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Iowa Politics Roundup: IASB Board Fires Executive Director Over Scandal PDF Print E-mail
Commentary/Politics - Iowa Politics
Written by Lynn Campbell   
Friday, 26 March 2010 13:35

The Iowa Association of School Boards (IASB) announced the termination of Executive Director Maxine Kilcrease, while the Legislative Council voted to authorize the legislature's government-oversight committees to meet jointly during the 2010 interim to conduct an investigation, issue subpoenas, and take other actions relating to the IASB.

IASB Board President Russ Wiesley said the board voted Thursday to terminate Kilcrease's employment, citing her decision to request and accept a salary increase of more than $100,000 without board approval. The board said Kilcrease also gave raises to several employees at the same time other employees were being terminated for financial reasons; prevented the IASB's auditing firm from providing information to the board; and directed an attorney to threaten the firm.

"We believe this to be in the best interest of the association," Wiesley said. "As a board we feel we were misled and blocked from information, and it has caused a huge amount of distress for this critical Iowa organization we so deeply care about."

Kilcrease also failed to utilize competitive bidding for projects over $10,000 and failed to obtain board approval for projects more than $75,000 by breaking them into smaller projects, Wiesley said.

Kilcrease has so far refused to cooperate with an investigation or appear before the government-oversight committees. Wiesley said the Polk County attorney, the Des Moines police, the attorney general, the departments of education at the state and federal level, the office of U.S. Senator Tom Harkin, the IRS, and the FBI have all contacted IASB.

A preliminary audit has shown the IASB will be in the black for 2009, and Wiesley said the group has voted to cut membership dues by 5 percent this year. Legal counsel Nolden Gentry said the group will be asking Kilcrease to pay back a sum in the neighborhood of $50,000.

"We share your anger at this situation," Bill Morain, treasurer of the board, told the legislature's Government Oversight Committee earlier in the week. "Anger because people we trusted with the management of our 64-year-old service organization let us down and erected such a barrier to information that it took months of painful disentanglement to tear down this wall. Looking back, we recognize that we could have exercised greater oversight during the transition between management teams. But none of us could have envisioned that such an appalling level of misconduct was even a remote possibility."

Morain explained that both Kilcrease and former Chief Financial Officer Kevin Schick came to the board highly recommended during the search process.

"While Dr. Kilcrease quickly assumed an uncommon level of autonomy in her leadership style, we accepted the matter with a deference we would have afforded to any new chief executive," Morain said. "In turn, Mr. Schick portrayed his numerous prior corporate leadership roles as valuable assets in assisting with our less-robust financial position. Both brought sharp new directions to the organization."

Morain called it devastating that these two executives broke the board's trust. "We did not have a credit-card policy," he said. "We had gone for two decades without a credit-card policy because everyone understands what the rules are with credit cards."

But Senator Rich Olive (D-Story City) said there's also a frustration among lawmakers: "Even though the board may not have been aware of some of these problems, a number of us feel the board should have been aware and taken steps earlier."

Legacy of the 2010 Session: Government Reorganization or $1-Billion Deficit?

The Iowa legislature is expected to adjourn this weekend with Democrats hailing passage of what they say is the largest government reorganization in history, and Republicans decrying what they say will be 2,500 pink slips for teachers, an increase in property taxes, and a $1-billion deficit next year.

"It has been no doubt the most challenging fiscal time that most of us in this body have even been alive to see," said Representative Jo Oldson (D-Des Moines), chair of the House Appropriations Committee, noting that budget chairs did everything they could to protect priorities such as education and health care.

"We can all feel good about the fact that we are going to leave here having reduced state-government spending and made further efficiencies in the way that we operate state government," Oldson said. "That we will have a balanced budget, that we will still have money in our savings account, ... and that we will have continued and will continue to be committed to educating our kids."

The Iowa House on Thursday wrapped up a two-day debate of the $2.7-billion catchall cleanup standings bill, which contains the all-important $2.5 billion in state aid for K-12 schools and has traditionally been the last bill debated by lawmakers before they go home for the year. The bill moved to the Senate for further debate.

Republicans said the state budget produced by Democrats that's moving through the legislature would commit the state to more than $1 billion in built-in expenditures without a funding mechanism.

"What have we done?" asked Representative Rod Roberts (R-Carroll), one of three Republican candidates for governor. "High expectations, missed opportunities, and the problem as large now as it was in January. People in Iowa are going to be dismayed."

Representative Elesha Gayman (D-Davenport), an assistant House majority leader, confirmed Thursday on the House floor that the standings budget bill underfunds K-12 education by $167 million, shorts the homestead property tax credit by $11.6 million, shorts the ag land tax credit by $2.2 million, and shorts the mental-health property-tax relief fund by $13.8 million.

"By my math, that adds up to $194.6 million," said Representative Chris Rants (R-Sioux City). "Today, you're making the decision to raise property taxes in this state by $194 million."

The landmark bill of the session came several weeks before adjournment: A government-reorganization bill estimated to save state and local governments $126 million, or $270 million when combined with early retirement and an executive order. The bill consolidates agencies, eliminates 14 different boards and commissions, reduces energy costs, combines state purchasing, requires a span of control of one manager per 15 employees by 2011 (which some say will cut down on middle management), and consolidates information technology.

Legislature Considers I-JOBS Sequel for Public Construction Projects

Under a 77-page RIIF budget bill released Friday, the Iowa legislature would create an I-JOBS II program for public construction projects relating to disaster prevention, would change the bonds authorized last year from appropriations bonds to revenue bonds, and would increase the amount of net proceeds from $105 million to $150 million by using money from the Rebuild Iowa Infrastructure Fund. This would bring I-JOBS to a total of $875 million over two years.

Senate Minority Leader Paul McKinley (R-Chariton) condemned Governor Chet Culver's plan to plow an additional $150 million -- including $45 million from the Rebuild Iowa Infrastructure Fund -- into I-JOBS, which McKinley called a "failed temporary work debt scheme."

"A year ago, Governor Culver promised Iowans that his I-JOBS plan would create 30,000 new jobs, but since that time, Iowa has actually lost over 30,000 jobs. If the goal was to create jobs, Governor Culver's plan has been a colossal failure," McKinley said in a news release. "All we get from Governor Culver is more unacceptable spending, more debt, and more Iowans out of work."

The infrastructure budget is the last budget bill to be released. It allocates $33.6 million for targeted disaster relief and rebuilding, flood mitigation, and construction projects, many which had applied for funding but were deferred. It also allocates $30 million to the I-JOBS board for a new Disaster Prevention Smart Planning Local Grant Program, under the I-JOBS II Program.

The bill instructs the Department of Administrative Services to conduct a cost/benefit analysis of using existing office space for state employees in downtown Des Moines and other areas in close proximity to the state Capitol Complex, in lieu of replacing or renovating the Wallace State Office Building and prior to leasing any space in the Mercy Capitol hospital building. The report to the legislature would be due January 14, 2011.

Debate on the bill is likely to include talk of leasing or selling the Iowa Communications Network (ICN). It includes $2.7 million for maintenance and lease costs associated with connections for Part III of the ICN, and $2.2 million for replacement of equipment for the ICN, an increase of $33,000 from this year.

The bill reduces money to the Grow Iowa Values Fund from $50 million to $38 million. It keeps the $47.5-million allocation to expand the Iowa correctional facility for women at Mitchellville and $130.7 million to build a new Iowa State Penitentiary at Fort Madison, but now says that can include costs related to project management. These are the first two projects to be covered under project labor agreements following an executive order by Culver. The Department of Corrections will receive a total of $2.5 million for prison-construction management for the two projects.