City leaders call for review of schools credit cards

Baltimore's top leadership called on the school system Monday to tighten oversight of its expenditures after a Baltimore Sun investigation found central office staff spent roughly $500,000 during the past year and a half on items such as a $7,300 office retreat at a downtown hotel and a $1,000 dinner at an exclusive members-only club.

Mayor Stephanie Rawlings-Blake said she believed the school board should review credit and procurement card expenditures incurred by administrators at city schools headquarters after a Sun review of statements and receipts found administrators charged about $300,000 on procurement cards. The procurement program, which city schools CEO Andrés Alonso started in January 2011, has been operating with little oversight or controls.

Among those transactions: $13,600 in office catering, $450 per-person office retreats, a student lunch at Hooter's, and hundreds of dollars in restaurant visits by a former employee that the system is investigating. In addition, the system is requiring a high-ranking school official to personally pay back $5,000 in expenditures the system deemed inappropriate.

As the city school system officially launched the new school year — and a campaign to lobby for the authority to borrow and manage billions of dollars for school construction — Monday at a brand-new $32 million facility, city leaders said they believe the system should look at tightening its oversight of everyday expenses.

"This is the first day of school, and I'm focused on schools opening across the city," said Rawlings-Blake, after remarks at Leith Walk Elementary School, where officials gathered to celebrate the school's new renovations. "With that said, oversight of expenses is important, and the school board should look into it."

Members of the city schools' parent organization, the Parent and Community Advisory Board, said they are also seeking answers.

"PCAB is extremely concerned about any excessive spending in a school system with such significant financial challenges," said Melanie Hood-Wilson. "We have requested an emergency meeting with the board of school commissioners' finance committee to discuss this issue."

School board President Neil Duke said previously that the school board would review some of the system's expenditures.

The Sun also obtained credit card statements through a Maryland Public Information Act request that showed officials charged roughly $200,000 on Bank of America credit cards. The expenses included about $16,000 associated with the city school board traveling to conferences and expensive meals, including a $1,000 dinner at the Center Club to discuss Alonso's contract.

City Council President Bernard C. "Jack" Young said Alonso had been "upfront with us about the issues" with the program.

The city school system acknowledged that "prior to the article, the school system shared the same information that was provided to the Sun with others who have an interest in City Schools."

"We try to be transparent," a school spokeswoman said in a statement, but she declined to provide the same memo to The Sun on Monday.

"I'm for every dime going into education, but it didn't seem to be anything malicious," Young said of the expenditures. "But it seems they need to be clear about what they can and can't do with the cards."

Gov. Martin O'Malley, who attended the first day of school celebrations in the city — which receives the bulk of state education funding and serves the poorest population in the state — did not respond to questions about the credit card charges.

Other leaders took to social media to express their concern that the charges further exemplify failures in accountability in a system that once needed a $50 million bailout, and whose budget decisions in the last year have spurred calls for more scrutiny on spending.

"Ours is a school system without any accountability, but let's keep pretending that we're doing fine," Del. Keiffer Mitchell, who has repeatedly called for mayoral control of the schools, wrote on his Twitter page Sunday.

On Monday, Mitchell — who initiated the 2004 schools bailout plan as a city councilman — said that as Baltimore's representatives continue to campaign for funding, "this type of spending just leaves us shaking our heads."

He said it will make things even more difficult in the next legislative session, when the system goes before lawmakers from other counties and asks them to commit to a steady stream of state funds for city school facilities.

"This is just another example of why we need to move in the direction of mayoral control," Mitchell said. "As they start to move forward, it definitely adds to the argument that we need a school construction authority to make sure it's not money wasted."

The Sun investigation found that the system's procurement card program in particular was operating with virtually no accountability measures. The cards were distributed to 38 administrators but were used regularly by about 16 administrators in the central office.

The Sun's review also found that many of the transactions did not follow spending rules that were spelled out when employees were issued cards.

For instance, according to those rules, the cards are not to be used on travel-related expenses like hotels and airfare. But since the program started, about $67,000 has been charged for travel by central office administrators. The guidelines also prohibit gifts for employees, but departments, including Alonso's, spent more than $600 on items such as fruit baskets, flowers and other gifts.

City school officials said that the procurement program's user guide — which underwent its eighth revision in March — was "outdated" and "unrealistic."

Alonso defended the program. "Overall, people use the program in exactly the way we thought they were going to," he said. "There's always going to be a margin where you give people flexibility, and they're not always going to use it in the way that you want [them to]."