Sweetwater school board fires superintendent following fraud audit | #employeefraud | #recruitment | #corporatesecurity


The Sweetwater Union High School Board has fired its superintendent, Karen Janney, two months after a state audit found evidence of potential financial fraud in the district.

The board voted 4-1 during a closed session Monday afternoon to terminate Janney, with only Board Trustee Frank Tarantino voting no.

On Monday the board withheld the name of the person they terminated, instead referring to the person as a “certificated management employee.” The board is required by state transparency law to disclose the title of the position of any employee it terminates.

In a two-sentence statement Tuesday afternoon, the district said the board gave Janney, who worked for the district for 36 years, a 90-day notice to end her contract.

“On behalf of the entire Sweetwater community, we want to thank Dr. Janney for her many years of service and dedication to the district, its board and our students,” the district said in the statement.

Janney said in an email that she was not present for the board meeting Monday.

“I am grateful I had the opportunity to return to Sweetwater as the superintendent for the past five years,” Janney said. “When I was hired, I knew I was an at-will employee and could be let go by the Board, at any time, without cause. I have worked with Sweetwater for close to 40 years where I have, and always will, wish the best for the students, staff and community.”

Janney’s firing is the latest blow to the image of Sweetwater, the state’s largest secondary school district, which educates roughly 38,000 students, 60 percent of whom are from low-income families. Before the audit was released, community support had been soured by budget cuts that hurt student programs.

The five board members who voted on Janney’s termination are the same five board members who hired Janney as superintendent five years ago on a promise to restore trust in the district after it was embroiled in a wide-ranging corruption scandal.

Board President Nicholas Segura and Interim Superintendent Moises Aguirre did not respond to requests for comment.

Janney was placed on paid leave in late June, two days after a state audit showed that former district finance staff not only worsened the district’s financial state but intentionally published incorrect financial information over the years. In June, the board said Janney was removed not for disciplinary reasons, but to support the investigation of the audit.

The audit found that the district used inaccurate financial information to get pay staff raises approved that the district was unable to afford. The audit also found the district misled rating agencies, bond insurers and investors by intentionally omitting information.

The audit said that Janney, as superintendent, had a fiduciary duty to ensure that the district was following the rules with its finances and acting ethically. The audit said that Janney, the district’s former chief financial officer Karen Michel, former director of fiscal services Douglas Martens, and the district’s financial adviser violated their duty.

Michel and Martens retired in the summer of 2018, shortly before news of the district’s financial troubles came to light. They have since disappeared from public view. Michel did not participate in the audit and auditors could not find Martens.

In June the board chose Aguirre, who is the assistant superintendent of facilities and operations, to lead the district during Janney’s absence. He does not have a teaching or administrative credential, but he says he has a doctorate in education.

Also in June the San Diego County Office of Education forwarded the state audit to the county district attorney’s office, per the state auditors’ recommendation. A district attorney’s office spokeswoman on Tuesday said she has no updates on the status of that office’s review of the audit.

Janney was being paid a $243,308 annual salary as of the beginning of last school year.

Promise of trust


The board appointed Janney five years ago on a promise to restore trust in the district by “putting students first.”

At the time, the district was struggling to recover from a corruption scandal in which former Sweetwater officials accepted theater tickets, expensive meals and other gifts from contractors, who in turn received work on the district’s bond projects.

The scandal, which came to light a decade ago, landed Sweetwater’s former superintendent in jail as the ringleader. A total of 18 people, including four former Sweetwater board members and officials in other south county school districts, were charged. All pleaded guilty.

When the board hired Janney, she was the fourth person to lead the district within the year. She was a familiar face, having served 31 years as a Sweetwater teacher and administrator before she was demoted in 2009 and she resigned.

With Janney’s hiring, Sweetwater had a new leader, new board members, and hope that they would turn the district around from its tainted past.

Instead the district got into a new financial crisis.

What contributed to much of the district’s financial woes were the unaffordable pay raises that the board approved in 2016 and 2017, the audit said, which increased the district’s structural deficit and led to budget cuts.

As the district’s deficit grew, Sweetwater relied on borrowing from its own special tax fund, the Mello-Roos, which is required to be used specifically for school facilities projects.

The district also lacked proper financial controls and systems that are designed to prevent fraud, the audit said.

In the end, the budget shortfalls hurt students. In recent years the Sweetwater board has voted to cut bus transportation, learning centers that helped struggling students, adult school classes, counselors and more, sparking outrage from students, parents and community members.

The role of the board


Julie Walker, president of the Sweetwater teachers union, said she was not surprised about Janney’s firing, considering the audit.

She said the union leadership is satisfied with the board’s decision and she thinks the board is doing its best. The union has endorsed Segura, who is running for re-election in November.

“I’m just hoping we take a deep breath and start again with the goal of having an environment that will allow for us to all be on the same page for what’s best for students,” Walker said.

Many Sweetwater residents, however, are not happy with board members and say they should not escape responsibility for their role in the district’s financial crisis. Some noted that the superintendent reports to the board.

Brian Chilstrom, a resident and grandparent of children attending Sweetwater schools, said he thinks the board has been complicit and made rubber-stamp approvals of payroll, raises and contracts “like a deer in headlights,” despite knowing of the district’s financial troubles.

“When you start cutting buses, tutors, counselors and summer school programs, there is something that’s definitely wrong there,” Chilstrom said.

Chilstrom said he thinks the best public service the board members can do now is resign in unison.

“The public services that they performed certainly weren’t with competent stewardship and governance of the taxpayers’ money. They missed out on that one,” Chilstrom said.

Kathleen Cheers, a Sweetwater resident who has watchdogged the district for more than a decade, said she’s frustrated that board members hid the fact that they were taking action on Janney’s employment before and after Monday’s meeting, preventing members of the public from weighing in beforehand.

“I need someone to explain to me how the new quote unquote leadership tells the community that they’re all about transparency, then they terminate our superintendent and fail to disclose it’s the superintendent that they’re ratifying the termination of,” Cheers said.

Cheers said she and other community members have been asking the board for years to audit the district’s finances and telling the board the budget isn’t right. Cheers said she feels like Sweetwater is back to where it was six years ago.

“You just think if time goes by, you learn lessons and you become better. But we have not become better,” Cheers said. “We have reverted back to the ways of old, and everybody in the community realizes it and they’re sick of it.”

District spokesman Manny Rubio said he could not say whether there was any severance agreement for Janney or what the district’s next steps are for hiring a new superintendent.





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