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Audit: Donna ISD Was REALLY Run Like Shit

in RGV/The News by

Earlier this year, Donna ISD’s newly elected school board reached out to the law firm of Weaver and Tidwell LLP to conduct a forensic audit “related to certain allegations of improper and/or fraudulent conduct on the part of Donna (ISD) employees, contractors, vendors and others” to cover between 2013-to-date and, by God, what a fucking mess.

Investigators analyzed “98,911 emails across 14,472 mailboxes, 311,097 purchase orders, 18 duplicate vendors, 1,090 TEAMS log‐ins, over 300 posted policies and operational documents, 6,741 journal entries…(and) over 50 free form and targeted interviews.”

The report summary is teeming with so much information that even highlighting some of the more noteworthy findings is a challenge. From a district culture where employees feared retaliation for cooperating with the investigators to an inept and disastrously unqualified district Chief Financial Officer, the report details a district as dysfunctional as its football team (sorry, Donna North). Warning: this article is approximately 2000 words,  however, if you enjoy horror stories of mismanagement and incompetence, by all means, proceed.

The report is laid out in sections, with the first section zeroing in on the district’s superintendent Fernando Castillo’s comically outrageous incompetence.

  • On July 1, 2015 Castillo notified Maricela Valdez (“Valdez”) that she was being reassigned from Director of Testing/Evaluation to Chief Financial Officer (“CFO”). The Superintendent did not review the District’s job description for the position of CFO prior to making the reassignment and was not aware that the job description requires the CFO to have a CPA certificate. The Superintendent was also unaware of other required and preferred qualifications listed on the CFO job description.  Upon inquiry, Castillo stated that when selecting Valdez for CFO he considered her experience with HEB Grocery (“HEB”) as a key factor in selecting her for the CFO position. Valdez’s job application shows approximately 10 years of experience as a service manager with HEB. Valdez’s experience as a service manager with HEB is not the type of experience necessary to prepare her for the position of District CFO.

No degree? No CPA certificate? No actual experience with finance? Fuck it, HIRED! I’m sure those 10 years Valdez spent running change to registers and giving discounts for shitty customers sure come in handy when dealing with the finances of a multi-million dollar operation. That is some next-level Cleveland Browns scouting shit right there. Unfortunately, as you will read below, Castillo’s riverboat gamble didn’t exactly pan out. You would imagine that there would be some type of check or balance (like, ohh…I don’t know, a Human Resources department?) that would have kept Castillo from making such an idiotic move, but in Donna ISD’s best impression of Murphy’s Law, those other checks and balances were ALSO just as dysfunctional.

  • The Superintendent was asked to sign letters to the District’s former auditor, Luis C Orozco (“Orozco”) in January 2017 regarding the District’s financial statements for the year ended August 31, 2016, and again in January 20167 regarding the District’s financial statements for the year ended August 31, 2015. The Superintendent acknowledged that he signed the letters requested by Orozco.  We asked Superintendent Castillo about these letters and he acknowledged that he does not have any accounting training and does not have an understanding of U.S. GAAP. The Superintendent should not have signed the letter to the external auditor unless he was certain the District CFO had the necessary skills, education, training, and experience.

Not to belabor the point that promoting someone who has no clue about finance or accounting to your top finance and accounting position was a historically dumb move, but if you, the superintendent, have no clue what the fuck the district’s financial auditor needs from you in terms of financial reporting, you sure as shit need to hire someone who actually does. You see, when someone becomes a CEO of a company, they become CEO because they are skilled at leading, not necessarily because they’re great at finance or any other specific sector. The CEO hires a cabinet around them to delegate tasks as well as so that their cabinet may analyze their prospective areas such as finance, human resources, business development, etc. If you fuck up the delegation part, YOU are ultimately fucked AS IS your company. Donna ISD is the Yahoo! of the school district world: nobody knows what the fuck its CEO is doing and everyone expects them to be fired pretty soon.

  • The District offers an anonymous reporting hotline through a contract with Lighthouse Services (“Lighthouse”).The current hotline reporting structure is fundamentally flawed. An obvious concern is what would happen to a report made regarding Castillo, Valdez, or Villanueva. The Superintendent informed us that the District does not track hotline reports or the resolution of those reports. He also informed us that the Board is not advised regarding reports made to the hotline. Under the current structure, there is no assurance that anonymous reports are being appropriately investigated.

I’m going to guess that they’re under the same phone contract as Progreso PD. MORE HOTLINE DRAMA:

  • We asked Castillo and (assistant superintendent of Human Resources, Jose J.) Villanueva individually about the hotline. Each independently provided as their first response anecdotal information about an employee they believe to be abusing the hotline. It is possible this is, in fact, true and it is an unfortunate cost of having an anonymous hotline. However, the actions of Castillo and Villanueva in response to this perceived abuse could completely undermine the value that can be achieved from having a hotline. Both Castillo and Villanueva volunteered that they attempted to identify the employee they believe to be abusing the system. Recall that this hotline is supposed to be anonymous. Instead of respecting the process, Castillo and Villanueva jointly asked the technology department to try to identify the person submitting the reports. When this failed Castillo and Villanueva reached out to the Police Department to request assistance in identifying the employee. This attempt also failed. Actions taken by Castillo and Villanueva to ferret out the identity of the anonymous tipster are inappropriate.

First of all, when you set yourself up to be potentially trolled, you better be ready to be God damn trolled. I say this from experience running The Bench Wire as we have been spammed numerous times with bogus tips and really (and I mean REALLY) shitty memes. Second, these morons completely shit on the entire process just to start a witch hunt on an employee who may have had legitimate complaints. Fuck these guys. If any Donna ISD employees have this number, I am kindly asking you to forward it over to jd@thebenchwire.com to compain SPECIFICALLY about the anonymity of their anonymous hotline.

  • During our review of emails, we noticed that the Superintendent often deletes emails that he sends. After deleting the emails he empties the “trash can” so that the emails are no longer
    stored in the District’s Microsoft Office 365 platform.

Who the fuck DOES that? This is LITERALLY the white-collar equivalent of going to Home Depot and buying a chainsaw, a shovel, duct tape, rope, and tarp. Sure, you haven’t committed a crime, but what in the fuck are you doing that for?

As stated before, the report also details highly suspect incidents committed by district CFO Maricela Valdez, who was placed on administrative leave on January 20th, earlier this year.

  • (Valdez’s) reassignment increased Valdez’s annual pay from $80,756.74 to $100,793.42 for a total increase of $20,036.68 (a 25% increase). Valdez stated that she did not apply for the position and no interview was conducted.

Just when you thought Valdez’ hiring couldn’t have gone any worse for Castillo, we find out that she didn’t even ask for the job and seemingly no one else was even interviewed for the position. It’s not every day that someone falls ass-backward into a $100,000k job that they a) didn’t ask for and b) aren’t qualified for but NOT with Castillo running the show! Next, watch as he hires a Stripes cashier to be the head of the math department because WHY NOT?

  • It is critical for the CFO to not only evaluate the accounting procedures, systems, and controls but to abide by those procedures, systems, and control at all times.36 However, we uncovered the following during our review of District records:
    • December 5, 2016: Daniel Valdez (Valdez’s husband) sent an email to Valdez asking for assistance on a purchase order. The purchase order was for shirts from CB Sportswear. D. Valdez wanted the purchase done before the holidays.
    • December 5, 2016: Valdez responds by email that she will request an emergency purchase order.
    • December 6, 2016: The purchasing clerk approves the requisition.
    • December 7, 2016: Sandra Martinez approves the purchase order.

WELP! Doesn’t take a genius to figure out why ALL of this is wrong but clearly, there wasn’t a single adult in this administration who thought otherwise.

The most notable piece of information regarding the Donna ISD business office, under the purview of Valdez, is that, again, there was not a single qualified CPA (Accountant) in that building.

On with the shitstorm, we reach Human Resources:

  • Assistant superintendent of Human Resources, Jose J. Villanueva met the job description requirements for education and had five years of administrative experience. However, Villanueva did not have experience in human resources before being reassigned to this position by Castillo. Absent previous experience in human resources Villanueva did not have the skills, experience, and training necessary to fulfill the essential duties and responsibilities listed in the job description.

2-2 for Castillo, our super talent scout. The report also stated that Villanueva clears over $100k to do a job he absolutely is not qualified to do. GOOD STUFF!

Remember CB Sportswear from earlier, the vendor that received funds via emergency purchase from the husband of the district CFO Valdez. GUESS WHO OWNS IT! Go ahead, take a wild guess.

  • During our review of emails, we noticed emails from Human Resources Supervisor, Adolfo Campos Jr. (“Campos”) related to CB Sportswear.  The emails were for quotes for shirts by CB Sportswear, a business owned by Campos’ father. The quotes were sent to the Donna Police Department and the Donna Cross Country team.

Because OF COURSE CB Sportswear would be owned by a district employee’s father. It’s a law that Donna ISD can’t go 30 min. without violating conflict of interest policies. In the time it takes you to read this article, I’m more than sure Donna ISD would have already broken a plethora of different laws. It’s like clockwork for these people.

  • We were advised that while presenting a sexual harassment training video Villanueva explained that if he and one of his direct reports in Human Resources were having an affair then there is no problem because both individuals agree to the relationship. This is inappropriate information particularly coming from the Assistant Superintendent of Human Resources.

Jesus, I’m sure this guy’s a real hit around his own office. Ladies, Villanueva is forever that gross boss you had that would linger around your desk all day, trying to rub his bulge on you. Villanueva is forever that balding weirdo that keeps staring at you from across the room, watching you eat. Villanueva is forever that greasy creeper at the bar that won’t stop hitting on you that you have to keep looking down at your drink for any fizzy pills. I would say that the best practice to avoid this guy would be to completely walk away from him but even then, I’m sure even doing that from this guy has got to be uncomfortable.

This rest of the report doles out a litany of other infractions and reflections of poor management that has come to be synonymous with Donna ISD.

What stuck out most was the auditors finding that “many District employees expressed the belief that nothing will change in the District. (The investigators) were told repeatedly that the employees did not believe the new Board would be any different than the old Board.” These employees and residents of Donna have every reason to believe that their beliefs are absolutely true. Just a few miles southeast, although the legal hammer was brought down hard on tiny Progreso, the school district basically fought off a toothless TEA and still remains shady as fuck.

You can read the full report below:

Donna ISD Weaver Report by The Bench Wire on Scribd

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