A West Virginia State Trooper is posted at the Upshur County Board of Education on Wednesday after the state assumed control of the local school system. (Katie Kuba / My Buckhannon)

State seizes control of Upshur County Schools, declares State of Emergency

CHARLESTON – The Upshur County school system has been taken over by the West Virginia Department of Education.

A routine report that questioned whether summer pool passes were a valid use of federal funding has ballooned into an all-encompassing investigation into the finances of Upshur County Schools. So far, hundreds of thousands of dollars in questionable transactions have been uncovered — as well as possible criminal violations.

In an extraordinary six-hour meeting Wednesday, the West Virginia Board of Education assumed control of Upshur County Schools, removing interim county superintendent Dr. Debra Harrison and giving state Deputy Superintendent Michele Blatt broad authority to administer the school system.

All positions who serve at the will and pleasure of the county superintendent were declared vacant with their contracts voided. Blatt can now fill the positions of local administrators and principals.

West Virginia State Police will secure the county board office until the state can assume operations.

Stephen Wotring was named interim county superintendent from June 15 to June 30, and the appointment of incoming superintendent Russ Collett was also thrown into question, as Blatt has the authority to hire a superintendent to replace the interim appointment. Wotring previously served as the Preston County superintendent before retiring last year.

The powers of the Upshur County Board of Education were also curtailed, particularly as they relate to finances, personnel, federal programs and real estate.

The stunning decision came after the state board of education heard from Jeff Kelley, the Officer of Educational Accountability, regarding the special circumstance review ordered by State Superintendent David Roach last month after a routine monitoring of federal funds uncovered numerous financial issues.

Kelley outlined more than a dozen findings. Those included tens of thousands of dollars spent at Stonewall Resort, CJ Maggies and an unnamed bed-and-breakfast, where overnight accommodation was paid for despite the B&B’s location being just six miles from the board office.

The preliminary investigation also flagged improper payments to school employees and administrators. The county was also accused of under-reporting the superintendent’s salary in their financial statement publication.

Laura Pauley, the Director of the Office of Federal Programs with the WVDE, said the investigation continues to uncover issues.

“At a minimum, what we’re seeing is that we have concerns with a least a couple hundred thousand dollars,” Pauley said.  “We’re finding stuff every single day that I would consider questionable. There are a lot of transactions that are outstanding, so I expect that number to continue to grow, unfortunately.”

This investigation is different, Pauley noted, because possible criminal actions are involved.

“The reason why this report was structured the way it was, and why there are no recommendations, is because a lot of this information has to be turned over to law enforcement, and that’s very unique for me,” Laura Pauley said. “This is the first situation I’ve been in with something like this, where I don’t just recommend, ‘Hey, this was a noncompliance, you pay it back.’ So this would be the first instance for myself and my team where we believe there could be violations of law, and we are working with the Office of the Inspector General at the U.S. Department of Education.”

West Virginia State Troopers are also involved in the investigation, according to Kelley.

The state board explored the role of former Upshur County Superintendent Dr. Sara Stankus, who was appointed as a state Deputy Superintendent in August 2022 and retired this month. According to personnel items documents posted on the WVDE’s website, Stankus’s initial retirement date as the deputy superintendent was listed as effective June 30, 2023, but that was later amended to reflect an updated ‘retirement effective’ date of June 7. Stankus’s salary was listed as $162,327.

Pauley noted that Stankus was involved in the federal monitoring review as far back as February.

“On our February 10 monitoring call with Upshur County, she actually joined the call as a deputy superintendent with the department,” Pauley said. “I’m not sure why. Normally it would just be for staff, but I think only one or one or two of their staff joined, and then she joined that call as well. So she would have been involved on that call. Personally, it made it kind of awkward for my staff. But, you know, our job is to do the monitoring and document the process. And then she was involved with our reporting out here of that monitoring.”

Pauley noted that Roach had the review team meet with Stankus even after learning about the team’s concerns.

“We initially took it to legal and Superintendent Roach, just because we were concerned with what we were seeing as potential implications that she was the one who would have approved what we were questioning,” Pauley said. “And then, after our meeting and providing documentation to Superintendent Roach, he had us meet with her, yes.”

“And [Roach] didn’t continue to meet with you?” board vice president Nancy White asked.

“He left and asked legal to leave and had us meet with Sara, that is correct,” Pauley replied.

“My fear initially was that including Dr. Stankus at the very beginning compromises that investigation — seriously compromises it,” White said.

Kelley, who joined the state department as the Officer of Educational Accountability in late March after serving as the Superintendent of Lincoln County Schools, outlined several areas of concern raised by the preliminary special circumstances review related to the operation of federal programs, poor internal controls and employee compensation.

Kelley said the review is ongoing and that he could not give a possible completition date.

“I would like to hope that these things can be processed quickly, but as you all well know, sometimes that’s not the case, especially when we’re talking about findings that are this significant thus far,” he said.

Sam Pauley, the West Virginia School Operations Officer, said the review goes beyond just federal funds.

“It’s not just a focus on the use of federal funds, it’s across the board,” Sam Pauley said. “We’ve seen – as you’ve seen in the report – there are instances of inappropriate compensation paid out of federal funds. In the instances that we noted, about 50 percent of what we found so far is federal, and the other 50 is state and local, primarily local dollars.”

Sam Pauley said the investigation is going paycheck-by-paycheck back four years and comparing those to the employment contracts and board policies, a process that takes time.

“We’ve really just started going through the payroll side, and we always start at the top-down,” he said. “Right now, at least with three of the central office staff, I can say it’s upwards of probably $150,000 of gross compensation for those three, plus some fringe [benefits] that would be attached to that, so maybe upwards of close to $200,000 over the four years.”

According to Kelley, the issues raised by the preliminary special circumstances review related to the operation of federal programs include:

  • Twelve contracts for staff retreats at Stonewall Resort totaling $49,260.
  • Four contracts for staff retreats at CJ Maggie’s totaling $21,834.
  • A contract for a staff retreat at a bed-and-breakfast totaling $1,415. Overnight accommodation was provided even though the bed-and-breakfast was located six miles from the board office.
  • A significant amount of federal funding was used to pay for out-of-calendar days for employees with contracts of 240 days up to executive-level employees with 261-day contracts. These pay rates were substantially higher than the normal daily rates and were not board approved, nor supported by records showing actual time worked. The three 261-day employees were already being paid under their normal contract to work those days and received an additional federal compensation totaling $75,100.
  • Two instances of food being provided for school events including staff totaling $810.
  • One instance of a P-card being used to purchase Sheetz gas cards totaling $100, which were charged to Title 1.
  • Several areas of noncompliance related to the 2021 model schools conference with $38,000 charged to Title 2.
  • Several instances related to travel reimbursement.

Kelley said the review found numerous occasions where employees received compensation that had not been approved by the Upshur County Board of Education:

  • The district provided additional wages related to the 2021 Summer Learning Academy that were not approved by the board.
  • On June 28, 2022, the district provided additional compensation for various employees as payout for out-of-calendar days. The board did not approve the payments, and WVDE Policy 3234 states that out-of-calendar days are non-paid days that are not included as part of the minimum employment term; therefore no county employee has a right to payment for such days.
  • Multiple instances of the district paying out unused leave without making appropriate reductions to employee leave balances. As a result, some employees may have overstated leave balances currently.

The superintendent’s compensation also raised red flags, according to Kelley.

“At various points throughout the superintendent’s tenure, the district paid the superintendent amounts which were not authorized by the board,” Kelley said. “The superintendent’s contracts for 2022 and 2023 include a provision to be paid for unused vacation days at the current daily rate. There were numerous instances of leave payouts which did not comply with the contract.”

Kelley said the payments in question include:

  • On June 28, 2021, the district provided additional compensation to the superintendent for $11,365 that was described as 20 days of vacation at a daily rate of $568.25.
  • On July 15, 2021, the district provided additional compensation to the superintendent totaling $17,379 described in the check as a payout for 42 vacation days at a daily rate of $413.79. Also, this payment was deemed to be unauthorized per the 2022 contract.
  • On July 26, 2021, additional compensation to the superintendent of $2,045.80 represented additional summer school wages paid to the district. That was paid using federal stimulus funds.
  • On June 28, 2022, additional compensation was paid totaling $13,410.80, described as 20 out-of-calendar days and a daily rate of $670.54.
  • The superintendent’s 2022 contract and salary was arbitrarily increased by $4,000. The superintendent’s contracted salary for 2022 was $112,000. However, the district increased it to $116,000, resulting in an overpayment of $4,000 during the month of June 2022.
  • Attendance and incentive bonuses that were not warranted, as well as a stipend for a book study.

The review also found Upshur County Schools misrepresented the superintendent’s compensation on the district’s financial statement publication, which is required by West Virginia code. In 2020, 2021 and 2022, the district underreported the superintendent’s compensation in those publications by $899.99, $12,335, and $37,763.45, respectively, the state alleged.

The preliminary special circumstances review also flagged several issues related to internal controls:

  • Seven instances where purchases with federal funds were not approved by the federal program director.
  • No conflicts of interest policy.
  • No P-card or credit card policy.
  • Insufficient travel policy.
  • Insufficient purchasing and procurement policy.
  • Insufficient leave policy.

Finally, the review uncovered two instances in which Upshur County employed individuals who did not hold the necessary licenses or certifications from the West Virginia Department of Education. One was the treasurer, who does not hold the appropriate certification required by WVDE Policy 5202, and the other was an immediate family member of the superintendent, Kelley said.

“During interviews with central office staff, the review team became aware of the hiring of the then-superintendent’s immediate family member as a Summer Learning Academy teacher,” Kelley said. “The minutes from April 19 show that the employment of summer professionals was subject to appropriate certifications and backgrounds. Our records indicate that the superintendent’s immediate family member has not held that certificate or license.”

The state officials stressed the results thus far are only preliminary.

Laura Pauley said her team has looked at less than 1% of the transactions over the four-year period.

“We do sample, but our sample was not completely random, because since our initial monitoring report came out, we were receiving tips of areas of concern,” Pauley said. “So, we were looking specifically for travel, we were looking specifically at food and stuff like that. But our findings represent less than 1% of transactions over a four-year period, and we are not done. We are still looking through data on a daily basis, because they are still uploading, and we have more issues.”

Read the full Upshur County Special Circumstance Review Report.

Update: State superintendent David Roach will retire June 30. Read that story here.

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