A cash payment for teacher retention draws auditor’s interest

Marysville gave $400 to each of its teachers. Auditors said the district didn’t make clear why.

MARYSVILLE — A $400 payment to every teacher in the Marysville School District has caught the attention of state auditors concerned it could be viewed as a gift of public funds because the school board failed to spell out precisely what the money was for.

They also raised concerns about a program offering employees up to $2,000 as an incentive to give the district early notice of their plans to retire.

Auditors targeted those incentive payments in a May 19 letter to the school board that accompanied the agency’s review of the district’s financial operations and record keeping, including payroll, contracts and purchases, in the 2019-20 school year.

Overall, the district received a clean audit as the agency concluded the operations “complied, in all material respects, with applicable state laws, regulations, and its own policies, and provided adequate controls over the safeguarding of public resources.”

But in the separate management letter, auditors drew a bead on how the district handles memorandums of understanding (MOU) used to amend collective bargaining agreements.

They noted that while the board approves the collective bargaining pacts, it lacked policies or procedures for approving MOUs, which can sometimes contain substantive changes to the larger agreements.

“As a result, the District does not have adequate controls to ensure that MOUs are appropriately approved in accordance with state law and the Board’s expectations,” the letter concluded.

Two situations called out in the letter deal with cash incentives for employees.

One involved a provision in an MOU between the district and the Marysville Education Association in October 2019. It contains a provision for a one-time payment of $400 to each teacher in April 2020. The association represents roughly 720 instructors.

“The payment was made in 2020 and was for the purpose of incentivizing continued work in the Marysville School District at a time when there was a teacher shortage and incentives from regional and national districts to fill open positions,” Jodi Runyon, spokeswoman for the school district, wrote in an email.

The Board of Directors did not discuss or formally approve the retention payment in a public meeting. However, the intent to agree to the changes for those purposes was shared with board members, Runyon said.

The district made $288,000 in payments, according to auditors.

Incentive programs are allowable but must be set up beforehand with guidelines on how employees can qualify to receive them, said Kathleen Cooper, a spokeswoman for the state auditor’s office.

In this instance, to avoid the appearance of a potential gift of public funds prohibited under the state Constitution, the district needed to establish clear criteria for awarding them that would show employees went above and beyond their normal duties, she explained in an email.

The second matter stemmed from an MOU in January 2020 with all labor groups regarding a one-time “retirement incentive” stipend. Employees who submitted a formal letter of retirement by Feb. 14, 2020, could receive up to $2,000, under the deal. Employees working less than full time would receive a pro-rated amount. About $70,000 was paid out last school year, auditors found.

The retirement incentive is an annual offering. It is beneficial to the school district to have early notification for planning and budgeting purposes, Runyon said.

Districts face a May 15 deadline to notify teachers if they could potentially be laid off. Knowing early who is going to retire could reduce or eliminate the need to send out those reduction-in-force notices, Runyon explained.

Auditors want the school board to adopt formal policies as to how the retirement incentive program will be run before offering it, Cooper said. Agency staff first raised a concern verbally at the end of the audit process last year. That put the district on notice it would be looked at this year, Cooper said.

The district is responding.

“We have a policy drafted that is under review by the policy committee prior to going to the Board of Directors,” Runyon said.

The intent of a management letter is to spotlight areas in need of improvement in the eyes of auditors. There are no penalties imposed, and it doesn’t detract from the clean audit issued by the agency, officials said.

The letter concludes with recommendations for the board to adopt policies for entering into and approving memorandums of understanding, and offering incentives.

“These recommendations are intended to bring awareness to the steps the district needs to take before offering the same or similar types of compensation,” Cooper said. “Whether they choose to continue these programs or not, our goal is to ensure they take the appropriate steps to ensure these programs and others are correctly authorized beforehand and in compliance with state law.”

Reporter Jerry Cornfield: jcornfield@heraldnet.com; @dospueblos

Talk to us

More in Local News

Cars move across Edgewater Bridge toward Everett on Tuesday, Sept. 26, 2023, in Washington. (Olivia Vanni / The Herald)
Edgewater Bridge redo linking Everett, Mukilteo delayed until mid-2024

The project, now with an estimated cost of $27 million, will detour West Mukilteo Boulevard foot and car traffic for a year.

Lynn Deeken, the Dean of Arts, Learning Resources & Pathways at EvCC, addresses a large gathering during the ribbon cutting ceremony of the new Cascade Learning Center on Thursday, Sept. 28, 2023, at Everett Community College in Everett, Washington. (Ryan Berry / The Herald)
New EvCC learning resource center opens to students, public

Planners of the Everett Community College building hope it will encourage students to use on-campus tutoring resources.

Everett Police Chief Dan Templeman announces his retirement after 31 years of service at the Everett City Council meeting on Wednesday, Sept. 27, 2023 in Everett, Washington. (Olivia Vanni / The Herald)
Everett police chief to retire at the end of October

Chief Dan Templeman announced his retirement at Wednesday’s City Council meeting. He has been chief for nine years.

Boeing employees watch the KC-46 Pegasus delivery event  from the air stairs at Boeing on Thursday, Jan. 24, 2019 in Everett, Wa. (Andy Bronson / The Herald)
Boeing’s iconic Everett factory tour to resume in October

After a three-year hiatus, tours of the Boeing Company’s enormous jet assembly plant are back at Paine Field.

A memorial for a 15-year-old shot and killed last week is set up at a bus stop along Harrison Road on Wednesday, Sept. 13, 2023, in Everett, Washington. (Ryan Berry / The Herald)
Teen boy identified in fatal shooting at Everett bus stop

Bryan Tamayo-Franco, 15, was shot at a Hardeson Road bus stop earlier this month. Police arrested two suspects.

Fatal 2-car crash closes Highway 99 in Lynnwood

Police closed off Highway 99 between 188th Street SW and 196th Street SW while they investigated.

Mike Bredstrand, who is trying to get back his job with Lake Stevens Public Works, stands in front of the department’s building on Wednesday, Sept. 27, 2023, in Lake Stevens, Washington. Bredstrand believes his firing in July was an unwarranted act of revenge by the city. (Ryan Berry / The Herald)
Lake Stevens worker was fired after getting court order against boss

The city has reportedly spent nearly $60,000 on attorney and arbitration fees related to Mike Bredstrand, who wants his job back.

Chap Grubb, founder and CEO of second-hand outdoor gear store Rerouted, stands inside his new storefront on Thursday, Sept. 21, 2023, in Gold Bar, Washington. Rerouted began as an entirely online shop that connected buyers and sellers of used gear.  (Ryan Berry / The Herald)
Used outdoor gear shop Rerouted finds a niche in Gold Bar

Seeking to keep good outdoor gear out of landfills, an online reselling business has put down roots in Gold Bar.

Naval Station Everett. (Chuck Taylor / Herald file)
Everett man sentenced to 6 years for cyberstalking ex-wife

Christopher Crawford, 42, was found guilty of sending intimate photos of his ex-wife to adult websites and to colleagues in the Navy.

Most Read