The Pointe Coupee Parish, La., school board violated state bidding laws in the purchase of more than $830,000 worth of computer equipment, software, and consulting services, said a legislative auditor’s report. The report also cited Superintendent David Lee for a breach of ethics, in taking money from companies involved in the transactions.
A state law requires school districts to seek bids for purchases of more than $15,000. The audit cited Lee’s purchase, with board approval, of five computer labs from four vendors for $830,863 without seeking bids for the services.
According to the audit, which was made public Dec. 7, the school system avoided the bidding laws by taking donated computer hardware and paying inflated prices for software packages. The software was available from only one source and was not subject to the laws.
Auditors also criticized the district for not maintaining complete records of the computer lab purchases. The auditors had to recreate the transactions with records from the vendors and the company that financed the transactions, the report says.
Lee told local reporters that the board relied on legal advice that approved the way it made the computer-related lease-purchases without seeking bids or approval from the state Bond Commission. Bob Hammonds, an attorney representing the board, noted in a response to the report that the purchases were from sole-source suppliers or below the bid threshold.
General Capital Corp. (GCC), the company that financed the lease-purchase of the computer labs, has changed the language of its contract to meet state Bond Commission approval, Hammonds said.
“It should also be mentioned that, according to representatives of GCC, it has similar financing agreements in place with numerous other public bodies. We are not aware that state Bond Commission permission has ever been previously required for a lease-purchase of this nature,” Hammonds told reporters.
The audit also criticized Lee for making paid speaking appearances during normal working hours and billing the school system for more than $500 in travel to those appearances between January 1995 and December 1997. From 15 speaking engagements, Lee reportedly received more than $11,000.
“Furthermore, Dr. Lee performed three of the speaking engagements for companies that had business relationships with the school board,” the report says. Those companies were involved in the computer purchases questioned in the audit.
“I’ve got explanations for it all,” Lee told the Baton Rouge Advocate Dec. 8.
He said that most of his speeches occurred in 1995 and were engagements already made when he took the superintendent’s job in January of that year. Other speaking appearances came at conferences or seminars he was attending for the school system, he said.
The speeches were motivational talks focused on effective job performance and improving communication, he said.
The audit shows that Mergent Technologies, which later became Invest Learning, paid Lee $1,500 for speeches in March and November 1995 and in November 1996 and directly paid his lodging and travel expenses to Mississippi and Tennessee.
“From June 1995 to August 1997, the school board purchased $194,424 of computer equipment, software, and other items from Mergent and Invest Learning,” the audit report says. “We further recommend that the Louisiana Board of Ethics review this matter and take appropriate action.”
Lee said he sees no problem in taking payments from companies doing business with the board. “Not if you provide a service,” he told reporters.
The audit includes a six-page letter from the board’s lawyers offering a detailed defense of the computer purchases and explaining Lee’s speaking engagements.
Through a payroll deduction that began this month, Lee said, he is repaying the school system for the $542 in questioned travel expenses and will follow an audit recommendation by returning 85 hours in leave to cover time taken for the speaking engagements.
Attempts by eSchool News to reach Lee were unsuccessful.
Baton Rouge Advocate