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Monday, April 10, 2006 | The audit of former superintendent Alan Bersin’s discretionary fund was finally released to the public by the San Diego Unified School District after numerous appeals, including a public records request made by voiceofsandiego.org. It reveals – drum roll, please – anything you want to see, depending on your filter.

Those who regard Bersin as a villain will find damning evidence of wrong-doing, while those who view him as an effective change agent for school reform will find nothing of consequence. Objectivity when the fiery former superintendent is involved is hard to come by.

The report, weighing in at five pounds, is two full inches high and contains over 800 pages of information. Its completion represents $75,000 worth of outside attorneys’ fees and hundreds of hours of district staff time.

“The total [spent] probably exceeds the $43,000 of greatest concern,” said SDUSD communications consultant Dick Van Der Laan. “But if we can prevent conflict of interest in the future, then it’s worth the investment.”

The amount of time it takes to read through the five-pound audit is considerable. In an attempt to summarize the detailed information, the school district kindly prepared a two-page brief to inform readers of its greatest concerns – notably, the $43,871 Bersin spent from the private fund on business-related travel and meals, including alcohol.

“It’s an accurate representation of the district’s position and a majority of the board,” said Ver Der Laan, of the summary’s critical tone.

However, the district’s summary – clearly biased against Bersin, perhaps to justify the monumental effort and expense of the project – provides only one small slice of the facts uncovered in the audit and should be disregarded by the media and any individuals searching for the complete picture.

To take the district’s condensed presentation of the data at face value is lazy at best, deceptive at worst. Only a deeper review of all the material can place the isolated incidents in greater context, if one is to judge the true scope of the alleged misdeeds.

Accepting the audit’s accusations of misconduct would be as wrong as believing Bersin’s assertion that every single dime spent was properly accounted for. There is gray – both sides have valid points. The issue is whether the questionable activity was serious enough to warrant such a full-blown investigation.

Following the Money

The Superintendent’s Fund, technically called the San Diego City Schools Superintendent’s Fund for School

The purpose of the fund was to provide grants for charitable, scientific, literary or educational purposes. The money was distributed at Bersin’s discretion – no school board oversight was required. He recommended organizations to receive grants, and the San Diego Foundation awarded the grants. Each recommendation included the name of the organization to receive the grant, the amount and the purpose of the grant.

Because money in the San Diego Foundation Superintendent’s Fund could only be paid out in the form of grants, about $122,000 was transferred into another fund that could make payments directly to individuals. This fund was called the Education Superintendent’s Account, which operated under the umbrella of the San Diego Education Fund (

The SDEF is run by Vance Mills, a former employee of the school district who worked as its director of math, science and technology, until he retired in 1999 after he was advised “that Alan Bersin had decided that Mr. Mills was to be removed from his position,” reads the district’s audit.

The school district investigated both funds at the request of school board member Mitz Lee.

The Allegations

Specifically, the district asserts that Bersin received $43,871 in reimbursements from the Education Superintendent’s Account for submitted expenses that were unaccompanied by receipts. Bersin said receipts were not required by the SDEF. But this just seems like bad business practice and is a valid issue – better internal controls should be implemented.

The district also objects that Bersin bought alcohol for dinner guests (apparently, drinking a glass of wine with dinner at a business gathering is a huge no-no at the puritanical school district). Bersin said that is precisely why he used the fund – and private money – rather than taxpayer money to pay for alcoholic beverages.

Allegations that Bersin double-charged for some meals were explained by his assistant Karen Heinrich in an email. “In each case, the total bill was split between the district (food portion) and the foundation (wine/spirits),” she wrote. “These were not duplicate billings as implied by the auditors.”

Allegations that Bersin charged for meals in cities that did not correspond to his travel itinerary were also explained by Heinrich. In many cases, “the credit card posting date did not reflect the actual transaction date,” she wrote.

Allegations that Bersin sometimes charged for multiple meals on the same day were true but justified, Heinrich wrote. “It is not uncommon to stretch the work day by using meal times to conduct business, which is exactly what Mr. Bersin did,” she wrote. “All persons hosted at the meals in question were related to district business, no exceptions. Non-district related expenses were never submitted for reimbursement.”

Heinrich did admit to three bookkeeping mistakes, totaling $410.21. Bersin said he will reimburse the district.

Beyond the $43,871, checks that turned out to be signing bonuses were issued to three individuals for reasons the auditors couldn’t identify. “The district had previously paid such signing bonuses to a few senior executives, but because of the severe budget situation at the time, Mr. Bersin decided to provide the funds through the Superintendent’s Fund,” Heinrich explained.

Then there were the three expensive retirement parties paid for by the fund – one for former chief administrative officer Henry Hurley, one for the finance division’s executive director Rick Knott and one for 19 retiring finance division employees. Hurley’s party cost over $20,000, Knott’s party cost over $17,000 and the retirees’ party cost just under $5,000.

A good portion of the costs was offset by party-goers who paid a fee to attend the parties. The rest of the money was donated by private corporations, including Bank of America, Merrill Lynch, Morgan Stanley and A.G. Edwards & Sons.

The audit implies that there may have been a quid pro quo arrangement or conflict of interest with the corporate donors, but no evidence is offered to support this. Bersin said there was nothing wrong with companies contributing to a party to honor two retirees with whom they had a warm business relationship for many years.

Another issue involved one donor who contributed over $200,000 to the Superintendent’s Fund but wished to remain anonymous, frustrating district efforts to uncover the name and giving rise to suggestions by the district of improper actions.

Kelly said anonymous donors are common at the San Diego Foundation, and their privacy must be respected “unless there is criminal wrong-doing.” He said the district was unable to provide him with any such evidence.

“There is a code of ethics,” Kelly said. “We said we’d be happy to give you the name if you will sign a confidentiality agreement. But they wouldn’t sign. We’re not hiding anything and want to cooperate. But we need to protect these individuals.”

Clouding the audit is the chilling effect it may have on future charitable giving. Will people be more or less inclined to donate money to school districts when they run the risk of having their motives questioned and groundless suggestions of impropriety raised?

The district questions a number of expenses but does not challenge the legitimacy of the remaining hundreds of thousands of dollars – again, of private money – spent on projects, people and causes that advanced the school district’s educational mission as Bersin, superintendent at the time, saw it. One might disagree with Bersin’s vision for City Schools, but that issue is not relevant to this report.

Some of these expenses include money spent for principal and staff training, sending a group of students to chess camp, prizes and rewards for schools that improved academically, awards dinners for successful staff members and other legitimate causes.

One program Bersin funded was with City Club of San Diego whose president, George Mitrovich, was paid $1,000 a month for a year to develop and promote a high school program aimed at educating teens about civic responsibility and involving them and their advisors in the City Club’s forums on topics of public interest.

Confirmation Hearings

Some have suggested that the release of the audit was timed to coincide with the Senate confirmation hearings for Bersin’s appointment to a seat on the State Board of Education, scheduled for April 19.

If Bersin opponents want to derail his confirmation, they should forget trumped-up charges and raise legitimate issues relevant to his views on education. What are his educational philosophies? Are they good for the children of California? How is he working to improve the state’s accountability system? Is he effective in helping districts hire and retain good teachers? Is he a strong leader? Can he bring people together? Is he focused and committed to improving the quality of education in California?

Oppose the appointment if you wish, but do it for solid reasons, not over insinuations and unsupported allegations of financial misconduct.

There are valid concerns brought to light by the audit, but let’s put these issues in perspective. Most have to do with tightening internal controls and instituting better policies and procedures. Whether the audit’s discoveries are serious enough or large enough in scope to justify the time and money spent, and all the righteous indignation, is doubtful.

[The entire audit is available to the public at the SDUSD offices at 4100 Normal Street, in the legal counsel’s department.]

Marsha Sutton writes about education and children’s issues. She can be reached at

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