Board Ad Hoc Committee Recommends Board Eliminate Credit Card Usage

July 22, 2014

Outside Counsel Updates Report on Expense Review

The Montgomery County Board of Education Ad Hoc committee reviewing credit card usage of Board members recommended Tuesday (July 22) that the Board eliminate the usage of credit cards, implement a per diem allowance when Board members are attending professional conferences, limit home office expenses for Board members and establish a list of preapproved public events Board members can attend.

The recommendations, unanimously approved by the Ad Hoc Committee for Review of Board Processes and Guidelines on Board Expenditures, will go to the full Board of Education on Monday, July 28, 2014 for consideration.

“The Board of Education takes its responsibility seriously and we want to make sure that we are being good stewards of public dollars,” said Board of Education President Phil Kauffman. “Our review process has shown that we clearly need to improve the review and approval process of Board member expenses. I think our recommendations today will go a long way in ensuring that we have good processes in place to manage expenses.”

The Venable law firm conducted an outside review of the expenses and the Board practices and guidelines regarding the usage of Board-issued credit cards. Attorney Karl Racine updated the committee on Venable’s findings. His report found that there were weaknesses and ambiguity in the current processes that need to be corrected. The review recommended that the Board eliminate the issuance of credit cards to Board members going forward. In addition, Racine’s review “did not uncover evidence of intentional action taken to improperly use the credit cards for personal expenses,” according to his July 21, 2014 written report to Board President Kauffman. The full report from Venable is attached.

“Outside counsel has done a thorough and comprehensive job reviewing Board member expenses and our policies and practices. I am pleased that the reviewers believe the Board members acted in good faith and there was no intent to improperly use the credit cards for personal expenses,” Kauffman said.

The committee recommended several improvements to Board of Education practices in managing office and Board member expenses. Among the committee’s final recommendations that will be discussed and voted on by the full Board on July 28 are –

1. Removal of Credit Card Authorization. The Ad Hoc Committee recommends that Board members not have credit cards, even for the purposes of authorized travel outside of Montgomery County. Board administrative staff may continue to use purchase cards for authorized purchases.

2. Per Diem on Authorized Travel. The Ad Hoc Committee recommends providing Board members a per diem for nonlocal travel. In some cases, the per diem may be given to Board members in advance of travel in an amount not to exceed the per diem allowed for the trip.

3. Home Office. The Ad Hoc Committee recommends that Board Members still be provided with the necessary equipment and supplies to maintain home offices, but that the Board no longer grant reimbursements for home office internet service.

4. Development of List of Pre-approved Events/Meetings for Board Members. The Ad Hoc Committee developed a recommended list of conferences, events and meetings that Board members would be authorized to attend or travel to for 2014-2015.

5. Semiannual Reports. The Ad Hoc Committee recommends that the Board’s Fiscal Management Committee review, on a semiannual basis, summary reports on the status of expenditures by Board members and the Board office. The full Board will receive the reports in their regular Board packets as items of information.

Venable Report

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