Guin termination hearing with BOE gets underway

By ED HOWELL, Daily Mountain Eagle
Posted 8/5/17

Attorney Charles Tatum laid out evidence and testimony Friday at a hearing that Carbon Hill Elementary School, under Principal Tanya Guin, failed many times in financial documentation before Guin was placed on leave, leaving questions about some of …

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Guin termination hearing with BOE gets underway


Attorney Charles Tatum laid out evidence and testimony Friday at a hearing that Carbon Hill Elementary School, under Principal Tanya Guin, failed many times in financial documentation before Guin was placed on leave, leaving questions about some of the funds.

A termination hearing conducted by the Walker County Board of Education started that day that was expected to take two days was started in the board chambers. Mrs. Guin’s attorney, John Saxon of Birmingham, said that the board was trying to terminate Mrs. Guin for personal and political reasons. Mrs. Guin, who is also being represented by her husband, Ken Guin, has planned to run against Walker County Superintendent of Education Jason Adkins.

Testimony resumes at 8 a.m. today, with Tatum still to call its fourth witness. The defense has not called witnesses yet.

Britt Campbell, an accountant with Carr, Riggs and Ingram in Birmingham, who performed consulting services for the board in looking at the Carbon Hill situation, repeatedly testified the firm did not perform an audit, but worked in September 2016 with two others doing consulting work concerning finances, examining receipts. Some employees were interviewed, but not Guin and bookkeeper Stephanie Elliott, who had been placed on leave the preceding month.

The argument was made throughout the morning that expenditures were made against board policy, and that there were several instances where documentation was not made. Saxon indicated through questioning that similar incidents happened at other schools and that Mrs. Guin was singled out for political and personal reasons.

However, Tatum, taking on a persecution role in the proceedings, objected many times to Saxon’s questioning, saying that he was making statements and raising questions that went beyond the situation in Carbon Hill. Board Chairman Brad Ingle, who presided at the meeting with the school board observing and asking some questions, overruled Saxon repeatedly, telling him to ask questions and to stick to Carbon Hill.

Saxon said if he was not allowed to talk about if other schools had problems and if there was a personal and political vendetta involved, that would pose “a fatal defect in these proceedings.” He tried several times in the afternoon, although few details emerged after Ingle sustained objections.

He also questioned whether some evidence was removed from the school after Mrs. Guin was placed on leave. It was established that Campbell did not seek Guin or Elliott for an interview, although Campbell said he allowed the system’s chief financial officer, Margaret Scurlock, to review the report to determine if anything had been missed. She reported no changes needed to be made.

Campbell indicated that several violations of policy occurred in relation to purchase orders and documentation not being on hand. He testified the principal had not approved expenditures. Some balances were found to be in negative accounts, although Scurlock later said if negative accounts were the only problem, the hearing would not have resulted.

Tatum, in questioning Campbell, also laid out that credit cards and their documentation would fall under the usual board procedures, which call for documentation such as purchase orders and invoices. He said school credit card numbers were kept on the personal Amazon accounts being used by teachers. The teachers would then use the cards without prior approval, which was a violation of board policy. Scurlock said it was difficult to track down detailed information from such accounts.

Tatum asked Campbell, concerning the practice of not giving out school credit card number to employees, “Is that just common sense?” Campbell said it was.

According to Campbell, food was also purchased from restaurants and grocery stores, when Department of Education guildelines say that should be limited. Money was also left in classrooms overnight, against policy. Concession funds were counted by a janitor but were not documented. Moreover, funds were sometimes recorded with Guin’s name, when someone else was actually handling the funds.

Overall, it was not easy to find any documentation. “There was not an adequate paper trail,” Campbell said. In one instance, a blank check was signed without any identification of who the check goes to, which Campbell said is not normal practice.

“We are just saying there was a lack of controls,” said Campbell.

Throughout the morning, Tatum obtained testimony that board policy was that purchase orders had to be issued for all purchases, and that credit cards would be included. Tara Rainer, the part-time accountant brought in about two days after Mrs. Guin and Elliott were escorted from the school, said teachers could be given a limit on purchases if a credit card was used.

Rainer said when she started to pay bills at the school, she found some of the receipts were not signed and called Scurlock to come to the school. “I had never been in a situation like that,” she said, noting she took two weeks to interview teachers and find out more about the bills. Some had to be paid without documentation, as some records were never found.

She said she was shocked that teachers at Carbon Hill were very upset with her when she said they needed purchase orders, as some had never had to use that method and didn’t know much about it.

Asked if she had thrown away any records, she said, “No, sir, we didn’t do away with anything. We were very careful.” Answering questions from Saxon, she said she did not have any knowledge as to what happened to anything in the two days before she arrived.

She said the Central Office obtained computers used by Mrs. Guin and Elliott. She said records were normally paper records, and that she would not have log in capability to go into computer records.

Ingle, after conferring with the board, allowed one ruling that morning in favor of Saxon, allowing him to ask Rainer if, while working at Valley, she had experienced negative balances. She said that would happen many time with sports, where a fund would be a little short but the purchase was approved as money would come in quickly to cover it. No funds were transferred, she said.

The various funds were actually in one account, so nothing was switched between accounts, and she said she did not approve anyone overdrawing an account. She also did not allow teachers to spend without getting a principal’s approval.

Scurlock, who was grilled for more than five hours on the stand, said principals are ultimately responsible for all school funds and are key to the finances, and are depended upon to review details at the local level. They may also call the Central Office for questions and help. She said funds should not be switched or borrowed. Purchase orders are required with a number of details filled out so the principal knows exactly what the funds are to be used for. If public and non-public funds are comingled then they are all considered public

In providing a PowerPoint presentation, she noted among the problems in Carbon Hill were that the accounting system was not properly established, cash was not properly deposited and recorded and expenditures were not properly documented.

Scurlock said she was to find out that $13,412.02 was purchased with a credit card which was not backed up with receipts or documentation. That brought the amount of funds that the school had to operate on from more than $42,000 to about $28,000.

Also, she said Rainer found envelopes with $106.79 in money, and no documentation, slid between recept books at the school. A safe in a closet in the principal’s office was found with $2,596.20 in cash, with money in envelopes labeled for items such as volleyball, flower funds, T-shirts, snacks and DVDs. One was for “the blue jean fund,” where students were allowed to pay $1 to wear blue jeans.

Sherlock said some teachers were told the flower fund was all spent, but funds for it were in the safe. Several problems in documenting credit cards and in money credits were also discovered.

During the afternoon session, Sherlock said one inexpensive item was sent to Elliott’s personal address, which was another red flag to her.

The PTO for the school had funds on the books and off the books, when the Central Office thought it was all on the books, she said. They can be on or off the books, but not both she said. Moreover, required reports were not made and she said the PTO officers were all allegedly school employees — so that money was being raised that was controlled by Mrs. Guin and employees, not parents.

Spurlock said principals keep up with changes in details and approach the Central Office if there are changes, even by as much as $50.

She also noted that the state Department of Examiners of Public Accounts issued its own audit for Fiscal Year 2016, which was critical on several points, including the use of credit cards by employees. All credit card use by the local schools was ended, she said, also noting that credit cards at Carbon Hill were cancelled soon after Mrs. Guin and Elliott were placed on leave.

Under questioning from Tatum, she said the auditors noted the credit card, a lack of internal controls with purchase orders, money in the safe that was not deposited and receipted, and purchase of volleyball trophies. The money for the trophies had to be repaid.

The lack of a paper system, purchase orders made out after payment (to be used for several venders in a month, and the discovery of blank documents signed by Mrs. Guin were among the situations Scurlock described. Questions were raised about cash being given to the PTO and then going to the off-the-book account.

“We had major problems” on various issues, Scurlock said.

Countering Saxon’s argument, Tatum tried to show the termination was not personal or political when Scurlock, the state and Campbell all came to similar conclusions.

“No, it was business,” Scurlock said, noting if the accounting system is not handled correctly, “you get to where it is, ‘I can handle this any way I want to.’” 

Under Saxon’s questioning, Scurlock said due to the investigation, money was found in a safe at Valley School, apparently going back years, although not as much money as was found in Carbon Hill. Authorities were informed about the situation. Little information was found about the money, and it was eventually deposited.

Saxon noted about the computers taken from the school, which had not been used in the investigation, but Sherlock said the paper records should stand for themselves and auditors should not have to look on computers for them. Told by Saxon some financial documents were on a flash drive, she said that would not be an appropriate place to put them.

During the day, Saxon would point out what he seemed to indicate were similar situations as found in Carbon Hill, asking if others had been terminated. He even pointed out a vending machine used by Central Office employees for scholarship money. However, Sherlock and Tatum said those cases did not involve Carbon Hill, and the vending machine was not on school grounds, accessible by students, which was cleared by state examiners. Saxon pointed to some cases of credit cards where some documentation was available, but Scurlock said some details were still not available for record keeping.

“You’re missing the pre-approval process,” she said at one point under Saxon’s questioning. She also said Mrs. Guin should have told officials when she was placed on leave that money was in the safe.

Saxon at one point said lunch funds in the safe were collected for children who would forget their lunch money. “You got a problem with that?’ he asked. She said she didn’t — but it still should have been documents.

He tried to point to a travel expense that was not approved until April for the Adkins. However, Scurlock said the event was in June and that it involved a payment voucher, which is different than a purchase order, the latter being for goods and services.