'Teeth' for school board expense rules Thursday, May 01, 2008 • BY JOHN MOONEY • Star-Ledger Staff As more critical state audits were released about urban school spending, the Corzine administration yesterday presented a draft of new regulations that expand the state's powers over how all schools spend their money. The 205-page draft includes limited "pay-to-play" rules on those doing business with school boards, and new authority for the state to rework and even reject specific line items in administrators' contracts, down to the amount of severance pay. There are provisions for the state to order districts to refinance their debts, and sections that demand that local school boards pre- approve field trips and set maximum costs on student awards. Maybe the most sweeping is a new process that will allow the state to withhold aid in the case of questionable expenses. "The goal here is greater fiscal accountability," said state Education Commissioner Lucille Davy. "I think the governor has been clear about that, and the Legislature has been clear. And the public has been telling us they want greater accountability and transparency." The new regulations provide the details and enforcement teeth for a series of state laws enacted in the last year that revamped how schools are funded and placed limits on their overall spending and taxes. The proposals -- some requiring state Board of Education approval, others enacted unilaterally -- came on the same day as long-awaited audits of more than two dozen urban districts falling under the Abbott v. Burke school equity rulings. Conducted in all 31 Abbott districts, the audits have caused a stir since the first were released early last year for four of the state's largest districts in Newark, Paterson, Jersey City and Camden, raising questions about more than $15 million in expenses in those districts. Another audit of Union City schools came out last month that showed frivolous overtime payments to school bus drivers. Yesterday's release contained a range of findings. New Brunswick and Elizabeth appeared to win good fiscal grades, but others like Asbury Park and Irvington were rife with questions about specific spending. For instance, of $27.8 million in expenses reviewed in Irvington between 2004 and 2006, $21.7 million drew questions about accounting or documentation. They included widespread questions over how in voices are processed, but also $6,000 spent for board members to stay two nights in Atlantic City for a statewide conference. In Asbury Park, $9.4 million of $11.4 million in expenses were found "unresolved," according to the audit. The audit also was wide- ranging, citing both scores of missing purchase orders and one $4,280 expense for golf shirts and jackets for athletic coaches. Yesterday, two key Democratic legislators praised the new regulations as an important step in curb ing some of the excesses found in these and other audits. "New Jersey should not and cannot sanction spending which violates the public trust," said state Sen. Barbara Buono (D-Middlesex), who chairs the Senate's budget committee. "Denial of funds and economic penalties for wasteful school districts will guarantee that administrators think twice before approving questionable expenditures." John Mooney may be reached at jmooney@starledger.com or (973) 392-1548. © 2008 The Star-Ledger. Used by NJ.com with permission.