Sep 26, 2022 Audit Committee Meeting Agenda and Notice

[00:00:01]

GOOD AFTERNOON AND WELCOME TO THE AUDIT COMMITTEE MEETING OF THE DALLAS INDEPENDENT SCHOOL DISTRICT BOARD OF TRUSTEES.

PLEASE STAND AND JOIN US FOR A MOMENT OF SILENCE AND REMAIN STANDING FOR THE PLEDGE OF ALLEGIANCE AND A SALUTE TO THE TEXAS FLAG.

[2. Moment of Silence and Pledge of Allegiance]

[3. Acknowledgements]

DISTRICT ONE.

EDWIN FLORES.

DISTRICT EIGHT.

JOE CARREON.

AND WE ALSO HAVE NOT A MEMBER, BUT A TRUSTEE DISTRICT FOR CAMILE WHITE.

OUR SUPERINTENDENT OF SCHOOLS, DR.

STEPHANIE ELIZALDE, JOINS US.

AND I AM JOYCE FOERMAN, YOUR COMMITTEE CHAIR.

IN ORDER FOR THE BOARD TO HOLD THIS MEETING IN AN EFFECTIVE MANNER, I WANT TO LET IT BE KNOWN THAT THIS MEETING WILL BE CONDUCTED IN AN ORDERLY FASHION AND ASK THE PUBLIC TO ABIDE BY THE RULES OUTLINED IN THE BOARD POLICY BED LOCAL PERTAINING TO PUBLIC PARTICIPATION.

ADDITIONALLY, IT IS A CRIMINAL OFFENSE FOR A PERSON WITH INTENT TO PREVENT OR DISRUPT A LAWFUL MEETING TO SUBSTANTIALLY OBSTRUCT OR INTERFERE WITH THE ORDINARY CONDUCT OF A MEETING BY PHYSICAL ACTION OR VERBAL UTTERANCE, AND THEREBY CURTAIL THE EXERCISE OF OTHERS FIRST AMENDMENT RIGHTS.

WE WANT TO REMIND EVERYONE THAT, ALTHOUGH NOT REQUIRED, WE DO RECOMMEND THAT THE WEARING OF A FACE MASK WHILE ON DISTRICT PROPERTY.

WE'RE GOING TO SKIP THE CHAIR'S REMARKS AND MOVE ON TO ITEM NUMBER FOUR.

ARE THERE ANY SPEAKERS? NO TRUSTEE FOREMAN.

I'VE BEEN INFORMED THAT THERE ARE NO SPEAKERS.

SO WE WILL MOVE RIGHT INTO THE AGENDA ITEMS.

[5. Action Items/Reports]

DO I HAVE A MOTION TO APPROVE THE MINUTES OF MAY 19, 2022? SO MOVE.

SECOND. IT'S BEEN MOVED AND SECONDED, THAT THE MINUTES FOR 2022 BE ADOPTED.

ALL THOSE IN FAVOR.

RAISE YOUR HAND. THE MOTION PASSES THREE ZERO.

SO TRUSTEES, THERE ARE NO CORRECTIONS.

IF NOT, THERE'S A UNANIMOUS VOTE.

SO WE WILL MOVE ON TO THE NEXT ITEM.

SO THOSE HAVE BEEN ADOPTED.

ITEM 5.2 REPORT ON DISTRICT FINANCIAL UPDATE.

DEPUTY SUPERINTENDENT DWAYNE THOMPSON.

OH. NOT DEPUTY SUPERINTENDENT DWAYNE THOMPSON.

NOT THIS TIME.

OKAY. GOOD AFTERNOON, TRUSTEE FOREMAN.

DR. ELIZALDE.

GOOD AFTERNOON. AND OTHER MEMBERS IN ATTENDANCE FOR THIS MONTH.

I'M SORRY FOR THE AUDIT REPORT.

WE'RE NOT ON AUDIT.

FOR THE FINANCIAL UPDATE.

WE HAVE THIS MONTH'S BUDGET AMENDMENT AS PRESENTED IN THE BRIEFING EARLIER THIS MONTH.

ARE THERE ANY ADDITIONAL QUESTIONS THAT ANYONE HAS REGARDING THE BUDGET AMENDMENT FOR THIS MONTH? ARE THERE ANY QUESTIONS? DO I HAVE A MOTION TO ACCEPT AND MAKE FINAL INTERNAL AUDIT REPORT? SO MOVE.

SECOND. OKAY.

ALL THOSE IN FAVOR.

RAISE YOUR HAND. SO THERE'S NO OPPOSES.

SO MOTION HAS BEEN ACCEPTED AND ADOPTED.

OKAY WE'RE MOVING ON TO 5.5, WHICH IS THE ANNUAL AUDIT COMMITTEE REPORT.

OR 5.3 TRUSTEE FOREMAN

[00:05:06]

THANK YOU, TRUSTEE FOREMAN SUPERINTENDENT AND OTHER TRUSTEES PRESENT TODAY.

WE HAVE EIGHT REPORTS TO PRESENT.

I'M GOING TO INCLUDE OUR MANAGERS THAT HAVE WORKED SPECIFICALLY IN DETAIL ON THESE AUDITS OVER THE COURSE OF THE LAST SEVERAL MONTHS.

AND OUR FIRST REPORT TO REVIEW WITH THE COMMITTEE TODAY IS THE E-RATE PROGRAM COMPLIANCE AUDIT.

WE HAVE WORKED IN THIS AREA FOR A NUMBER OF YEARS, AND IT ACTUALLY HELPS THE DISTRICT GET READY FOR AN EXTERNAL AUDIT THAT IS CONTRACTED OUT.

THEN MIRAGLIA WILL BRIEF THIS REPORT.

GOOD AFTERNOON, TRUSTEES, SUPERINTENDENT ELIZALDE.

I'M BEN MIRAGLIA, MANAGER OF INTERNAL AUDIT.

AND I'D LIKE TO REPORT FIRST ON THE E-RATE PROGRAM COMPLIANCE AUDIT.

THIS AUDIT IS IMPORTANT.

BECAUSE WE RECEIVED ABOUT $3 MILLION IN E-RATE FUNDS IN FISCAL YEAR 22.

THESE FUNDS ALLOWED US TO RECEIVE DISCOUNTS ON TELECOMMUNICATIONS AND INTERNET SERVICE PROVIDED TO STUDENTS.

THE AUDIT FOCUSED ON COMPLIANCE REQUIREMENTS, PRIMARILY REGARDING THE TRACKING OF ASSETS.

OUR OFFICE RECOMMENDED TWO IT BUSINESS SERVICES THAT THEY IMPLEMENT A RECONCILIATION PROCESS TO VERIFY FRN NUMBERS ARE BEING ACCURATE.

THE FRN IS WHAT IDENTIFIES AN ASSET AS AN E RATE ASSET AND TIES IT TO THE APPLICABLE FUNDING YEAR.

BASED ON OUR UNDERSTANDING OF CURRENT PROCESSES, E RATE ASSETS ARE INPUT INTO TIP WEB BASED ON THE INFORMATION FROM THE PURCHASE ORDER WHERE IT IS NOT ALWAYS CLEAR WHICH OF THE ASSETS ARE E RATE ASSETS.

A MORE DETAILED BREAKDOWN IS GIVEN ON THE INVOICE.

A POTENTIAL SOLUTION WOULD BE FOR A RECONCILIATION TO BE COMPLETED INTO WEB ONCE THE INVOICE IS RECEIVED.

IN ADDITION, WE RECOMMEND THAT THE INSTALLATION DATES BE DOCUMENTED IN TIPWEB AS THESE DATES ARE NEEDED TO MONITOR ALLOWABLE DISPOSAL DATES.

IF WE WERE TO DISPOSE OF ANY RATE ASSET BEFORE THE ALLOWABLE TIME FRAME, WE COULD POTENTIALLY HAVE TO REFUND THAT REIMBURSEMENT.

ARE THERE ANY QUESTIONS ON THE E RATE AUDIT? I HAVE A QUESTION YES, SIR. I WAS READING IN THE REPORT AND IT WAS STATING THAT SOME OF THE ITEMS WERE, THE NUMBERS WEREN'T CORRECT AS FAR AS THE FORMS WERE CONCERNED.

I'M ON PAGE 6.4.

I HOPE IT'S ON THIS PAGE.

I DO APOLOGIZE, BUT THE NUMBERS WERE MISASSIGNED AND I WAS WANTING TO KNOW IF THAT WAS THE CASE WHAT EFFECT WOULD THAT HAVE AS FAR AS CORRECTING WHATEVER NEEDS TO BE CORRECTED? AND ALSO, CAN YOU TELL ME EXACTLY HOW TIPWEB WORKS AND HOW IS IT UTILIZED? TIPWEB IS AN INVENTORY SYSTEM FOR THOSE ASSETS, IT KEEPS TRACK OF THOSE ASSETS.

THE NUMBERS YOU'RE TALKING ABOUT ARE THE FUNDING REQUEST NUMBERS, THE FRNS WHICH IDENTIFY THOSE ASSETS AS BEING E RATE.

AND YOU ALSO SAY THAT IF SOME OF THE ITEMS THAT WERE I MEAN, BECAUSE I KNOW WE USE ESSER FUNDS FOR VARIOUS AMOUNTS OF THINGS. SO I HEARD YOU SAY THAT IF THERE ARE ANY ITEMS, BECAUSE I KNOW WE WERE TALKING ABOUT PURCHASING THE HOT SPOTS, I THINK WITH SOME OF THOSE FUNDINGS, IF I'M NOT MISTAKEN.

SO YOU'RE SAYING BASICALLY THEY'RE SAYING WE NEED TO TRACK THAT INFORMATION BECAUSE OF WHATEVER IT IS WE PURCHASE, WHETHER IT BE THE HOT SPOTS OR WE WHATEVER ELSE WE PURCHASE WITH IT. IF WE DISPOSE OF IT WITHIN A CERTAIN PERIOD OF TIME, WE MAY END UP HAVING TO REIMBURSE.

YES. RIGHT. SO WHAT ARE SOME OF THINGS THAT WE HAVE PURCHASED THAT WE DEFINITELY NEED TO TRACK OF THOSE ITEMS WITH THOSE FUNDS? OH, THAT'S REALLY ALL THE, THAT RULE APPLIES TO ALL THE TELECOMMUNICATION AND INTERNET SERVICES THAT WERE INSTALLED AND REFUNDED BY, REIMBURSED BY E-RATE, ALL OF THAT.

[00:10:04]

IT'S JUST THOSE SERVICES WHICH WE PROBABLY WOULD NOT DISCONTINUE ANYWAY, CORRECT? NO, THAT'S ACTUAL HARDWARE.

THAT INCLUDES HARDWARE, SPECIFIC ASSETS.

THANK YOU.

TRUSTEE, HELP ME HERE.

I DON'T THINK ANY OF THE EQUIPMENT PUT IN SERVICE FOR STUDENTS IS PURCHASED THROUGH E-RATE.

OR AM I WRONG ON THAT? GOOD AFTERNOON, EVERYBODY. THIS IS REBECCA SANCHEZ AND THE DIRECTOR OF I.T.

BUSINESS SERVICES.

AND THEY ARE FOR THE ENTIRE DISTRICT.

THEY ARE UTILIZED AT CAMPUSES.

IT'S USUALLY FOR NETWORK EQUIPMENT THAT MAKES SURE THAT STUDENTS ARE CONNECTED AS WELL AS WIRELESS ACCESS POINTS AND CABLING.

BUT THAT'S WITHIN THE SCHOOLS, NOT AT HOME FOR STUDENTS.

THAT IS CORRECT. IT'S NOT AT HOME LIKE THE HOTSPOTS OR THE CONNECTED.

THAT WOULD MORE LIKELY BE THE ESSER FUNDS.

THAT WOULD BE ESSER OR THE EMERGENCY CONNECTIVITY FUND, WHICH WOULD NOT BE REIMBURSED BY E-RATE BECAUSE THAT WOULD BE ANOTHER FEDERAL PROGRAM.

SO DO I HAVE A MOTION TO ACCEPT AND MAKE FINAL INTERNAL? TRUSTEE CARREÓN.

THANK YOU, MADAM CHAIR.

I HAVE A QUESTION.

ON THE THE INCORRECT FRNS, IS THAT JUST A MATTER OF MANUAL INPUT ERRORS? SO I CAN SPEAK TO THAT.

IT'S A LITTLE BIT OF A COMBINATION BETWEEN A SYSTEMATIC ERROR, WHICH WE ARE CONSULTING WITH THE VENDOR ASSET FRONT LINE ASSET MANAGEMENT TO MAKE SURE THAT THAT IS, THOSE CORRECTIONS OR REVERSIONS ARE FIXED.

AND IT ALSO IS A MATTER OF TRAINING PURPOSES FOR MAKING SURE THAT ONLY CERTAIN INDIVIDUALS ARE ALLOWED TO INPUT THAT FIELD SO THAT THERE'S NOT AN INCORRECT NUMBER THAT IS PLACED THERE. OKAY.

I DON'T KNOW WHY I WANT TO KNOW THIS, BUT AN FRN, IS THAT A, HOW MANY DIGITS IS THAT? IT IS SIX DIGITS.

AND IT'S THE FUNDING REQUEST NUMBER.

AND THEN 67 ASSETS WERE TESTED.

AND AGAIN, THIS IS PROBABLY A HARD QUESTION TO ANSWER, I DON'T THINK I SAW IT IN HERE.

HOW MANY ASSETS ARE THERE TOTAL? IN THE THOUSANDS. YEAH, THAT'S WHAT I FIGURED.

OKAY. SO THAT'S A, SO 52% HAD INCORRECT OF THE ONES TESTED. CORRECT.

THANK YOU. SO WE'RE GOING TO.

I NEED TO ASK A QUESTION.

SO DO I HAVE A MOTION TO MAKE THIS REPORT FINAL.

SO MOVED.

SECOND.

ALL THOSE IN FAVOR.

MOTION CARRIES.

SO THE NEXT REPORT.

THE NEXT REPORT IS THE AUDIT OF SUPERINTENDENT EXPENDITURES FOR FISCAL YEAR 2021-2022.

OUR OFFICE REVIEWS THE SUPERINTENDENT'S QUARTERLY EXPENDITURES REPORTED TO THE BOARD TO VERIFY THAT THEY ARE COMPLETE AND ACCURATE.

THERE WERE NO OBSERVATIONS NOTED FOR FISCAL YEAR 2022 EXPENDITURES.

IS THERE A MOTION TO MAKE THIS REPORT FINAL? SO MOVED. SECOND.

ARE THERE ANY QUESTIONS? ALL THOSE IN FAVOR.

THIS MOTION PASSES THREE ZERO.

NEXT REPORT, PLEASE.

THANK YOU, TRUSTEE FOREMAN. OUR NEXT REPORT TO COVER IS CONSTRUCTION MANAGER AT RISK.

I'VE ASKED OUR OUTSIDE AUDITOR, RICH TOWNSEND, TO HELP COME AND ANSWER SOME QUESTIONS TODAY AND PROVIDE AN OVERVIEW TO THE COMMITTEE.

VERY GOOD.

GOOD AFTERNOON. GOOD AFTERNOON.

SO WE'VE BEEN AUDITING FOR THE DISTRICT, PROVIDING CONSTRUCTION AUDIT CONSULTING SERVICES FOR ABOUT TWO YEARS NOW.

WE STARTED SEPTEMBER 2020 BEFORE YOU WENT OUT AND HIRED THE FIRST FOUR CMAR PROJECTS YOU CURRENTLY HAVE.

TALKED TO YOU ABOUT THOSE BEFORE.

YOU JUST RECENTLY ADDED TWO NEW CMAR CONTRACTS AND OUR AUDIT CONSULTING PROACTIVE AUDITING IF YOU WILL, EXTEND IT TO THE OLIVER WENDELL HOLMES AND C.F.

CARR RECENT PROCUREMENT. AND YOU'RE JUST NOW GETTING THOSE TWO PROJECTS UNDER CONTRACT TO START.

[00:15:04]

WE HAVE DONE THAT FOR ALL THE FIRST FOUR CMAR PROJECTS TO DATE, AND WE HAVE THEN STARTED LOOKING AT ALL OF THE PAYMENT APPLICATIONS, THE MONTHLY PAYMENT APPLICATIONS THAT COME THROUGH TO SEE, LOOK AT WHAT THE PMS ARE REVIEWING TO MAKE SURE THERE'S NOTHING MAJOR THAT'S GETTING BY IN THOSE MONTHLY PAYMENT APPLICATIONS BECAUSE THEY'RE BUILDING ALL THE JOBS ON A COST PLUS FEE BASIS SUBJECT TO THE GUARANTEED MAXIMUM PRICE.

AND THE OTHER BIG THING THAT WE'VE BEEN DOING IS WORKING WITH THE PM FIRMS AND CMS TO LOOK AT ALL OF THE MONEY THAT'S BEING SPENT ON CONTINGENCY CHANGE ORDERS, WHICH ARE NOT REALLY CHANGE ORDERS, THEY'RE GNPS, SO THEREFORE IT'S NOT SOMETHING THAT COMES TO YOU.

YOU APPROVED APPROXIMATELY 10% FOR CONTINGENCY AND ALL THE CMAR BUDGETS SO FAR.

THIS CURRENT ACTIVE CMAR PROJECTS AMOUNT TO ABOUT 220 MILLION APPROXIMATELY TOTAL.

SO THERE IS MAYBE $20 MILLION WORTH OF CONTINGENCY IN THOSE GNP BUDGETS.

AND THAT MONEY IS BEING USED AS NECESSARY TO TAKE CARE OF WHAT CONTINGENCIES ARE FOR, UNFORESEEN CIRCUMSTANCES.

YOU KNOW, PLAN CHANGES, DELAY COSTS, WHATEVER COMES UP TO BE DEALT WITH.

ALL OF THAT IS MENTIONED IN THE REPORT THAT WE GAVE YOU.

SO WE'VE BEEN ADVISING ON THOSE THINGS.

THEY THOUGHT WE WOULD WORK VERY CLOSELY WITH CHIEF ALFRED AND HIS TEAM, MIKE GARCIA, ETC., THE STAFF AND THE PM FIRMS, THEY WILL ASK US QUESTIONS ON DIFFERENT THINGS THAT ARE COMING UP.

SO WE'RE PROVIDING REAL TIME AUDITING, IF YOU WILL, AND OBSERVATIONS AND RECOMMENDATIONS, WHICH THEY'VE DONE A GREAT JOB OF IMPLEMENTING.

THIS REPORT HAS THREE MAJOR OPPORTUNITIES FOR FINE TUNING, REALLY.

WE IDENTIFIED THEM AS MEDIUM RISK.

SO FINE TUNING WHAT THE CM TEAM IS DOING.

EVERYBODY WE SAID THEY'RE DOING AN EFFECTIVE JOB, AS GOOD AS WHAT WE'VE SEEN.

WE DO AUDITS LIKE THIS FOR ORGANIZATIONS ALL ACROSS THE COUNTRY.

AND SO WE KNOW WHAT'S GOOD AND WHAT'S NORMAL.

AND YOUR TEAM IS WORKING WITH THINGS THAT ARE FAIRLY NORMAL FOR YOUR TYPE OF ORGANIZATION UNDER THESE THESE TYPICAL CMAR DIFFICULT PROJECTS.

AND SO THEY'RE WORKING HARD TO BRING THESE THINGS IN ON TIME WITHIN THE APPROVED GNP BUDGET.

AND I THINK WE MENTIONED THAT IN THE REPORT, BUT WE DID RECOMMEND THREE THINGS.

THE FIRST ONE BEING THAT ON FUTURE JOBS, IF THEY HAVE THE OPPORTUNITY TO JUST FOCUS WITH THE ARCHITECT DESIGN FIRM, THE CM FIRM, PM FIRMS, DISD, CITY, WHATEVER IT TAKES TO GET THE DESIGN DOCUMENTS AS COMPLETE AS POSSIBLE BEFORE THEY GO OUT TO BID TO THE TRADE CONTRACTORS. SO IF YOU READ OUR REPORT, RECOMMENDATION NUMBER ONE WAS TALKING ABOUT THAT, TRY TO GET AS COMPLETE DOCUMENTS AS YOU CAN BEFORE YOU GO OUT TO BID TO THE TRADE CONTRACTORS AND THAT IF YOU DO THAT, YOU SHOULD HAVE TO SPEND LESS OF YOUR CONTINGENCY.

YOU KNOW, WE'RE ON OUR WAY TO SPENDING MAYBE NOT ALL THE CONTINGENCY IN THESE JOBS, BUT A GOOD 20 MILLION WILL BE DONE THROUGH AND IT'S USUALLY NON COMPETITIVE BIDDING, RESULTS IN CHANGE ORDERS SO THE CHANGES ARE THE RESULT OF NONCOMPETITIVE BIDDING.

SO THE CONVENTIONAL WISDOM IS THAT THOSE COSTS A LITTLE BIT MORE THAN IF YOU HAD HAD IT IN THE BASE BID DOCUMENTS WHEN YOU WENT OUT TO BID.

SO IT'S JUST LIKE, WELL, WHATEVER WE CAN DO TO IMPROVE THAT.

AND I KNOW THE TEAM HAD DONE REALLY GOOD TODAY.

THEY DID THE BEST THEY COULD WITH THE TIME THEY HAD AVAILABLE AND THE DYNAMICS.

AND IT JUST THERE MAY BE WAYS TO FINE TUNE THAT.

SO WE HAD A WORKSHOP ON THAT ON FRIDAY.

WE HAD ALL THE CM FIRMS THERE TO TALK ABOUT THAT, THE PM FIRMS, THE STAFF, ETC.

SO ANYWAY, IT'S JUST I THINK THEY'VE GOT A GOOD PLAN GOING FORWARD.

OUR SECOND RECOMMENDATION JUST IT WAS AN ADMINISTRATIVE DEAL ON CHANGE ORDERS THAT ARE COMING IN.

WHAT'S GOING TO THE SUBCONTRACTORS, THE TRADE CONTRACTORS ON SPENDING THIS $20 MILLION OF CONTINGENCY.

SO PAPERWORK COMES IN TO THE PM FIRMS. THEY HAVE TO REVIEW IT AND APPROVE IT, GET IT APPROVED BY DISD.

ALL THAT'S LOOKING PRETTY NORMAL, BUT WE IDENTIFIED SOME OPPORTUNITIES WHERE THEY COULD FINE TUNE THAT, TO STANDARDIZE THE FORMS THAT THE TRADE CONTRACTORS TURN IN THEIR DOCUMENTATION ON SO IT CAN BE MORE EFFECTIVELY REVIEWED BY THE MANAGEMENT TEAM, WHICH SHOULD GIVE YOU BETTER OVERALL COST CONTROL.

SO WE'RE WORKING WITH THEM VERY CLOSELY ON THAT GOING FORWARD.

AND THEN THE THIRD RECOMMENDATION WE HAD WAS SIMPLY A BETTER WAY TO ORGANIZE FILES FOR SHARING BETWEEN ALL THE THE MEMBERS OF THE TEAM, THE PROGRAM MANAGEMENT FIRMS, THE ARCHITECT, THE AUDITORS, INTERNAL AUDITORS.

WE WORKED VERY CLOSELY WITH BOB AND HIS INTERNAL AUDIT TEAM, EVA ETCETERA.

AND SO HAVING ACCESS TO ALL THE KEY DOCUMENTS, ALL THE SUBCONTRACTS NEED TO BE REVIEWED BY US AND THE PM FIRM, ETC.

[00:20:07]

SO WE RECOMMEND SORT OF STANDARDIZING THAT WITH THIS CLOUD BASED SYSTEM CALLED PROCORE, WHICH ALL THE CMS ARE USING.

IT'S A CLOUD BASED STORAGE AND INFORMATION SHARING DOCUMENT.

IT'S VERY, VERY EFFICIENT.

AND, BUT THEY JUST, EVERYBODY WAS USING A LITTLE BIT DIFFERENTLY.

SO WE IDENTIFIED OPPORTUNITY AND MADE A RECOMMENDATION TO STANDARDIZE THAT.

SO THAT'S A SUMMARY OF THE REPORT.

WE'RE READY FOR QUESTIONS.

DO I HAVE A MOTION TO ACCEPT TO MAKE FINAL THIS INTERNAL AUDIT REPORT? SO OVED. SECOND.

IT'S BEEN MOVED BY TRUSTEE FLORES AND SECONDED BY TRUSTEE CARREON.

TO MAKE FINAL THIS REPORT.

IS THERE A DISCUSSION? TRUSTEE FOREMAN I HAVE QUESTION.

AND SO DO I. SO I DO RECALL A COUPLE OF YEARS AGO WHEN YOU KNOW CMAR WAS BROUGHT FORWARD, I HAD EXPRESSED CONCERNS ABOUT THERE BEING ADEQUATE EXPERIENCE WITHIN THE DISTRICT WITH INDIVIDUALS THAT HAVE EXPERIENCE MANAGING CMAR PROJECTS IN THE PAST.

AND I GUESS WHAT I'M HEARING FROM YOU IS YOU CAN KIND OF HELP SORT THIS OUT BECAUSE IT SEEMS LIKE YOU'RE WEARING A NUMBER OF HATS.

YOU'RE AUDITING AT THE SAME TIME YOU'RE PROVIDING TRAINING.

AND IN SOME SENSE IT SEEMS LIKE YOU'RE STEPPING IN AND DOING ACTIVITIES THAT I WOULD EXPECT THE MANAGEMENT WITHIN THE DISTRICT TO BE PERFORMING. IS THAT KIND OF IN LINE WITH WHAT YOU ARE THE EXPECTATION OF WHAT SERVICES THAT YOU ARE GOING TO PROVIDE AND WHAT HAS BEEN DONE FROM A DISTRICT STANDPOINT TO MAKE SURE THAT WE DO HAVE THAT THAT SKILL SET AND BENCH STRENGTH TO REALLY MANAGE THESE GOING FORWARD.

LET ME JUST COMMENT. MR. LEWIS. THANK YOU FOR THAT QUESTION.

TRUSTEES. SO WE HAVE TO BE VERY CAREFUL TO MAINTAIN OUR INDEPENDENCE.

THERE WAS SOME TRAINING INVOLVED.

WE DO FOLLOW EACH PROJECT THROUGH THE COURSE OF THE LIFE CYCLE OF THAT PROJECT SO WE CAN SHARE OUR OPINION AND WE DO THAT. BUT WE'RE VERY CLEAR THAT MANAGEMENT AND THE CONSTRUCTION TEAM IS MAKING THE DECISIONS.

SO ALTHOUGH WE COVER A LOT OF AREA, I STILL FEEL LIKE WE'RE MAINTAINING THAT INDEPENDENCE AND VERY CAREFUL THAT WHO'S EVER SIGNING, SO TO SPEAK, ON THE LINE IS LEADERSHIP AND MANAGEMENT.

I MEAN, THEY HAVE TO, THEY HIRE THE PROJECT MANAGERS, THEY MAKE THOSE DECISIONS AND HOW THEY DEAL WITH THE CONTRACTORS AND THE PROJECT MANAGERS.

BUT WE ARE OBSERVING IT AND WE'LL COMMENT WHERE WE THINK WE SHOULD.

YEAH. I WOULD SAY THAT THE TREND WITH CONSTRUCTION AUDIT CONSULTING, WHICH IS WHAT WE'VE BEEN HIRED HERE TO HELP YOU DO, IS TO BE MORE PROACTIVE, MORE REAL TIME AUDITING, IF YOU WILL, MORE REAL TIME PROBLEM SOLVING.

THERE'S NOTHING WORSE THAN TO DO A WHOLE PROJECT AND HAVE THE AUDITOR COME IN AT THE END AND SAY, OH, WELL, YOU SHOULDN'T HAVE DONE ALL THESE THINGS OR YOU SHOULD HAVE DONE IT.

IT'S TOO LATE TO REALLY HAVE AN IMPACT THEN.

SO THE MODERN CURRENT TREND IN CONSTRUCTION AUDITING, WHICH WE'RE TRYING TO DO HERE FOR YOU, IS DO THAT PROACTIVE AUDITING.

AND SO IT'S REAL TIME AUDITING, IF YOU WILL, PROVIDING INPUT.

BUT YEAH, WE DON'T APPROVE ANYTHING, BUT WE ARE HERE TO ANSWER QUESTIONS FOR THEM.

AUDIT RELATED. IT SEEMS LIKE IT'S WORKING.

MAYBE MR. ALFRED CAN ADD TO WHAT HE THINKS OF THAT.

BUT. IT'S BEEN A PLEASURE WORKING WITH YOU AND YOUR TEAM.

SO ARE THERE ANY ADDITIONAL QUESTIONS? TRUSTEE WHITE. UMM.

I'M JUST KIND OF CURIOUS BECAUSE I KNOW WE'VE BEEN IN THE CONSTRUCTION BUSINESS FOR QUITE SOME TIME.

THIS IS NOT OUR FIRST BOND.

AND BECAUSE WHY ISN'T THIS ALREADY IN PLACE? I GUESS THAT'S MY NUMBER ONE QUESTION.

AND I KNOW IT'S YOU KNOW, I KNOW WE'RE A LARGE ORGANIZATION AND THERE'S A LOT OF MONEY FLOATING AROUND, BUT IT'S STILL IMPORTANT THAT WE SAVE EVERY DOLLAR.

WHY ISN'T, WHY HASN'T THIS BEEN PUT IN PLACE? AND ALSO, YOU SAID PROCORE IS THE CLOUD SOFTWARE WHERE ITEMS WILL BE PUT INTO THE CLOUD TO BE SHARED.

HAVE WE ALREADY PURCHASED THIS OR IS THIS SOMETHING WE'RE LOOKING TO PURCHASE? GOOD QUESTION. THE PROCORE SYSTEM THAT I REFERRED TO IS ACTUALLY SOMETHING THAT MANY CONTRACTORS ARE BUYING ON THEIR OWN.

THEY ACTUALLY ALREADY HAVE THAT AND THEY PAY FOR IT AS PART OF THEIR OVERALL CORPORATE EXPENSE AND UNDER REIMBURSABLE CONTRACTS.

THAT BECOMES A COST THAT CAN BE BILLED TO THE PROJECTS.

IT'S A SMALL FRACTION OF THE COST, BUT IT'S A TOOL.

AND YEAH, THE DISTRICT DOES NOT OWN THAT.

EACH OF THE CMS HAVE THEIR OWN SERVICE THAT THEY PAY FOR.

[00:25:01]

AND OF COURSE I, WHEN I SAW WE'RE PAYING FOR THAT, I SAID, LET'S MAKE SURE WE'RE GETTING THE MOST VALUE WE CAN OUT OF PROCORE.

OKAY. SO BASICALLY THAT'S SOMETHING THAT THE CONTRACTORS HAVE.

AND ARE WE, I MEAN, BECAUSE I GUESS MY NEXT QUESTION TO THIS FOLLOW UP WOULD BE IF WE'RE NOT PUTTING IT IN THE PROPOSAL FOR THE BIDS. I MEAN, I KNOW AND I DON'T THINK WE SHOULD REQUIRE CONTRACTORS TO HAVE IT.

I MEAN, I KNOW IT'S A PLUS THAT THEY DO HAVE IT.

SO I GUESS THAT'S WHY I WAS LOOKING AT THE FACT THAT IF WE HAD IT, YOU KNOW, THEREFORE WE COULD SHARE IT WITH THE CONTRACTORS THAT ARE COMING ON BOARD AND NOT WORRY ABOUT IF THEY HAVE IT OR NOT.

ABSOLUTELY. THAT'S A GREAT POINT.

AND I BELIEVE THE DISTRICT ACTUALLY BEEN LOOKING AT THAT OF EVEN TWO YEARS AGO.

IT WAS MENTIONED THAT YOU WERE LOOKING AT POSSIBLY STANDARDIZING AND LOOKING INTO SOMETHING LIKE PROCORE.

AND I DON'T THINK YOU'VE MADE ANY MOVEMENT ON THAT, BUT IT IS POSSIBLE FOR YOU TO GO OUT AND DO YOUR OWN PROCUREMENT OF THAT, YOUR OWN NEGOTIATION OF THE CONTRACT PRICE.

IT'S SOMETHING THAT YOU COULD USE FOR ALL YOUR PROJECT.

IT IS ACTUALLY SOMETHING OWNERS COULD USE.

IT'S ONE OF THE BETTER MODERN TOOLS, THAT'S NOT CHEAP.

SO, BUT TO YOUR POINT, IF YOU HAD IT, THEN YEAH YOU WOULD NOT HAVE TO PAY THE CONTRACTORS FOR THEIR USE.

YOU WOULD ALREADY HAVE IT.

IT WOULD PROBABLY BE MORE COST EFFECTIVE.

BUT GREAT QUESTION.

THANK YOU. AND I DON'T KNOW WHO WOULD ANSWER THIS QUESTION, BUT I MEAN, YOU JUST MENTIONED SOME THINGS FROM TWO YEARS AGO.

I THINK MR. LEWIS ALSO MENTIONED SOME THINGS FROM TWO YEARS AGO.

WHO'S DOING FOLLOW UP? WHO'S DOING FOLLOW UP ON WHAT? I MEAN, LIKE, YOU MENTIONED SOME RECOMMENDATIONS THAT YOU FELT NEEDED TO BE DONE, SUCH AS, YOU KNOW, THE BETTER ORGANIZING OF FILES AND THE CHANGE ORDERS, THINGS OF THAT NATURE.

RIGHT. THOSE ARE OUR CURRENT RECOMMENDATIONS.

OUR RECOMMENDATIONS TWO YEARS AGO WERE WE HAD TWO AUDIT REPORTS THAT CAME AND MAYBE ONE WAS FINAL, CAME TO THE AUDIT COMMITTEE, WAS SUBMITTED.

I THINK THE FIRST ONE WAS OUR INITIAL SET OF RECOMMENDATIONS.

THERE WAS ONE SIX MONTHS LATER, WAS MORE LIKE A FOLLOW UP AND THEN THOSE FIRST CMARS WERE UNDER CONTRACT AT THAT TIME.

WE MADE RECOMMENDATIONS AT THAT TIME, FOR EXAMPLE, YOU COULD IMPROVE YOUR CONTRACT FURTHER.

IT'S A CONSTANT IMPROVEMENT PROCESS, REALLY.

YOU KNOW, WE THINK WE HAVE A GREAT CONTRACT RIGHT NOW, BUT IT'S NOT AS GOOD AS WHAT IT COULD BE, BUT IT CAN BE BETTER, YOU KNOW, THE NEXT TIME WE DO A CMAR CONTRACT.

AND WE DID A CURRENT ITERATION.

WE TRIED TO MAKE THE NEW CMAR CONTRACTS FOR THE TWO NEW ONES, BETTER.

WORK WITH PROCUREMENT, WORK WITH LEGAL, WORK WITH CONSTRUCTION.

AND IT WAS JUST PART OF THE PROCESS.

OKAY. BECAUSE I WAS JUST REALLY CURIOUS ABOUT THE FOLLOW UP.

AND I MEAN, I KNOW A LOT OF THINGS HAVE BEEN BLAMED ON COVID AND COVID WAS REALLY BAD.

BUT WHEN IT COMES TO THE CITY AND OTHER ORGANIZATIONS, WHICH I HEARD YOU SAY UNDER YOUR FIRST RECOMMENDATION, I UNDERSTAND THAT THERE WAS, IT WASN'T JUST US. THERE WAS A LOT OF PEOPLE WHO HAD PROBLEMS GETTING PERMITS IN ORDER TO PERMITS, PERMITS PULLED IN ORDER TO DO WORK.

SO, I MEAN, THAT I UNDERSTAND, BUT AND I THINK YOUR RECOMMENDATION IS ON POINT TO MAKE SURE THAT ALL OF THAT IS DONE, WHICH I JUST KIND OF I BELIEVE THE PHRASE I USED IN THE WORKSHOP WE HAD ON FRIDAY WAS DO WHATEVER YOU CAN TO MINIMIZE AVOIDABLE CHANGE ORDERS.

YOU'LL NEVER MAKE THEM ALL GO AWAY.

YOU'LL NEVER HAVE A PERFECT SET OF PLANS.

YOU'LL NEVER HAVE A PERFECT CITY, YOU KNOW, GIVING YOU A PERMIT.

EXACTLY. BUT THE MORE YOU WORK ON THAT AND MORE YOU PAY ATTENTION TO HAVE ALL YOUR TEAM FOCUSING ON IT, YOU KNOW, HOPEFULLY YOU CAN MINIMIZE THOSE AVOIDABLE CHANGE ORDERS.

THAT WAS OUR MAIN POINT.

WHICH SHOULD SAVE MONEY IN THE END, ACTUALLY GIVE YOU MORE VALUE FOR THE MONEY YOU'RE GOING TO SPEND.

TRUSTEE FLORES.

SURE. THANK YOU. TRUSTEE FOREMAN I JUST WANT TO THANK YOU GUYS FOR CONTINUING TO DO THIS.

I MEAN, I KNOW THAT THIS WAS A BIG YEARS AGO WHEN I WAS ON THE AUDIT COMMITTEE BEFORE AND WE PUT IT IN THE PLAN AND I CONTINUE TO SEE MORE AUDITING IS STILL IN THE PLAN.

SO I WANT TO THANK YOU FOR THE REPORT.

I JUST HAD ONE QUICK QUESTION FOR ADMINISTRATION.

THERE WAS A QUESTION THAT REALLY ABOUT BRENT, ABOUT BUILDING CAPACITY.

AND I JUST WANTED YOU TO KIND OF ADDRESS THAT IN TERMS OF KIND OF LONG TERM, AS WE DO A HANDFUL MORE OF THESE.

YES. GOOD EVENING, EVERYONE.

YEAH, WE'VE HIRED A LOT OF NEW ADDITIONAL STAFF WITH THAT CMAR EXPERIENCE.

IT'S ONE OF THE MOST POPULAR PROCUREMENT METHODS IN TEXAS.

SO A LOT OF OUR GUYS ARE COMING IN WITH THAT TYPE OF EXPERIENCE AND WE ARE BUILDING CAPACITY TO DO MORE TYPE OF THESE PROJECTS.

[00:30:07]

SO FROM A STRATEGIC STANDPOINT, DO YOU FORESEE KEEPING, YOU KNOW, CONSULTANTS ON STAFF TO CONTINUE THE PROACTIVE AUDITING OF THESE CONSTRUCTION PROJECTS? IS THERE SOME PROCESS WHERE YOU'RE DESIGNATING CERTAIN STAFF TO GAIN THAT EXPERIENCE, OR LOOKING TO HIRE STAFF THAT CAN FACILITATE THAT.

SO I'M JUST TRYING TO GET AN UNDERSTANDING OF WHAT'S YOUR PLAN ON THAT? THANK YOU, MR. LEWIS.

WE'VE BEEN DEVELOPING AND TRAINING STAFF ALL ALONG THE WAY, EVER SINCE WE'VE GOT OUTSIDE SUPPORT NOW.

DONE A LOT OF TRAINING ON THE STAFF, SENDING PEOPLE TO TRAINING AND DEVELOPING THAT.

I'VE GOT SEVERAL STAFF PERSONS DEDICATED TO CONSTRUCTION.

OBVIOUSLY, WITH THE APPROVAL OF THE AUDIT COMMITTEE WE'LL CONTINUE TO TO PUT RESOURCES INTO THIS AREA AND IT MIGHT EVEN GROW.

I MEAN, WE'RE JUST GEARING UP IN THE BOND PROGRAM.

AND WHEN WE GET TO THREE, FOUR, 500 MILLION SPENT A YEAR, THAT'S GOING TO LOOK A LOT DIFFERENT THAN WHAT WE'RE LOOKING AT RIGHT NOW IN CMAR.

SO CONTINUAL EVOLUTION WE'LL BRING THAT INFORMATION BACK.

BUT ANY AND ALL RESOURCES WE'LL TRY TO UTILIZE.

ANY MORE QUESTIONS? OKAY NOW I CAN ASK MY QUESTIONS.

I'M READY. JUST A FEW QUESTIONS.

BECAUSE I STILL HOLD CMAR SOMEWHAT SUSPECT IN TERMS OF THE ABILITY TO DELIVER THE PRODUCT ON TIME AND COST EFFECTIVELY AS OPPOSED TO CSP.

AND SO ONE OF THE THINGS THAT WAS MENTIONED THAT GOT MY ATTENTION WAS THE 10% CONTINGENCY.

NORMALLY WITH CSP, THAT CONTINGENCY IS PART OF THE BID.

BUT IT LOOKS LIKE WITH CMAR, IT'S AN EXTRA AMOUNT OF MONEY.

AM I HEARING THAT CORRECTLY? HERE WE GO. I'M BACK ON MIC.

SORRY. GOOD. SO THE CSP PROJECTS, OF COURSE, AS YOU KNOW, ARE COMPETITIVELY BID AT THE GENERAL CONTRACTOR LEVEL, THE PRIME CONTRACTOR LEVEL.

THEY GO OUT FOR COMPETITIVE AND BIDDING IS DIFFERENT ON CMARS, AS YOU MENTIONED.

SO. BUT THE WAY I UNDERSTAND YOU DO YOUR CSPS.

AND BRENT CORRECT ME IF I'M WRONG.

SO THAT'S THE SAME CONTINGENCY OR FOR OWNER CONTINGENCY, IT'S THE SAME 5% THAT WE'RE CARRYING ON THE CMAR CONTRACTS. I HEARD YOU SAY 10%.

I WAS GETTING TO THAT. THANK YOU.

THE REASON FOR THE CMAR, THE OTHER 5% IN THE CMAR CONTRACTS WAS DESIGNATED IN YOUR CONTRACT.

AND THE OLD CONTRACT IS DIFFERENT THAN THE NEW ONE.

SO THE NEW ONE, ITS CONTINGENCY IS YET TO BE DETERMINED.

IT'LL BE, NO ONE KNOWS THE AMOUNT YET BECAUSE IT WILL BE ARRIVED AT DIFFERENTLY THAN ON THE FIRST FOUR.

BUT THE OTHER 5% TRUSTEE FOREMAN WAS FOR THE CONTRACTOR CONTINGENCY.

SO WHEN THEY PUT IN THEIR BID THEIR GNP PROPOSALS TO YOU, NOT EVERYTHING WAS KNOWN AND IT'S TRADITIONAL IN THE CMAR WORLD FOR THEM TO CARRY SOME MONEY AS FOR THE UNKNOWNS FOR CONTRACTOR CONTINGENCY.

AND IT WAS AGREED, MUTUALLY AGREED BY THE PARTIES TO CARRY 5%.

I NEVER THOUGHT THEY WOULD SPEND ALL THAT 10%.

I AM FRANKLY AMAZED THAT THEY HAVE.

BUT NOW THAT I SEE WHAT HAPPENED AND THE REASONS IT HAPPENED, YEAH, YOU KNOW, WHEN THEY BID THEY'RE GOING TO CARRY THAT PERCENTAGE FOR CONTINGENCY WITHIN THEIR BID.

YOU JUST WON'T KNOW WHAT IT IS.

AND THEN THE OTHER 5% IS IT'S PRETTY MUCH THE SAME.

SO. BUT YOU'RE RIGHT, CMAR, UNLESS YOU DO IT RIGHT, THERE ARE SO MANY PITFALLS, YOU CAN REALLY ACTUALLY SPEND MORE MONEY THAN YOU SHOULD.

I'VE TRIED TO HELP YOU NOT DO THAT.

I'VE TRIED TO HELP YOU.

AND I THINK YOUR TEAM HAS DONE A GREAT JOB OF, YOU KNOW, DOING BEST PRACTICE WITH THE CMARS.

BUT IT'S, YOU KNOW, YOU WOULD BE AMAZED WHAT OTHER SCHOOL DISTRICTS AND HOW BAD IT IS AND HOW HOW BAD THE CMARS ARE TAKING ADVANTAGE OF OTHER SCHOOL

[00:35:08]

WELL, WE KNOW ABOUT CMAR.

SO ONE OF THE THINGS, AND BRENT DON'T GO ANYWHERE.

ANOTHER QUESTION I HAVE IS, AND THIS IS IN YOUR OBSERVATION ONE, A SIGNIFICANT AMOUNT OF THESE AVAILABLE CONTINGENCY FUNDS IS BEING SPENT TO FUND CHANGES FOR REVISIONS TO THE CONSTRUCTION DOCUMENTS THAT ARE MADE SUBSEQUENT TO THE COMPETITIVE BIDDING PROCESS.

SO WHERE IN CMAR DO YOU HAVE A COMPETITIVE BIDDING PROCESS? EXCELLENT QUESTION.

SO THIS IS REALLY A FUNDAMENTAL PROCESS UNDER CMAR CONTRACTS IS YOU ACTUALLY PUT TOGETHER BID DOCUMENTS, THE BID PACKAGES, THEY CALL THEM, FOR ALL THE TRADE SUBCONTRACTS.

SO THAT'S WHERE THE COMPETITION COMES INTO PLAY.

THE CMAR PUTS TOGETHER A BID PACKAGE ADVERTISING JUST LIKE YOU DO FOR CSPS.

SO YOU'RE JUST ADVERTISING FOR CSP CONTRACTS DOWN A LEVEL.

ALL RIGHT. SO YOU GO OUT ON THE STREET.

SO IF YOU NEED AN ELECTRICAL CONTRACTOR, YOU HAVE A BID PACKAGE THAT GOES OUT, ELECTRICAL CONTRACT, WHOEVER WANTS TO BID IT, IT'S JUST THE SAME AS YOUR CSP BIDDING.

SO YOU HAVE CSP BIDDING GOING ON AT THE TRADE CONTRACTOR LEVEL MANAGED BY THE CMAR AND OVERSEEN BY THE PM FIRM'S STAFF. WE LOOKED AT IT.

YOU GUYS LOOK AT WHEN IT ROLLS UP TO THE GNP SUBMITTAL TO YOU.

SO THERE IS COMPETITION AND THAT'S ACTUALLY LIKE 90% OF THE COST.

THERE'S ALSO COMPETITION FOR THE FEE, THE CMAR FEE, WHEN YOU GO OUT TO ORIGINALLY HIRE A CMAR, THEY HAVE TO COMPETE THEIR FEE.

AND I THINK YOU DID A PRETTY GOOD JOB ON THAT ON FROM WHAT I SAW USING THE CLASSIC CMAR APPROACH.

SO THE ONLY THING I HAVE IS A SIGNIFICANT AMOUNT OF THESE AVAILABLE CONTINGENCY FUNDS ARE SPENT BEFORE YOU GO OUT FOR THAT BID? THE FIRST PARAGRAPH.

SO THEN I WENT ON TO OBSERVATION NUMBER TWO.

I F I CAN CLARIFY THAT.

THAT'S A GREAT QUESTION.

NO, THE CONTINGENCY.

SO WHAT WE HAD WHEN WE WENT OUT, LET'S TAKE TJ, FOR EXAMPLE.

TJ, WE NEEDED TO GET GOING ON THAT RIGHT BECAUSE WE WERE LATE BECAUSE CORE GOT FIRED AND TJ NEEDED TO GET UNDER CONTRACT.

SO WE BROUGHT IN BECK TO BE THE CMAR AND EVERYBODY GOES, WELL, IF WE WANT TO START CONSTRUCTION IN JANUARY OF 2021, WE NEED TO GO OUT TO BID LIKE IN OCTOBER OR NOVEMBER AT THE LATEST WITH BID PACKAGES FOR THE TRADE CONTRACTORS THAT I WAS JUST TALKING ABOUT.

SO THEY NEEDED TO GET DOCUMENTS READY TO GO.

OCTOBER ISH, 2020.

BID EM NOVEMBER 2020 AND DECEMBER.

AND THEN THEY NEED TO ANALYZE ALL THAT AND ROLL IT ALL UP AND GIVE A PROPOSAL TO YOU SO THEY COULD GET STARTED ON TIME, SO THEY COULD FINISH IT WHERE THEY'RE GOING TO FINISH IT NOW. SO WHEN THEY WENT OUT TO ADOPT IT, THEN THE CMAR CONTRACTS WERE BUILT THIS WAY.

IT SAYS, WELL, LET'S TRY TO GO OUT TO CONTRACT WHEN WE HAVE 90% CONSTRUCTION DOCUMENTS, 90%.

IN OTHER WORDS, THE ARCHITECT HAS HAD A GOOD JOB.

YOUR TEAM'S HAD IT. I MEAN, THEY'VE DONE IT AS MUCH AS THEY CAN TO GET WHAT THEY CALL 90% CDS, 90% CONSTRUCTION DOCUMENTS.

AND THEN YOU PUT THAT OUT ON THE STREET, AND ONCE YOU GET YOUR BIDS IN, YOU CAN THEN CHANGE THOSE DOCUMENTS, WHICH IS WHAT HAPPENED IN YOUR CASE HERE. WHAT I'M TALKING ABOUT IN MY REPORT, CHANGE THOSE DOCUMENTS AND ISSUE THE ARCHITECT SUBSEQUENTLY ISSUES AFTER YOU ALREADY GOT BIDS, AFTER YOU ALREADY HIRED THE SUBCONTRACTOR, THEY CHANGED THE DOCUMENTS AND NOW YOU HAVE AN ISSUED FOR CONSTRUCTION SET OF DOCUMENTS BASED ON THOSE CHANGES.

WHEN THEY FINISH THEM BECAUSE THEY HAD MORE TIME, THEY HAD THREE OR FOUR MORE MONTHS TIME.

NOW THEY SEND OUT THOSE NEW DOCUMENTS TO THE TRADE CONTRACT AND ALL OF THEM GO, OH, THAT'S GOING TO COST THIS MUCH MORE MONEY.

AND SO THEY ALL TURN IN THEIR CHANGE ORDERS FOR WHATEVER CHANGES WE MADE.

IT'S JUST FINE TUNING, VERY NORMAL.

MANY, MANY, MOST OWNERS ACTUALLY DO EXACTLY WHAT I JUST DESCRIBED.

IT'S JUST MY POINT WAS IN MY AUDIT, IT'S LIKE IF YOU COULD MINIMIZE HOW MUCH OF THAT YOU HAD TO DO AND MINIMIZE THE CHANGE ORDER YOU'D GET MORE VALUE FOR YOUR CONSTRUCTION.

AND SO LET'S GO ON TO OBSERVATION TWO, WHICH IS ALSO ON PAGE SEVEN.

SO IT SAYS, OIA AND CONSULTANT NOTED THAT SOME DOCUMENTATION SUBMITTED BY TRADE CONTRACTORS WHO SUPPORT PROPOSED CONTRACT ADJUSTMENTS RELATED TO ALLOWANCE AND CONTINGENCY EXPERIENCE EXPENDITURES COULD BE IMPROVED TO ENHANCE THE DISTRICT'S ABILITY.

SO AGAIN, IT'S RIGHT BACK TO THE DISTRICT, REALLY DOESN'T HAVE COMPLETE CONTROL OVER THESE DOCUMENTS AND WHAT WE'RE GETTING FROM THE CMAR.

[00:40:08]

AND SO FOR ME, IT WOULD BE GOOD, BRENT, IF YOU GUYS GET ON TOP OF THAT KIND OF A SITUATION.

BECAUSE WHAT I'M SEEING IS WHAT I'VE ALWAYS FEARED IS THAT THERE ARE SO MANY HOLES IN THE CMAR CONTRACT THAT YOU CAN SLIP THROUGH AT ANY TIME.

AND AS A PERSON WHO IS RESPONSIBLE FOR THE FINANCIAL STABILITY OF THIS DISTRICT AND TO KNOW THAT WE CAN SPEND $20 MILLION AND IT DOESN'T EVEN COME TO THE BOARD REALLY JUST KIND OF FLOORS ME, BUT IT IS WHAT IT IS AND WE'RE GOING TO HAVE TO WORK ON THAT TO TRY TO FIX THAT PARTICULAR SITUATION. AND ACTUALLY.

LET ME FINISH. PLEASE.

SORRY ABOUT. SO I'M ON PAGE EIGHT.

I GO DOWN THE LIST TO MAKE IT EASIER.

SO OBSERVATION THREE WHERE YOU TALK ABOUT THERE IS CURRENTLY NO STANDARDIZED PROCESS IN PLACE TO REQUIRE THE CMARS TO FILE AND MAINTAIN PROJECT DOCUMENTS.

I THINK THAT'S WHAT YOU ALL WERE JUST TALKING ABOUT, ABOUT THE THE CLOUD.

BUT THERE'S NO DOUBT IN MY MIND THAT THEY DO HAVE DOCUMENTS THAT THEY ARE GIVING TO THE DISTRICT.

AND HOW IS THAT HAPPENING? I DON'T KNOW. THE METHODOLOGY FOR OBTAINING AND MAINTAINING RECORDS OF THE EXPENDITURES COULD BE IMPROVED TO ENHANCE THEIR ABILITY TO OVERSEE THE COST, WHICH WE'RE RIGHT BACK TO WHAT WE JUST TALKED ABOUT A FEW MINUTES AGO IS THE COST OF CMAR CAN BE OVERWHELMING AND WE'RE NOT WE DON'T REALLY HAVE CONTROL.

AND THEN ON RECOMMENDATION NUMBER THREE, YOU TALKED ABOUT SOME DOCUMENTS THAT WE COULD TALK ABOUT, BUT I ALSO THINK THAT WE SHOULD ADD MONTHLY BILLING AND ANY CHANGE ORDERS WITH DOCUMENTATION.

BECAUSE WHILE WE HAVE THE CONTINGENCY, THEY CAN STILL GO OUTSIDE OF THE CONTINGENCY AND DO CHANGE ORDERS.

ABSOLUTELY. AND I DID COVER THAT IN MY RECOMMENDATION OF SOME POINTS IN THERE, THE BULLET POINTS.

IT'S ALL OF THAT DOCUMENTATION I WANT THE DISTRICT TO SEE.

I WANTED TO COME IN WHERE THE PMS CAN SEE IT, THE STAFF CAN SEE IT, THE AUDITORS CAN SEE IT.

I GOT IT FROM THEM.

I'M GETTING IT PRETTY MUCH BY GOING BACK TO THEM AND ASKING THEM TO PUT THAT OUT THERE FOR ME, BECAUSE I HAVE TO AUDIT ALL THIS STUFF, PUT THAT ON PROCORE FOR ME.

BUT THEY WEREN'T DOING THAT BEFORE I ASKED THEM TO.

AND JUST BECAUSE WE DIDN'T HAVE A STANDARD THE DISTRICT HAD, EACH PM HAD THEIR OWN WAY OF FILING THINGS.

SO THE STUFF IS OUT THERE.

THE PMS ACTUALLY DID LOOK AT THE STUFF AND SO, BUT I THINK IMPROVEMENT THERE.

LET ME MAKE A COMMENT HERE.

THERE'S A VAST DIFFERENCE BETWEEN USE OF CONTINGENCY AND A CHANGE ORDER.

ANY CHANGE ORDER, THE GNP WOULD COME TO THE BOARD.

WHAT WE'RE DISCUSSING ARE UTILIZATIONS OF THE CONTINGENCY, WHICH THE BOARD APPROVED WITHIN THE GNP.

SO WHEN WE'RE TALKING ABOUT THOSE DIFFERENCES, I WANT TO BE VERY CLEAR THAT THE DISTRICT HAS APPROVED NO CHANGE ORDER AND DOESN'T HAVE THE ALLOWANCE TO DO THAT WITHOUT BOARD AUTHORITY. OKAY.

VERY GOOD. SURE, SUPERINTENDENT.

CHIEF ALFRED.

COULD YOU TELL ME HOW MANY CHANGE ORDERS HAVE BEEN DONE ON CMAR? WELL, NO CHANGE ORDERS.

THAT'S WHAT I THOUGHT. THANK YOU.

SO I'M TRYING TO CLEAR SOMETHING UP NOW.

WHAT I SAID WAS CHANGE ORDERS COULD BE DONE OUTSIDE OF THE CONTINGENCY.

IS THAT CORRECT? ALL CHANGE ORDERS COME TO THE BOARD.

BUT CAN CHANGE ORDERS BE DONE OUTSIDE OF CONTINGENCY? NOT WITHOUT COMING TO THE BOARD.

THAT'S NOT THE QUESTION.

CAN CHANGE ORDERS BE DONE OUTSIDE OF THE CONTINGENCY.

NO, WE'RE LOCKED INTO A GNP.

IF WE EXCEED THAT, WE'LL HAVE TO COME TO THE BOARD.

WHAT WE'RE TALKING ABOUT IS CONTINGENCY AUTHORIZATION EXPENDITURES.

THOSE ARE ALL HAPPENING WITHIN THAT CONTINGENCY AND THEY DO NOT HAVE TO COME TO THE BOARD.

I UNDERSTAND THAT'S THE 20 MILLION, BUT MY QUESTION REMAINS, OUTSIDE OF THE CONTINGENCY CAN CHANGE ORDERS BE DONE AND COME TO THE BOARD? YES. THAT ANSWERED MY QUESTION.

IT'S SIMPLE. AND THEN THE LAST QUESTION IS WHAT PROJECT MANAGEMENT FIRMS, ARE THEY THE SAME PROJECT MANAGEMENT FIRMS THAT DO THE CSP?

[00:45:01]

ALL RIGHT. THANK YOU.

ARE THERE ANY ADDITIONAL QUESTIONS? OKAY. I THINK I'LL GET A MOTION.

ALL THOSE IN FAVOR.

THE MOTION PASSES THREE ZERO.

ALL RIGHT. THANK YOU. THE NEXT REPORT.

TRUSTEE OUR NEXT REPORT IS ESSER FUNDING. I HAVE EVA NARTEN, OUR DEPUTY CHIEF TO BRIEF THIS.

GOOD AFTERNOON, MR. LEWIS, TRUSTEES AND SUPERINTENDENT DR.

ELIZALDE. MY NAME IS EVAN NARTEN AS ROB RUBEL SAID, AND I AM THE DEPUTY CHIEF FOR INTERNAL AUDIT.

THE ESSER FUNDING AUDIT.

THE DISTRICT IS EXPECTING TO RECEIVE MORE THAN $700 MILLION OF ESSER REIMBURSEMENTS, AND AS SUCH, IT'S IMPORTANT THAT WE HAVE ADEQUATE CONTROLS IN PLACE TO ENSURE SPENDING IS IN LINE WITH DISTRICT INITIATIVES AND GRANT REQUIREMENTS.

THE AUDIT FOCUSED ON ESSER TWO AND ESSER THREE FUNDING REQUIREMENTS.

WE BEGAN REVIEWING ESSER TOWARDS THE BEGINNING OF LAST FISCAL YEAR WHERE WE LOOKED AT THE GRANT APPLICATION PROCESS AND OUTLINED THE NUMEROUS SPENDING AND REPORTING REQUIREMENTS. OUR OFFICE THEN REVIEWED THE CONTROLS IN PLACE SURROUNDING THE TRACKING AND MONITORING OF ESSER SPENDING.

ADDITIONALLY, OUR OFFICE COMPLETED TRANSACTION TESTING FOR ITEMS RECORDED THROUGH JANUARY 22ND FOR ESSER TWO AND MARCH 28 FOR ESSER THREE.

NO RECOMMENDATIONS WERE MADE FOR THE PERIOD TESTED.

HOWEVER, WE ARE CONTINUING TO MONITOR EXPENDITURES UNTIL THE END OF THE GRANT TERMS. QUESTIONS. DO I HAVE A MOTION TO MAKE, ACCEPT AND MAKE FINAL THIS INTERNAL AUDIT REPORT? TO MOVE.

SECOND. ARE THERE ANY QUESTIONS? SO I HAVE A COUPLE OF QUESTIONS.

SO THE OTHER REPORT TALKS ABOUT ESSER TWO AND THREE FUNDING.

WHAT ABOUT ESSER ONE? THE ESSER ONE FUNDING WAS OBVIOUSLY THE FIRST OF THE SERIES, BUT IT WAS A SUPPLANT BY THE STATE.

SO THEY CUT OUR STATE AID AND HAD US UTILIZE ESSER ONE FOR THAT FUNDING.

SO WHILE WE DID GENERATE REVENUE, IT WAS JUST AS A SUPPLANT BY THE STATE.

SO THERE WAS NO REAL PROGRAM TO THAT.

I HAVE ONE OTHER QUESTION.

AND SO WE WE HAVEN'T RECEIVED ESSER THREE MONEY, CORRECT? CORRECT. WE HAVE NOT.

SO HOW COULD WE HAVE? WE HAVE ESSER THREE RECOVERED.

EXCUSE ME, TRUSTEE.

THAT'S OKAY.

TO ANSWER THE QUESTION.

YES, WE HAVE RECEIVED SOME OF OUR ESSER THREE ALLOCATION.

OKAY. BECAUSE THE QUESTION WAS IN THE AUDIT IT TALKS ABOUT FIXED ASSETS FOR ESSER THREE, AND I WAS LIKE, IF WE HAVEN'T RECEIVED THE MONEY, HOW COULD WE HAVE THE FIXED ASSETS? SO THANK YOU VERY MUCH FOR THAT FOR ME.

THANK YOU. ANY ADDITIONAL QUESTIONS? IT'S BEEN MOVED AND SECONDED TO ACCEPT THIS REPORT.

ALL THOSE IN FAVOR.

THE MOTION PASSES THREE ZERO.

THANK YOU TRUSTEES. OUR NEXT ORDER TO COVER IS IT SYSTEMS POWER SCHOOL APPLICATION CONTROLS.

GIVEN THAT POWER SCHOOL HOUSES CRITICAL DATA SUCH AS STUDENT GRADES AND ATTENDANCE, RISKS SUCH AS UNAUTHORIZED ACCESS AND INACCURATE DATA POSE A HIGHER

[00:50:01]

THE POWER SCHOOL AUDIT FOCUSED ON APPLICATION CONTROLS RELATED TO USER ACCESS, DATA, ACCURACY, VALIDITY AND MODIFICATIONS, AS THESE CONTROLS ARE ESSENTIAL TO REDUCING RISKS SURROUNDING STUDENT DATA.

OUR OFFICE RECOMMENDED THAT IT ENTERPRISE APPLICATIONS DETERMINE DOCUMENT AND MONITOR PRIVILEGES AND AUTHORIZATIONS ASSOCIATED WITH USER ROLES TO ENSURE APPROPRIATENESS OF THOSE WHO HAVE ACCESS TO CRITICAL STUDENT INFORMATION.

SECONDLY, WE RECOMMENDED THAT IT EXPLORE OPTIONS TO IDENTIFY AND MORE EFFECTIVELY MONITOR UNSUBMITTED ATTENDANCE.

AS NOTED IN THE REPORT, POWERSCHOOL DOES NOT DIFFERENTIATE BETWEEN STUDENTS WHO ARE PRESENT AND UNSUBMITTED ATTENDANCE.

AS ATTENDANCE REPORTING IS USED THROUGHOUT THE DISTRICT'S OPERATIONS, IT IS IMPORTANT TO ASSURE IT IS ACCURATE.

OUR THIRD RECOMMENDATION WAS TO IMPLEMENT SYSTEM MODIFICATION CONTROLS AND EDIT CHECKS FOR GRADE CALCULATIONS AND ASSIGNMENTS TO ENSURE GRADE BOOKS ARE CALCULATED CORRECTLY. AND LASTLY, WE RECOMMENDED THAT IT LOOK AT ENHANCING PASSWORDS FOR THE SUBSTITUTE PORTAL.

ALTHOUGH ACCESS TO SUBSTITUTE PORTAL DOES NOT CURRENTLY CONTAIN HIGH RISK DATA OR AUTHORIZATIONS, IT WOULD BE A BEST PRACTICE TO SECURE ANY DISTRICT SYSTEM OR APPLICATION TO REDUCE SECURITY RISKS.

DO WE HAVE ANY QUESTIONS? DO I HAVE A MOTION TO ACCEPT THIS REPORT? TO MOVE. SECOND.

ARE THERE ANY QUESTIONS OR IS THERE DISCUSSION? I HAVE A QUESTION.

HOW LONG HAS THE CURRENT SYSTEM BEEN IN PLACE, AND ARE YOU SPEAKING OF REPLACING THE ENTIRE SYSTEM OR ARE YOU JUST GOING TO DO MODIFICATIONS TO THE SYSTEM? AND IF SO, AT WHAT COST? GOOD AFTERNOON. I'M MICHELLE THOMPSON, THE DIRECTOR FOR IT STUDENT APPLICATIONS.

WE ADOPTED POWERSCHOOL IN 2018.

I BELIEVE WE HAVE A CONTINUED CONTRACT FOR APPROXIMATELY THREE MORE YEARS, SO WE'LL BE LOOKING AT MODIFYING THE CURRENT SYSTEM TO MEET THE OBSERVATIONS.

OKAY. SO AS FAR AS THE ASSESSMENT OF THE SYSTEM, WHO DID THE ASSESSMENT? DID YOU DO THE ASSESSMENT? THE AUDITORS DID THE ASSESSMENT.

AND HOW MUCH WOULD IT COST TO UPGRADE? I'M SORRY, TO REPLACE THE SYSTEM BECAUSE MY ORIGINAL QUESTION WAS, WILL THE CURRENT SYSTEM BE MODIFIED OR WOULD THE SYSTEM JUST TOTALLY BE REPLACED? AND I BELIEVE THE ANSWER IS THAT THIS WOULD BE ABLE TO BE MODIFIED AND ENHANCED TO ADDRESS THESE RECOMMENDATIONS THAT WE HAVE IN HERE. I KNOW THERE'S SOME ADDITIONAL EVALUATION MIGHT HAVE TO BE DONE ON HOW THAT ATTENDANCE VALUE IS RECORDED.

TO REPLACE THE ENTIRE SYSTEM.

SO THERE ARE SOME STRENGTHS IN THIS PARTICULAR APPLICATION AND THERE ARE SOME DRAWBACKS.

HAVING HAD EXPERIENCES IN AT LEAST ANOTHER DISTRICT, THERE HAS BEEN NO APPLICATION OF THIS TYPE OF ENTERPRISE THAT IS PERFECT.

SO TO REPLACE THE ENTIRE THING WOULD MEAN WE WOULD ALSO LOSE SOME OF THE STRENGTH OF THE SYSTEM TALKING TO EACH OTHER FROM DEPARTMENT TO DEPARTMENT AND HAVING COME FROM A DISTRICT THAT THAT DIDN'T HAPPEN, THAT COST MILLIONS UPON MILLIONS OF DOLLARS WHEN IT ISN'T READING DATA FROM ONE DEPARTMENT TO ANOTHER. SO BECAUSE OF THE CURRENT CONTRACT, THE TEAM IS WORKING TO MAKE THE MODIFICATIONS IN THE SECTIONS NECESSARY.

WE WILL BE REVIEWING THE ENTIRE POWERSCHOOL APPLICATION AND VERY LIKELY ARE CONSIDERING WE'LL BE DOING RFPS.

WE'LL BE GOING OUT.

AT THIS POINT IT'S A COST BENEFIT ANALYSIS.

WE NEED TO CONTINUE TO DO THESE OBSERVATIONS THAT OUR AUDITORS ARE PROVIDING US TO MINIMIZE SOME OF THE CHALLENGES THAT WE HAVE.

AND I THINK THIS FIRST ONE, TRUSTEE WHITE, AS YOU'VE INDICATED, THAT IS ONE THAT IS SIGNIFICANT.

AND I NOTED THAT IT IS LISTED AS A HIGH RISK BECAUSE IT IS DIRECTLY CONNECTED TO ATTENDANCE, WHICH IS DIRECTLY ALSO CONNECTED TO OUR FUNDING.

SO I WANT TO BE TOTALLY TRANSPARENT.

WE'RE NOT IN A SITUATION WHERE WE WOULD EVEN FINANCIALLY IT WOULD COST US WAY MORE TO TRY TO CHANGE OVER THE ENTIRE SYSTEM.

THIS IS JUST ONE PART OF THAT SYSTEM.

[00:55:03]

YEAH. SO I'M MAKING THE ASSUMPTION THAT WE'RE NOT THE ONLY DISTRICT TO USE POWERSCHOOL, CORRECT? SO I KNOW THERE'S ALWAYS A DELICATE DANCE WHEN WE'RE TALKING ABOUT MODIFICATIONS TO A SYSTEMS THAT POTENTIALLY WE ARE FUNDING, BUT THAT OTHER DISTRICTS OR EVERYONE WHO MAY BE EXPERIENCING THE SAME ISSUES MAY BENEFIT FROM.

SO I THINK THAT'S ALWAYS SOMETHING TO KEEP IN MIND AS WE GO TO THE BOARDS.

ARE WE GOING TO COLLABORATE WITH POWERSCHOOL AND THEN SAYING, OKAY, HEY, THESE ARE SOME OF THE THINGS [INAUDIBLE], BUT SOME OF THESE THINGS, I WOULD THINK THESE ARE BASIC, YOU KNOW, SYSTEMIC CONTROLS THAT WE SHOULD EXPECT TO SEE WITHIN THE SYSTEM THAT WE'RE USING FOR THE PURPOSES AND THE ACTIVITIES OF THAT WE ARE.

SO JUST, YOU KNOW, JUST KEEP THAT IN MIND.

FOR THE SECOND OBSERVATION, POWERSCHOOL IS ACTUALLY DOING A RELEASE IN NOVEMBER THAT WILL IDENTIFY THE STUDENTS ATTACHED TO UNSUBMITTED ATTENDANCE. SO WE'LL BE CREATING A DISTRICT LEVEL REPORT SO THAT DISTRICT LEVEL FOLKS WILL HAVE ACCESS TO THAT.

AND THAT'S JUST A RELEASE THAT POWERSCHOOL WAS PLANNING ANYWAY.

AND WE'LL BE READY FOR NOVEMBER.

ANY ADDITIONAL QUESTIONS.

ONE. AND THIS IS JUST OUT OF CURIOSITY ON RECOMMENDATION THREE.

WITH THE TEACHERS HAVING THE ABILITY TO CREATE THEIR OWN ASSIGNMENT CATEGORIES, IS THAT, THOSE CATEGORIES THEY CREATE, IS THAT CATEGORIES THAT ARE SEEN AT THE ACCOUNT LEVEL.

THAT MEANS THAT OTHER TEACHERS OR EVERYBODY IN THE DISTRICT, OR IS IT JUST FOR THAT SPECIFIC TEACHER THAT CREATES THEM? IT'S SPECIFIC JUST FOR THAT TEACHER.

OKAY. ANY OTHER QUESTIONS? EXCUSE ME, I HAVE A COUPLE OF QUESTIONS AND I'M ON PAGE EIGHT OF 15.

ITS RECOMMENDATION TWO AND OBSERVATION THREE.

THE MODIFICATION CONTROLS AND EDIT CHECKS ARE NOT IMPLEMENTED FOR GRADE CALCULATIONS AND ASSIGNMENTS.

SO HOW WOULD THAT AFFECT OR DOES THAT AFFECT CLASS RANKINGS? NO. IN THIS DOCUMENT, THE OBSERVATION WAS RELATED TO TEACHER GRADE BOOK, NOT GRADES THAT ARE STORED WITHIN POWERSCHOOL.

WE DO HAVE AN AUDIT RECORD FOR ALL GRADES THAT ARE MOVED FROM THE TEACHER GRADE BOOK EACH GRADING CYCLE INTO THE SYSTEM AS HISTORICAL GRADES.

THIS OBSERVATION WAS RELATED TO SPECIFICALLY THE GRADES WITHIN A TEACHER GRADE BOOK, A GRADE FOR AN ASSIGNMENT.

ULTIMATELY, WHAT THE TEACHER ASSIGNS FOR A GRADE WOULD IMPACT A STUDENT'S FINAL GRADE EACH GRADING CYCLE OR FOR A SEMESTER.

SO IF IT WAS FOR A COURSE THAT WAS INCLUDED IN RANK, ULTIMATELY IT COULD IMPACT THAT RANK.

BUT WITHIN POWERSCHOOL, ANY CHANGES TO STORED GRADES, THERE IS AN AUDIT WITH THAT.

SO. BUT IT SPEAKS TO THE FACT THAT THE POTENTIAL FOR ERRORS IN GRADE CALCULATIONS IS INCREASED.

AND I PARTICULARLY HAVE BEEN ONE WHO ASKED A LOT OF QUESTIONS ABOUT CLASS RANK AND HOW OUR STUDENTS ARE RANKED, THIS LAST MINUTE RANKING.

THE DAY BEFORE GRADUATION, STUDENTS ARE RANKED.

AND SO IF WE'VE GOT THIS KIND OF AN ISSUE, THERE'S NO TIME TO CHECK IT OR ANYTHING, IF IT'S NOT PERFECT.

WE'VE GOT SOME STUDENTS THAT MIGHT HAVE.

WHAT ACTUALLY HAPPENS WITH THIS IS THAT THE STUDENT DOES NOT RECEIVE A GRADE BECAUSE THE GRADE CATEGORY THAT THE TEACHER CREATED DOESN'T HAVE THE MATHEMATICAL LOGIC BEHIND IT.

SO IT ENDS UP WITH THE STUDENT HAVING A BLANK GRADE THAT IS AVAILABLE.

CURRENTLY, THERE IS A REPORT FOR ALL CAMPUSES TO RUN.

WE ASK THEM TO RUN IT ON A DAILY BASIS, ESPECIALLY IN MAY.

THAT INDICATES WHICH STUDENTS HAVE AN ONGOING, CALCULATED FINAL GRADE, WHICH STUDENTS MAY BE MISSING THAT GRADE, SO THAT CAMPUS PERSONNEL CAN VIEW THAT REPORT AS OFTEN, INFREQUENTLY AS NECESSARY, AND THEY CAN CONTACT THAT TEACHER TO SAY WHAT YOUR GRADES AREN'T CALCULATING FOR YOUR STUDENTS.

LET'S SEE WHAT'S HAPPENING.

AND THEN WE HAVE SUPPORT COORDINATORS THAT CAN ASSIST CAMPUSES WITH IDENTIFYING WHY A STUDENT MAY NOT HAVE A GRADE, EVEN THOUGH THERE ARE GRADES ENTERED IN THE GRADE BOOK.

SO, SUPERINTENDENT, THIS IS ONE ISSUE THAT I REALLY BELIEVE NEEDS TO BE ADDRESSED.

WE CAN'T JUST BRUSH OVER THIS BECAUSE STUDENTS AT THE VERY LAST MINUTE ARE BEING TOLD THAT ANOTHER STUDENT HAS

[01:00:03]

SO THAT'S THAT'S A REAL SERIOUS CONCERN FOR ME.

AND THEN THE LAST THING IS ABOUT THE SUBSTITUTES.

AND THE TEMPORARY PASSWORDS FOR THE SUBSTITUTES.

WHICH THEY'RE NOT UNIQUE TO THAT PARTICULAR INDIVIDUAL.

ARE THEY? SO THEY'RE PERMANENT SUBSTITUTES AND THEN THEY'RE SUBSTITUTES THAT JUST ROLL IN AND OUT.

HOW ARE THEY HANDLED DIFFERENTLY? SO SUBSTITUTES THAT ARE ON A DAILY OR A VERY SHORT TERM ASSIGNMENT ARE GIVEN A UNIQUE DAILY PASSWORD FROM THE CAMPUS THAT ALLOWS THEM TO GO NOT INTO POWERSCHOOL, BUT JUST FOR A SINGLE PLATFORM OF MARKING A STUDENT PRESENT OR ABSENT.

LONG TERM SUBSTITUTES RECEIVE FULL TRAINING ON GRADING, ATTENDANCE AND THEN ARE ASSIGNED ACTUALLY TO THAT CLASS AS A TEACHER OF RECORD FOR THAT PERIOD OF TIME THAT THEY'RE THERE.

THEY HAVE A UNIQUE LOG IN.

JUST LIKE OUR CONTRACT TEACHERS WOULD.

ALL RIGHT. THANK YOU. ARE THERE ANY ADDITIONAL QUESTIONS? IT'S BEEN MOVED AND SECONDED.

ALL THOSE IN FAVOR.

THE MOTION PASSES THREE ZERO.

THE NEXT REPORT, PLEASE.

THANK YOU, TRUSTEES. NEXT REPORT WE HAVE IS STATE OF TEXAS ASSESSMENTS OF ACADEMIC READINESS.

RICHARD SIU, AUDIT MANAGER, IS GOING TO HELP PRESENT THIS.

GOOD AFTERNOON, TRUSTEES.

DR. ELIZALDE. MR. LEWIS. MY NAME IS RICHARD SIU.

I'M THE AUDIT MANAGER FOR THIS PROJECT.

STAAR TEST RESULTS PROVIDE ACTUAL DATA THAT WOULD HELP STUDENTS, PARENTS, TEACHERS MEET OR END OR IMPROVE ACADEMIC PERFORMANCE.

STAAR TEST RESULTS ARE ALSO USED IN EVALUATING EACH CAMPUS AND THE DISTRICT OVERALL.

THE AUDIT FOCUS ON TEST ADMINISTRATION, SECURITY AND TRAINING AT A CAMPUS LEVEL TO VERIFY AN ADEQUATE TEST ENVIRONMENT WAS PROVIDED TO STUDENTS.

THERE WERE NO RECOMMENDATIONS MADE.

ARE THERE ANY QUESTIONS? OKAY TRUSTEES. ANY QUESTIONS? SO IS THERE A MOTION TO ACCEPT THE FINAL REPORT? TO MOVE.

SECOND. NOW, ANY QUESTIONS? SO I HAVE JUST A COUPLE OF QUESTIONS MYSELF REGARDING THE REPORT, AND THANK YOU FOR THE REPORT, BUT IT WOULD BE INTERESTING TO KNOW WHICH CAMPUSES WERE SELECTED.

SURE I CAN FOLLOW UP WITH YOU AND SEND THAT TO YOU.

AND GOING FORWARD WE CAN ALSO INCLUDE.

YEA GOING FORWARD IF YOU CAN INCLUDE THE CAMPUSES, I KNOW THEY'RE RANDOMLY SELECTED, BUT IT'S REALLY NICE TO KNOW WHICH CAMPUS IS ELEMENTARY, MIDDLE HIGH SCHOOL, THAT WE DID. SO IF THERE ARE NO OTHER QUESTIONS, ALL THOSE IT'S BEEN MOVED AND SECONDED? I'M SORRY, I DON'T KNOW WHO WAS FIRST.

I WAS GOING TO VOTE. HE WAS GOING TO VOTE.

YOU GOT A QUESTION. IF YOU HAVE A QUESTION I DO. LET ME GET IT IN.

THERE YOU GO. MY UNDERSTANDING IS THAT FOR I THINK IT'S FOR THE, NOT MAYBE THIS YEAR, BUT MAYBE THE 23-24 SCHOOL YEAR THAT ALL STAAR TESTING IS GOING TO BE ONLINE.

IS THAT CORRECT? GOOD AFTERNOON.

CHARLENTA GOVAN, DIRECTOR OF ASSESSMENT.

THIS CURRENT SCHOOL YEAR IS THE TRANSITION TO FULL ONLINE.

BUT THE STATE IS STILL ALLOWING STUDENTS THAT ARE ELIGIBLE 504 AND SPED TO TEST ON PAPER.

THE 504 AND SPED ARE GOING TO TEST HOW I'M SORRY? IF THEY MEET THE ELIGIBILITY THEY CAN TEST ON PAPER.

ON PAPER. OKAY.

THE TESTING. WE DIDN'T, I DIDN'T GET A LOT OF DETAILS.

SO THE TESTING ONLINE IS GOING TO BE IN THE CLASSROOM, IS THAT CORRECT? YES, WE'VE BEEN ONLINE FOR THE LAST, FOR DALLAS ISD WE'VE TESTED ONLINE THE MAJORITY OF GENERAL ED STUDENTS FOR THE LAST TWO YEARS.

OKAY. AND.

WITH ALL OF THE TESTING BEING ONLINE, WE STILL HAVE SOMEONE, THERE MAY BE A CAMPUS THAT'S SELECTED TO BE MONITORED AND SOMEONE COMES AND DOES THE MONITORING THERE IN PERSON.

IS THAT CORRECT? WE SEND A MONITOR OUT IN THE SPRING TO ALL CAMPUSES AND IN DECEMBER WE ALSO MONITOR IT AS WELL.

THANK YOU. ANY OTHER QUESTIONS? [INAUDIBLE] BEEN MOVED AND SECONDED TO ADOPT THIS REPORT.

[01:05:01]

THE MOTION PASSES THREE ZERO.

THANK YOU, TRUSTEES. WE HAVE TWO CAMPUS BASED CONTROLS AUDITS TO PRESENT.

THE FIRST ONE IS SAMUELL HIGH SCHOOL.

GIVEN THE NUMBER OF CAMPUSES PROCESSED, MAY NOT ALWAYS BE CONSISTENT OR EFFECTIVE.

AND AS SUCH, IT IS IMPORTANT TO REVIEW WHAT CONTROLS ARE IN PLACE.

WE REVIEWED SEVEN AREAS, ACTIVITY FUNDS, PAYROLL CODING, GRANT ACCOUNTING, CAMPUS CREDIT RECOVERY PLAN, WALK THROUGH OF CAFETERIA, CAMPUS VENDING MACHINES AND THE ORACLE USER ACCESS.

FOR SAMUELL HIGH SCHOOL, WE NOTED THERE WERE THREE RECOMMENDATIONS MADE FOR ACTIVITY FUNDS WHICH WERE ACKNOWLEDGMENTS OF ACTIVITY FUND RESPONSIBILITY FORMS WERE NOT PROVIDED FOR ALL REQUIRED PERSONNEL.

WE WERE UNABLE TO DETERMINE WHETHER CASH HANDLING PROCEDURES WERE BEING FOLLOWED DUE TO INCOMPLETE DOCUMENTATION AND FUNDRAISER FINANCIAL RECAP FORMS, DEPOSIT RECEIVING AND FUNDS DISBURSEMENT PROCEDURES WERE NOT APPROPRIATELY COMPLETED AT THE CONCLUSION OF THE ACTIVITY.

WE ALSO HAD A RECOMMENDATION REGARDING THE CAMPUS CREDIT RECOVERY PLAN.

THAT'S FOR ATTENDANCE.

CREDIT RECOVERY PETITION DOCUMENTATION WAS NOT REVIEWED.

ARE THERE ANY QUESTIONS? I HAVE A QUESTION. I THINK I JUST NEED SOME LITTLE CLARITY ON RECOMMENDATION TWO WHERE YOU SAY YOU WERE UNABLE TO DETERMINE WHETHER CASH HANDLING PROCEDURES WERE BEING FOLLOWED DUE TO INCOMPLETE DOCUMENTATION.

BECAUSE I GUESS IN MY MIND, I WOULD THINK THAT COMPLETE DOCUMENTATION WOULD BE A PART OF, YOU KNOW, THE CASH HANDLING PROCEDURES BEING DONE. SO CAN YOU KIND OF HELP ME UNDERSTAND THAT? YES. SO THERE WERE TWO PARTS TO THAT.

ONE IS WHEN A STUDENT GIVES THE CASH TO THE SPONSOR, WHICH IS USUALLY A TEACHER, THEY'RE SUPPOSED TO GET A RECEIPT, S1 RECEIPT.

SO THAT DOCUMENTATION WAS NOT PROVIDED.

AND ALSO, WHEN THE SPONSOR GIVES THE CASH TO THE CAMPUS OFFICE, THE BOOKKEEPER OR THE FINANCIAL CLERK, YOU'RE SUPPOSED TO DO AN ORACLE RECEIPT SO THAT THAT DOCUMENTATION WAS ALSO NOT ON FILE.

SO CASH HANDLING PROCEDURES WERE NOT BEING FOLLOWED? CORRECT. OKAY. SO BEFORE WE MOVE ON TO ADDITIONAL QUESTIONS, DO I HAVE A MOTION TO ACCEPT AND MAKE FINAL THIS INTERNAL AUDIT REPORT? TO MOVE.

SECOND. NOW, ARE THERE ANY QUESTIONS? AS FAR AS CASH FLOATING AROUND ON A CAMPUS, WHETHER IT'S ON A, YOU KNOW, I KNOW WE DON'T USE THE CART METHOD ANYMORE, BUT HOW IS THIS GOING TO BE CORRECTED AND ARE WE CHANGING THE PROCESS PROCEDURE? WHEN WHEN MONEY IS TURNED IN TO THE OFFICE, IS THERE A THREE DAY PERIOD FOR IT TO BE DEPOSITED? DOES THE PRINCIPAL HAVE THE AUTHORITY TO ASSIGN WHO WAS MAKING A DEPOSIT.

THOSE ARE ALL MY QUESTIONS.

TRUSTEE WHITE. TO ANSWER YOUR INITIAL QUESTION REGARDING COLLECTIONS OF CASH.

SO ANY TIME CASH IS RECEIVED FROM A STUDENT OR STAFF MEMBER AT THE CAMPUS, THAT MONEY SHOULD BE TURNED INTO THE OFFICE MANAGER AND PROPERLY DOCUMENTED AS SUCH.

AS YOU KNOW, WE ALSO HAVE AN ARMORED PICKUP SERVICE THAT DOES SERVICE OUR CAMPUSES AS IT RELATES TO PICKING UP CASH AND THERE ARE SCHEDULED PICKUPS.

GARDA IS THE ACTUAL COMPANY THAT PROVIDES THAT SERVICE.

GOING FORWARD IN ORDER TO MITIGATE SOME OF THE CHALLENGES THAT SAMUELL AND PERHAPS OTHERS HAVE EXPERIENCED WITH CASH COLLECTIONS.

THE FINANCE TEAM IS GOING TO, A) MAKE CERTAIN THAT ALL OF THE SPONSORS AT THE CAMPUS LEVEL THAT WILL BE RESPONSIBLE FOR COLLECTING CASH IN THE BEST WAY THAT THEY ARE, THEY DO RECEIVE A TRAINING, BUT WE NEED TO MAKE CERTAIN THAT THAT TRAINING IT'S FOLLOWED PROPERLY.

SO DOING THOSE SPOT CHECKS AND THOSE CHECK INS AT THE CAMPUSES, MEANING GOING OUT AND CONDUCTING THOSE VISITS AND BETTER SUPPORTING THOSE OFFICE MANAGERS THAT ARE ALSO RESPONSIBLE FOR MAKING CERTAIN THAT OUR CASH DEPOSITS ARE RECEIPTED AND COLLECTED IN THE PROPER WAY.

SO BEING MORE PROACTIVE AND INTENTIONAL ABOUT HOW WE GO OUT AND SUPPORT OUR CAMPUSES IS ONE OF THE WAYS THAT WE ARE GOING TO HELP THE CAMPUSES OVERCOME SOME OF THE CHALLENGES THAT THEY MAY HAVE WITH PROPER RECEIVING.

AND OF COURSE, DOCUMENTATION IS IMPORTANT, BUT WE JUST NEED TO MAKE CERTAIN THAT THEY ARE FOLLOWING THE GUIDELINES IN OUR MANUAL AND PROVIDE THAT ONGOING SUPPORT THROUGHOUT THE SCHOOL YEAR INSTEAD OF ONCE OR TWICE A YEAR.

THANK YOU. YOU ANSWERED THE OTHER QUESTION ABOUT TRAINING.

[01:10:03]

SO I'M ACTUALLY ON PAGE FOUR AND IT TALKS ABOUT THE TOTAL BUDGETED PAYROLL AMOUNT.

SO MY QUESTION IS, DOES THAT INCLUDE TITLE MONEY? DOES THAT INCLUDE IDEA MONEY OR IS THAT JUST THE BUDGETED AMOUNT, BASED ON ALLOCATION AND LOOKING AT THAT PARTICULAR ALLOCATION AT 12.2, I WOULD THINK THAT'S GENERAL OPERATING TRUSTEE FOREMAN.

OKAY.

SO IF IT'S GENERAL OPERATING AND I'VE BEEN ASKING THIS QUESTION FOR A WHILE, SUPERINTENDENT, IN REGARDS TO SCHOOLS GET ADDITIONAL FUNDING THROUGH ESL, THROUGH IDA, TITLE MONEY, AND WE NEVER CAPTURE THAT.

WE ALWAYS TALK ABOUT JUST WHAT THAT REGULAR BUDGETED MONEY IS, AND I ALWAYS TRY TO FIGURE OUT EXACTLY HOW MUCH MONEY IS ACTUALLY GOING ON A CAMPUS.

DWAYNE, I SEE YOU BACK THERE TALKING.

SO IF YOU LOOK AT THE SECOND PARAGRAPH WHERE IT SAYS GRANT ACCOUNTING, IT LISTS THE TOTAL TITLE ONE BUDGET FOR THE CAMPUS.

SO THAT'S THEIR TITLE ONE ALLOCATION.

SO YOU'VE GOT ESL ALLOCATIONS, YOU GOT IDEA ALLOCATIONS AND IT MAY NOT BE THAT THE CAMPUS GETS A SPECIFIC ALLOCATION, IT MAY BE THAT THEY'RE GETTING SERVICES THAT THAT PARTICULAR FUNDING SOURCE PROVIDES.

SO IT WOULD JUST BE GOOD TO KNOW.

OKAY, SO THAT WHEN WE TALK ABOUT THE DOLLAR AMOUNT, WE'RE TALKING ABOUT THE OVERALL DOLLAR AMOUNT, NOT JUST THE BUDGETED AMOUNT BASED ON WHAT WE ALLOCATE IF THAT MAKES ANY SENSE.

BECAUSE IT MAKES IT MAKES A BIG, BIG DIFFERENCE.

SO WE USE THE WORD JUDGE MENTALLY.

THAT SAMUELL WAS SELECTED.

WHAT DOES THAT MEAN? SO IT'S NOT A RANDOM SAMPLE BASED ON IF WE'VE BEEN THERE BEFORE.

SO BASICALLY WE JUST GET THE LIST OF ALL THE CAMPUSES AND SAY, OKAY, WE NEED TO DO, WHICH ONES ARE WE GOING TO DETERMINE WHO TO REVIEW.

AND IT'S BASICALLY NOT SAMPLE.

IT'S JUST A JUDGMENTAL SELECTION.

IT'S JUST A SAMPLE RATHER THAN SAYING JUDGMENTALLY, THAT JUST DOESN'T REALLY COME OFF REAL GOOD.

TRUSTEE FOREMAN WE SELECTED SAMUELL HIGH SCHOOL BASED ON THE LARGE DOLLARS.

THAT SOUNDS MUCH BETTER THAN JUDGMENTALLY.

THEN I'M ON PAGE FIVE AND IN THE THE WALK THROUGH OF THE CAFETERIA.

NOW, WE ALL KNOW THAT WE'VE STRUGGLED WITH FOOD SERVICES.

AND THEN TO GET ALL THIS GLOWING STUFF ABOUT THE RANK AND THE MAGAZINE AND ALL THAT OTHER STUFF.

WHAT I WOULD EXPECT IN AN AUDIT IF YOU'RE GOING TO GO TO A SCHOOL IS TO BE ABLE TO LOOK AT THINGS LIKE ARE THEY EATING THE FOOD? WHAT DOES THE EQUIPMENT LOOK LIKE? DO THEY HAVE SUFFICIENT STAFF, THOSE KINDS OF THINGS, AS OPPOSED TO THINGS LIKE THEM GETTING RECOGNITION? I MEAN, I'M NOT INTERESTED IN RECOGNITION.

I'M MORE INTERESTED IN WHAT THAT CAMPUS LOOKS LIKE.

AND IF THERE ARE SOME SOME DEFICIENCIES THERE THAT WE MAKE SURE THAT WE POINT THOSE DEFICIENCIES OUT SO THAT THEY CAN BE ADDRESSED? WHEN I LOOK AT THE VENDING MACHINES.

SAMUELL IS HOW MANY KIDS? ABOUT 2000? SO WE'RE TALKING ABOUT MAYBE $200 A WEEK PER MACHINE.

THAT JUST SOUNDS UNUSUAL FOR KIDS AND VENDING MACHINES.

THAT'S A VERY, VERY LOW USE.

SO I JUST LOOKED AT THAT AND WONDERED ABOUT THAT ALSO.

AND THE LAST ONE, WHICH REALLY CAUGHT MY ATTENTION, WAS OBSERVATION FOR THE CREDIT RECOVERY AND WHERE THE THE DOCUMENT WAS NOT SIGNED OR IT WASN'T AUTHORIZED BY THE SCHOOL ATTENDANCE COMMITTEE.

SO THE QUESTION IS, HOW DOES THAT AFFECT THOSE STUDENTS THAT WENT THROUGH THE CREDIT RECOVERY? DOES IT AFFECT THEM IN A NEGATIVE WAY? SO IN THESE PARTICULAR INSTANCES, THE STUDENTS WERE GIVEN CREDIT FOR IT.

[01:15:02]

SO THEY WERE REASONABLE.

THEY WERE VALID. SO THOSE STUDENTS WERE GIVEN CREDIT.

OKAY. BUT THAT'S NOT A NORMAL PROCESS, CORRECT? WELL, THE NORMAL PROCESS IS STUDENTS HAVE TO, OR THERE IS SUPPORTING DOCUMENTATION FOR WHY THEY WERE GIVEN OR WHY THEY WERE NOT GIVEN.

BUT HERE THAT THE SIGNATURE WAS JUST MISSING FROM THE DOCUMENTATION.

SO IT DIDN'T GO THROUGH THE COMMITTEE? IT DID GO THROUGH A COMMITTEE.

BUT FOR WHATEVER REASON, THE SIGNATURE WAS JUST MISSING.

THEY DIDN'T SIGN IT. OKAY.

ALL RIGHT. ANY ADDITIONAL QUESTIONS.

ARE WE READY TO VOTE? ALL THOSE IN FAVOR? THE MOTION PASSES THREE ZERO.

GOOD. AND WE ALSO DID CAMPUS BASED CONTROLS AUDIT AT WOODROW WILSON.

AGAIN, WE NOTED THREE RECOMMENDATIONS FOR ACTIVITY FUNDS.

CASH DEPOSITS WERE NOT DELIVERED TO THE BANK IN A TIMELY MANNER.

THE FUNDRAISER FINANCIAL RECAP FORMS FOR ACTIVITY FUNDS WERE NOT COMPLETED AT THE END OF THE ACTIVITY, AND MONTHLY RECONCILIATIONS FOR ACTIVITY FUNDS WERE SUBMITTED AFTER THE DUE DATE. AND THEN WE ALSO NOTED ONE RECOMMENDATION FOR GRANT ACCOUNTING.

NON-COMPLIANT ITEMS THAT WERE NOTED BY THE SPECIAL REVENUE DEPARTMENT'S BIANNUAL REVIEW WERE NOT ADDRESSED.

ARE THERE ANY QUESTIONS? TRUSTEES CAN I HAVE A MOTION TO ACCEPT THIS FINAL REPORT? TO MOVE. SECOND.

SO ARE THERE ANY QUESTIONS? SO I JUST HAVE ONE QUESTION AND I'M ON 13 OF 14, AND THAT'S OBSERVATION ONE OF WHERE THE CASH DEPOSITS WERE NOT DELIVERED TO THE BANK IN A TIMELY MANNER.

DO WE HAVE A DOLLAR AMOUNT? IT WAS $4,175.

OKAY. ARE THERE ANY ADDITIONAL QUESTIONS? I HAVE A QUICK QUESTION.

WERE THE SAME CRITERIA OF QUESTIONS UTILIZED FOR EACH CAMPUS? YES, IT WOULD APPLY FOR ALL CAMPUSES.

I'M JUST KIND OF CURIOUS BECAUSE HERE IT SAYS CAMPUS VENDING MACHINES AND IT'S GIVEN THE DOLLAR AMOUNT FOR THE TEACHER'S LOUNGE.

BUT I'M ASSUMING ON PAGE FIVE OF 16 ON THE SAMUELL REPORT THAT THIS IS CAMPUS WIDE.

SOME CAMPUSES DO NOT HAVE A VENDING MACHINE FOR THE TEACHER'S LOUNGE.

THERE IS A CAMPUS OR DISTRICT WIDE CONTRACT FOR COCA-COLA, BUT THAT'S FOR THE ATHLETICS.

SO IT JUST VARIES CAMPUS TO CAMPUS.

AND THIS IS THE FIRST YEAR THEY'VE ACTUALLY STARTED TO LOOK AT VENDING MACHINES.

OR REVISIT.

SO BASICALLY WHAT YOU'RE SAYING IS THAT WITH WOODROW WILSON, THERE IS NO VENDING MACHINES FOR STUDENT USE THROUGHOUT THE CAMPUS. AT THE TEACHERS LOUNGE, THERE WERE NO VENDING MACHINES, WE DID NOT NOTICE ANY VENDING MACHINES IN THE CAMPUS.

UM. I'M SORRY.

WHAT CAMPUS ARE YOU MENTIONING THAT HAD NO VENDING MACHINES IN THE TEACHER'S LOUNGE? FOR WOODROW WILSON? BUT THAT'S WHAT IT SAYS IT HAS HERE.

IT SAYS THE CAMPUS HAS TWO VENDING MACHINES UNDER THE AGREEMENT LOCATED IN THE TEACHER'S LOUNGE FOR THE PERIOD OF AUGUST 21ST THROUGH THE 22ND.

THE PROCEEDS $312.64.

WHICH TRIGGERED MY, WELL, NOT SO MUCH AS THE DOLLAR AMOUNT, BUT IT WAS ONLY LOCATED IN THE TEACHER'S LOUNGE HERE.

BUT ON THE OTHER REPORT, IT I MEAN, I DON'T KNOW WHETHER IT WAS IN THE TEACHER'S LOUNGE OR THROUGHOUT THE CAMPUS BECAUSE IT'S JUST NOT STATING IT.

YES. TRUSTEE I THINK WE CAN CLARIFY THAT.

I DO NOT BELIEVE THESE VENDING ARE IN THE CAFETERIA AREAS, BUT WE CAN WE CAN CLARIFY THAT.

THE ONLY THING I REALLY NEED CLARIFICATION ON IS ARE YOU LOOKING AT APPLES TO APPLES ON EVERY CAMPUS? BECAUSE IT LOOKS LIKE ON CAMPUS A, IT MAY HAVE BEEN TEACHER'S LOUNGE AND STUDENT USE.

IT LOOKS LIKE THERE'S A WHOLE CAMPUS WAS LOOKED AT, BUT IT LOOKS LIKE OVER HERE ON CAMPUS B THAT ONLY A

[01:20:05]

I HAVE BEEN TO WOODRUFF WOODSON'S CAMPUS, BUT IT'S BEEN A LONG TIME.

THINGS CHANGE. SO I JUST WANT TO MAKE SURE THAT, AND HOPEFULLY YOU WILL BE DOING MORE OF THESE, THAT YOU HAVE A STANDARD CHECKLIST THAT YOU'RE GOING DOWN AND IF YOU DEVIATE FROM IT, JUST LET US KNOW.

ALL RIGHT. YEAH, SO AT EACH CAMPUS, WE WILL TRY TO DETERMINE EXACTLY WHERE ALL THOSE VENDING MACHINES ARE.

AND WE ALSO ARE GOING TO TRY TO DETERMINE WHAT THE TOTAL REVENUES COLLECTED FROM THOSE VENDING MACHINES.

ANY ADDITIONAL QUESTIONS? WE READY TO VOTE? ALL THOSE IN FAVOR.

THE MOTION PASSES THREE ZERO.

TRUSTEES NOW WE'RE ON ITEM NUMBER 5.4, REPORT ON STATUS OF AUDIT FOLLOW UP.

TRUSTEES DIRECT YOUR ATTENTION TO SECTION 5.4.

WE FOLLOWED UP ON ALL THE ITEMS THAT WERE OUTSTANDING.

TODAY. I'VE GOT SOMEONE TO HELP ME ON THIS, TOO.

AND THE ITEMS THAT WERE DUE WERE REVIEWED AND DETERMINED THEY WERE IMPLEMENTED.

SO THERE WERE SEVEN ITEMS? THAT'S CORRECT. MY NAME IS AISSA HERNANDEZ.

GOOD AFTERNOON, TRUSTEES AND SUPERINTENDENT.

I'M THE AUDIT MANAGER AND I AM DOING THE FOLLOW UP.

SO WE HAVE COMPLETED SEVEN FOLLOW UP AUDITS.

ALL RECOMMENDATIONS HAVE BEEN IMPLEMENTED AND VERIFIED AND 17 REMAIN OPEN.

DO YOU HAVE ANY QUESTIONS? ARE THERE ANY QUESTIONS? NO QUESTIONS. THANK YOU FOR THE REPORT.

THANK YOU. WE'RE ON ITEM 5.5.

THANK YOU, TRUSTEE FOREMAN.

WE'VE INCLUDED IN THE PACKET THE ANNUAL AUDIT COMMITTEE REPORT TO THE BOARD OF TRUSTEES FOR THE PRIOR FISCAL YEAR.

THESE ARE THE REQUIREMENTS IN THE AUDIT COMMITTEE CHARTER, YOU CAN SEE, INCLUDES A LOT OF INFORMATION, MEETING DATES, MINUTES, ATTENDANCE, COPY OF THE QUALITY ASSURANCE REVIEW TO SHOW THAT THE DOCUMENTS THAT THE COMMITTEE MEETS AND DOES ITS DUTIES RELATED TO THE CHARTER.

I'D BE GLAD TO ANSWER ANY QUESTIONS IF YOU HAVE.

ARE THERE ANY QUESTIONS? THANK YOU FOR THAT REPORT.

WE'RE ON TO ITEM 5.6.

5.6 IS AUDIT PLANNED STATUS 21-22 AUDIT PLAN.

AS YOU CAN SEE, WE COMPLETED THE ENTIRE AUDIT PLAN FOR THE YEAR.

ALTHOUGH WE CARRIED FORWARD AND ALLOCATED TIME IN THIS FISCAL YEAR FOR SPECIAL SERVICES DEPARTMENT, FORMERLY KNOWN AS SPED OR SPECIAL EDUCATION. IF YOU LOOK AT 22-23 AUDIT PLAN, YOU CAN SEE A LARGE NUMBER OF AUDITS AND PROCESS WE WERE ABLE TO FINISH LAST YEAR ON TIME AND START THIS CURRENT FISCAL YEAR AUDITS ALLOTED PROCESS.

WE'LL BE BRINGING SOME OF THESE REPORTS BACK AT THE NEXT AUDIT COMMITTEE MEETING.

I'LL BE GLAD TO ANSWER ANY QUESTIONS ON THE AUDIT PLAN STATUS.

I DO, AND HAVE ATTACHED AN ORG CHART, SHOWS THE FULL ORGANIZATION.

I'VE ACTUALLY BROUGHT A FEW OF MY AUDIT STAFF TO OBSERVE THE MEETING TODAY.

SAM WILLSON WAS UP HERE EARLIER.

XI CHEN AND SOME OF MY NEWEST MEMBERS, ASHTON LOYD, CAME TO US FROM CADDO PARISH SCHOOL DISTRICT WITH OVER FIVE YEARS OF EXPERIENCE. STAND UP, PLEASE.

ENRIQUE FUENTES AND JONATHAN BRYANT ARE SOME OF THE NEWER STAFF.

I'D LIKE TO INTRODUCE THEM.

THANK YOU SO MUCH FOR COMING.

WELCOME. QUESTIONS.

SO, I'M SORRY, TRUSTEES, ARE THEY ANY QUESTIONS? I DON'T.

[01:25:07]

THERE'S TIME FOR, IN THE PLAN, FOR ADDITIONAL ITEMS THAT MAY COME UP OR COME TO THE ATTENTION OF THE COMMITTEE THAT THEN THEY WOULD BRING FORWARD AND OR DIRECT ME TO CONSIDER.

ALL RIGHT. THANK YOU, TRUSTEE FOREMAN.

YES. SO JUST REAL QUICK, SO IN A COUPLE OF THESE, IT'S REALLY WE'RE HELPING SUPPORT THE OUTSIDE AUDITORS, LIKE LIKE E RATE.

YES, SIR. RIGHT. SO YOU GUYS AREN'T DOING THE E RATE.

WE HIRE THAT OUT? THAT'S CORRECT. AND THEN YOUR TIME ON THIS IS JUST TO SUPPORT IT.

AND SO THE HOURS SHOULD REFLECT THAT.

[INAUDIBLE] WE DO FIND SOME HELP IN LOCATING AND IDENTIFYING FIXED ASSETS, WHATEVER THEY MAY NEED, WITHIN REASONABLENESS THAT WE WOULD HELP THEM.

AND OF COURSE, IT HELPS US STAY ON TOP OF IT TO SEE WHAT THEY'RE DOING AND HOW THEY'RE LOOKING AT THINGS TOO.

OKAY. THANK YOU.

SO NOW WE'RE ON TO 5.7.

YES. I WILL BE REPORTING ON THE HOTLINE STATUS REPORT FROM JULY 1ST, 2022 THROUGH AUGUST 31ST, 2020.

THE OFFICE OF INTERNAL AUDIT RECEIVED 183 HOTLINE REPORTS.

THE HOTLINE REPORTS ARE DOCUMENTED BY TYPE, DISTRIBUTION AND REDISTRIBUTION ON PAGE TWO OF THREE FOR FISCAL YEAR 2020 THROUGH 2022, THE OIA RECEIVED THE FOLLOWING HOTLINE REPORTS BY YEAR.

THE HOTLINE REPORTS ARE DOCUMENTED.

FOR FISCAL YEAR 2020 WE RECEIVED 1,316.

FOR FISCAL YEAR 2021, WE RECEIVED 1169 AND FISCAL YEAR 2022, 1884. PAGE THREE OF THREE, THE HOTLINE REPORTS DISTRIBUTION. SO WE HAVE A BEGINNING BALANCE.

WE HAD FIVE.

WE WERE ASSIGNED 183 CASES.

WE CLOSED 147 AND 41 REMAIN OPEN.

THE AGENT REPORT IS WE HAVE A TOTAL OF 41 OPEN CASES AT THIS TIME.

AND NO CASE IS OLDER THAN MAY OF 2022.

ENTERTAIN QUESTIONS.

ANY QUESTIONS? I HAVE A COUPLE OF QUESTIONS.

SO, OF COURSE, WHEN I LOOK AT THE FISCAL YEAR 2020, 2021, SO WHAT WOULD THE SCHOOL YEAR BE? IS IT 2021-2022? SO THIS IS JULY ONE THROUGH JUNE 30TH.

SO THAT WOULD COVER THAT SCHOOL YEAR, SCHOOL STARTING SOMETIME IN AUGUST AND OF COURSE ENDING.

WE PUT THIS TOGETHER TO HAVE A CLEAN CUT OFF AND TO BE ABLE TO COMPARE YEAR OVER YEAR.

YOU CAN SEE WITH COVID YEAR IT WAS OBVIOUSLY REDUCED, HAVING A FULL YEAR BACK, SCHOOL IN SESSION, THE NUMBERS, AS WE EXPECTED, WENT UP SIGNIFICANTLY.

SO THIS IS JUST A SUGGESTION.

IT'S MUCH EASIER FOR ME TO GO BY THE SCHOOL YEAR SO THAT YOU'RE ABLE TO IDENTIFY EXACTLY WHAT SCHOOL YEAR YOU'RE IN SO THAT THERE'S SOME CONSISTENCY ON HOW WE GO ABOUT BRINGING DATA FORWARD.

YES, MA'AM.

SURE.

YEAH, WE'LL CARRY THAT FORWARD LIKE THAT.

BECAUSE IF YOU LOOK AT IT RIGHT NOW, WE DON'T HAVE ANYTHING ON HERE THAT'S RELATIVE TO NOW, THIS SCHOOL YEAR.

WELL, PAGE ONE IS YEAR TO DATE, JULY ONE THROUGH AUGUST 31ST.

OK.

YES, MA'AM. I GOT YOU.

I GOT YOU.

THAT HELPS A LOT. WE HAD THE DATE, BUT NOT THE SCHOOL YEAR SLASH FISCAL YEAR.

[01:30:10]

HOW MANY DID WE HAVE UP TO THAT? WE CONTINUE TO WORK ON THEM EVERY SINGLE DAY.

THE CUTOFF DATE WAS SEPTEMBER THE NINTH.

WELL, YEAH, WE INCLUDED EVERYTHING HERE THAT IS REPORTED THROUGH AUGUST 31.

IF I WAS GOING TO GIVE YOU MY BEST GUESS, YOU KNOW, HALF OF THESE ARE PROBABLY CLOSE BY NOW BECAUSE IT'S SEPTEMBER 26TH.

OKAY, GOOD DEAL.

SO JUST ON THE DATED ISSUES, I JUST WANTED TO BRING SOMETHING TO YOUR ATTENTION.

RECENTLY THERE WERE CHANGES TO OCR GUIDELINES RELATED TO TITLE NINE INVESTIGATIONS.

AND THESE ARE NOT YOUR STANDARD RUN OF THE MILL INVESTIGATIONS.

THERE'S A LOT OF COLLABORATION BETWEEN MY OFFICE, THE PARENTS, THE STUDENTS, THE CAMPUSES.

AND SO YOU'RE GOING TO SEE THESE DATA CASES EXPAND, WHICH IS NOT THE NORM.

IT'S GOING TO BE THE EXCEPTION.

SO I DON'T WANT ANYONE TO THINK ANYTHING DIFFERENT.

WE CAN PROVIDE THOSE CASE NUMBERS TO YOU IN OUR FRIDAY PACKET, AS WE NORMALLY DO, AND I THINK THAT WOULD BE HELPFUL.

IT MIGHT BE HELPFUL TO BREAK OUT TITLE NINE SINCE IT HAS THE DIFFERENT NUANCES THAT YOU HAVE TO DEAL WITH.

YOU MIGHT WANT TO BREAK OUT TITLE NINE AND MAKE IT A SEPARATE CATEGORY, SO THEN YOU CAN DEAL WITH THAT SEPARATELY.

ABSOLUTELY. AND THAT'S WHAT YOU'RE SEEING HERE.

THE TWO, THE ONE OFFS, THE TWO FOR MAY, THREE IN JUNE, ONE IN JULY, YOU'RE GOING TO SEE THOSE.

THOSE ARE THE EXCEPTION. EVERYTHING ELSE GETS CLOSED WITHIN 28 BUSINESS DAYS FROM MY OFFICE.

SO THANK YOU.

OKAY. THANK YOU.

ARE THERE ANY ADDITIONAL QUESTIONS? YES. I HAVE A QUICK QUESTION.

WELL TWO ACTUALLY.

FOR ACADEMIC MISCONDUCT DO WE, IS THERE A FURTHER BREAKDOWN AS FAR AS IF WE WANTED TO SEE FURTHER BREAKDOWN AS IF IT'S ON A HIGH SCHOOL CAMPUS OR MIDDLE SCHOOL, ELEMENTARY, IS THAT INFORMATION AVAILABLE AND ALSO MISUSE OF AUTHORITY OR POSITION? CAN WE SEE IF THAT'S A ADMINISTRATOR, WHETHER IT'S CAMPUS LEVEL PRINCIPAL OR ED OR WHAT THE CASE MAY BE? IS THERE? YES, WE CAN BREAK THAT OUT.

OKAY. DOES IT HAVE TO BE REQUESTED SEPARATELY OR, I MEAN, I'M JUST ASKING.

WE HAVE TO REVIEW INDIVIDUAL CASES TO BE ABLE TO DETERMINE THAT.

ONE DRAWBACK OF THIS SYSTEM THAT WE USE IS THAT IF YOU WENT TO PUT A CASE IN ONLINE, YOU COULD CALL IT MISUSE OF AUTHORITY AND IT MIGHT BE BULLYING. SO ONCE THAT PERSON THAT PUTS IT IN SELECTS THAT CATEGORY, I CAN'T CHANGE IT.

IT'S A GENERAL CATEGORY.

DOES THAT MAKE SENSE? SO I'D HAVE TO GO IN AND COUNT EACH ONE OF THESE.

WE CAN RUN THAT REPORT AND SEE WHAT SCHOOL ACADEMIC MISCONDUCT IS OCCURRING.

WE CAN DETERMINE THAT, BUT IT'D BE MANUALLY DO IT.

AND THEN ON MISUSE OF AUTHORITY, IT COULD BE THAT.

IT COULD BE SOMETHING ELSE.

IT FALLS INTO THIS.

I WOULD LIKE TO ENHANCE THIS SYSTEM.

WE'RE LOOKING AT SOME OTHER SYSTEMS THAT MIGHT GIVE US MORE FLEXIBILITY.

THE ONE THING THIS ETHICS POINT DOES IS IT ANSWERS THE PHONE 24 HOURS A DAY.

CURRENTLY, POLICY REQUIRES THE PHONE BE ANSWERED 24 HOURS A DAY BY SOMEBODY.

AND THAT'S WHY WE'VE BEEN KIND OF LOCKED IN TO THIS.

THERE'S OTHER RESOURCES OUT THERE, BUT THEY DON'T ANSWER THE PHONE NECESSARILY.

THEY WOULD TAKE A PHONE MESSAGE, TRANSLATE IT INTO AN EMAIL AND HANDLE IT THAT WAY.

SO WE'RE ALWAYS LOOKING FOR BETTER SOLUTIONS TO GET BETTER INFORMATION.

AND AS THESE COME IN, TO MAKE SURE THAT'S ACTUALLY CORRECT.

BUT ONCE IT GOES THROUGH THE PROCESS, THE CALL IS, WHETHER IT'S ANSWERED BY A LIVE PERSON OR IT'S ANSWERED AUTOMATICALLY OR AUTOMATED, AND AN EMAIL IS GENERATED AND SENT OVER, IT'S ASSIGNED TO SOMEONE TO HANDLE.

SO THAT PERSON IS THE ONE WHO HAS THE ABILITY TO SAY IF IT'S MISCONDUCT OR BULLYING OR ASSAULT.

IS THAT CORRECT? WELL, THEY CAN THEY CAN SAY THAT OR DETERMINE IT'S SOMETHING ELSE.

BUT CURRENTLY, WE CAN'T CHANGE IT IN THE SYSTEM.

[01:35:01]

SO YOU'RE SAYING THE PERSON WHO CALLS.

EXCUSE ME FOR INTERRUPTING.

BUT YOU'RE SAYING THE PERSON WHO DOES, IF I CALL IN AND I SAY I'M HAVING PROBLEMS WITH A PRINCIPAL AND THIS IS WHAT'S HAPPENING, THAT'S HOW YOU DECIDE, THE SYSTEM DECIDES THE CATEGORY.

CORRECT. AND MAINLY THAT'S THE WEB BASED FORM INPUT.

IF YOU CALLED IN, THE OPERATOR MIGHT SAY, WELL, WHAT'S IT RELATED TO? AND PROBABLY HELP FIND A BETTER CATEGORY.

BUT IF YOU GO IN AND YOU USE THE INTAKE FORM IT'S SELF REPORT, IN OTHER WORDS.

SO WHEN I CALL IN, I'M SELECTING FROM WHAT'S AVAILABLE TO ME.

SO I COULD SAY IT'S THIS AND LATER ON WE MIGHT DECIDE IT REALLY WASN'T THAT, BUT WE'LL STILL HANDLE IT.

BUT ONCE IT'S ON THIS REPORT RIGHT NOW, IT CURRENTLY CANNOT BE CHANGED.

IS THAT CORRECT? BUT THERE'S TWO FORMS OF REPORTING.

IT'S THE SYSTEM AND ALSO THE LIVE CALLS THAT ARE COMING IN.

BUT THAT PERSON STILL HAS TO ASK THAT PERSON WHAT THEY CONSIDER IT.

RIGHT. SO BOTH, EITHER WAY IT GOES, IS PRETTY SUBJECTIVE? YES, TRUSTEE.

ANY ADDITIONAL QUESTIONS? THANK YOU FOR THAT REPORT.

THANK YOU. THE BOARD WILL NOW RETIRE TO CLOSED SESSION.

[6. Closed Session - The Board will retire to closed session pursuant to Texas Government Code Section 551 concerning the following sections:]

THE PUBLIC PORTION OF THE MEETING WILL RESUME AFTER CLOSED SESSION.

THE BOARD WILL RETIRE TO CLOSED SESSION PURSUANT TO THE TEXAS GOVERNMENT CODE SECTION 551 CONCERNING ANY AND ALL PURPOSES PERMITTED BY THE ACT, INCLUDING BUT NOT LIMITED TO THE FOLLOWING SECTIONS.

SECTION 551.076 TO DELIBERATE REGARDING THE DEPLOYMENT OR SPECIFIC OCCASION FOR IMPLEMENTATION OF SECURITY PERSONNEL OR DEVICES OR SECURITY AUDIT SECTION 551.089 TO DELIBERATE SECURITY ASSESSMENTS OR DEPLOYMENT RELATING TO INFORMATION RESOURCES, TECHNOLOGY, NETWORK SECURITY INFORMATION AS DESCRIBED BY SECTION 2059.055 BE OR THE DEPLOYMENT OR SPECIFIC OCCASIONS FOR IMPLEMENTATION OF SECURITY PERSONNEL, CRITICAL INFRASTRUCTURE OR SECURITY DEVICES.

THE TIME IS NOW WE SHOULD BE GONE FOR ABOUT 15 MINUTES.

THE TIME IS NOW 4:41 P.M.

AND WE'RE BACK IN OPEN SESSION.

THE BOARD TOOK NO ACTION IN CLOSED SESSION.

WE ARE ADJOURNED.

* This transcript was compiled from uncorrected Closed Captioning.