Milwaukee Public Schools documents sent to DPI indicate inexperienced, understaffed financial office

The embattled Milwaukee Public Schools submitted an updated draft Corrective Action Plan to the Wisconsin Department of Public Instruction Tuesday, detailing how the district will address overdue financial data and compliance issues. 

District leaders hope the plan will release nearly $16 million in state funds being withheld after MPS failed to produce audited financials. 

“We are committed to resolving the issues surrounding the delayed financial data submission,” Board President Marva Herndon said in a written statement. “In addition to submitting the Corrective Action Plan to DPI, we are actively analyzing the root causes behind this situation, and we pledge to keep our families, staff and the public informed as we progress.”

The 26-page draft plan, obtained by WPR, paints the picture of an inexperienced, understaffed financial office that was using an outdated accounting system to manage the state’s largest school district. 

The report states that 12 vacant finance department positions need to be filled by Sept. 26. The MPS software system, BusinessPlus, needs to be updated so it can convert financial data to the DPI’s WISEdata system.

Throughout the report, MPS cites not being able to access WISEdata as a reason for missing deadlines.

A chart of the current staffing in the MPS office of finance shows CFO Martha Kreitzman is still employed, but there are three vacant positions — a data support analysis, project management specialist and comptroller — directly under her.

The plan indicates Kreitzman is likely to be replaced.

Two of the three positions that would report to the comptroller are also vacant. 

Report outlines several issues and challenges

According to the report, MPS missed four deadlines to submit financial information to the state. 

The first was an external audit by Baker Tilly due on Sept. 15, 2023.

According to the report, the district’s financial team tasked with completing this “has limited experience, and it is unclear if all steps to perform the required tasks are documented in detailed standard operating procedures.” 

The report also said the MPS software, BusinessPlus, is not integrated into DPI’s WISEdata system. 

“The finance team is utilizing numerous excel spreadsheets that are outside of the BusinessPlus system to produce financial information, increasing the risk that data errors may occur,” the report says.

MPS missed another deadline for the submission of its 2023 annual report to the state, which was due Sept. 22. 

Again, the explanation was an inexperienced financial team and the BusinessPlus system not being integrated into DPI’s WISEdata system. 

Audited financials were due to DPI on Dec. 15. According to MPS, that wasn’t completed because of “the lack of experience of existing finance staff, the risk of errors is high, and it will mean further reliance will be placed on the external audit firm to ensure the accuracy of the data to be submitted to DPI.”

A fourth deadline was also missed on Dec. 15 when certified budget data was supposed to be sent to the state. MPS said that data was reliant on one individual with historical knowledge to perform the task but who had not worked with WISEdata reporting. 

The draft Corrective Action Plan submitted to DPI sets the course for MPS to make improvements over the next year. 

All overdue financial data must be submitted to DPI by Sept. 26, according to the report. MPS financial staff have 20 days to receive additional training.

Matt Chason, who heads the district’s office of accountability and efficiency, will serve as project manager for MPS. Baker Tilly, an internal auditor, newly hired consultant Todd Gray and DPI will also oversee the process. 

Gov. Tony Evers has also called for two external audits of the district’s operations, processes and procedures, as well as an audit of instructional policies and methodologies. That could include a review of classroom learning environments, professional development policies and practices to support educators, among other areas.

On Thursday, the MPS Board of Directors is expected to approve the $1.47 billion 2024-25 budget. 

Board Vice President Jilly Gokalgandhi said the board will take public comments before the vote.  

“First and foremost, our top priorities are our students, families and staff,” Gokalgandhi said in a statement. “As part of our ongoing commitment to transparency and accountability, we look forward to hearing from our valued stakeholders.”