In yesterday's report, Miss Fortune examined Steven Ingersoll’s unusual method of “creative bookkeeping” at the Bay City Academy: the possible budget manipulation of “local revenues” to stave off a deficit—or at least eliminate the appearance of one.
At the end of the post, I posed this question: short of loan proceeds, ISD revenues, and earnings on investments, where could those “local revenues” be coming from?
I now believe that I have the answer: thin air.
OK, I'm joking...a little.
Miss Fortune has obtained an official Michigan Department of Education 2013-2014 revenue report for the Bay City Academy (shown below) which reveals the “local sources of revenue” line items included in the category.
Oh, and look here—nearly all show zero dollars, except “earnings on investments” (a whopping $11.00!) and the happy little family's oafish big brother “other”.
A Michigan charter school is subject to an independent financial audit, either on its own or as an entity of a school district. But here in the state, schools operated by private management contractors may be exempted from important aspects of uniform financial reporting that are normally required of public schools.
Although Michigan officially refers to its charter schools as “public school academies”, charter schools in the state run by independent management companies do not have to comply with several parts of the state’s Freedom of Information Act, sharply limiting the usefulness of uniform financial reporting.
The problem is baked in the cake, until it comes running out in federal court just like the gooey filling of a Chocolate Molten Lava Cake.
So what are we to make of the Grand Traverse Academy's fiscal year 2009 local revenue estimate of $2,734,000?
Was it spurred by the Academy's need to plug a big, round financial hole? From the financial audit excerpt below, it looks like the Bay City Academy has a red-headed stepbrother up in Traverse City at the Grand Traverse Academy: his name is “miscellaneous”.
The only way we'll ever know the answer to these questions (and many others) is when in-depth forensic audits are finally conducted at both charter schools associated with Steven Ingersoll.
And if (or when) that happens, Miss Fortune will be the one to break that news.