Fayette School System financial practices questioned

Fired bookkeeper alleges improper interest income on ESPLOST funds not accounted for

A bookkeeper fired from her position with the Fayette County School System says the system is breaking the rules for handling millions of tax dollars, to the point of concealing improper interest payments.

The Board of Education approved firing Diana Parlier at the May 20 meeting. It was during public comments at that meeting that Parlier cited allegations of financial improprieties with ESPLOST (Education Special Purpose Local Option Sales Tax) funds and employee expense claims.

The school system responded to the allegations the following day, noting Parlier’s statements and saying those allegations are being reviewed.

“It is with a heavy heart that I have had to express concerns about things that I have come to know about the improprieties in the financial accounting of educational funds. As my only option to be heard was to come and speak publicly at this meeting, please know that I do so after much prayer and consideration,” Parlier said.

Parlier said there are three major issues of impropriety that have been raised that need to be investigated by the school board.

“I am aware through my work and direct involvement with the finance department that ESPLOST funds are being commingled with other accounts, which is against state law. In addition, these funds are being misappropriated and used to generate revenue through interest-bearing accounts. There is no accounting to those interest-bearing dollars. And to be clear, I am referring to millions of dollars,” Parlier said.

“This is where ESPLOST funds are being transferred from secondary accounts into other institutions for the sole purpose of generating income from those funds. They are then being held in these secondary accounts and transferred back to the primary only to cover payments. The interest being drawn off the ESPLOST fund is not accounted for, and is not disclosed to the taxpayers for whom this money is to be accountable to,” Parlier continued. “This is all in addition to employee expense claims that are being paid without proper supervisory and board approval.”

“As this county grows and revenues increase, there must be more accountability to ensure the quality of education that our county is known for. This misappropriation and illegal commingling of funds serves as a direct attack against our ability to continue providing the quality education that should be provided to our children,” Parlier said.

A type of public comment rarely heard in a local government meeting, Parlier’s statements came during her three-minute time allotment during the public comments portion of the meeting, and prior to the board’s vote to accept the personnel recommendations from the superintendent later in the meeting. Parlier was listed on the school board’s personnel action list which was unanimously approved by the school board at the May 20 meeting, and posted online the following day. Parlier’s separation approved by the board was listed on the personnel document as occurring May 1.

Parlier was hired several months earlier as a bookkeeper in the finance department.

The school system on the morning following the meeting issued the following: “Concerns about the appropriate use of ESPLOST funds and other financial operations were expressed during public comments at the Fayette County Board of Education regular business meeting on May 20. The school system is in the process of reviewing the allegations.”

School system spokesperson Melinda Berry-Dreisbach further noted that each year, the school system prepares a Comprehensive Annual Financial Report (CAFR), and the financial statements contained within that report are reviewed by an independent auditor. The auditor also completes an ESPLOST Performance Audit on the compliance of the use of ESPLOST expenditures based on state law and the voter approved ESPLOST referendum. Throughout the years, the auditor’s report has found that the Fayette County Board of Education is in compliance with accounting principles generally accepted in the United States of America, and no findings have been issued against the school system. The Fayette County Public School System closely follows its own stringent internal controls, along with state and federal regulations, to ensure that taxpayer funds are being used appropriately.

Berry-Dreisbach said the public can view the CAFR and independent audit reports of financial statements and ESPLOST funds dating back to 2007 on the school system’s website, www.fcboe.org. Click on the “Departments” tab at the top and select “Finance.” Once on the Finance page, click the “Financial Statements and Budget Information” link on the left.