HOLDEN, Mass. — After an error in the fiscal year 2012 budget led to an over-expenditure to the tune of $1.2 million, the Wachusett Regional School Committee has voted to terminate the contract of Business Manager Peter Brennan, and is exploring a forensic audit of the school department's finance history.
An additional $1.4 million shortfall in employee benefits and insurance called for "significant and substantial reductions" to FY13 according to Superintendent Thomas Pandiscio.
The $2.6 Million mistake played a key role in the committee's later decision to support Rutland's proposed reduction to a $79,064,670 budget by 15-3. After the originally proposed budget failed to get support in Rutland and Paxton, Wachusett's superintendent recommended supporting Rutland's number.
Rumors of the errors began circulating last week, and Monday night's scheduled school committee meeting began with a protracted executive session for discipline of an employee.
"Mr. Brennan was dismissed for failure to perform his duties as the district's chief financial officer," said School Committee Chairman Duncan Leith. "Specifically Mr. Brennan failed to forecast growth in the health insurance budget in an adequate manner."
Leith said Brennan ignored standards and practices in using spending history to predict future expenses, and the resulting error forced the district to make significant cuts in other line items to balance the budget.
The chair added that Brennan recently left the FY12 budget out of balance by using a faulty spreadsheet of his own creation.
The amount of the over-expenditure was not initially stated; however, Pandiscio later confirmed it at approximately $1.2 million for FY12.
The school committee voted to have its business and finance subcommittee consider an audit of the school department finances, but left the it open-ended whether it would be a forensic audit. Due to the school committee's by-laws on new business, they were unable to vote on the matter Monday night and the full committee will vote on the recommendation at their next meeting on Aug. 8.
In order to restore credibility to the school department, School Committee member Stacey Jackson says she is hoping the Business and Finance Subcommiittee will come back with the recommendation for a very thorough audit.
"I think the whole community needs the result of that audit to feel more comfortable," she said.
School Committee member Erik Scheinfeldt said that he believed the business manager was terminated for good cause.
"He made a lot of mistakes with forecasting the budget, and that is one of the primary reasons we're in the mess we're in," he said.
While supporting the budget reduction was a tough decision, Scheinfeldt said "ultimately I made the decision to get a budget passed for this year and tried to also keep in mind the concerns of the voters."
Though the superintendent reported the $1.2 million over-expenditure, Scheinfeldt said "to be honest, the numbers don't make much sense to me at this point," and supported talk at the meeting for a full audit to be conducted.
"I think we need to get to the bottom of this given the severity of the negligence of the business manager, I honestly don't know what to believe now," he said. "An audit will help us better understand what happened."
Members of the Holden Board of Selectmen were present at the meeting as well, and Selectman Bob Lavigne expressed disappointment that the shortfall amount was not clearly stated during the public meeting.
"It was a little bit less than transparent, and its a way for rumors in the community to continue to perpetuate,' he said. "Even I can only work under the rumors that I've heard, which was between $1 and $3 million — which is a huge difference. I was hoping to hear some kind of number from the school committee and superintendent tonight so that we could start to formulate a game plan."
Selectman Anthony Renzoni added that he was disappointed that the statement following the executive session was "vague at best."
"I've been contacted throughout the week and I've heard mis-accounted numbers from $1 to up to $4 Million. Granted they're all rumors, but until I was hoping to get something cleared up tonight."
Lavigne was also disappointed that they didn't call for an independent audit.
"Recommending it to business and finance to review the possibility of maybe having an audit just didn't seem like enough from the town's standpoint," said Lavigne. "We should have just called for an independent audit right now to find out what happened with the money so that we could move forward with it."