SPS Finances Show Cracks

Back in February of this year, I asked via public disclosure for the following travel information:

- Names of Board members who attended the Council of Great City Schools “mini-conference” in May 2022 in Monterey, California. Please give a listing of all expenses incurred from this trip including travel costs, hotel costs, food, conference fee (if any), length of stay. 

- Names of SPS staff who attended the Council of Great City Schools “mini-conference” in May 2022 in Monterey, California. Please give a listing of all expenses incurred from this trip including travel costs, hotel costs, food, conference fee (if any), length of stay. 

- Board President Brandon Hersey attended a CUBE conference (part of the National School Boards Association) in December 2022 to accept an award. Please give a listing of all expenses incurred from this trip including travel costs, hotel costs, food, conference fee (if any), length of stay. 

- If the Seattle School Board is a member of the National School Boards Association, please list annual membership cost and how long SPS has been a member of this organization. 

- A list of all the state/national organizations that the Seattle Schools School Board currently has membership in and the cost of membership.

Doesn't really look like a lot, does it? I mean you ask Accounting for those costs for the Monterey trip which I have to believe are readily accessible, the costs for President Brandon Hersey's quick trip to pick up this CUBE conference award (wonder if he flew First Class on that trip as he did the one to Orlando) and the costs for membership for the Board in professional associations. 

All that info would take up, maybe,  two pages. What I get are rolls and rolls of emails, some of them the same ones stacked on top of a new one, that I have to take apart and then decipher all the costs. (Also, for some weird reason, they do not redact all the info of the Board members' birthdates which seems problematic to me.) 

I still do not have all the info and I am going to cancel this request for two reasons. One, the Public Records office is hugely overburdened and two, I think the Public Records office gets direction to slow walk some requests, mine being one of them. 

As you may recall, the Board and district staff spent nearly $20K to go to the Council of Great Cities Schools' Orlando conference earlier in the year. From what I can ascertain for the Monterey trip, it was Director Eliza Rankin, Director Chandra Hampson and Superintendent Brent Jones. That 3-day trip appears to have cost roughly $5,000. 

Both the Orlando conference and the Monterey Conference were in service to the new Student Outcome Focused Governance (which appears to be spreading like wildfire throughout the country. If it's a thing in 10 years, I will be astonished.)

As for the list of professional associations and their costs, I'm pretty sure the Board office could do that in 30 minutes or less. 

As far as the conferences go, from the latest batch of emails from Public Disclosure, it appears that perhaps the district is slow-walking paying bills AND that the process for travel for staff/Board members is just byzantine. It's weird that the directors - who are not paid employees - have to submit a form to SPS saying they want to go on this trip and Hersey has to approve it. 

From the emails, it appears that the company that SPS was using for travel in 2022 -Direct Travel - had put a hold on the SPS account for unpaid invoices. SPS travel staff had asked for the hold to be lifted and promised payments soon. Direct Travel had sent this chain of emails:

May 24, 2022

The attached statement shows all invoices currently past due. We need immediate payment to prevent your account from being put on hold.
Please let me know when we w ill receive payment.

 

May 31, 2022

We need immediate payment on this account. You are in violation of the State contract. Please advise ASAP.

 

June 6, 2022 Subject: RE: Past Due Travel Statement ACCOUNT ON HOLD STATUS

Hello,
I have sent several emails and left voice mails with no response. As such, effective June 15 we will no longer be able to manage future bookings unless the account balance has been brought current.
Of the $44K balance due, over $26K is past due. And by the 15th even more will be past due. 

Once the account has been brought current, we will need to have continued weekly payments so that the account stays current.

June 13, 2022

Thank you for the recent check payments in the amount of $13.5K. Those have been applied to your account. As you can see on the attached $14.8K is still past due. We will need immediate payment for the past due amount in order to avoid the account being put on hold on June 15th .

We will need the account to stay current in order to continue to provide services.

 

June 17, 2022 - SPS Travel Staff internal email

We are currently on credit hold with Direct Travel because of past due invoices. Any
possibility you can forward that information to SB as soon as possible so we can get the invoices processed? 

Finally - that same day, June 17th, it appears the invoices got paid.

Yikes! Was the district was only partially paying in hopes of keeping the account open and active?   

Now we turn to the Capital Building arena. 

Reading through the minutes of the BEX/BTA Oversight Committee for 2022, we learn:

February 2022

Ms. Coan reported on the BEX V program through December 31, 2021. She indicated that she was watching cash flow closely as this program has many expenditures coming soon. She highlighted overages in three major projects and a corresponding request to transfer $12M from the program contingency fund to those project budgets.

She was not concerned about this transfer because other projects were being completed with anticipated savings to return to the contingency fund. Ms. Coan
described a “lesson learned” from the three overspent projects was to engage building principals earlier in projects and more often throughout the work to remain clear and aligned on project expectations. 

Seriously? It's 2023 and they still don't realize that they need to work with school principals as soon as the project is announced. 

On Alki:

Staff clarified that SPS does not have projections for demographics at its schools. They noted that the City of Seattle might have that kind of information for different regions of the city. The design team added that they are reaching beyond the school community for a broader perspective of what the building could be and could mean to the area.

Did staff do the latter? Because from the reporting on the zoning issues around Alki, it sure doesn't sound like it happened as this is being stated here in the minutes.

June 2022

Ms. Coan concluded her presentation describing the process by which SPS General Fund costs are charged to Capital Projects, as transfers, as allowed by legislation and accounting rules.

I believe they can do some painting and very basic maintenance with capital funds for General Fund costs but it sure would be great if an annual list of how much money was moved from Capital Funds to General Funds and what it was used for. 

July 2022

Mr. Best highlighted to the School Board Directors in the meeting the critical importance of nimbleness in this market because prices increase quickly. They acknowledged that current School Board processes for contracts are not time sensitive.

Song Maritz and Rivera Smith were the directors at the meeting. I get a whiff of SOFG here and maybe more Board policies changed so that Capital Projects can be "nimble." 

September 2022

Mr. Aliya reported on the BEX V Program through July 31.2022. He reminded the committee that this is the youngest program in the portfolio and very large. He informed the committee of two projects facing deficits – Montlake Elementary School and Rainier Beach High School. Mr. Best added that three budget transfers were submitted to the School Board to account for additional projected expenditures – Alki, John Rogers and Montlake Elementary Schools.

All three of the new "mega-elementaries" being built.  

 

December 2022

Ms. Coan reported on the BTA IV Program through October 31, 2022. She highlighted savings realized for two projects and indicated additional savings were anticipated throughout the program. She addressed a transfer that appeared in this report as a negative but would be corrected in a future report. Ms. Coan noted a revenue shortfall, unique to this program. She assured the committee that she was monitoring the situation and continuing to investigate the matter with the SPS Finance Department.

I have to wonder what this is about but it would do no good for me to ask. Maybe I'll throw this to the Seattle Times and get them to ask.

Ms. Asencio explained that a downtown school was not included in this levy because enrollment projections do not indicate a near-term need for it. Mr. Best clarified that Seattle Public Schools (SPS) works closely with the City of Seattle to identify and plan for population projections. He highlighted funding provided in BTA V for a demographer, FLO Analytics, to inform the planning of BEX VI. He noted that they will present their findings to the committee in Winter 2023.

Ms. Asencio presented the Cash Flow for BTA V. She described how staff will integrate this program with all previous levies to verify scheduling, staffing, and site work. Mr. Best clarified that there was no opportunity to adjust the escalation rate and that the remaining option was to reduce project scope to meet the budgets available per the levy.

 

January 2023

Ms. Coan defined the Capital Eligible Program (CEP), noting the fund receives rental revenues with expenditures utilized for emergency critical repairs. She clarified that the fund is rarely used now by either Capital Projects and Planning or Facilities/Operations.

So if this CEP isn't being used, is that money truly being held for emergencies or did staff plunder it as well for the budget deficit?

 

February 2023

Mr. Best presented an award plaque from the American Institute of Architects (AIA) for the Wing Luke Elementary School to the project leads (listed above). 

 

Student Enrollment Projections
(Becky Asencio, Tingyu Wang – Seattle Public Schools; Benjamin Maloney, Charles Rynerson – Flo Analytics)
Mr. Maloney and Mr. Rynerson delivered a detailed presentation of Seattle Public Schools Enrollment trends and their relationship to trends in the Seattle area in terms of women of childbearing ages, birth rates that are lower than the replacement rate, and population and housing trends. They also identified the data sources for their findings.
The committee and presenters discussed the recent report that shows a trend of students leaving public school districts in urban areas across the United States. The presenters posited several reasons for that trend and connected it to the Covid-19 pandemic. However, they emphasized the role of smaller birthrates affecting enrollment rates over the effects of other causes.

It would be interesting to know if Flo Analytics asked SPS for data - any data - that parents gave for leaving SPS. Because that company would certain say "it's the birthrate" in the absence of any other documented reasons.

 
The committee inquired about the influence of climate-related migration and immigration policies on student enrollment. The presenters explained that this was not included in their analysis, due in part to the lack of data and the observation that cities with a hotter climate, such as Phoenix , AZ and Miami, FL continue to have population growth outpace the more moderate temperate climate of Seattle, WA.
They clarified that today’s presentation represented a continuation of documented trends that have already influenced growth in this region.

Well, FYI, Arizona's push to grow the Phoenix Metro area is not going to be able to last. There are several reasons. 

One, the former governor allowed Saudi Arabia to buy up farm land AND gave them a sweetheart deal on water costs. The Saudis are growing feed for their cattle here and shipping it back there. 

Two, in case you missed it, the Colorado River is not getting renewed as it did in generations past. Arizona and California are going to duke it out for that water. 

Three, one development near Scottsdale was getting its water from Scottsdale but had been warned that it would run out for that development. Scottsdale turned off the spigot and that development had to truck water in for awhile.

Four, Phoenix is considering a desalinization plant in Mexico and piping up the water to Phoenix (which is uphill). How many billions that would cost and how well it would work is anyone's guess.

Five, I grew up here. I don't want to hear from any climate deniers. Phoenix is nearly on fire with heat. 

As for Miami, well, they may sink in the ocean in a couple of decades. No, you tell your kids that Cascadia should build a wall around it to protect against the climate refugees and water refugees.