Legislative Joint Auditing
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Good morning, we're going to call this meeting to order. Members, audience, this is the 25th anniversary of 9-11, so
what I'm going to do is recognize someone to say a prayer, and then if we could stand for a moment of silence, stand and pray, but representative richmond if you would lead us in a prayer remembering that day
Representative Marcus E. Richmond
Unverified
0:37
let us pray father in heaven again we're so very thankful that we have the state that we have the privilege of representing here that we live in such a wonderful place and we have such great freedom in this country we're thankful every day for that father we're very thankful for all the blessings that you give us each and every day and on this day this day that 25 years ago that that evil come to this country and his shadow cast over the people
and for those that whole day we watched painfully watched other people lose their lives So, Father, we ask that you take into your arms and comfort the families and everyone that lost loved ones on that day, the first responders who were doing their job without any consideration of their own safety, that put their lives at risk. We pray for the families that, sadly, some of them even watched their loved ones choose death by flinging themselves out of that terrible tower from that fire.
and waited 10 seconds for death and too many of them are recognized and that image will never go away from those families. We ask that you extend your healing hand over all of them and if it is your will, restore them back to a measure where they can continue to serve you, continue to live in this world and deal with those terrible things on that day. Now, Father, we ask that you be with our leaders Give them wisdom so they may govern in a way that brings peace, brings unity to this country
so that our enemies overseas will know that if they strike, that we as a nation will respond and punish them for these terrible things that sometimes they do. Father, we ask that our leadership look at the people and make wise choices and seek your guidance each and every time that they make this choice of something that this nation should do. Now we ask for your forgiveness of our sins.
All this we ask in Jesus' name, amen. Thank you all.
all right first up on the agenda we have uh the minutes we have a motion to adopt the minutes motion a second any discussion all in favor any opposed motion carries item number c uh c1 co-chairman blundstrom you're recognized for the executive committee report
Representative Robin Lundstrum
Unverified
4:08
thank you the executive committee met thursday september 10th 2026 and adopted the minutes from the meeting of august 13th 2026 staff reported to the committee the audits and special reports scheduled
to be presented to the standing committees in the full legislative joint auditing committee this month in new business the committee approved requests for staff to perform the city of gosnell annual financial audit and a special report concerning the bathroom remodel project at the pocahontas school district in other business legislative auditor kevin white informed the committee that paper warrants were temporary temporarily be issued from members expense reimbursement co-chair representative lundstrom reminded the committee that some of the standing
committees would meet in alternative locations this month the next committee meeting will be scheduled for thursday october the 8th 2026 or at the call of the chairs i move
to adopt this report i have a motion do i have a second second any discussion all
in favor any opposed motion carries uh senator stone you are recognized for the standing committee report on county and
Senator Matt Stone
Unverified
5:18
municipalities the committee adopted the minutes of the meeting held on august the 13th 2026 the
committee was informed that three entities have not filed their delinquent private water and sewer audits for december 31 2023 and 2022 entities have not filed their delinquent private water sewer audits for december 31 2024. the committee was also updated to the city of bauxite has not filed as december 31 2024 delinquent private city audit the officials from the town of haynes were present to address questions regarding failure to meet requirements of their approval
approved plan for repaying misused street funds for the year ended december 31 2024. the report was filed after staff reported the town currently uh currently compliant with the approved repayment plan the committee reviewed 26 deferred reports 106 current reports officials from 10 entities were present to address repeated findings the 13 previously deferred reports were filed and 13 were deferred of the 106 current reports reviewed nine were referred to prosecuting attorneys
and the attorney general and two were certified to the government bonding board the committee filed 98 current reports and deferred eight reports to allow officials to answer questions and provide additional information at a future meeting move for adoption of
this report have a motion and get a second any discussion all
in favor any opposed motion carries senator sullivan you are recognized to present the standing committee on educational institutions
Senator Dan Sullivan
Unverified
6:58
thanks mr chair a question for the chair so i see later on we're having an investigative report on the prescott school district so in our review here of of our committee meeting we referred the prescott school district to the prosecuting attorney so the question would be if we if a motion is made today to refer the prescott issue to professional licensure then once we review the
report we're making a different motion my understanding is that that is we're still in compliance with with rules of the of the committee this committee I want to make sure we don't review something and then try to bring it back up I'm going to recognize
Kevin White thank you Senator Sylvan the investigative report that we're going to talk
Senator Kim Hammer
Unverified
8:00
about today in this committee has already been referred
to the prosecuting attorney and the Attorney General by myself under my capacity under the law and
Speaker 22
8:10
my statutory requirement is that what your
Senator Dan Sullivan
Unverified
8:12
question is in regard to well yes so once we refer it to the prosecutor can we then make a separate referral to licensure or once it's referred once it's reviewed today does that prevent us from making a referral to licensure by this committee
Senator Kim Hammer
Unverified
8:34
good so senator sullivan the investigative report on the agenda today can be referred by this committee today to the professional licensing standard board if that's the desire of the committee okay
Senator Dan Sullivan
Unverified
8:44
great thank you but i want to wait until we hear the report before i would make a such a motion okay thank you and with that mr chair i'll read our report yeah you're recognized to read the report the committee met on september 10th 2026 and adopted the minutes from the august
meeting 10 education audit reports were included on the committee's agenda for review there were two audit reports with no findings and eight reports with findings under arkansas code 6-17-426 the committee moved to refer the fiscal 24-25 audit reports of the blivel school district which contained repeat findings to the division of elementary and secondary education for investigation by the professional licensed standard board the audit reports for the prescript
school district and texarkana arkansas school district were referred to the applicable prosecuting attorney and the attorney general the audit report for texarkana arkansas school district was deferred to the october meeting so that school officials can be present to answer or committee questions related to the findings in this report. In other business, a motion was made to invite the prosecutor coordinator from the Arkansas prosecutor coordinator's office
to the October standing committee meeting to discuss the audit referral process. The committee filed nine audit reports and deferred one audit report that was brought before it. Mr. Chair, I move to adopt this report. - I
have a motion. I've got a second any discussion on the motion all in favor any opposed motion carries representative Meeks you're recognized
to present the standing committee on state agencies report thank you mr.
Representative Stephen Meeks
Unverified
10:40
chairman 13 reports were on the
committee's agenda yesterday the following four special reports were presented the Department of Health sexual risk avoidance education law enforcement agencies compliant with asset seizure and forfeiture requirements, law enforcement agencies compliance with tobacco seizure and forfeiture requirements, and finally law enforcement agencies compliance with human trafficking seizure and forfeiture requirements. In addition to the special reports, the following findings were presented. The Department of Education had three
immaterial exceptions with educational freedom account expenses, identified students with educational freedom accounts who were also enrolled in a public school, had an underpayment of academic facilities and partnership program funds due to a formula error, and had missing equipment. The Department of Parks, Heritage, and Tourism had an unauthorized payroll disbursement and insufficient collateral on a bank account. The public employees retirement system had an unauthorized benefit payment, benefit overpayments, and ineffective internal controls over benefit
payments. Finally, the military department had an unauthorized payroll disbursement and overstated its fiscal year-end accounts receivable related to federal funds. Various agency staff members were present to report on how the agencies intend to address the audit findings and to answer committee questions. During the meeting, the committee filed the 13 reports. I move to adopt this report
I have a motion I have a second any discussion on the motion all in favor any opposed motion carries I'll take us to our first of four reports
under item D the first report will be the item D one and I'll recognize Justin met to give us that report. Thank you, Mr. Chair. The annual review of the
Speaker 29
12:42
Employee Benefits Division and the performance of the health and benefit plans for the fiscal year ended June 30th, 2025 was presented to this committee at its meeting held last month. The committee voted to defer the report for
discussion today. The report contained no findings and summary financial information will be presented today. Exhibit 5 on page 5 of the report and on this slide provides information for the ASC plan for the past five years. Changes in claims and administrative costs are represented by the blue line and changes in premiums and other revenues are represented by the red line. Since 2022 revenues have exceeded costs contributing to the growth in the fund
balance. Exhibit 9 on this slide and on page 7 of the report provides the same information for the PSE plan for the past five years. Since 2024, costs have exceeded revenues causing the decline in fund balance. ASE fund balance increased to $151.3 million at the end of fiscal year 25, as shown in
Exhibit 6 and on page 5 of the report. The fund had a growth rate in fiscal year 2024 of 44.3%, compared to the 26.6% growth rate in fiscal year 25. The PSE fund balance decreased to $173.8 million at the end of the fiscal year, as shown on this slide and in Exhibit 10 of the report. In fiscal year 2024, the fund balance grew at a rate of 0.9% over fiscal year 2023.
For fiscal year 2025, the fund balance experienced a decline of 15.8%. At the meeting held last month, a 10-year comparison of claims and administrative costs, as well as premiums and other revenues, was requested. That information is provided in your packet today. That concludes this presentation, and we have agency representatives present to answer any committee questions. All right, we have that report.
Seeing no questions, Representative Lundstrom, you are recognized for a question. Could the agency person
Representative Robin Lundstrum
Unverified
15:15
come up? I'd like to ask a question. Do
we have a member from the agency
here? Please remain standing. I have to swear you in here. If you would, state your name, employer, and position.
And then raise your right hand if you
hit your button on the mic there so that you're on the record. Fran
Speaker 38
15:54
Jansen, Deputy Director of Employee Benefits Division. Okay, hit all. James Caldwell, CFO for Shared Administrative
Speaker 39
15:59
Services. And Ben Davis, Counsel for Employee Benefits Division, the Office of Property Risk. All right,
Speaker 41
16:06
if you'd raise your right hand. Do you solemnly swear or affirm that
the testimony you're about to give will be the truth the whole truth and nothing but the truth all right you are recognized
Chair
Unverified
16:20
representative lundstrom for your question thank
Representative Robin Lundstrum
Unverified
16:23
you this report is is is good and it's enlightening but there's some gaps that i'm not understanding on page five there is exhibit five and exhibit six that has a diagram if everybody could take a look at that we we go in physical year 2023 from 320 million and then the next year 320 and then all of a sudden we have a big jump to 363 million in costs i'm trying to understand
what happened in between 23 and 25 that our costs would go up so substantially i'm not saying it's right or wrong or there's a problem i just want to know the why um we'd have to go we
Speaker 45
17:18
can go dig into that and get back to you i just i don't have it off top
Representative Robin Lundstrum
Unverified
17:25
of my head okay um the same in the graph below if if we could just get some answers we're in trying to review a contract right now, and
I'd like to know what we're doing right, what
we're doing wrong, and why for that big increase. I think I'll hold the
rest until we get some more answers. I'll come up with a
list of questions. All right. Representative Ladyman, you are recognized
Representative Jack Ladyman
Unverified
17:58
for a question. Thank you, Mr. Chairman. Along that same line of that last question, when you look at ASC, although the claims went up, they remained below the income.
But on the teacher, the public school employee, it went up a lot more. And then when I look at the participation rate, the public school is a lot less than the state employees. Is that the reason for that, or
Speaker 53
18:31
is there another reason? Well, and I want to preface my answer by saying it's unfortunate that Director
Speaker 40
18:38
Wallace couldn't be here today. He's at a conference out of state. So I will attempt to answer that, but, of course, we will follow up if my information needs more clarification.
I believe if the question that you're asking is about the numbers with PSE
Speaker 40
18:59
a significant difference. Yes, sir. Yeah. My assumption is that it is based on multiple factors, including the utilization, the drugs that they are being prescribed and are taking, as well as just the overall health.
We see an interesting trend with the public school employees having different issues physically. And if you look at the exhibit Appendix B, the disorders that they have tend to be more expensive to treat than typically the ASE members. But I can't find it right now,
Representative Jack Ladyman
Unverified
19:48
but the participation rate is quite a bit different.
Speaker 53
19:54
Do we have a reason for that? I'm not aware. I can't answer what the
Speaker 40
20:01
participation decrease is a result of. Is that
Representative Jack Ladyman
Unverified
20:04
something you all can look into and try to figure out why that is? Yes, sir. Because that would affect the cost to income ratio,
Speaker 61
20:17
I would think. Yes, sir. All right. Thank you. All right. Any other
Representative Robin Lundstrum
Unverified
20:22
questions? I do. Representative Lundstrom. One of the things that came out in this report was the vendor, we paid them approximately $37 million to the vendors for ASE, and then another $47 million.
What does that compare to the contract? I thought the contract was a little bit different. So was there a comparison done by what the actual contract cost and the actual cost, what their bid was and the actual cost, and was there a discrepancy? did y'all happen to look
Speaker 45
20:55
at that I mean I'm not aware of any discrepancies between what was contracted I know we had on one of them we did a program to help maximize the coupons the plan could take it advantage of and part of that
program we had to run through it the administrative costs the cost share there's like a 20% cost share on that program but outside of that there's nothing that was different than the original contracts that I'm aware of
okay all right thank you representative Mayberry
Representative Julie Mayberry
Unverified
21:33
you're recognized thank you I'm sorry I haven't had time to completely digest all
of this so please forgive me but Fran you made reference to appendix B and the questions that representative
lady men was just asking because I was looking at that chart going wow I mean I mean, there's such a difference between the public school employee, if you look at the 10-year chart versus the 10 years of the Arkansas State employee chart, this other graph that we have right here, I mean, it's a huge jump. And so you made reference to going to Appendix B, and I just want to make note. It says the public school employee health claims and pregnancy-related disorder 78%.
And I just felt like I needed to point that out because we've been talking about the importance of good prenatal care And, you know, after having our babies, the help that we need. And I just wanted to point that out. And that's not on the state employee list. So have you all analyzed that? Is it, you know, we have more younger women in the school employee workforce,
and we don't have good maternal care in rural areas. I mean, it's, you know, we've been talking a lot about this, so here's your
Speaker 53
23:03
opportunity to share. Well, to be honest, I'm not aware of any formal analysis that we
Speaker 40
23:09
have done to look into this. But I do, again, feel that the assumptions or the possibilities that you entertained as far as that, it isn't teaching and education does tend to draw more women.
And so I think that plays a very large role. And then once you get into, like you said, some of the rural schools, so it's just compounded probably by some health care deserts that are out there. So when we work on this issue as
Representative Julie Mayberry
Unverified
23:40
a whole, we potentially could help lower the cost for our public school employee insurance program as well. That could be a byproduct. So, I mean, not only helping moms and new babies, but also saving some costs there. As well as, I'm sure if it's hitting our insurance, it's hitting private insurance as well.
Absolutely. So, anyway, just wanted to make
note of that. Thank you. All right. Thank you, Representative. Seeing no further questions, without objection, we'll file this report. Thank you. Moving on, item D2, financial and compliance report. I recognize J.J. Salario.
Speaker 78
24:39
Thank you, Mr. Chair. This presentation covers the audit for the city of Mineral Springs for the
Speaker 79
24:45
year ended December 31, 2025. Located in Howard County in southwest Arkansas, Mineral Springs operates using a mayor, council, former government, and six council members. The city's population is approximately 1,100. Non-compliance with state law and accepted accounting practices was noted in the offices of mayor and recorder treasurer.
First, we noted questionable transactions totaling nearly $264,000 for the period January 1, 2023 through December 31, 2025, related to the recorder treasurer. As discussed on the next five slides, these included improper credit card transactions as well as improper payroll and non-payroll disbursements. Our review of credit card transactions by the Recorder Treasurer revealed improper transactions totaling $174,000.
These included $92,000 for online gambling, $37,000 for personal purchases, which included groceries, home items, clothing, streaming services, fuel, online shopping, and buy now, pay later charges. Additionally, we noted $7,500 for expenses that appear to be for a legitimate business purpose but lack supporting documentation. A similar finding was noted in the prior report, $6,800 for undocumented travel, $2,700 for
fuel and personal vehicles, and over $2,300 in unallowable expenses. It should also be noted that five credit card statements were altered to reflect differing transactions, amounts purchased, and statement
Speaker 84
26:36
recaps. Our review of non-payroll disbursements to the recorded
Speaker 79
26:41
treasurer revealed improper payments totaling almost $56,000. These included $19,000 in undocumented travel reimbursements. A similar finding was included in the prior report.
Additionally, we noted $10,000 in duplicate reimbursements, $7,500 in labor payments that were not processed through payroll or authorized by resolution, and $6,800 in undocumented reimbursements for items that included a computer, fall festival expenses, Christmas sculptures, flowers, and mowing. Included in this amount is a $300 check issued to the recorder treasurer that was endorsed, deposited, and subsequently altered to reflect a voided check for audit
records. The recorder treasurer was also reimbursed $5,300 without a documented business purpose. Further improper non-payroll disbursements included $2,800 for reimbursements for fall festival expenses paid from park funds, $2,600 paid directly to the recorder treasurer for services provided by a company she owns, and nearly $5,800 paid to a company for which the recorder treasurer earned commission as a salesperson $850 in reimbursements for personal
items which included Christmas items food clothing and gift cards $520 in travel reimbursements in excess of supporting documentation and $156 paid for meals drinks and tips at a hotel by the recorder treasurer who was also
Speaker 84
28:14
reimbursed the per diem rate for this day. Our review of payroll revealed improper disbursements to the recorder
Speaker 79
28:26
treasurer totaling over $33,000. These included $9,300 in loans to the recorder treasurer who was
allowed to repay the city through subsequent payroll deductions in conflict with Arkansas code $7,300 remained outstanding at December 31st 2025 we also noted almost $7,400 for additional pay related to the park that was not authorized through city ordinance $5,000 in undocumented payments $3,300 for vacation pay in addition to salary paid on days off and $2,700 in additional compensation for conferences and meetings attended attended on normal workdays the city also paid
twenty three hundred dollars for the park director position which the recorder treasurer filled on a contract basis although the city council approved an arrangement the city did not enter into a written contract with the recorder treasurer who was who was paid eleven hundred dollars more than the approved pay over a six-month period. Other payroll disbursements to the recorder treasurer included $2,000 for attendance at special meetings in excess of authorized amounts, $1,300 for
community gatherings, festivals, and an employee Christmas party in conflict with the public purpose doctrine and the state constitution, and $170 in garnishments paid on behalf of the recorder treasurer in excess amounts garnished from her pay. The remaining slides discuss additional findings. During the calendar year 2025, the city loaned employees over $11,000 and allowed employees to repay the city through subsequent payroll deductions in conflict with the state
constitution. Outstanding loans to employees totaled $3,100 at the end of 2025. A similar finding was noted in the prior report. Testing of non-payroll disbursements revealed that none of the 25 disbursements tested were approved. Additionally $5,700 including a $250 bonus was paid to the spouse of the mayor pro tem for contract labor without an authorizing ordinance or resolution and $998 was expended for seven pairs of men's boots without a documented business
Speaker 84
30:46
purpose. Our review also revealed that the mayor was paid almost $2,200 in excess
Speaker 79
30:55
of his authorized salary in apparent conflict with Arkansas Code. The mayor was also paid $300 for patrolling the city without an authorizing resolution and outside of the payroll process. A similar finding was noted in the prior report from these findings we noted that special revenue funds were used for
unallowable and undocumented purchases this included nearly $35,000 from the Parks and Recreation Activity Fund over $26,000 from the Volunteer Fire Department Fund and almost $6,000 from the street fund. Also from these findings, we noted unallowable and undocumented purchases totaling $63,000 from water and sewer funds. These included over $43,000 in credit card disbursements, $13,000 in payments to the recorder treasurer, $6,000 in payroll advances
to employees, and $1,300 in payroll advances to the recorder treasurer. It should be noted that procedures for the Water Department were outside the scope of our engagement and the city obtains an agreed-upon procedures report of the Water Department as required by Arkansas Code. Other issues noted in our report included the following areas of non-compliance with Arkansas Code. Bank reconciliations were not approved by someone other than the preparer and electronic
disbursements were made without proper approval of the council and without establishing written policies and procedures to ensure that the electronic fund's payment system provides for internal accounting controls and documentation for audit and accounting purposes. A similar finding was noted in the prior report. Recorder Treasurer Denise Junel, who resigned on November 5th, 2025, was charged with felony theft of property and tampering with a public record. this case is pending as noted on the slide according to arkansas fidelity bond program
coverage was canceled for denise unel due to a prior finding a mineral spring school district this concludes my presentation city officials are present to
respond to committee questions all right uh representative rise your question for somebody from the audience or for the
Speaker 90
33:24
staff you're recognized for your question okay about two flips backwards
Representative Johnny Rye
Unverified
33:34
on the credit card charges just a little yeah do we have any idea what that was spent on that forty three thousand dollars was all that uh yes
Speaker 96
33:51
sir if this was for the um water and sewer credit card expenditures all that was actually included in
Speaker 83
33:58
the previous slides we were just recapping it by fund here at the end
Speaker 51
34:03
okay thank you all right co-chairman lundstrom i just
Representative Robin Lundstrum
Unverified
34:09
need a point of clarification in this report it talked about this treasurer or recorder whatever has was also working at a school district and did the similar thing
Speaker 101
34:24
and it wasn't caught or just clarify mr. white
Senator Kim Hammer
Unverified
34:28
thank you representative lundstrom back in 20 let me check and make sure it's the proper report yet so it is the 2012 2012 otter report performed by legislative audit one of the
findings in that were in regard to some timesheets submitted to the district in regard to this individual Hendrix Juniel she was later prosecuted on that issue and removed from the fidelity bond program and not covered for surety bond coverage at that time so the summation is the zebra didn't change
Representative Robin Lundstrum
Unverified
35:02
their stripes they went on to commit an additional fraud at the city and that
caused them to lose their bond or they couldn't have it because she had already been convicted correct correct part of the state
Senator Kim Hammer
Unverified
35:20
process is that you know when we refer these findings that we mention at times we're referring findings to the prosecuting attorneys and the attorney general at times we also say and we're referring those to the bond board as well the bond boards processes they typically wait until resolution of those referrals by the prosecuting attorney or attorney general to make a decision of whether to provide a reimbursement to the participating governmental entity, as well as they have a list of individuals who are not insurables.
Representative Stephen Meeks
Unverified
35:51
And she was added to the list at that time. Okay. Thank you. All right. Representative Meeks, you're recognized. Thank you, Mr. Chairman. So my question also for staff, I've got two. So would the city council have known that they
were no longer eligible for this coverage because of her past theft
All right representative makes that's not
a question I think staff have the answer to but we do have some
people here from the city of
Representative Stephen Meeks
Unverified
36:36
mineral springs okay i'd be interested to hear from them just if you know if they if they she was being hired with
this known history and then i could have the uh folks here from mineral springs come to the table and i think we've got
Representative Stephen Meeks
Unverified
36:54
and and then a question for staff was it just the recorder
treasurer that was responsible for all these inappropriate expenses or was it the mayor or other members of the city council as well
Speaker 83
37:12
you're recognized yes sir as as far as we can tell it is
just the recorder treasure that was involved in these okay okay all right if you would keep remain standing and hit your hit your button there and state your name employer and position and then we'll raise your right
Speaker 113
37:31
hand, and I'll swear you in. The Bureau of Marks, Mayor of Middle Springs. Okay. Vanessa Hendricks, City Council Member. Stephanie Harrison, Financial
Secretary of Middle Springs. All right. If you would raise your right hand. Do you solemnly swear or affirm that the testimony you're about to give will be the truth, the whole truth,
and nothing but the truth? I think I do. Thank you. All right. Representative Meeks, you're recognized to ask your question
Representative Stephen Meeks
Unverified
37:57
of the city. All right. Thank you, ladies, for being here. I know it's a long drive to come up here.
It sounds like you all have a mess down there. So give us the latest about, you know, where we're at with this. Was there prior knowledge, and that may have been previous administrations, so you may not know, but was there prior knowledge before she was hired that she had this history, and, you know, what are we doing to reassure the citizens of Arkansas that this is in the rearview mirror and then it's not going to
Senator Stephanie Flowers
Unverified
38:34
happen again? so I was married I was finishing out to term 21 23 to 22 and I have your little
knowledge that she had committed something somewhere else and at the time the mayor stepped down to record his treasure stepped down and we put the advertisement out there for somebody to come up forward nobody came forward but her and I know we had a time frame to get the bills and everything lined out so yes I did hire her
Speaker 124
39:07
but with very little knowledge about you
Representative Stephen Meeks
Unverified
39:12
knew something you just didn't know the details okay and then what what safeguards have we put in
place to make sure that this doesn't happen
Senator Stephanie Flowers
Unverified
39:21
again we're doing some double checking um whatever stephanie does then i'm checking behind her she's checking behind me as well so every everything happens have to be on the same level at all times okay all right thank you thank you
Representative Stephen Meeks
Unverified
39:41
ladies all right representative gonzalez you're
Representative Justin Gonzales
Unverified
39:47
recognized thank you mr chair i guess my
Representative Tracy Steele
Unverified
39:52
question is probably for staff on page three where it talks about the unallowable and undocumented purchases from parks and rec volunteer fire with those being undocumented we have no idea if those were spent for personal use and was that authorized by the mayor or who authorized those funds to be spent that
Speaker 134
40:17
was that would have been authorized by the mayor it was not if I
remember correctly there was a certain amount that could be purchased for the parks and recreation but anything beyond that amount went directly to the mayor who was at that time yeah but this specifically says unallowable and
Representative Tracy Steele
Unverified
40:41
undocumented i just was curious to know if we knew if that was spent for city purposes at all or if it was personal use like all the other and maybe more people ought to be turned over to the
Representative Justin Gonzales
Unverified
40:56
prosecuting attorney jj if you know the
Speaker 83
40:59
answer that uh yes sir uh again these slides at the end are
Speaker 79
41:04
just recapping uh what funds the unallowable and undocumented expenses were paid from from the first slides so we they are included in the descriptions in these first few slides of everything that was spent inappropriately um and as far as approval we did not note approval other than maybe the mayor or council member that was signing the check all right uh representative
Speaker 143
41:34
Matt Brown uh thank you Mr. Chair um and I apologize I don't think this is the answer yet is the recorder treasurer is that an elected position or is that hired by the city it's I'm sorry hit your button there elected okay and um now Mineral Springs I think the population is about a thousand is that right so I mean $175,000 that's I'm assuming that's a pretty big lick to y'all is that right who who was asleep at the switch i guess for lack of a better word like why did this go on for so
Senator Stephanie Flowers
Unverified
42:11
long bob tellers appointed me to be the mayor pro temp in april of last year he had this baby all by himself until then i only followed his lead my name was not on any sign checks I didn't approve anything. And now he's stepped down, so I signed the same thing I did in 21 to 22. He beat me in the election by a few points in 23,
but asked me to come on board again in 25. So now I'm finishing out this term, but no opposition. So when next year starts, I will be the elected mayor. Okay. And one last follow-up, Mr.
Speaker 143
43:02
Chair. Obviously, you know, any city can have a bad apple. It does take time to find that sometimes, and that's why we have audit. But probably what gives
Speaker 152
43:12
me the most heartburn on this report is the fact that there were several times where it said that there had been previous findings by legislative audit regarding travel expenses, employee loans, payments to the mayor, electronic transfers.
And it appears that nothing was done to fix that. What are y'all doing to make sure? Because, you know, when legislative audit sends a report, it's not suggestions. You know, they're very good at their jobs. And when they tell you something's wrong, it's wrong. So what is the city doing to make sure that a year from now we're not back here again and it says, here's some more stuff that was
Speaker 134
43:49
on a prior report that's still not been fixed? Checks and balances we're going to put in. And I will say that there are things that were not presented to the city council at that time.
Even the financial paperwork that we had maybe didn't have all the information. And, of course, we were not aware of it. We were just seeing what we had in front of us. And there were times that we did not have a full discussion according to what the mayor said that we need to discuss on finances. So we've learned that from this that we need to know for every penny, every session we need to go through everything.
I will say I did ask that at one time, and I was told that the mayor had the power to say what we would present in the meeting and
Mr. Chair. All right. Thank you. So I'm assuming in the last year since you've kind of taken over, you're having more regular city council meetings and reviewing all of these things in a timely fashion?
Yes, sir. Okay. Co-chairman Lindstrom, you're recognized. Just a question for the
Representative Robin Lundstrum
Unverified
45:14
councilwoman or suggestion. In the future, you might want to ask for actual bank statements. compare them to your financials it sounds like this is these folks have been picking your pockets for a long time i don't know how your city is going to make up this difference um and my question is for the mayor do y'all do criminal and credit background checks on your employees yes
Chair
Unverified
45:43
okay thank you all right senator mark johnson senator mark johnson you're recognized thank
Senator Mark Johnson
Unverified
45:57
you mr chairman uh i just i'm trying to follow the timeline of of who's on first and that type of thing okay uh ms junil who was the recorder treasurer has resigned and she's been charged with a theft. On one of the pages it describes
the officials at the time. Now,
Speaker 163
46:19
Ms. Harris, you were appointed recorder treasurer last December no sir I am
Senator Mark Johnson
Unverified
46:26
the financial secretary oh you're the financial secretary I
Speaker 165
46:31
am not uh in regards to the gentleman you're miss Harrison Harrison yes no Krishana Harris Krishana Harris she is um they took the when when this happened they took the position and split it and I am
actually a city employee I am not a uh elected official and so I will not I will be keeping the office until i decide to leave or until they decide to remove me and so it okay it's no longer um it's no longer an
Senator Mark Johnson
Unverified
47:07
elected position yes ma'am i understand now uh mayor is mayor tell us still
Senator Mark Johnson
Unverified
47:15
march of 2026 yes sir okay and who's the mayor now okay and ma'am you you were elected so you will be you will remain in january you will still be
mayor is that correct yes sir okay i just want to like i said it's it's kind of like that evan costello thing of who's on first and who's on second i wanted to make sure uh mayor tullis was not charged by for any kind of criminality although there's some sites in the audit and that's a totally different matter i just want wanted to understand all this okay uh thank you for helping me kind of sort all this out and i wish you the best of getting it and as i say to
many local officials thank you for your willingness to serve thank you mr chairman
all right members uh here's where we're at we've got half a dozen in the queue at the moment and people continue to buzz in so just keep that in mind as you're making your comments representative rye you're recognized. Thank you, Mr.
Representative Johnny Rye
Unverified
48:20
Chairman. Ma'am, let's just say that in the month of October, November, December of the year, you're setting the budget for the next year for the town. And this is not
a very big town, something like 1,100 people. And the budget is probably not that big considering that you don't have a lot of folks. What I can't understand is let's just say that you set the budget, and then you start January through December with spending from each category. When you got the bank statements in each month, could you not see something going on there?
Senator Stephanie Flowers
Unverified
49:01
There were no bank statements. It was all on, what do you call
Speaker 130
49:09
it, electronic. So Denise was the only one that saw those,
Representative Johnny Rye
Unverified
49:15
the amounts that was in there. Yes, ma'am. Follow-up, please. But did you check
behind that each month to see what was balancing out and how big of an expenditure, especially those
Speaker 130
49:28
credit card expenditures? I did not, and apparently Bobby didn't either.
Senator Stephanie Flowers
Unverified
49:33
Yes, ma'am. But now we are able to go in and have printed out bank statements. Thank
Chair
Unverified
49:41
you, ma'am. Thank you, Mr. Chairman. Representative, thank you. Senator Scott, you're recognized. Thank
Senator Jamie Scott
Unverified
49:49
you, Mr. Chair. Can you explain to me what checks and balances look like moving forward? I know she said y'all are going to go behind each other, but what
Speaker 165
49:59
does that mean? You're asking, like, when I receive a bill, how do I handle that?
Senator Jamie Scott
Unverified
50:04
Like, what are y'all putting in place to ensure that there's checks and balances and that everybody that y'all
Speaker 165
50:12
are in compliance and not in this situation in the future? Each, when a bill comes in, each department head is now required to tell me, they need to tell me what fund and
Senator Jamie Scott
Unverified
50:23
what category it comes out of. Do they
Speaker 165
50:25
do that via email for documentation purpose? They come and tell you? Either way. They either, either if they come by my office on a regular basis, it's put in their box and they come by and there's a stamp that's put on it and they write and put their initials on it.
to be paid out of our fire chief does not work he's volunteer so all of his comes through email and I print off that email saying where he wants it to come from the check is cut two people sign the check two separate people sign the check and then it's sent out and then and each director knows what budget they have what's in the line item so
Senator Jamie Scott
Unverified
51:02
they can't just come and tell you to pay it from here right or how do you verify that when they come and tell you how do I verify the fund
that the funds are available in a specific line item or that category um that's
Speaker 165
51:19
it's all a work in process to teach them to uh to know where it needs to come out of because they were just basically letting her have the control and she was just taking it out of whatever line item she wished yeah that's my concern that's
Senator Jamie Scott
Unverified
51:35
why that's why i'm asking these questions yes
Speaker 165
51:37
ma'am if y'all want to think a little further about what processes look like it's a learning curve right now it's a learning process and we are taking steps to correct that i just want to offer that yes ma'am
Senator Kim Hammer
Unverified
51:49
thank you senator senator hammer you're recognized thank you mr chair um and maybe one of y'all can answer this or staff can answer it the did the did the bonding company or is bonding company standing good for your losses as a city or um because of previous experience they're not on this one we'll go staff first mr white so
again we're going to refer it to the bond board anyways and
it will be their decision on what occurs however her name is listed on a
Speaker 101
52:28
you know the individual who's been charged here, is listed as a particular excluded party, and coverage
Senator Kim Hammer
Unverified
52:35
is not available. Okay. So back to the city then. Have you all determined that all the current employees that you have have not been excluded by the bonding company, so history would not repeat itself? I'm not trying to cast anything on anybody, but have you all gone to that? And then I wonder, first of all, let me ask that question to the ladies at the table.
have y'all checked out all your other employees to see if they've been excluded from the bonding company to the staff or to the chair? Do we know if that's in legislation that that's a requirement that municipalities check with the bonding boards to make sure that no company or that, that no one, somebody has already been reported. I think we'll have to do some research on that and get back with you. Yeah, that'd be great. All right. Then last question, this is going to be, uh, this is going to be to the audit staff, the, um, in all your investigation, did audit staff determine if the mayor through his or her, I'm sorry.
was it a him or her yeah through did the mayor through his action do anything that would have hid this or shielded other elected officials or office personnel from knowing what the problem was was that ever determined or is that within your scope to make that assessment go ahead senator hammer that's that's really falling out beside
the scope we refer the report as in its entirety the prosecuting attorney attorney general and they're the ones who can make
determinations of that potential matter which would be looking at the mayor to see if there was something inappropriate done as far as shielding this from other people or prohibiting because i heard the ladies say something about we weren't allowed to look at so that would all
be left up to the pa to do that correct correct okay thank you all right uh representative
Speaker 152
54:38
matt brown thank you mr. chair um has the city sued this recorder civilly or does it have any plans to do
so no sir we have not well may i suggest that y'all do that because you're about to have a statute of limitations problem some of this and i think you have a lot better chance of trying to get something back you go ahead sewer and civil
court instead of trying to rely on criminal restitution just in my opinion thank you and for the last question representative Mayberry
Representative Julie Mayberry
Unverified
55:16
thank you I'm kind of going back to the fact that this person came up in audit findings I guess in
2013 maybe with our education working for a school district that that is all correct right Mr. White yes um so what was that person found guilty or just charged um so the individual pled guilty in
Speaker 204
55:42
higher county district court on July 9th to misdemeanor theft of property charge okay so it should have come
Representative Julie Mayberry
Unverified
55:50
up in a in a background check then okay so I guess
I was trying to figure out if so many times as we have seen and have recently been talking about in that education committee that we have findings from our auditors. They do a great job. They send it, we send it on to prosecuting attorneys and the prosecuted attorneys don't do anything with it for various reasons. And we have recently discovered that we can send it to ADE for um maybe a look at the professional standards um to see if there were some ethics and i guess i'm
just trying to point out that that's just another reason why we need to do that as much as possible um but anyway i guess if if she did plead guilty that should have shown up as well but just another way to maybe um raise some wet red flags earlier um to you know bring attention
to people who continue to do the same things over and over again thank you
sorry all right thank you and ladies that's all the questions we have for you you're
dismissed members without objection will follow this report
moving on to item d three we have Michelle actually to give this report on a review of selected transactions for the Conway School District. Thank you Mr. Chair.
Speaker 206
57:22
This report is issued in a response to a request from the 20th Judicial District Prosecuting Attorney out of Faulkner County for legislative audit to assist
Arkansas State Police and review selected transactions of the Conway School District Central Maintenance Department. Objectives of our
Speaker 208
57:41
review were were to determine if district funds within the maintenance department were misappropriated,
Speaker 206
57:47
determine if applicable state laws and district policies were followed, and assess internal control issues within the maintenance department that came to our attention. Located in Faulkner County, the Conway School District is governed by a seven-member board
and operates 16 schools, making it the eighth largest public school district in Arkansas. During our review period, the district had two superintendents, Jeff Colum, who served from July 1 of 2021 through June 29 of 2025, at which time the board entered into a separation agreement totaling $461,000. Then Assistant Superintendent Jason Black was named Interim Superintendent on June 29 of 2025 and named Superintendent on December 21 of the same year.
According to the district website, the maintenance department is responsible for the safety, efficiency, and aesthetics of the district and employs skilled laborers, including carpenters, electricians, painters, and plumbers. Additionally, the district contracts annually with a private CPA firm for their financial audit. In January of last year, district officials and board members became aware of allegations of misappropriation of district resources in the maintenance department.
Subsequently, the district contracted with a law firm and a CPA firm to perform an independent investigation. On February 21st, the district notified the employees who were included in the investigation that they would be placed on leave pending the outcome of that investigation. The final report of the independent investigation was provided to the superintendent on May 9th of 2025. Employee A and employee B remained on leave, pending the board accepting their retirement and resignation, respectively.
Remaining employees that were placed on administrative leave were allowed to return to active employment status. It should be noted that the cost of this independent investigation totaled almost $21,000. The remainder of this presentation will discuss the results of legislative audits review.
Speaker 208
1:00:10
Arkansas Code requires a public employee with supervisory fiduciary responsibility to report to legislative audit
Speaker 206
1:00:17
a loss of public funds of $1,000 or more in one calendar year within five business days of learning of the loss of funds.
The loss identified in the independent investigation was not reported to legislative audit until more than three months after the independent investigation report was received. Our review of board meeting minutes revealed that during a meeting held on June 10th of last year, the board unanimously approved the retirement of employee A and the resignation of employee B, both effective on June 30th, 2025, allowing each of these employees to complete their contracts with the district.
In addition, employee A received a payment of over $18,000 for unused sick leave and a retirement bonus of $900. Employee B received a payment of $836 for unused leave. During a board meeting held on September 9th of 2025, a motion to request that the prosecuting attorney conduct an investigation regarding the district's maintenance department, including any financial transactions related to the department
or any current or former employees. This motion failed to pass with five board members voting against it. As noted in the report, failure to notify law enforcement of suspected improprieties appears to conflict with Arkansas Code 6-13-620, which indicates the powers and duties of the board are to ensure that all properties belonging to the district are managed and maintained for the benefit of the school district.
As previously noted, the district utilizes an independent CPA firm to conduct its annual audit. The most current audit completed was for the fiscal year ending June 30, 2025, and the board approved the report during a meeting held in March of this year. The audit contained a material weakness finding which stated, former employees in the maintenance department of the district misused district funds and resources for personal use. The misuse of district funds was discovered through an independent investigation.
Our review of selected disbursements in the maintenance department for the period July 1 of 2023 through February 28 of 2025 revealed questionable purchases that appear to conflict with Arkansas Constitution. The questionable purchases totaling nearly $31,000 were approved by employee A and made from selected vendors by employee B, who worked primarily as a painter. These included over $16,000 for automotive parts not compatible with district-owned vehicles,
over $10,000 for other automotive parts, paint, supplies, and tools for which a business purpose cannot be substantiated, and $3,400 for automotive parts that were specific to racing cars. In addition, $3,600 in questionable purchases approved by Employee A and made by various maintenance department employees included another $2,100 for other automotive parts, paints, supplies, and tools
for which a business purpose cannot be substantiated, and over $1,400 for automotive parts not compatible with district-owned vehicles. A disbursement of almost $1,900 to an automotive repair vendor was undocumented, therefore we could not determine what the disbursement was for or who approved the transaction. It should be noted that the documentation available for these questionable transactions did not identify a work location or reference a work order to indicate the purchases were for legitimate district use.
Communications provided to legislative audit between maintenance department employees were compared to payroll documentation and other accounting records revealed that timesheets for maintenance department's employees did not reflect leave taken for time that they indicated to employee A that they would be away from work. Employee B and other maintenance department employees performed non-school related work on employee A's personal residence and assisted relatives of employee A during normal working hours without recording leave.
Additionally, employee A authorized employee B to use district equipment for personal purposes. It should be noted that employee A was responsible for approving timesheets for maintenance department employees. In addition, employee A allowed an employee to take and utilize an extra sink from a district classroom for personal purposes in violation of district policy. Furthermore, district facilities and equipment were used on multiple occasions by maintenance department employees for personal purposes, such as cabinet painting and automotive repairs, which appears to violate district policy.
Our review also revealed internal control deficiencies within the maintenance department. Specifically, purchases were approved that appear to have no business purpose, invoices or other supporting documentation were not maintained for some disbursements, and invoices were not adequately documented to support a business purpose. Throughout our review, certain events came to our attention that comprise the district's internal control environment and commitment to transparency. As previously mentioned and shown
on the slide, management approved non-district related work that was performed by district employees during working hours using district supplies and equipment. The superintendent did not report the loss of funds to legislative audit within five business days and the board failed to notify law enforcement of suspected improprieties. Legislative audit recommends that the district ensure disbursements are in compliance with the state constitution and serve a district purpose, develop purchasing policies that ensure all purchases are legitimate and for district
purposes, ensure that district facilities are used for district purposes, and report to legislative audit any potential loss of public funds that totals a thousand dollars or more in one calendar year. This report was forwarded to the 20th Judicial District Prosecutant Attorney and the Attorney General. Bruce Harrell, who is referred to as Employee A, and Justin Turney, who is referred to as Employee B, were both charged with felony theft of property last month. This concludes my presentation. Management response is
provided in its entirety in Appendix A of the report and district officials are present to respond to committee
Speaker 61
1:07:33
questions. All right thank you for that report members co-chairman Hunstrom you're recognized for a
Speaker 62
1:07:41
question thank you I'd like to go to that timeline on a1 and
Representative Robin Lundstrum
Unverified
1:07:46
I have a question about June 29th so a1 the timeline and line that begins with June 29th it says the board
approved separation agreement for four hundred and sixty one thousand for superintendent Jeff Cullen and the board appointed Jack Black interim superintendent I would like to understand what that means so was he paid four hundred and sixty one thousand I see nods from an audience member do we
need to ask the folks present or I'm just asking the audit folks do you have
an answer for that or do we need to bring somebody up from the district? Okay, we have Jason Black
and Ms. Walton, school board president and the superintendent here. If you would come to the table and when you get there, remain standing, push the button and I need you to state your name,
employer and position for the record leona walton conway school district currently
Speaker 212
1:08:55
board president of the board jason black conway public school
superintendent all right if you would raise your right hand and do solemnly swear or affirm
the testimony you are about to give will be the truth the whole truth and nothing but the truth i
do all right if you would have a seat there and representative, you
Representative Robin Lundstrum
Unverified
1:09:21
are recognized to ask your questions. Mine's just a point of clarification. So Mr. Cullen was relieved
of duty, and we paid him $461,000.
Speaker 217
1:09:33
That is correct. We bought his contract out. Bought
Speaker 104
1:09:38
his contract out. Okay. I'm shocked by that, but
Representative Robin Lundstrum
Unverified
1:09:42
I will leave and let the other folks get in line, and we'll have some more
questions. Yes, ma'am. All right. There are a few. Representative
Representative RJ Hawk
Unverified
1:09:55
Hawk, you're recognized. Thank you, Mr. Chair. I'm over here.
Okay. So, look, this has been something that's been very public, and I guess my confusion is the board knew that there were some issues going on,
But you guys let the superintendent, the maintenance guy, just retire willy-nilly and say, we're going to pay you to retire. There's things going on. Because this was brought to executive from members of the school board, and that's how it got brought to our attention. And you guys just let him
Speaker 221
1:10:28
retire and paid him to retire, and now there's
Representative Justin Gonzales
Unverified
1:10:32
charges pending. Is that correct? That is correct. I'll do a little expounding. First off, I knew nothing about maintenance on June the 29th. I mean, but every day we did the let him resign, I didn't have history.
I was new to the board. That was my first board meeting. I was new to the board. So give me some grace today because I'm doing the best I can. Nevertheless, we seem to be, the board, we seem to be more interested in getting rid of the superintendent than taking a look at the personnel records that were given to us that we had to approve that night. I saw his name on there, but I did not have the background, and I did not know the other employee's name, period.
So when we went out to approve, when it was time to approve the personnel documents, we all approved it. Then those that did know about it realized what they had done, not testifying for them, but it was too late to go through the termination process because we had already done what we had done. A follow-up? Does that make sense? Yeah, it makes perfect
Representative RJ Hawk
Unverified
1:11:44
sense. I'm just trying to figure out
Representative Justin Gonzales
Unverified
1:11:46
the timeline. I think our focus, the board's focus, our focus, because I was present,
was to relieve the superintendent of his duties based on information, things that had been going on prior to my getting on the board. So that's what we negotiated. Makes sense. Follow
Representative RJ Hawk
Unverified
1:12:04
up. Now that these two individuals have been charged and are facing prosecution, is the school district planning on trying to get some of this money back through lawsuits or anything like that? I mean, because this is a substantial amount of money,
especially when you're talking about race cars and personal vehicles and personal homes. Like, is there a pathway for you guys as a board to say, you know what, We now need to take some legal action and try to
Representative Justin Gonzales
Unverified
1:12:35
get some of this money back. Okay. As a board member, that has not been discussed as of yet. This is kind of relatively new. Y'all know we're in the news, so our focus has been moved to something else right now. However, that does not mean that we will not try to pursue recouping of the money.
But that has not been discussed with the board. Thank you. Mr.
Black, were you part of the district prior to
all this happening? Yes, sir, I was. Okay, so you
were under the previous superintendent? I was. Okay.
Representative Stephen Meeks
Unverified
1:13:15
Representative Meeks, you're recognized. Thank you, Mr. Chairman. Right up close here. Yes, sir. As a citizen of Faulkner County, I guess I am relieved to learn that Conway School District doesn't have race cars zipping up and down through the streets of Conway.
My question, kind of going back to the superintendent and for kind of a follow-up on Representative Lundstrom, it is standard practice that superintendents get contract buyouts. That happens all the time. I'm not a big fan of it, but that's generally the reality. My question related to that, was his resignation because of these issues coming to light and other issues, or is it just coincidence that the board asked for his resignation at the same time?
So, in other words, was he complicit in this to the degree that he felt like he needed to resign or the board felt he needed to resign, or is it just
Representative Justin Gonzales
Unverified
1:14:14
coincidence in timing? I believe it's more coincidence, but I can't speak for Dr. Cullum. Again, that was me first getting there. But in the news, public perception was that he was not doing a good job and I believe maybe pressure to resign or we were going to need to fire you or whatever.
So a negotiation was done that night and he submitted his
Representative Stephen Meeks
Unverified
1:14:39
resignation. Okay. And then the other question I have, kind of follow up. So employee A was the supervisor. Was he using these funds for his personal benefit or was it employee B was
the one who was using the personal funds
and employee A just wasn't being a good manager and keeping an eye on things like he should. He was just
signing off. He was rubber stamping stuff without giving it the appropriate scrutiny. Yeah,
Speaker 213
1:15:18
I believe both have been insinuated. I know through the Arkansas legislative audit process, that was the findings. I think
Speaker 229
1:15:24
a little bit of both could have transpired. Personal knowledge about that, I couldn't tell you. But
Speaker 230
1:15:30
based on what I've read and what I've seen, I believe both most likely transpired is my understanding.
Representative Stephen Meeks
Unverified
1:15:37
Okay. And then my final question is, the school board, once you learned of these allegations, you
went and hired an outside firm to substantiate them. At what point did you go to legislative audit? Because legislative audit, it looks like you spent like $20,000 in order to learn that there was, what, $4,000 worth of theft, $5,000 worth of theft. You can kind of see where the concern is there, right? Whereas if you'd gone to legislative audit originally, obviously we know they've got a full slate,
but they could have done the investigation, and ultimately they did do the investigation, right, and would have saved the school district $20,000 here. So it just kind of makes sense. And, again, understand you're new, and it may just be that that's what the case was, but talk us through that decision to do that versus contacting legislative audit Because one of the concerns was is once these things were found out, they weren't reported to legislative audit in a timely
Representative Justin Gonzales
Unverified
1:16:36
manner. Okay, I agree with, I hear what you're saying. Again, I was not trying to dismiss my participation.
I need y'all to know that. But I don't know what happened that, why the investigation was privately done. But when I got there the night that it was Dr. Naylor, David Naylor said he's sending it to legislative audit. i took him for his word and that's one of the reasons i did not vote for it to go to the prosecutor dumb learning didn't know that's where it needed to go as well but i felt like doing it
to the legislative audit and doing it to them at the same time was a waste of resources why you got them both doing the same thing so if dr naylor said that legislative audit was going to handle it i believe that so that's what i voted for it to go ahead and do which i think maybe legislative audit went ahead and sent it to carol cruise which was wonderful we got the end of it found out what's going on and uh we have a opportunity to learn on what to not not to do we have a lot of turnover
on school board in conway or anyway we i've learned rather i'm gonna speak for me on what not to do and what to try to do better in this situation yeah i would agree with that
Speaker 213
1:17:57
uh the the five-day timeline that we didn't follow that we learned from I think now moving forward absolutely
Speaker 229
1:18:02
we know about that and typically you would reach out to your your auditor in this situation we know now that you need to do both and we're on track for that awesome
Representative Stephen Meeks
Unverified
1:18:13
right thank you and I know being a school board member
is sometimes a thankless job so thank you all right
Senator Jamie Scott
Unverified
1:18:20
Senator Scott you're recognized thank you Mr. Chair can you talk me through the September 9th where the board failed to adopt a motion to request the 20th Judicial District Prosecuting Attorney to conduct an investigation regarding this district manner? Did they
have all the information we just got and
Representative Justin Gonzales
Unverified
1:18:42
still failed to? At that particular time, in the board meeting, in executive session that I was in, I never saw a report from the investigator.
I heard what the report was. I was told what the report said. And then when Dr. Naylor said he was already going to legislative audit, that was good enough for me. I think I'm understanding your question. Because that's when it went to legislative, well, that's not when it went to legislative audit. I found out about it. But Dr. Naylor said that he had talked to someone here and they were going to handle it. so y'all
Speaker 232
1:19:26
had limited well like i'm gonna say i had limited the previous board members may have had
more information on that okay thank you yeah
Speaker 229
1:19:36
i would say that the third party investigation that was referred to by ala was provided to the school board that was probably discussed during executive session uh to miss walton's point i don't know if all of the board members that were current were in there I believe most would have been and then you know based on what she said as far as referring it to ALA or the prosecuting attorney there was discussion about that during an open
Speaker 231
1:20:03
board meeting there was discussion agreed
Representative Justin Gonzales
Unverified
1:20:05
but I never saw a piece of
paper that said this this this is what I found but I didn't have to have that but I trust him to do the investigation I ought to be able to trust him to give me a report
Speaker 146
1:20:22
you know verbally thank you representative matt brown thank you mr chair um i'd like to follow up i think representative hawks maybe represent blumstrom
Speaker 143
1:20:29
on the uh the timeline um of course you know i live in conway i pay taxes in conway to the school district my kids go to
Speaker 236
1:20:38
conway public schools my understanding of the way this thing went down and correct me if i'm wrong was there was this was discovered there was an issue in i guess june-ish of 25 is that right it was reported to the board and my understanding was is that the board was led to believe by the previous superintendent that the employees were being fired but i think that the statement
was something to the effect of it is being addressed or it
Speaker 153
1:21:15
has been addressed or essentially it was implied that they were being terminated but they weren't in
Representative Justin Gonzales
Unverified
1:21:21
fact terminated is that what happened they were not in fact terminated um the they the employee a submitted his retirement stuff and employee b just resigned i i guess i can tell you what other board members said was they wanted him fired but that never that procedure never took place no ma'am i understand that my question
Speaker 236
1:21:45
though is is my understanding was is that when this discussion was going on statements were made by the previous superintendent that would lead the board and i think a reasonable person to believe that they were in the process of being terminated when in fact the previous superintendent allowed them to continue to serve as employees for six weeks or two months my understanding was so that they got some retirement benefits they wouldn't have gotten had they been terminated immediately. Is that the way it
Representative Justin Gonzales
Unverified
1:22:10
went down? I don't know if the one that retired would have been able to get his
benefits had he retired, had he been terminated or not, because I don't know the law on that part, but that is certainly a possibility. To my coming into the board, I was elected in May of 2025, and when I came in in June of 2025 for that board meeting, he was on, both employees were on the list to resign or retire so that tells me that nothing was done toward termination by the superintendent at that particular time okay i appreciate that ma'am but again i don't
Speaker 236
1:22:50
think i'm not trying to avoid your question i think my question is and you were on the board at this time yes was the board led to believe by the previous superintendent that he was going to fire the employees or otherwise take care of it when in fact he allowed them to continue to serve for a couple months so they get their retirement because my understanding was the board was hood winked okay this hold on in this timeline that's been produced you know it clearly shows board was notified dot dot dot later board accepts resignation so it so it implies from the timeline that the
board knew this was going on and allowed them to resign so they could get their benefits my understanding as a citizen of conway was that the board was essentially lied to by the previous superintendent i'm just trying to get
Speaker 232
1:23:37
it is that what happened or did the board know this was going on and let it happen i know that some board members wanted him fired
Representative Justin Gonzales
Unverified
1:23:45
and told this them fired and told that communicated that to the superintendent to only find out that they were listed on resignation and retirement so i believe the answer would be yes to which part the part
that they told the superintendent that they wanted him fired. I'm just going by what they told me they said because I was not on the board at that particular time. So my first meeting, they were on the list. So I would say you are correct in saying they may have been misled by the superintendent, but because I was not present, it appears that they may have been misled. But I think it's our fault, the board, because we could have pulled their names off had we been paying attention and went ahead and adopted the personnel resignations and retirement by taking off those two people.
But that did not happen. So we, somebody thought that it was done, but it was not in the works, rather, but it was not in the
Speaker 201
1:24:54
works. And because these employees were allowed to resign a month and a half or
so later, were they, in fact, able to get some retirement benefits or other benefits they wouldn't
Representative Justin Gonzales
Unverified
1:25:05
have otherwise gotten? I am not aware of anything on whether they actually got retirement or not because I don't know the policies, rules, whatever on that part.
Speaker 229
1:25:14
Is there anyone else in the school district here today that might know the answer to that? Yeah, I was going to attempt. I'll tell you, I'm not familiar. That's a question that we've discussed is if there is a termination, does that suspend anyone's retirement? I'm not aware. I don't know if anybody in the room is or I know we have our legal counsel with us here today. Are you aware, Ms. Wagner, of that ruling? Okay. I don't have an answer for you, but we can definitely get one. And then I'll speak to, I know you were asking me as well, you know, I wouldn't want to speculate anything that was discussed during executive session
because I was not in those executive sessions for those discussions. So I would not
Speaker 214
1:25:53
have that information to be able to give to you in regards to their discussions with the
previous superintendent. Representative, if we can, get back in the queue if you need some more questions. I've got several stacking up here. Representative Gonzalez,
Representative Tracy Steele
Unverified
1:26:10
you're recognized. Thank you, Mr. Chair. My question is going back to this $461,000 payout.
Is that an annual salary, or is that a multiple-year salary? How was that determined to be that amount? Multiple years. Multiple years. How
Representative Justin Gonzales
Unverified
1:26:31
many years? I think it was two. Okay. I think it was two years. I didn't research that before I came here, but I
Representative Tracy Steele
Unverified
1:26:37
believe it was two years left. So a question to audit. There's nothing questionable about that, right? That's a perfectly legal payout to them?
Speaker 254
1:26:47
yeah it's representative that was not really in the scope of us reviewing the legality but
Senator Kim Hammer
Unverified
1:26:54
no we didn't i i think that's pretty somewhat we see that on occasion from other school districts as well of similar type agreements okay i i thought
Representative Tracy Steele
Unverified
1:27:02
so i just saw it in the report wanted to make sure i didn't know why that was even mentioned there but i think that's something that we need look at and and uh probably this next legislative session is these school school boards school
districts being able to obligate taxpayer dollars for multiple years for superintendent salaries that should probably be limited to a single year's salary for payout because to me it's a waste of taxpayer dollars wouldn't you agree i would i would
uh senator mark johnson you're recognized thank you mr chairman and there
Senator Mark Johnson
Unverified
1:27:41
are so many issues here i will try to restrain myself and limit it to the things that are actually in the audit i would like to say for the benefit of
the committee and the entire legislature that for every session i have been in the senate with the exception of the last one i sponsored legislation that would say if you committed a felony in the line of duty. This was both for any public employee in Arkansas, not just people in school districts, that you would forfeit your pension. I was fought vehemently by some other members of the legislature and the actuary for the retirement committee saying that it was
unconstitutional. I couldn't do it. Although something like 15 or 20 other states do it. so i think i'll try one more time in 2027 and maybe we can get it done i had some people say well that'll hurt their families i said
you hurt the family of every single person you send to the department of
corrections so let's just don't pick on one over the other but getting back directly on this audit first i'm not currently a resident of the conway school district conway school district
is in my senatorial district i'm a fifth generation son of conway i'm a proud wampus cat and graduate of conway high school and uh so this is very personal to me and i've heard from a whole lot of constituents about this and as far as the representative gonzalez had a beautiful comment But I think that we have to fix this long-term payout thing.
This is something that can be fixed by legislation, I believe, and I'd be happy to work with you on that. But I want a couple things. First of all, I want to thank Ms. Walton and Mr. Black for coming to the table. But I would respectfully request, Mr. Chairman, how many current or former members of the board are here? uh gosh i can't get you all up here i i would like like miss hargis to come if she could and
if anybody else would need to we would certainly want to hear your testimony but i i personally have heard some things in the past from miss hargis uh so i'd like to ask for miss linda hargis who's a member of the board to to come and be
Speaker 167
1:30:24
sworn in thank you sir yes sir we'll
Speaker 110
1:30:27
have to swear you in but y'all just yeah if you would stand and state your
Speaker 258
1:30:32
name individually yeah barrett petty conway school board zone 5 elected may 13 2025 okay linda
Speaker 260
1:30:39
hargus school board member five years i was selected i think in 22 and i go off in november All right,
and if you'll raise your right hand, do you solemnly swear to affirm that the testimony you're about to give will be the truth, the whole truth, and nothing but the truth? I do. I do. All
Senator Mark Johnson
Unverified
1:31:01
right, thank you. Okay. Senator Johnson. Thank you, Mr. Chairman. I simply wanted to, first of all, this is no disrespect to Mr. Black or Ms. Walton, but your predecessors, this kind of happened on their watch,
So we needed to clarify the fact that, you know, we don't hold people accountable for things happened before they were in charge. Although you were assistant superintendent at the time, were you not, Mr. Black? Yes, sir. Okay. So I'm not blaming you. I'm just saying that you may have had eyeballs on some of this situation, too. The first thing, Mr. Collum, was, my understanding, directed by the board to fire the employees?
I won't get into the whole situation. And then this thing just seemed to snowball after that. Am I reading that correctly? And that's a question
Speaker 260
1:31:57
for anyone that would know that. Yes, sir. it was brought to us the the gentleman that did the independent audit gave us the facts and then his recommendation was to either fire them or prosecute them and the board chose to fire them and we directed dr column to do that and i think what happened here is i check resignations most of
the time i checked them for two months after this happened i think it was two names weren't on there so i'm assuming that he has fired them i had no idea they were allowed to continue to work so they were not
Senator Mark Johnson
Unverified
1:32:43
only on it paid administrative leave they were working yes sir
okay and then And let me interject something, and you brought this up, Ms. Walton.
Again, having followed this, I was contacted by more than one board member asking me about should they refer this to the prosecutor, and I'm not saying I was right or wrong, but I pointed out that this committee under the law is required to refer certain things to both the prosecuting attorney and the attorney general. And I understand why Ms. Walton and other board members might have been confused about what that is.
That's a separate statute, though, that requires the superintendent or the board to share this information with Arkansas-led slave audits. So I could understand how there would be some confusion, but I think we'll clarify, try to clean up the language and
the law so everybody will understand, but I think both should have been done. i
Speaker 260
1:33:50
misspoke i think they were on paid leave not working okay well that's
Senator Mark Johnson
Unverified
1:33:55
correct those are facts that we can ascertain thank you still being paid yes ma'am uh the final thing that that i want to
uh come up with is that uh these people were they were actually weren't terminated they were allowed to resign and they were given a severance and it's like here's some money go away goodbye and that once again this is one of those things this is our fault these are things that the general assembly has to put in the law to fix and so i'm not blaming anybody that has to administer the law as it was at this time but i mentioned to all my colleagues
we've got to seriously do some things about this rewarding people you know life is a series of incentives and disincentives and uh you know if you get out here and drive a hundred miles an hour on 6 30 the state police are going to give you a ticket that's a disincentive and if if you're not going to be fined for doing that then you might be more apt to to speed down 6 30 uh it's the same way with uh wanting some parts for your race car or whatever uh you'll steal them if there's
no accountability on it so obviously that's our our work that we need to come in and fix but mr chairman i'll yield back because again i promise to stay strictly on the audit and not the broader issues thank you mr chairman representative matt brown you're recognized thank you mr chair uh
as hard as mr petty uh
Speaker 152
1:35:34
you heard my question earlier about essentially was the board hood winked were y'all hood winked yes and that was by dr mccull or dr cullum yes all right yes
Speaker 258
1:35:47
can i give some dates and perspective sure so on may on may 13 20 2025
myself miss leona walton and leo commons were elected to the board we had our first meeting which was a special session meeting on may 27th of 2025 and i think the next two i'm sorry then in june the second tuesday we had that board meeting in which those individuals were listed I can speak for myself being elected a month earlier. I had no idea about them being listed. Now, I
Speaker 269
1:36:20
did hear things and rumors and things been stated in the community from constituents,
but officially I did not know or was made aware of it. And, I mean, obviously, you know,
Speaker 152
1:36:33
I started out in the quorum court, and I learned a long time ago that when you're dealing with, you may be the governing body, but you've got a bureaucracy you're dealing with, And one way that they control what you do is they hide information. And it sounds like that's something that happened here was Dr. Cullum hid this from y'all and led y'all down the primrose path that y'all thought had been addressed. And then as a result, these employees are allowed to stay on the payroll and accrue more benefits even though they had stolen tens of thousands of dollars from the school district.
One last question, Mr. Chair. Does the board or the district have any plans about trying to go after these guys civilly to try to get this money back? I can't
Speaker 260
1:37:09
answer that. we have not in my knowledge no well i would encourage y'all to
Speaker 152
1:37:12
sue them at least try to get the money back because certainly that's certainly
Speaker 212
1:37:15
something that the board can discuss yes because the school district needs to do all it can
Speaker 152
1:37:19
to get this money back and the school district has lawyers and it's not going to cost any money and it needs to sue them at least because you can't rely on criminal restitution thank you mr chair
all right uh representative hall thank you all for
Representative Brad Hall
Unverified
1:37:34
coming here today uh this is just for education purposes for us that don't know about the buyout purposes of on superintendents um the new superintendent do you have a buyout clause in your contract and if so how much i have
Speaker 229
1:37:49
a uh 18 month um yes sir it's part of the part of the contract negotiation on the front end i don't intend on using i hope i'll be around for
Speaker 271
1:38:04
a long time all right uh representative baity thank you mr
Representative Howard M. Beaty, Jr.
Unverified
1:38:09
chair i'm over here just a quick question
y'all probably know a lot about foia these days i i see some of those posts did y'all provide proper notice today before this meeting that you would be here the two hour notice that you're required to provide to the press i don't know i don't i don't believe so school board members
Speaker 273
1:38:31
i do not know if a notice was sent out to the press i do know i was notified by mail i really don't know i i did not ask i i
all right members seeing no further questions uh well spoke too soon representative
Representative Wayne Long
Unverified
1:39:02
long thank you mr chairman just one quick question um i was wondering before this come up were y'all aware of the statutory requirement of reporting this within five days no sir not
Speaker 229
1:39:14
before it came up that was one of the mistakes and errors that we did make we realized that after the fact and
as soon as we found out we did turn it over to ALA unfortunately we did not do that within the five days and that's now part of our corrective action plan and our process to ensure that we do better with that moving forward and same thing upon the school board
Representative Wayne Long
Unverified
1:39:36
members y'all weren't aware of it either. No, no, sir. I
Representative Justin Gonzales
Unverified
1:39:43
was not. This happened before the investigation was done before I ever got there. So I was not aware of that, but I am certainly aware of
Representative Wayne Long
Unverified
1:39:50
it now. Yeah. That's probably something that we probably need to do is make sure that school board association is, you know,
is notifying the members, uh, superintendents across the state should know this because obviously y'all didn't that, um, you know, you're really not going to comply with the law. You don't know exists and so that that's a little bit on us but we probably need to work on make sure that the people that need to know this do know it thank you it's a
Representative Justin Gonzales
Unverified
1:40:14
little bit on us as well we
need to all right now see no one for you guys are good to go thank you for being here and without objection we'll follow this
report. Thank you. Item D4 is on the Prescott School District presentation by Ms. Cassie Newton. Ms. Newton you are recognized to present
the report. Thank You Mr. Chair.
Speaker 280
1:40:56
This report is issued in response to a request from the
8th North Judicial District prosecuting attorney for legislative audit to review selected transactions of the Prescott School District. The PA requested the review after the district discovered questionable purchases and undeposited revenues collected for admission to athletic events. The objectives of this review were to analyze selected disbursements for propriety and determine if revenues collected for athletic events and activity funds were properly deposited located in nevada county in southwest
arkansas the district serves approximately 867 students and is subject to an annual audit by legislative audit the audit for the fiscal year ended june 30th 2025 disclosed that certain financial transactions of the district were still under review this report addresses those transactions it should be noted that the superintendent resigned effective June 30th 2025 and was placed on non-duty status on April 17th 2025 I
review revealed unallowable purchases totaling thirty four thousand dollars that were made initiated or approved by the superintendent as shown in exhibit 1 on page 3 and on the slide these purchases included but were not limited to a MacBook purchased by the district and later advertised for sale on social media and sold online by the superintendent both the advertisement on
social media and the online listing indicated the macbook was purchased for a relative of the superintendent a cell phone purchase by or for a relative of the superintendent on the district's credit card and assigned to the superintendent's personal cell phone plan and lapel pins that were customized with a neighboring school's name and logo the invoice appears to have been altered to conceal the customization further unallowable purchases included golf clubs purchased by or
for a relative of the superintendent that could not be located at the district or in the golf shed at the prescott country club where district golf equipment is stored the superintendent later notified us that the clubs were located at the country club in a golf shed belonging to a member of his family. Other purchases included a custom baseball bat engraved with the name of a tournament baseball team not associated with the district and with the superintendent's initials, a golf
tournament entry fee for the superintendent and three others, and apparel without an apparent business purpose additional unallowable purchases included numerous items purchased at PGA golf tour superstore locations out of state umpire related apparel and equipment that appeared to be for non-district use a full-page advertisement in a sports program for a personal tribute to a relative of the
superintendent and out-of-state travel expenses including a first-class flight for an American baseball coaches association conference registration was made under the name of a tournament team not associated with the district it should also be noted that the superintendent did not serve as a baseball coach for the district based on our examination of supporting documentation, interviews conducted, and inability to physically inspect items during inventory
observations, these items do not appear to have a school purpose and are therefore constitutionally suspect under Article 14, Section 2 of the Arkansas Constitution. It should be noted that the superintendent acknowledged some items were unallowable and reimbursed the district just over $1,200 between March 17th of last year and February 26th of this year. In addition, the cell phone and golf clubs mentioned are now in the possession of the district. After the superintendent was
placed on non-duty status, the district discovered that he possessed a golf cart owned by the district that was not recorded on the district's fixed asset listing. The district determined the golf cart was purchased on its behalf by a vendor in January 2021 for over $11,600. This purchase was included with the cost of a $12.3 million elementary building constructed in fiscal years 2020 through 2024. Our review of the golf cart invoice revealed the cart included
numerous upgrades as listed on the slide. The superintendent indicated that the golf cart was purchased through the construction project so that he could transport building materials shipped to the administration office as well as transport board members or other individuals to the construction site. In addition, purchases totaling over $5,600 did not have a documented business purpose and could not be located on district property. These purchases included
almost three thousand dollars for lawn care equipment thirteen hundred dollars for four yeti coolers seven hundred dollars for pickleball equipment and seven hundred dollars for five arctic coolers in fiscal year 2024 the district received a grant of just over forty five hundred dollars from the arkansas game and fish commission for a trap shooting project a fishing project and the animal science program. In fiscal year 2025, the district expended $1,900 in remaining
grant funds and $91 in operating funds to purchase items for the animal science program, including 30 bags of deer feed, nine SD cards, eight trail cameras, six batteries, three deer feeders, and three mineral blocks. According to the animal science teacher, the superintendent provided him a gang camera, deer feed, and a feeder to be used on district property. We conducted interviews and inventory observations and determined
that a deer feeder, a battery, a trail camera, an SD card, and approximately 10 bags of deer feed appear to have been used for the animal science program. however the use or location of the other items could not be identified additionally grant closeout documents were not properly submitted as a result the district was ineligible for the program for fiscal year 2026 the district
discovered and we verified by reviewing the district athletic schedule the athletic admission revenues for two softball games and three baseball games held in March and April 2025 were not remitted or deposited into a district bank account according to district officials multiple employees had access to the location where collected funds would have been kept therefore the custodian of these funds could not be identified a comparison of football and basketball gate revenues revealed a higher average amount of gate revenues
collected in 2026 compared to 2025, as shown in Exhibit 2 on page 5. This difference could indicate all athletic gate revenues were not properly remitted or deposited in fiscal year 2025. Finally, we identified banquet ticket sales not properly handled and issues related to the athletic booster club account operating under the district's federal identification number.
Legislative audit recommends that the district ensure disbursements are in compliance with the Arkansas Constitution and serve a district purpose. Disbursements have a documented business purpose. Equipment is placed on the fixed asset listing and any equipment not located on district property is properly accounted for and cited annually. Grant proceeds are used in accordance with grant guidelines and grant requirements are adhered to in order to be eligible for future funding and proper procedures are
implemented so that athletic and activity fund revenues are properly accounted for and deposited in a district bank account. This concludes my presentation. This report has been forwarded to the 8th North Judicial District prosecuting attorney and the Attorney General. Management response is provided in Appendix A of the report and district officials are present to answer committee questions all right I think
we're gonna have some questions so
if the district officials will that are here come to the table and as is the practice when
you get to the table please hit the button and remain standing each of you will state your name employer and position for the record and then raise your right hand and I'll swear you in Michael Williams
Speaker 284
1:50:55
school board president Larry Smith superintendent schools all right if you would raise your
right hand do you solemnly swear or affirm that the testimony you're about to give will be the truth the whole truth and
nothing but the truth yes I do you thank you all right go chairman months from you're
Representative Robin Lundstrum
Unverified
1:51:21
recognized thank you gentlemen for being here um i have a question what were these school pens what what school was this bought for why would he
Speaker 289
1:51:30
hide the information i believe it's the district that he is currently working at which would be ashdown but
Speaker 290
1:51:36
i'm not 100 sure that i wasn't there when the purchase was made okay
We had similar ones at Prescott with
Representative Robin Lundstrum
Unverified
1:51:46
think that was probably what it was. Okay. So it was bought for another school district with this school district with Prescott's money, correct? That's
Speaker 289
1:51:54
what legislative auditors found, yes. Okay.
Representative Robin Lundstrum
Unverified
1:51:56
What about the collegiate school items? Prescott's not a college. No, it's not. Do we know who it was bought? Again,
Speaker 290
1:52:03
let me start by prefacing this. I started in
Speaker 293
1:52:08
January of 26, so all of this occurred not just the semester before I got there, but the year before I got there.
So I don't know a lot of those answers to that part of it, but I know of no purpose that you would have purchased that
Representative Robin Lundstrum
Unverified
1:52:24
for as far as the school district is
concerned. So given this gentleman's propensity to spend money, the district's money, what district is he now spending the money of? I
Speaker 293
1:52:33
believe he's currently employed as superintendent in the Ashdown School District. okay um this
Representative Robin Lundstrum
Unverified
1:52:37
is so blatant it's it's amazing to me that i'm thankful that audit caught this i i
hope you've what have you done to to stop this in the future now that you're in
Speaker 293
1:52:54
the saddle well uh we have put in recommendations from legislative audit into place money is now for athletic events is accounted for by the gatekeepers themselves with the athletic director it is then brought to my office and placed in a gun safe that is located there. The business office officials get it the following morning and bring it out with the athletic director, recount it to make sure it's deposited, then it's deposited in the bank with all the proper proceeding done as they go through
that. We go through a requisition process that ultimately ends up on my desk through eFinance, which is the district's ability to send purchase orders through. So those are all reviewed and signed off on by me uh before purchases are made uh and it goes to the proper uh supervisor before it gets to me uh from the
Speaker 295
1:53:37
building or from the program okay how long was he employed
Representative Robin Lundstrum
Unverified
1:53:41
at prescott i want to say
Representative Jessie McGruder
Unverified
1:53:45
a little over 18 plus years i believe 18 years 18 plus years yes ma'am i don't
Representative Robin Lundstrum
Unverified
1:53:52
don't quote exactly on that are y'all going back and taking a look at more than
Representative Jessie McGruder
Unverified
1:53:58
just this i would like to but the investigation only went back to 2022 i
Representative Robin Lundstrum
Unverified
1:54:04
i think i'd find me an accountant and go through and do some audit work that or pull your previous audits every school year is audited
every year with legislative audit um and get a forensic accountant there might be some money on the table
y'all need to sue and go after yes ma'am that's that's pretty scary i'll get out of
queue and let some other folks get in all right thank you um representative matt brown
Speaker 303
1:54:30
thank you mr chair and i may have missed this what's this guy's name
Speaker 152
1:54:35
superintendent robert pool and and you said that he's now employed by ashdown school district yes sir well i guess we know where to go next um so my understanding
Speaker 143
1:54:42
from this report though is that he essentially used prescott as his own personal piggy bank is that fair to say i can't answer that
Speaker 306
1:54:50
question but i would say that legislative audit seems to feel that that's what the case was well i mean it's there do y'all agree
Speaker 305
1:54:58
with legislative audit that's what the case was well and understand sir i got this last week the investigation was already underway when i got there so i was not privileged to see any of the information that they reviewed or anything that was with that um my conversation with the attorney general's office was the investigation is underway so we really can't say anything to you so i'm seeing this as as you're seeing it has the school district done any any kind
Speaker 152
1:55:22
of its own internal investigation time in the past under this gentleman no sir not in the past this is the
Representative Trey Steimel
Unverified
1:55:31
first all right thank you mr chair uh representative stymel thank you mr chair this is in relation to the golf cart that was purchased by the construction manager, the contractor at the time, do we have a name of that construction manager or contractor that purchased that golf
Speaker 286
1:55:54
cart by chance? I'm not aware of the person's name, but C.R. Crawford was the contractor that built our school.
Representative Trey Steimel
Unverified
1:56:01
You know, could staff get that information to us? It would be great at some point in time. Yeah, we'll have staff get that to you. Yeah, I generally just have a concern with that. If they already had two golf carts at their disposal, how they could justify that, and then why a construction manager would justify that, purchasing that potentially, especially an upgraded model, definitely customized. So just some unanswered questions I really
Speaker 310
1:56:30
want to try to wrap my head around.
So primarily just information related to the golf cart
Representative Trey Steimel
Unverified
1:56:38
purchase? Yes, and the construction manager or the general contractor that was in charge of that project. Okay. Thank you The
Speaker 280
1:56:49
construction manager was C.R. Crawford All
right Represent one storm I'm just
Representative Robin Lundstrum
Unverified
1:57:01
a question moving forward has
Have you broadened this to make sure that there are no other folks
that have been involved and make sure this doesn't happen in the future? And this is for the school board president I'm concerned one person. This is a lot of money and a lot of moving parts if
Representative Jessie McGruder
Unverified
1:57:20
they had help. Yes, ma'am The scope needs to be bright and I mean in my opinion it does it needs to be a thorough a more thorough look at The spending habits of does say it in the individuals that contributed to this Our financial demise so it needs to be broadened in my opinion,
Speaker 315
1:57:36
but I don't speak for the total board
I speak for Michael Williams, but it does need to be broadened I
Representative Robin Lundstrum
Unverified
1:57:42
would hope the board would would do that so that the current superintendent doesn't have to be constantly wondering what else is going on Thank you representative Matt Brown Thank you, mr. Chair.
Speaker 200
1:57:54
I have a question I guess for staff My understanding
Speaker 236
1:57:57
is now that the report's been presented and committee has been filed. It's now a public record. Is that correct? That's correct. The report is now a public record.
Would it be possible to request audit to send a copy of this report to the Ashdown School District? Because, you know, the thing that shocks me in this whole deal is that the superintendent, it appears, has stolen. I mean, just outright stolen money from Prescott, was allowed to resign, has now been hired by another school district, and who knows what he's doing there. And I think they need to know what's going on. Would it be possible to send a copy of this report to them, or is that something I need to do myself?
That's something this committee, if we want to take it up, You could make a motion to direct the staff to do that, or you could
just send it to them yourself. It's public record. Well, I just don't know if it would have more oomph if it
Speaker 236
1:58:59
comes from audit versus just coming from me. But if I could make the motion, I would make the motion to, could we ask staff to support a copy of this to Ashtown School District, just to make sure their eyes wide open, because I certainly wouldn't want a situation like Mineral Springs to happen where they've got a bad actor and then they're left holding the bag because they didn't know about previous incidents. Okay.
Let's come back to that in just a second. Let's see if there's another one in the queue here, and then we'll come
back around to you. Representative Mayberry. Thank you. I just wanted to say that the bright
Representative Julie Mayberry
Unverified
1:59:30
spot in all this is that, Dr. Smith, I know that you're going to take
care of this. I know that you've had a lot of experience, and I think that you're seeing this report, and I just know that you're going to make things right, and I wanted to
say thank you. We're going to do the best we can do. Thank you.
all right representative matt brown if you'd like to state your motion and just clarify who the recipients are that you're wanting to report sent to hold on there
Speaker 236
2:00:18
you go i'm sorry thank you Mr. Chair, I would make the motion that staff forward a copy of the report to the Ashdown School District.
I would think it would need to be the school board, perhaps the board president, just so maybe with a cover letter saying, you know, this is the results of an investigation, you know, for your information, just so that they're in
the loop. Okay. Do I have a second on that motion? I've got a second. Any discussion on that motion? All right. Senator Mark Johnson, you're recognized for discussion on that
Senator Mark Johnson
Unverified
2:00:49
motion. Thank you. I'll be brief, Mr. Chairman. Thank you, Representative Brown, for that idea. We need to probably do this more often.
I would respectfully request that the letter be signed by the co-chairs. If that be prepared by staff and signed by the co-chairs to emphasize that this is not just the administration, this is the General Assembly. If you would, if Mr. White agrees with that, or has a problem with that. I don't know if
I think that's the typical. Okay, great. Thank you, Mr. Chairman.
Deal. All right. Senator Sullivan, are you discussing on this motion? Folks,
Senator Dan Sullivan
Unverified
2:01:36
we're making a big precedent here. We refer issues to prosecuting attorneys all the time. And those people often have another job somewhere else or seek employment somewhere else. And is it now going to become the responsibility of the legislature to notify potential? Because this guy or others could move from Ashdown to wherever.
And how deep does our responsibility go to notify school boards or others that public information is out there? It's public information, and if other school districts are not following what we're doing, that's not our responsibility to go this far in notifying everyone who may be impacted by this. I understand the thought behind this, and I agree that others should be aware, but that's on them.
And school boards and others need to be, as we've seen earlier in this deliberation, folks need to take that in consideration and do their job and it's not our
job to do their job for them thank you mr. chair all right thank you senator seeing no other folks in the queue
for discussion motion is before you all in favor
aye any opposed motion carries all right and
Senator Sullivan did you have you're up like
Senator Dan Sullivan
Unverified
2:03:20
to move that we refer this report to the professional licensing standards board for investigation into the contents of this report
to have a second I have a second Any discussion on this motion? Seeing none all in favor say aye. Any opposed?
Motion carries. So with that seeing no other questions for you guys are dismissed and without objection we'll file this report. Members that takes us to other business. The next meeting of the Legislative Joint Audit Committee will be held on October 8th and 9th, 2026. Seeing no other business, we are adjourned.
Agenda
A. Call to Order by Chair
B. Adoption of Minutes
C. Reports of Executive and Standing Committees:
D. Review of Reports:
E. Other Business:
F. New Business
G. Adjournment
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — LEGISLATIVE JOINT AUDITING, Sep 11, 2026 | Agenda | 1 | Official source ↗ |
Speakers
Senator Jim Dotson Chair
Unverified
Representative Marcus E. Richmond
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Representative Robin Lundstrum
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Senator Matt Stone
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Senator Dan Sullivan
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Senator Kim Hammer
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Speaker 22
Representative Stephen Meeks
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Speaker 29
Speaker 38
Speaker 39
Speaker 41
Chair
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Speaker 45
Representative Jack Ladyman
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Speaker 53
Speaker 40
Speaker 55
Speaker 61
Representative Julie Mayberry
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Speaker 78
Speaker 79
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Speaker 90
Representative Johnny Rye
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Speaker 96
Speaker 83
Speaker 51
Speaker 101
Speaker 113
Senator Stephanie Flowers
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Speaker 124
Representative Justin Gonzales
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Representative Tracy Steele
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Speaker 134
Speaker 143
Speaker 152
Speaker 116
Senator Mark Johnson
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Speaker 163
Speaker 165
Speaker 130
Senator Jamie Scott
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Speaker 204
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Speaker 62
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Speaker 104
Representative RJ Hawk
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Speaker 221
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Speaker 236
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Speaker 167
Speaker 110
Speaker 258
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Speaker 269
Representative Brad Hall
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Speaker 271
Representative Howard M. Beaty, Jr.
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Speaker 273
Speaker 237
Representative Wayne Long
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Speaker 280
Speaker 284
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Speaker 290
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Speaker 295
Representative Jessie McGruder
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Speaker 303
Speaker 306
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Representative Trey Steimel
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Speaker 286
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Speaker 200
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Speaker 328