Last night, Bill Matthews hit one out of the ball park. He has identified $36 million in double counting in the budget. The following combines Bill's comments in the beginning of the meeting and at the end of the meeting. Bill identified specific Board of Viewers cases which are duplicates. PLEASE take the time to listen to his comments.
Update April 16, 2014 2:51 PM The following update is from Bill Matthews:
The “double counting” relates to the properties in our community that are currently under appeal with the County. Recently, Dr. Steinhauer reported to the board and our community that these properties totaled about $214 million. The district assumes this collective valuation may be reduced by 20% by the time each of these cases reaches final adjudication. Appropriately, the district makes an allowance for successful appeals in preparing its annual budget.
Upon request, the district provided reports detailing the $214 million – by property. In the first 2 minutes of my review, I concluded there were cases counted twice by the district, and additionally, there were several individual properties with two cases pending, effectively resulting in double counting (counting the property valuation twice, once for each pending appeal).
My deduction is that at the point in time of the district’s calculation, the collective value of properties under appeal was $178 million; $36 million less what Dr. Steinhauer reported.
Because an allowance is only made for the value of successful appeals (20%) not the entire $36 million, about $7.3 million in additional property valuation may be included in our community tax base for budget purposes. This $7.3 million represents about $164 thousand in ultimate tax revenue not currently included in the district’s proposed budget.
In other words, adding back the $164 thousand in anticipated revenue would reduce the millage increase required to balance the budget from the proposed .54 mills to .48 mills; a reduction of more than 10%.
Update April 17, 2014 9:34 AM Elaine Cappucci asks Jan Klein about the budget and double counting prior to the Proposed Budget vote on April 15, 2014.
Update April 17, 2014 10:57 AM The entire April 15, 2014 School Board Meeting podcast is available on my website, Lebo Citizens.
63 comments:
I have uploaded the entire podcast on Lebo Citizens. Presently, I am watching the meeting on TV. Elaine Cappucci has changed the order of the meeting, to take comments about the rifle range. Now, the school board directors are having a discussion about the rifle range. The meeting has been running for over an hour, and Bill Matthews has not spoken, even though he has requested to speak.
The timing is unbelievable. Sure takes the focus off the budget!
Elaine
I found Steinauer's (sounder like the Super) response to Matthews presentation offensive.
While it is nice that he stepped up in defense of his staff his reply skirts the subject matter and instead subtely shoots the messenger.
Matthews may or may not be correct in his assessment, but he is a resident and taxpayer and has every right to question the budget numbers.
Steinhauer's response should have been at the very least - "Thank you Mr. Matthews, I will look into your information and get back to you, the public and the board."
No, he chose to circle the wagons! Terrible behavior by our district leader IMO.
From a resident, thank you Mr. Matthews for your work!
Bill's comments still have not aired. Board is doing board reports. It has been airing for 90 minutes. I am anxious to watch board and administration reactions to Bill's comments.
Elaine
Typical defensive response by Steinhauer. Looks like the district finances are in deeper doo-doo than they thought.
"The [Super] doth protest too much, methinks."
OMG!!!! The televised meeting has ceased during Bill Matthews' comments!!!!!!!!!!!!!
Elaine
Condescension and incivility go hand and hand.
Yes, Mr. Steinhauer, it's not like the district ever gets numbers wrong.
Where are we building that most likely under $100 million high school again???
Civility is absent from challenging public discussions in Mt Lebanon. The podcast of Bill Matthews' comments demonstrates the respectful manner in which he presented concerns based on the diligent work he completed voluntarily on the budget. The podcast also demonstrates that the responses from Dr. Steinhauer and Mrs. Cappucci were condescending, inflammatory and aggressive; their responses exemplify the lack of civility within the administration of the Mt Lebanon School District.
I was intrigued by Bill's observations. I was disappointed that the response from The Board was not, "Thank you for bringing this to our attention. We believe that our numbers are completely accurate, but let us review your observations and see why we differ." If anything, the Board could have done Bill more damage by destroying his credibility IF Bill's numbers were incorrect. Unfortunately, because of the way that this was handled by The Board they may have created a bigger problem for themselves.
Mt Lebanon is not the boardroom of a mammoth law firm or a Country Club and Bill doesn't need to feel that he, "spoke out of turn." We live in a democracy and we live in an age of transparency. Our laws and our public policy are directed towards inclusion and open dialog. Mt Lebanon needs to wake-up! We have too many Napoleon's marching around local government with autocratic tendencies. They need to go!
If anything, the School District should be grateful that a citizen took enough of an interest in local affairs to review an entire budget in detail so that he could understand how our hard-earned money is being spent.
The Board's reaction was chilling! Absolutely chilling!
I want to thank David Huston for recording the meeting. Had he not, our community would not have known about this. The meeting was filled with citizens concerned about the rifle range. The room cleared out and the board reports started. One hour and forty minutes from the start of the meeting, Bill Matthews was permitted to speak. I knew something was up when Cappucci changed the order of the agenda.
This blog and my website are the only two places where Lebo can hear about this double counting. Bill Matthews has been censored.
Elaine
"Manners easily and rapidily mature into morals." — Horace Mann
Our district - no perhaps our community - seems to have lost their way on both.
Not only did MTLSD censor Bill, the vote for the proposed budget was not aired this morning. I have not listened to the entire podcast here, but I understand that Scott Goldman was the only one who voted against the budget.
Elaine
ALL Mt Lebanon residents should write a Letter to the Editor of every local paper and express their opinion concerning The Board's behavior to Bill's remarks.
I realize a segment of Mt. Lebanon thinks I am crazy, but I am more concerned with our finance director's fake budget, instead of Timmy and Cappucci's attitudes.
The School District is playing games with our budget!
Elaine
The fake budget is of course the prime concern, but budgets and attitudes aren't mutually exclusive.
One gives birth to the other, here in the bubble.
"There's no way to know this."
How does Superintendent Steinhauer say that? WE PAY YOU TO KNOW THIS! Look at the superintendent's goals (#1 specifically http://www.mtlsd.org/superintendent/goals.asp You may not be able to rattle this off from memory but you should be able to say "We can look into this and we will definitely answer this."
It's math. It's not magic.
I wonder if anybody's numbers include the homestead exclusion from gaming revenue?
Is Bill's handout available for us to see?
Are they going to figure this out before the final budget is approved next month?
12:57, that is just the point. It is obvious that Mr. Matthews invested quite a bit time and energy on his study. Does he have it wrong or right, who knows, but I seriously doubt that Steinhauer or any board director fully comprehended the numbers during the 4 minutes of Mr. Matthews' presentation.
To launch into a defensive strategy on the spot is ludicrous, Ms. Klein certainly isn't a super human incapable of making an error.
Hey, she moved out of the best community in Western PA didn't she! ;-)
What HAPPEND to freedom of speech? or is that just for the devil's advocate? Perhaps Dr. Timmy should practice what he preaches!
Elaine,
I can't say for sure if Bill is correct or incorrect. There may be a misunderstanding or incorrect data that the School District gave to Bill or any one of a number of other things that could explain the difference.
What concerns me is the reaction and the behavior of the institution to his comments at the meeting. The comments were so swift and so severe that it left me feeling that The Board doesn't have faith in the staff who are producing the budget.
This brings us to the next problem - censorship and Board credibility. Assume that Bill is wrong and The Board is correct. Who will ever trust The Board when they tell us that we're watching ANY School Board meeting? With censorship taking place we really don't know what we are watching!
For 33 years, Ms. Klein has been padding the budget.
The one ultimately responsible is Timmy. Jan works for Timmy.
Elaine
There is no doubt that JK knows her stuff.
When asked in an Audit & Finance meeting if the HS project would put the district in trouble with Act 1 limits, she replied there are always exemptions and exclusions the district could use.
Staying under Act 1 limits because it was the right thing to do was never an objective.
Dr. Steinhauer and Mrs. Cappucci have the same type of reaction to all citizen comments that challenge the status quo or open up the possibility that something is wrong or needs to be fixed.
Dr. Steinhauer wants to promote this unrealistic (and untruthful) image of the perfect school district and he's willing to do so at the cost of mistreating and silencing thoughtful residents.
This is exactly why Senate Bill 76 seriously needs to be looked into.
Voters would have final say on the budget (tax hike) through mandatory referendum.
Why can't our legislators pass a law making it illegal for a state, county, municipal government or school district to censor the broadcast any public meeting?
Dan Miller and Matt Smith should consider passing a law making this practice illegal in Pennsylvania. The enforcement would be simple - PA will withhold any state funding for any entity that censors the broadcast of a public meeting.
Bill Matthews sent me some additional information, which has been added to this post as an update.
Elaine
If this error is corrected, the proposed millage increase would be reduced by more than 10%, from the proposed .54 mills to .48 mills.
We have more overtaxing by our local government!
Elaine
The school board meeting is being aired presently, including Bill Matthews initial comments.
Elaine
Elaine Cappucci just asked Jan Klein about the budget. Jan Klein just stated that she has no knowledge of double counting. She feels that the numbers are too optimistic. She thinks the budget, on the whole is very reasonable. Looks like it is going through with the double counting.
Elaine
Will someone make that soundbite for me? It is right before the vote for the budget. I want to post that portion of the meeting. Please include how Elaine Cappucci starts out by saying that Jan Klein has the full support of the school board. It is around the 01:49;49 time stamp. When Timmy was having his say about Bill Matthews' comments, Timmy said that Jan Klein could not respond to the numbers since she didn't have the spreadsheet in front of her. Yet, Jan was able to answer Elaine's question. Why is that?
Elaine
If there is the possibility of reducing the millage rate increase from .54 to .48 as a taxpayer I want that break!
Hate to bring this up, but in the budget has there been any discussion on the Capital Fundraising Campaign?
Is it in the black or still operating in the red?
4:12 PM, please listen to the report given by Larry Lebowitz. We are never given numbers for fundraising on either side of our local governments.
Elaine
"Even when the experts all agree, they may well be mistaken."
-- Bertrand Russell, British philosopher, mathematician and historian
Steinhauer needs to go back to school... he missed something.
Musicians don't make good leaders in MtL.
Did I hear Mr. Matthews read off numbers from the same handout which he passed out to the Board and Dr. Steinhauer? The video captured the Board passing papers during Mr. Matthews' address. Dr. Steinhauer had the explanation right under his nose.
Maybe everyone should start thinking about what Mt Lebanon will do if Steinhauser and Kline walk? Face it, they are human too- and after a period of all of this examination and commentary they may walk!
Who would Mt Lebanon pick? Do they have succession planning in place? Does the SD have a leadership supply process? Would they promote from within? What are the ideologies of those subordinate to the Supt and Kline?
Maybe the best thing to do is just shut the whole place down, wipe our taxes, drop the kids in the states' lap and let PA figure out where and how to educate them?
I like the next to last bullet point in this linked article. http://smartblogs.com/education/2014/04/16/what-maker-leaders-make/?utm_source=brief
"I’ve come to realize that “maker leaders” emerge from all demographics. They can be introverts, extroverts or ambiverts. They bring different experiences, capabilities, talents and habits with them. They are successful not because of what they know, but because of what they make.
What do leaders make?
They make a culture that unleashes the potential of others.
They make time to connect people inside and outside of their organizations, and to nurture and cross-pollinate ideas, resources, questions and solutions.
They make diverse teams thrive by valuing the unique contributions and talents of each member as they lead and collaborate together to invent, design, create and produce.
They make agenda space that validates creativity as a pathway to solving grand challenges, daily problems and unexplored possibilities.
They make other leaders through opportunities that empower people to think and act out of conviction, commitment, knowledge, skill and courage.
They make beliefs, ethical decision-making and regard for others’ core values in their actions.
They make mistakes and use those as pathways to model humility as well as learning.
And, they make their own leadership with their hands, their hearts and their heads as they listen, question, seek and share in the work with those they encounter, regardless of position, age or experience."
Was this a mistake by the District an accident or something by design ? It is well known that governmental budget developers pad their budgets by underestimating revenues by a variety of means and overestimating expenses. One such means was revealed by Bill Matthews.
Who would have ever thought that a resident would obtain and actually study the County & District documents he relied upon to expose this mistake, or skullduggery ?
And one wonders what else could be revealed by dissecting the proposed budget with documentary backup utilized by the District. Another similar example occured several years ago when the District administration claimed, in response to a question, that there was absolutely no "fat" in the proposed budget, and that any reduction in the budget would affect the education of the children. A SB member with a financial background said "hogwash" and claimed he could find $500,000 in further reductions that would have no effect on childrens education by simply reviewing the budget line item detail and backup. He met privately with District Finance rep's a few days later, and at the next SB meeting reported $500,000 in savings had been identified and revealed. The Finance reps confirmed his findings and the costs were removed from the budget.
"figures lie and liars figure" so the saying goes.
6:06 PM, Bill was reading the cases from a RTK he filed with MTLSD. This report came from the district.
JDK, Timmy will not walk. He has a sweet deal. His contract ends in 2019. It says right in his contract that his salary will never go down. Plus, he is our golden-haired boy now that we are "Number 1" according to PBT.
Why would he leave? He is living in an underassessed home with no pending appeals. He can hand out pizza and cupcakes to kids who may be lactose intolerant or have celiac disease, and not give it a second thought. He can tweet to his heart's content and take pics of Post It Notes. He gets six goals or so a year, that take half a page of paper. There is no accountability. He can attack residents who raise questions during questions or comments from taxpayers. He can block me on his Twitter account. Come on, John, would you walk from a job that pays $175,000 a year with low expectations? Here is his contract.
Jan will probably retiring this year. She was supposed to retire with her BFFs, but they're gone and she is still here. I am sure she sees the writing on the wall.
7:00 PM, I remember when Bill Matthews challenged something in the PlanCon process and Timmy told him he was wrong. Bill was using an updated form with updated numbers. Who was it, Celli? who said Bill was right? That was a couple of years ago. Timmy is never wrong, or so he thinks.
Elaine
7:00 PM, the school board member you refer to was Mark Hart.
6:32pm, Steinhauser is not a leader - Steinhauser is a manager. The leaders are the members of the School Board.
Oh my God, did I say that? The School Board are our leaders? Yikes! That is a FRIGHTENING THOUGHT! (It's true, but it's frightening, isn't it? )
Maybe in a future election the electorate will take the election more seriously and more than 17% will turn-out to vote?
The same with the Commission. Granted, the Commission isn't as bad as the School Board,... well, ... - anyway - Steve Feller is a manager, not a leader. We need leadership! We need people with a vision and the intellectual capacity to direct Feller (of his successor) to realize the leadership's vision.
This is actually a very big problem in Mt Lebanon. Nobody is leading. Nobody has a vision. The elected officials are depending on Steinhauser and Feller to tell them what to do, because outside of ball fields and raising taxes they really don't know what to do!
The events unfolding before our eyes are a Call to Action for every resident. Folks, you need to get involved, get informed, select candidates, register and VOTE!
Otherwise, we're going to become the next Wilkinsburg, Aliquippa, Detroit, etc.
Bill Matthews found a hole in the budget and the cover-up proceeds. Damn the residents credibility. FULL MILLAGE AHEAD! Don't expect the auditor to find the deviation Mr. Matthews exposed. Funny how things like this don't happen in Upper Saint Clair but they did happen in North Allegheny and citizens asked over 160 questions about the budget.
Yes 7:27 PM, and because Hart tended to regularly challenge the District Admin for "hogwash", several female members of the SB who were Admin and teacher suck-ups spread false behind-the-scenes rumors about Hart via the PTA network in an attempt to embarrass and shut him up.
Hi Elaine,
I just read your post. You're right! Steinhauser has it made!!!
Kids, (those of you under 18 who enjoy reading about the management of your school) - Please download a copy of your Supt's contract, frame it, place it on your desk and aspire to come up with a deal like the one that Mt Lebanon gave Steinhauser!
There's an old song, "When I think of all of the crap that I learned in High School it's a wonder that I can think at all..."
There's a lot of truth to that song! Maybe the one thing that you can leave the Palace with is a dream that you too can work a deal like Steinhauser.
Face it - the Supt's contract is a blueprint for success!
John, the next election isn't for a couple of years. This budget is going to pass next month, in spite of what Bill Matthews has uncovered. So now what? Vote?
I want to know how we can stop this NOW. I can't keep up with all the corruption in Mt. Lebanon. We have commissioners spending our surplus money on toxic turf because we are overtaxed. LeboALERTS are coming out about PAYT. The school board snarls at us and rolls their eyes when we challenge something. The superintendent is as arrogant as they come. We're seeing fake budgets. We're filing RTKs daily. I am still waiting to hear from Harrisburg on my appeal about a RTK I filed in January! Our commission president thinks she is Gozar from Ghostbusters and threatens to shut down meetings. She won't tell me that the numbers from the deer survey are 60% LOWER than last year's numbers. She ignores emails. Our school board president only answers emails when she is in town or isn't entertaining out of town guests, if she answers you at all. We have public information officers who treat residents poorly. Meanwhile, our State Rep, Senator, and media just sit and watch it all happen.
Elaine
How much extra did the grievance cost in this year's budget?
How many tens of thousands of dollars in bonus payments did Jan Klein receive going back 5-10 years?
Where are the demands for an outside audit? That would scare the piss out of all of them! Especially when the new teachers contract is finally outed.
HI Elaine,
Boy! I sure don't know what to do! But I can tell you one thing- after hearing how the Supt sounded off at the meeting last night I'm going to watch him and all of the elected officials very carefully, 'cuz if anyone starts looking nervous or anxious I'm gonna get the hell out of there fast!!!!
Senate Bill 76 doesn't have a chance in hell of passing! This is Pennsylvania. The unions will spend their last penny to see the Bill go down in flames. They will NEVER allow the voters to determine if they get the money and benefits they want.
We can not rely on the PA Department of Education for help. We need an outside agency that is willing to take on the variety of problems here. We can't rely on local individual lawyers because they say things like "corruption is everywhere". Is there a law firm or agency that is strong enough for these matters?
After Mrs Cappucci insulted Mr. Mathews on his hard work, Dr Steinhauer cut off Mrs. Cappucci from asking Ms. Klein about Mr. Mathews double counting information. He did so by saying Ms. Klein doesn't have a copy of the information Mr. Mathews gave to the board. Why couldn't Dr. Steinhauer walk back his copy of the numbers to Ms. Klein to see? It really isn't a long walk Dr.
Then Dr. Steinhauer asked Ms. Klein out of the 33 years you have been here, how many years have you underspent your budget? Ms. Klein responded the budget was underspent in 32 years revealing ML has been overtaxed 32 of her 33 years here.
When does this nonsense stop Dr. Steinhauer? You need to get your staff to check their work like you expect students check their work. 32 years of overtaxation is real old and newcomers shouldn't be asked for additional money in inflated budgets.
So was there a $2.6 million shortfall? I don't know what to believe now.
10:59 PM, I took that the same way. I don't think that is something to be proud of, Timmy.
Elaine
Not one peep about this in either paper. What do they write about? The rifle range. That's it.
Elaine
Elaine democrats won't rat on other democrats when it comes to their crimes! Matt Smith walked away when asked about the lies used to keep the High School project away from a vote. He's right in the mud with the School Board. He in with the turf people too.
If Steinhauer treats kids the way he treated Mr. Matthews, we need someone else to be sitting in his seat now.
Please listen to the exchange between Elaine Cappucci and Jan Klein that I have linked in my 9:34 AM update.
Elaine
How much money did Mrs. Klein and MTLSD set aside in the budgets over the past 30 years to anticipate the school renovations? Wouldn't that be considered an essential part of the budget process?
11:04 AM, take a look at the history of the Capital Projects Fund...they're in the annual CAFR's and Budget books on the website. That and the Policy set by a SB several years ago that undesignated fund balances exceeded a certain % each year would be assigned to the Capital Projects Fund.
The Finance Dept. and Super pad budgets each year (e.g. underestimate revenues & overestimate expenses) which the dead-from-the-neck-up SB unquestionably approve that generates enough surplus to add to the Fund.
The elementary, middle school and high school renovation projects from the early/mid 1990's to now were so large as to require mostly bond financing but were supplemented by the fund which is also used for for significant district repair & maintenance projects and purchases of capital equipment.
11:37, hence avoiding a referendum.
Cappucci will never admit it.
You got that right, 1:06 PM !
After watching Steinhauer's response to Bill Matthew's presentation the following came to mind.
"• As a bureaucracy grows, the level of talent initially rises and then declines. Washington is a city of peons.
• As bureaucracies grow older, their top officials shift their focus from performing "social functions" to ensuring the institution's budgetary growth. This means dealing ruthlessly with "whistle blowers."
• Each bureaucrat tends to distort the information he passes upward in the hierarchy, exaggerating those data that are favorable to him, and ignoring those that are critical. He also tends to tell his superiors only what he thinks they want to hear, which is not necessarily consistent with reality. And we think we can rely on these people to protect us from terrorists.
• Each bureaucrat will comply with those directives from his superiors that serve his own self interests, and will subvert those that don't.
• In any large bureaucracy a significant amount of what goes on is completely unrelated to the bureau's goals.
• As any bureaucracy grows, the proportion of wasted activity rises steadily. But it's only taxpayers' money. [PIZZA LUNCHES COME TO MIND!]
• The larger a bureaucracy, the more resistant it will be to any change. Of course; there are no market pressures.
• Every bureaucrat is a vigorous propagandist for the expansion of his organization. Governments at all levels spend billions of dollars annually attempting to fool the public into believing that their failures are really successes."
— "Inside Bureaucracy" Anthony Downs
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