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Buckeye Valley Local Schools Audit Released
Public Dollars May Not Be Used For Campaigns
Columbus – A public relations firm received public money to promote a bond levy campaign for the Buckeye Valley Local School District (Delaware County), according to an audit released today by Auditor of State Dave Yost. The work included campaign polling, and even a sidebar $15,000 “win bonus” agreement between the architecture and the public relations firms. The levy failed, so the bonus was never paid.
“The law is clear – public dollars may not be used to promote school levies,” Auditor Yost said. “All of Ohio’s school districts must be careful not to cross the line from educational to promotional – and not knowing about an illegal expenditure doesn’t make it legal.”
In early 2014, the Buckeye Valley Local School District School Board sought out architecture firms to determine the costs for upgrades to three elementary schools and to determine the size of a bond issuance to propose to voters. The board approved Orchard Hiltz & McCliment, Inc. (OHM), and they entered into an agreement on March 18, 2014.
The agreement stated that OHM would provide basic services related to the possible renovation of three older elementary schools and included a provision for Aimpoint Research, a subcontractor of OHM, to provide up to $30,000 in “community engagement” services relevant to the proposed bond issuance. It is not uncommon or improper for school districts to contract with architecture firms that also offer public relations services for community engagement purposes.
The district was invoiced by OHM and paid all monies directly to OHM. The agreement between OHM and the board was approved by legal counsel and on its face did not violate Ohio Revised Code. When Aimpoint performed work as a subcontractor, invoices were submitted to OHM for payment.
On September 3, 2014, the Auditor of State’s office received a complaint regarding the district, alleging that public money was being paid to Aimpoint to promote an upcoming bond levy - a potential violation of Sections 9.03 and 3315.07 of the Ohio Revised Code (ORC).
The Auditor of State’s office opened an audit for the public interest to determine what work was actually performed and whether work performed under the agreement by Aimpoint violated ORC §9.03 and 3315.07. Auditors evaluated records for the period of July 1, 2014 through June 30, 2015.
In response to the board’s request for proposals (RFP), OHM and Aimpoint presented their proposal to the board’s architectural committee. A handout obtained by auditors included the following services to be provided by OHM and Aimpoint:
- Development of a Campaign Platform and Message
- Development of the Campaign Strategy and Plan
- Voter Turnout and Targeting Analysis
Minutes from an August 18, 2014 meeting of the district’s facilities committee show that Aimpoint’s CEO spoke about campaign strategy and how to pass the proposed bond issuance. Aimpoint later billed OHM $2,500 for the meeting. The next day, August 19, 2014, a board member was recorded saying the district hired OHM and Aimpoint “to aid us in passing the bond issue.”
Auditor of State staff found polling conducted by Aimpoint was substantially designed to conduct a campaign and was billed back to the district. Multiple questions asked voters about messaging, and one in particular asked if the election were held today, would the respondent vote for or against the bond issuance. In an interview, the chairperson for the We Believe in BV Schools campaign stated Aimpoint assisted the campaign with mailers, signs and telephone calls. The campaign and Aimpoint had regularly-scheduled phone calls, and while Aimpoint never directly invoiced the levy campaign, the chairperson thought Aimpoint was helping pass the levy.
The review of invoices found that Aimpoint failed to itemize expenses with any detail and the invoices were submitted to OHM for round-dollar amounts. However, a September 10, 2014 email from Aimpoint to OHM stated Aimpoint would not bill for $5,000 worth of projects, because those projects could be construed as being campaign-related.
An interview with Aimpoint’s CEO revealed a separate contract between OHM and Aimpoint in which OHM would pay Aimpoint an extra $15,000 should the bond levy pass. The CEO stated, and subsequent interviews with board members confirmed, the board was unaware of the $15,000 “win bonus.”
The report concludes that Aimpoint did receive public money to promote the levy campaign and that board members knew, or should have known, this fact. Under Ohio law, an expenditure of public money contrary to law is subject to a finding for recovery even if the entity was unaware of the law – that is, governmental entities are strictly liable for spending decisions. This report will be forwarded to the Auditor of State’s Central Region for consideration as part of the district’s FY 2015 financial audit.
As an office policy, the Auditor of State does not typically release audit reports in the fourteen days prior to an election. This report was originally scheduled to release in accordance with that policy, however, the Buckeye Valley Local School District Board of Education asked for more time to formulate a response to the report. The superintendent acknowledged in writing that he understood the audit would be released today during the traditional hold period.
“What could we possibly say to the voters after the election if they discovered we withheld information from them prior to their decision at the ballot box?” Auditor Yost said. “The Auditor of State has no interest in any local election or its outcome. It has every interest, and duty, to report its findings regarding the conduct of local governments and their compliance with applicable law.”
A full copy of this report may be accessed online.
The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,800 state and local government agencies. Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.