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School District Under Fire After Racking Up Nearly $10M in Credit Card Debt

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The Natrona County School District in Wyoming stands by its policy of granting access to district credit cards to more than half of its employees in the wake of disclosures that the district accumulated nearly $10 million in credit card transactions in 2017.

In an Aug. 17 article on the Forbes website, OpenTheBooks.com founder Adam Andrzejewski outlined the district employees’ nearly 28,000 credit card charges, which included almost $300,000 for dining bills, more than $600,000 for travel and more than $1 million for entertainment and recreation. Of the 2,500 district employees, 1,400, or 56 percent of the total, have district credit cards.

“NCSD has determined that empowering our staff with the credit cards is the most efficient and effective way to conduct business,” Tanya Southerland, the district’s public relations officer, told Watchdog.org in an email.

During a press conference district officials held after the publication of the Forbes article, officials emphasized that the school district has a decentralized method of handling funding decisions. Individual schools or departments conduct their business based on the funds they are allocated, according to Southerland, and employees are given training about district rules and regulations before receiving a credit card.

“Part of the purchase process includes a justification step where each purchase must be explained in detail and approved at the administrative level,” she said.

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School district administrators, according to Andrzejewski, have vowed to review their financial policies and to be accountable to the taxpayers.

“District administration is certainly taking the issue seriously and stated they are a continuous-improvement district and looking to institute reforms based on stakeholder feedback,” he told Watchdog.org.

District officials also have provided more details on some of the expenditures highlighted by OpenTheBooks.com.

A total of $6,195 in Krispy Kreme purchases were related to a student fundraiser, and $3,480 spent at the Venetian Palazzo Room in Las Vegas were for district officials attending a conference on school lunch programs for disadvantaged students, according to the district.

Would you be upset if your local school district spent money this way?

“The Natrona County School District is confident the credit card expenditures were made in good faith for expenses related to educational needs and purchases,” Southerland said. “However, human error may occur on a rare occasion. When those instances have occurred, employees are often quick to realize or are notified of their mistake, and immediately rectify the situation with NCSD Business Services.”

Andrzejewski, however, isn’t convinced that all the expenditures were reasonable or justified.

“On certain expenditures, the school district argues a public purpose,” he said. “That doesn’t mean that the spending wasn’t extravagant. The school district quite evidently has a spending culture.”

The district paid more than $100,000 to United Airlines for travel, as well as $400,000 on hotel bills, according to Andrzejewski.

“The district can argue all that has educational purpose, but taxpayers need to weigh in on whether they consider that waste,” he said.

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The district reports that there are checks and balance on the credit card transactions and that district officials ensure that purchases do have educational purposes.

“All transactions are reviewed and approved by the employee’s direct supervisor and audited by the NCSD business office,” Southerland said. “Then transactions are presented to the Board of Trustees for approval prior to payment on the charges. At any point in the process, if the determination is made the purchases do not have an educational purpose or justification, the items are returned for credit or the employee reimburses the district.”

But Kevin Lewis, a researcher with the Equality State Taxpayers Association, questions whether district payments to the St. Louis Cardinals Hall of Fame or the Dollywood Amusement Park in Nashville, Tennessee, are in the interest of taxpayers.

“There’s one transaction for a haircut,” Lewis told Watchdog.org. “There’s no way in the world a haircut is district business.”

The state funds school districts to the tune of $20,000 per student, one of the highest rates in the nation, he said. The state’s funding model provides money to school districts in the form of block grants, Lewis said.

“We are very concerned that these large amounts of block grants without oversight result in spending that is not in the interest of the students of Wyoming,” he said.

And the number of employees in the district who have access to district credit cards is extraordinary, according to Lewis.

“Fourteen hundred kind of floored me …” he said. “The potential for abuses is obviously high.”

But Lewis also congratulated district officials for responding to the disclosures about credit card expenditures quickly and openly. The credit card transactions had been regularly posted on the district’s website, but beginning in mid-2017 the postings inadvertently stopped, according to the district. As of Monday, weekly expenditure reports over the past year are now available to the public at NatronaSchools.org.

More scrutiny is needed, though, on how public funds are spent in Wyoming, Lewis said.

“People in government need to look at that money and put it to good use for the taxpayer,” he said. “I don’t think we have that here.”

A version of this article previously appeared on Watchdog.org under the headline “Wyoming school district defends $10 million in credit card purchases.”

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