State auditor issues findings for recovery of $278,000 in Liberty district

RELATED: What has Liberty ‘Learn’ed?

By Jeanne Starmack


The state has issued $278,000 in findings for recovery in audits of two former conversion schools within the Liberty School District.

State auditor Dave Yost said Thursday that careless bookkeeping led to the findings in five audits from 2009 to 2012.

The conversion schools were similar to charter schools, but operated under the sponsorship of the public school district from 2009 to 2011. Called Liberty Early Academic Resource Nest, or LEARN, and Liberty Exemplary Academic Design, or LEAD, they used Liberty buildings and teachers. Each had its own governing board.

Among the findings for recovery in the audits is $169,590 against Liberty schools and its former treasurer, Tracey Obermiyer, “jointly and severally,” which means the money can be collected from Obermiyer and/or the school district.

The finding is in favor of LEARN for payments LEARN made to the district that “lacked documentation to support the public purpose of the payments.” That finding is included in a 2010 audit.

Yost also said that during the 2010-11 school year, LEARN issued 25 checks and made 26 debit-card expenditures totaling $68,131 without including proper documentation to support the purchases. Transactions include payments to a bowling alley, a pizza restaurant, Toys “R” Us and CVS Pharmacy. Yost issued a finding for recovery against Obermiyer.

“Without the proper documentation, it is not possible for auditors to determine whether the purchases were made for a proper public purpose,” Yost said.

Findings for recovery also were issued in the 2011 and 2012 audits against Obermiyer for expenditures that lacked proper documentation.

In 2011, LEAD issued $9,951 in improperly documented checks and debit-card expenditures, which included payments to a brewing company and a shop called Grandpa’s Cheese Barn. An additional $2,247 in undocumented expenditures occurred in 2012, Yost said.

Obermiyer said Thursday all checks were authorized by the school boards, the superintendent and legal counsel.

She said the Toys “R” Us payment was likely for a purchase for students. Payments to the restaurant and Grandpa’s Cheese Barn could have been employee travel expenses, she said.

The 2010 and 2011 audits contain an additional $26,906 in findings for recovery against the district and in favor of LEARN for unauthorized payroll expenditures to district employees for supplemental accounting services.

According to the conversion school sponsorship contract, the employees who received payments from LEARN should have received their compensation from the district, the auditor said.

Conversion schools were eligible for state grants as well as per-pupil funding. LEARN used space in E.J. Blott Elementary School and LEAD met at the middle school, and the schools also used 12 of the district’s teachers. The district’s school board believed the conversion schools were the way to achieve academic success while solving Liberty’s budget problems.

The financial gain the district was expecting never happened, however. The school board in place at the time was under the impression the district would get double per-pupil funding for each student who attended the schools, which turned out not to be the case.

The board blamed Obermiyer for misleading them into believing the district would receive the double funding, Vindicator files indicate.

Obermiyer stopped attending board meetings and resigned in April 2011. A week later, she took a job as a business consultant for LEARN and LEAD, which obtained a new sponsorship from the Portage County Educational Service Center in September 2011. The Portage County ESC suspended the schools’ operations in October 2011, however, and the schools’ operations remain suspended.

It was unclear Thursday how the findings would be recovered.

A spokeswoman for the state auditor said that even though the schools are suspended, they still exist.

A call to the Portage County ESC to find LEAD and LEARN representatives for comments was not successful.

Stan Watson, Liberty schools superintendent, said LEARN and LEAD still owe the district $100,000 from a lawsuit the district won against them.

“We’ve never been paid, and it’s a matter of litigation,” he said.

Obermiyer said she has not been affiliated with the schools since 2011 and she does not know their status.

She also said she was not aware of the auditor’s findings until a phone call from The Vindicator, and she did not want to comment much about them.

“I’ve taken heat for this for so long, and it’s entirely misdirected,” she said.

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