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This post has been updated.
The Poway Unified School District board believes former Superintendent John Collins, who was fired Sunday, took hundreds of thousands of dollars in unauthorized pay, according to dismissal charges obtained by Voice of San Diego and an audit report released by the district Monday.
According to the documents, Collins was also censured for filing litigation without the school board’s approval, and for interfering with the district’s investigation into his financial dealings.
The board could ask a court to force Collins to pay back as much as $345,000 – the amount forensic auditors flagged as unauthorized pay.
Communications by Collins unearthed in the district’s investigation suggest some of the money may have been used to pay for a personal attorney who unsuccessfully attempted to negotiate a buyout of his contract, which had one year remaining.
In the district’s charges, the board lays out the myriad ways it believes Collins engaged in illegal self-dealing, unprofessional conduct, dishonesty and misappropriation and gifting of public funds.
Some descriptions in the documents make it sound as if certain district accounts became a sort of personal piggy bank for Collins – whose compensation made him the second-highest paid K-12 public school educator in the state.
Collins, who served as superintendent for six years, declined an interview request through his wife, Lisa Collins, who is a teacher in the Poway district.
The charges, written with findings from a two-month forensic audit that began when Collins was placed on paid leave April 25, offer a painstakingly detailed look at the allegedly troubling transactions and actions by Collins.
The board “did not take this action lightly, nor come to the decision precipitously,” board president Michelle O’Connor-Ratcliff said in a statement. She said the board was “dismayed” at the volume of financial irregularities and overpayments auditors found. “The severity of the findings justified terminating the superintendent’s contract for cause,” she said.
Below is a summary of what the board says justified his termination.
Vacation Pay
One of the costliest areas of concern for the board dealt with Collins’ vacation days.
Collins’ employment contract grants him 30 days of vacation a year, not including national and local holidays granted to other managers. Vacation days roll over year to year, up to a maximum of 60 days. His contract allows him to cash out unused vacation upon departure from the job.
Yet, forensic auditors found that Collins on four separate occasions since August 2012 directed the business chief to pay him for vacation time.
Collins cashed out 116 vacation days in recent years, to the tune of at least $148,400, according to the documents.
On July 31, 2014, Collins was even allowed to cash out 64 days for $87,192, resulting in a negative vacation balance.
Last November, Collins had his staff cut him a check for $17,000 in vacation pay out of the district’s revolving cash fund after telling business chief Malliga Tholandi he needed the money for an attorney he had hired, according to the district’s investigation. The fund is supposed to be limited to small purchases of $150 or less, and emergency payments.
The five-member board of education and Collins began separation talks shortly thereafter.
In the weeks before the payment, Collins used his district-issued iPad to text his wife repeatedly about financial hardships they were facing. In one message on Oct. 15 he reportedly said, “All I was trying to do on my phone at the game tonight was try to figure out a way to get the money needed to help both us and Ginger before December. I think I found a way.”
“He did in fact find a way — misappropriating public funds, through the revolving cash fund,” the district charged. “Dr. Collins’ use of ‘vacation cash out’ to address financial hardship was so prevalent, and informal that the District’s Employee Leave Information was grossly inaccurate.”
At no point did the board approve the vacation payouts, and some days paid were never deducted from his vacation bank, the district claims.
Auditors also found Collins took time off work without docking it from his vacation time.
The district’s calendar showed Collins took the entire month of July 2015 off, totaling 22 days, but he only claimed 10 vacation days and two sick days. Then in February this year, Collins told the board he would be taking an indefinite amount of time off following the death of a relative and to tend to a medical issue.
Collins was informed by the board president March 17 he would get the same number of bereavement days as other employees and would need to follow state and district rules for taking sick leave.
On April 22, Collins told his wife via text message he wasn’t going to work, but the time off was not reported to the district. Another text said he had surgery on Feb. 25, but that day also was not logged with the district.
Longevity Pay
Another pricey area of concern centers on Collins’ longevity pay, or payments for achieving 10, 15, 20 and 25 years of work for the district.
Though the incentive is plainly stated in his contract as a perk paid “at the completion” of the landmarks, Collins received a whopping $144,692 in “annual, compounded and cumulative” longevity payments. That amount should have been just $12,602 total for completing 20 years in 2010 and 25 years in 2015, according to auditors with accounting firm Vicente Lloyd Stutzman.
And Collins appears to have tried to take even more.
In December, Collins asked Tholandi to analyze the cost of increasing the longevity pay for all managers, including him.
He wrote in an email, “I’m thinking this could be effective 1-1-2016. So anyone currently receiving longevity for 15, 20, or 25 would just start getting their longevity recalculated to the new number going forward.”
Collins, with 27 years at the district, would have received the highest boost proposed of 4 percent, or an extra $43,000 using the improperly compounded calculation method. The proposal was never implemented but would have cost the district hundreds of thousands of dollars, posed a conflict of interest and amounted to illegal self-dealing, the district claims.
More Problems
According to the district, Collins also abused the revolving cash fund, an account that is supposed to be limited to small purchases and emergency payments.
Collins received $1,646 for internet service, paid in eight installments in recent years. He also received three advances for travel totaling $900 and $1,119 for travel reimbursement. Some of those expenses, including the $17,000 vacation payout, violated the fund’s $150 limit and required circumventing internal controls that are supposed prevent such activities, the district claims.
As someone charged with the safekeeping of district money, Collins’ actions may be criminal and “constitute misappropriation of public funds, and a breach of his fiduciary duties,” the district wrote.
Collins is also accused of violating strict state conflict of interest laws late last year by trying to negotiate a severance or settlement contract “both as the District’s Superintendent and as the adverse party to the District.”
He did so by directing the board Nov. 19 to use an attorney already contracted with the district to negotiate with his personal attorney, Lynne Lasry. Collins also tried scheduling multiple special board meetings to get departure negotiations under way.
One such meeting was ultimately canceled after the district’s general counsel, Dan Shinoff, received a call from the San Diego County district attorney’s office after concerns were raised over the legality of the meeting.
Shinoff wrote to Collins, “Just got a call from DA’s office. Spoke to DA. He doesn’t want his hand to be forced. Cancel the meeting.”
In February, knowing his interests were averse to the district’s, Collins sought legal advice from the district’s general counsel, the documents say.
Collins asked Shinoff if the board could hold a serial meeting, rather than a group closed session meeting, without violating state open-meetings laws to give their attorney direction regarding litigation threatened by Collins.
Shinoff responded, “With any threat of litigation they can hold a closed session and give direction to counsel. All the best to you and your family.”
Collins also reportedly used the district credit card for personal expenses, like family airline travel.
Just before Collins was placed on paid leave and told to relinquish access to the district and his district-owned belongings, his assistant sent him a text message.
Tina McDowell said she was “feeling uncomfortable about the Board being here on Sunday. Unless you are planning on being here over the weekend, I am loading up files (from the stack on your desk) and taking them home with me,” she wrote April 22.
Collins replied, “I will not be there. Thanks for doing that.” McDowell then messaged Collins the day he was placed on leave, April 25: “I have files from your desktop last week in my car. Shall I bring them to your house after work.”
Collins replied, “Yes please and the drive.”
The charges say Collins’ actions interfered with the district’s investigation.
Restraining Orders
Another major concern for the board arose in January, when it discovered Collins had initiated legal action and sought four restraining orders without board permission.
Out of four restraining order attempts by Collins since 2014, three of them took aim at a family openly critical of Collins and the district.
One of the workplace violence restraining orders sought in 2014 was filed against district parent and former employee Chris Garnier, who’s now locked in two costly legal battles with the district – one to overturn the restraining order and a second for wrongful termination.
Collins also sought a restraining order against Garnier’s father-in-law, Keith Wilson, who had also publicly lobbed harsh personal and professional criticism at Collins. Collins had told the court he feared for his and his family’s safety.
That legal action was filed by Shinoff in Collins’ name – not the district’s name, in violation of state law – but the district nonetheless paid the legal bill, according to the charges. The effort was unsuccessful.
Looking Back and Ahead
Collins, 62, began his teaching career at San Diego Community College District’s Kearny Adult School in 1978, before moving on to Hoover High School in San Diego Unified. A few years later, he became assistant principal at Twin Peaks Middle School in Poway, then principal at Rancho Bernardo High before heading to the Poway Unified district office for jobs as area superintendent, deputy superintendent and chief business officer. He took the top job in July 2010.
Collins enjoyed unwavering support from the teacher’s union leadership during his tenure. Both touted the success of their negotiation methods, which averted a strike and layoffs during even the harshest economic times.
Poway students also consistently posted high marks on the state’s former standardized tests.
His tenure as superintendent wasn’t all rosy though.
Collins grabbed headlines nationally in 2012 for a $1 billion bond deal that sparked state school bond reform. He also attracted criticism in the last year for his handling of a consultant report and his financial interest in teacher and manager pay negotiations.
His contract to lead the 36,000-student district with a $300,000 base salary wasn’t set to expire until June 30, 2017.
Last month, the school board selected Edward Velasquez to serve as interim superintendent beginning Aug. 1. District leaders are now preparing to launch a search for a permanent replacement.
Update: After this story published, Collins’ attorney Lynne Lasry sent us a statement:
It is unfortunate and troubling that the Board of PUSD, in terminating Dr. Collins’ contract with the District, has released an alleged independent audit that is replete with errors, both legal and substantive, including privacy violations of Dr. Collins and others (even in the “redacted” form). It is, however, expressly noted in the first paragraph of the released audit that it “does not express an opinion regarding the existence of fraud.”
Without going into detail about the legal and factual errors in the audit and other issues with the Board, the audit clearly ignores evidence which supports Dr. Collins, and includes questionable presentations of summaries which rely on unseen documents and/or mischaracterizations of many circumstances and events.
In addition, Dr. Collins has been systematically denied access to witnesses and documents to defend his position. Dr. Collins denies that he failed to substantially perform his duties as required of a retained Superintendent of PUSD or as required by his contract with the District. Further, he denies that he has intentionally or recklessly engaged in conduct that was designed to be dishonest, or that he intentionally or recklessly violated any other law of this State.
For the almost 3 decades that Dr. Collins has served PUSD, he has had the best interests of its students and its employees in mind. Dr. Collins will vigorously defend against these charges, and expects to take affirmative and decisive action in response to the District’s actions.
Update II: The forensic audit released by Poway Unified is a public document and includes the cell phone numbers of several district employees. VOSD initially printed the version released by the district but has since redacted the cell phone numbers voluntarily at the request of one of the employees.
Correction: An earlier version of this post incorrectly stated that Collins completed 10 years of service in Poway Unified in 2010 and 15 years in 2015. He completed 20 years of service in 2010 and 25 years in 2015. An earlier version of this post also misspelled the name of Collins’ attorney, Lynne Lasry.