The Budget Committee gave its approval this week to begin a 15-year, $17,000 audit of the Foundation for Pierce College.
The Pierce Foundation is an independent, non-profit organization that handles fundraising for the college.
The foundation’s Senior Program Director Floriya Borzenkova said news of the audit was “unexpected” and “like thunder,” and that the foundation has paid a firm every year to conduct external audits, as required by law.
“If we did something wrong, or misused money, they would find it,” Borzenkova said. “And then we had an audit from the college. It was an internal audit. They didn’t find anything wrong on the financial side.”
Budget committee ex-officio Rolf Schleicher would not confirm the audit’s cost of $17,000, and declined multiple requests for a comment.
Schleicher referred the Roundup to the committee’s minutes. However, those minutes were unavailable. The most recent budget committee minutes were from July, 2014.
The audit was initially intended to investigate accusations leveled against the foundation by former Farm Center Director Robert McBroom, according to Borzenkova.
McBroom said repeatedly that he is still owed money by the foundation, according to the foundation’s chair Denise Robb.
The audit will go through 15 years of the foundation’s records to ensure a thorough examination of Farm Center documents, according to Pierce College President Kathleen Burke.
“In order to do that, you’d have to go back to when the Farm Center became involved,” Burke said.
The budget committee’s decision to increase the scope of the audit to cover the past 15 years is not just about McBroom’s allegations, but is part of a feud between the administration and the foundation, according to Borzenkova and Robb.
The Farm Center’s contract with the foundation didn’t begin until 2005, and “expired at least three or four years ago,” Borzenkova said.
That means that much of the 15-year period covered by the audit will fall either before or after the Foundation’s involvement with the Farm Center.
“It was for five years we had a contract with them,” Borzenkova said. “Why is it [the audit] 15 years.”
Borzenkova said that the audit was initially a reasonable response to the allegations by McBroom, but that it became a much more complicated issue when the budget committee ordered that the audit look back through 15 years of the foundation’s records.
“It’s impossible to produce all the paperwork. Our retention policy goes back to seven years,” said Borzenkova. “After seven years, we destroy.”
The foundation oversees about $700,000 in funds and donations.
Administrators have alleged that the foundation board spent funds on projects for which they were not originally intended, and of not meeting the required fundraising minimums set forth in the foundation bylaws.
“The Foundation board voted to use money called ‘Legacy Funds’ for repairs to the Farm Center,” Robb said.
The $100,000 used for those repairs came from “a former Pierce president,” and was part of an account known as the President’s Beautification Fund, according to Robb.
“The foundation board had determined that the District didn’t want to pay for it, even though it sounds like the District should have paid for it, and the foundation didn’t know what to do. So they voted to use that money to repair this land,” Robb said. “The president contends to this day that that money was not theirs to use for that purpose. The foundation claims that it was.”
Burke confirmed that the administration decided, in part, to pursue the audit as a step toward the recovery of “an undetermined amount” of funds, which were allegedly misspent by the foundation. Burke said her administration has actively sought recompense for those funds.
“We’ve been trying since I took office,” Burke said.
Robb said that McBroom’s allegations of imminent private development on the former Farm Center land have seriously impacted fundraiser efforts, and the foundation’s financial woes were made worse by the recent exodus of its board members.
“The thing is, it’s really been hard because everybody quit. All the board members quit, except two, just a few months ago,” Robb said.
Burke said the board members’ mass exit was due, at least in part, to a clause in the foundation’s bylaws.
“Their [foundation board members’] sole purpose is to raise money,” Burke said. “The bylaws include a ‘give-or-get’ clause.”
That clause means that each board member is obligated to either seek out and “get” a minimum amount of $2,000 each year from private donors, or else they must “give” that money themselves.
Burke said that many board members were not meeting that requirement and that that was the reason all but two members quit within a short period of time.
“When the foundation pursued them for the funds, they chose to step down,” said Burke.
As a result of the clash, the foundation “is only being allowed to continue for one more year,” said Robb.
“She [President Burke] is signing a one year contract to see if we can raise the money. We need to raise a lot of money,” Robb said.
Robb said she would like to see the foundation and the administration focus on reconciliation.
“I don’t think we should be at war with the President,” Robb said. “I think we should work with the president as much as we can.”