded to confusion surrounding how years of experience (both public and private sector experience were historically used to calculate pay schedules for classified employees in Durham public schools) would be credited in establishing new pay rates.  Yet the law firm’s February 7 report explicitly stated, “The consultants provided an estimated cost of $10.8 [million] to implement the new salary schedules.”

At the Durham school board’s meetings in January and October 2023 meetings, Tharrington Smith’s report stated, “The board was never informed that the implementing the new salary schedules using employees’ existing years of experience would nearly double the cost.  The costs discussed or the budget amount requested had referenced or relied upon the $10.8 million estimate presented by HIL in January 2023.”

The underlying, 39-page pay study by HIL Consultants states that its three partners – Hank Hurd, Kathy Isenhour, and Lopes, along with two other consultants – had interviewed 70 Durham public school employees for the study.  Lopes, the retired CFO and a certified public accountant, is listed as one of the authors of HIL’s pay study for Durham public schools.

The revelation earlier this year that Durham public schools didn’t have enough money in its budget to pay for the new, higher pay schedules – and that many classified employees would lose raises they received, effective with their October 2023 paychecks, along with a subsequent lump sum to make the raises retroactive to July 1 – led to multiple “sick outs” and system-wide school closures due to staffing shortages.  The controversy culminated with the resignation of then-superintendent Dr. Pascal Mubenga on February 7.

 

Interim superintendent says ABSS won’t contract with HIL Consultants

Harrison, however, assured the newspaper Wednesday that HIL Consultants won’t be providing any of those types of services for ABSS.

“I know they were involved in the pay study in Durham,” the interim superintendent conceded.  “I don’t know what role [Mr. Lopes] played in that.  He’s not doing anything of that nature here.”

Harrison instead describes Lopes as an experienced retired school finance officer who knows how to navigate the myriad N.C. public school finance rules.

Lopes will assist ABSS as a short-term “mentor” for the finance department through the N.C. Association of School Business Officials (NCASBO), a statewide association of current and retired school finance officers that provides ongoing training, professional development, and other assistances to North Carolina’s 115 public school systems.

Two other school finance “mentors” from NCASBO were brought in last month to assist the school system’s finance department last month following the departure of then-CFO Kim McVey in mid-February.  Mark Winters, a retired CFO from Wake County public schools, is one of the mentors.

 

Lopes to pick up where second “mentor” left off

Tyler Beck, a second mentor who’d been helping the ABSS finance department briefly, was a former chief finance officer from Davidson County schools and currently serves as vice president of NCASBO.

Beck, however, was hired last week as the finance officer for Guilford County schools, according to a March 19 announcement by that school system.

Harrison said Wednesday that Lopes will pick up where Beck left off in the finance department.

“[Lopes] is recognized as one of the best in the state,” Harrison told the newspaper.  “I called him for some advice when I was coming up here, but I didn’t even think he’d be available.”

Instead, Harrison said that Lopes’ mentoring services will be provided as part of the same arrangement through NCASBO, which is funded by a statewide grant program that the General Assembly agreed to fund a couple of years ago.

“I think he would be available to do two days a week,” Harrison said.  “My take is to get us to a position where we’re ready to move…getting a new finance officer.  We may ask NCASBO and Mr. Lopes to stay with us a little longer.  I appreciate NCASBO [being willing to help].  I appreciate that I have someone as good as they come and that I’ve got a relationship with; he’ll tell me what I need to hear rather than what I want to hear.”

Asked why he agreed to bring in Lopes, given his partnership in HIL Consultants, Harrison insisted his decision was based on the fact that Lopes had been recommended by the executive director of NCASBO. “It’s already taken longer than I thought – there are none out there,” he explained.

 

Statewide shortage of CFOs in N.C. public schools

Pam Satterfield, who is the executive director of NCASBO and a retired veteran CFO from Richmond County schools, told the newspaper Wednesday morning that the organization assigns a “contract mentor” to school systems that have either no, or a new, finance officer.

Pam Satterfield

“Let me say this – this is important,” Satterfield explained Wednesday morning in an interview with The Alamance News.  “This mentor contract only allows for 40 hours a month of assistance – for all the school districts.  It’s not like [Winters, Beck, or Lopes] is there full-time.”

While there can be a little latitude with work schedules in the spring, as school systems prepare to close their books for the fiscal year on June 30, an NCASBO mentor is permitted to work, at most, no more 50 hours per month, and in many cases, a mentor may be providing those services for multiple school systems, Satterfield said.  Any hours above the maximum number permitted per month, she said, “are the district’s responsibility” to fund.

In Winters’ case, “It doesn’t mean he just works for ABSS; he can be assigned to more than one school district,” Satterfield added.

That mentoring and technical assistance program began July 1, 2022 as part of a grant program developed by the N.C. Department of Public Instruction (DPI) and funded by the General Assembly, Satterfield said.  As of October 2022, within the first three months of the program’s launch, 31 N.C. public school systems had requested mentoring services from NCASBO, according to the organization.

The program’s genesis stems from what Satterfield described as an ongoing, statewide shortage of public school finance officers.  “The funding model North Carolina has [is extremely complicated],” and the demands on finance officers, due to fluid, constantly-changing regulations, have made it very difficult to find new finance officers when existing CFOs resign or retire, she said.

NCASBO describes the program as intended to provide training and technical assistance, particularly to new public school CFOs during the first five years of their careers – at no cost to N.C. public school systems, but subject to available state funding.

“[Years ago], somebody had to die before these positions became available,” Satterfield explained.  “Now, because of the stress, the complexity, it’s not as attractive as it used to be.  Then you’ve got those rural counties; most people graduate, move on, and aren’t coming back.”

Meanwhile, Satterfield confirmed for the newspaper Wednesday that she’s been beating the bushes to locate someone willing to serve as an interim or a permanent finance officer for ABSS.

“I did try to find a retired finance officer to try to help them, to get somebody for three or four days a week, and couldn’t find anybody,” Satterfield explained in the interview.  “They retire for a reason.  Most of them are [doing other things].  I wouldn’t say they’re avoiding ABSS.  I don’t believe that’s true.  We want every one of our school systems to succeed.  It’s a challenging time to try to find teachers; it’s a challenging time to try to find bus drivers.”

Satterfield confirmed for the newspaper that Lopes is contract mentor for NCASBO – as well as a past president.  “He was in one district for us recently,” she explained.  “He can be in there for up to two years.”  N.C. public school systems are required to have such mentors for up to two years, Satterfield said, but can have it as many as five years, as school finance officials are learning the ropes.

For his part, Harrison said Wednesday he doesn’t see any potential conflict of interest with bringing in his former CFO from Cumberland County, or a conflict with Lopes’ involvement in HIL.  “Absolutely not,” he told the newspaper.  “Even if we were to hire him, people hire former colleagues all the time.”

“We contract with all kinds of groups,” Harrison added.  “Tyler Beck was a sitting [CFO].  Mark Winters was retired from Wake.  NCASBO has a network of finance people in all stages of their careers, doing all kinds of things.”

Harrison said Wednesday that the contract mentor relationship with Lopes hadn’t been listed on the school board’s meeting agenda – nor was there any discussion of it – Monday night because “we didn’t know about it Monday night.”

Lopes will not be paid the previous state-funded salary already budgeted for the CFO position; he will be paid through the state grant program with NCASBO, according to both Harrison and Satterfield.

“I emailed the board yesterday, letting them know it wasn’t an employment contract,” the interim superintendent said.  Instead, it’s a continuation of the existing relationship between ABSS and NCASBO, he said, adding, “This happened yesterday.”

School board chairman Sandy Ellington-Graves told the newspaper Tuesday that she hasn’t received an update about the GovOps investigation but hopes the board will receive a report prior to its next meeting on April 9.

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