The  Board of Trustees regular meeting, held on Monday, October 15, 2018,  had a presentation that was given by the Office of the Kern County Superintendent of Schools. This presentation addressed a matter concerning former Business Manager Chuck Hagstrom. The presentation was given by  Priscilla Quinn, Assistant Superintendent – Administration/Finance, Kern County Superintendent of Schools and Gary Bray, Management Consultant – School District Advisory Services.

Mr. Hagstrom was put on paid leave as of January, 2017, but Gusher reporters were unable to find the reason why Hagstrom was put on administrative leave since staff/board members were unable to comment. He submitted his letter of resignation on September 19, 2018.  It was then ratified by the board on Monday, October 15, 2018. The superintendent accepted the resignation on the board’s behalf.

An investigation has now begun with an “extraordinary audit” of the district’s financial matters that will be performed by the Fiscal Crisis and Management Assistance Team (FCMAT). Kern County Superintendent of Schools (KCSOS) has requested FCMAT specifically inspect an alleged opening of an unauthorized bank account by Hagstrom. In the 10-10-18 KCSOS FCMAT Contract Letter, it states that, “The primary focus of  this review is to determine, based on the sample testing performed by the auditor’s judgement, whether the former business manager opened an unauthorized district account using false documentation outside the state of California, conducted unauthorized activity on the account, concealed the account and related documentation and failed to report information related to the account to the district Board of Trustees and administration; (2) whether the extent of any possible fraud, misappropriation of funds or other illegal practice is isolated to the testing period, and (3) whether, based on that assessment, fraud, and misappropriation of funds or other illegal practices may have occurred.”

It is also in the Education Code Section 1241.5, which is referred to in the FCMAT contract, that “(a) At any time during a fiscal year, the county superintendent may audit the expenditures and internal controls of school districts he or she determines to be fiscally accountable, and shall conduct this audit in a timely and efficient manner. The county superintendent shall report the findings and recommendation to the governing board of the district within 45 days of completing the audit. The governing board shall, no later than 15 days after receipt of the report, notify the county superintendent of schools of its proposed actions on the county superintendent’s recommendation. Upon review of the governing board report, the county superintendent, at his or her discretion, may revoke the authority for the district to be fiscally accountable pursuant to Section 42650.”

The audit will cost roughly $30,000, but any changes that may occur during the investigation will affect the estimate of the total cost. John Kopp, President of the Board of Trustees was asked via email about, “how the school and its students will possibly be affected by this?” Kopp replied in the email saying, “Costs related to this investigation are paid by the county superintendent’s office, not by TUHSD. We have no reason to believe the investigation, nor its outcomes, will affect the programs that students enjoy at TUHSD or its schools.”

Kopp also talked about last year’s budgetary issues, specifically employees, as stated in the email Kopp sent, “Last year, we worked closely with our employee groups to be proactive in reducing costs to our district budget. For example, the district offered early retirement incentives and 15 employees took advantage of this opportunity. We also left many vacant positions unfilled. Our certificated staff also agreed to teach six out of seven periods in order to make sure that our students kept the wide range of course offerings, similar to previous years…We continue to work with our employee groups to ensure we remain fiscally sound as a district.  Be assured that the School Board has our students as its primary focus and we are committed to providing a well-rounded educational and extra-curricular program for our students.”

We attempted to contact Mr. Hagstrom for a statement, but were unable to reach him for comment.

The investigation is ongoing and whether the accusations against Mr. Hagstrom are confirmed or not is still to be determined. As it seems, the board has the school and its students “as its primary focus.” As reassuring as it may be, the fact that a supposed unauthorized bank account was opened without the board’s or the superintendent’s knowledge raises many questions.