By Patrick B. McGuigan

Published: 01-Sep-2010

A confidential note from Broken Arrow public school board member Terry Stover to a member of the staff of Oklahoma Auditor & Inspector Steve Burrage raised concerns about any involvement of the Rosenstein, Fist & Ringold law firm in the “exit interview” process that is now wrapping up an audit of the public school district that began in 2009.

In the note, obtained by CapitolBeatOK in response to an open record request to the auditor’s office, Stover expressed “serious concerns” about the controversial law firm – concerns that he wanted passed on to Burrage. Stover and Burrage subsequently discussed the matter, CapitolBeatOK has learned.

Today (Wednesday, September 1), a spokesman for Auditor Burrage said, “I don’t know the details of that conversation.”

Concerning the law firm’s presence in the exit interviews (ultimately held August 18 and 31) Stover “didn’t make any objection the day of the exit conference. When Mr. Stover met with Michelle Day and Ricky Branch to review the audit’s findings, I understand that one attorney from [Rosenstein, Fist & Ringold] was present in the room but did not participate in the discussion.”

The text of Stover’s note follows:

“When you were conducting the audit of the Broken Arrow School District you said I should contact you if I had any questions or concerns. I have some serious concerns that I respectfully request you pass on to State Auditor Burrage. My concerns are as follows:

“1. I would like that no attorneys from Rosenstein, Fist & Ringold sit in on my exit interview. As a Board Member and Immediate Past President of the Broken Arrow School Board, I observed first hand enough to question the wisdom of having the Rosenstein, Fist and Ringold law firm sit in the exit interviews. Furthermore, they will have the Audit report within 14 days from the completion of the exit interview. I would like to discuss this issue privately and confidentially with Mr. Burrage and request that he call me … or provide permission for me to call him at a convenient time.

“2. I visited with Mykle Fry in the Attorney General’s office when the format for the exit interview was changed from an Executive Session back to separate exit interviews with 2 Board members at a time. Someone from your office has said the laws controlling Executive Sessions for school boards prohibited having the Audit Report presented in Executive Session. It was my understanding from Ms. Mykle Fry that the exit interview could be done in Executive Session. I believe she also stated that there is ample precedent for this in that Audit Reports had been done in Executive Session with other school Boards. Having the exit interview in Executive Session will be easier, quicker and cheaper. Also, easier to control the process. We must, by law, give legal notice by 48 hours prior to [the] called meeting if the exit interview is held in Executive Session.

 
“On January 7, 2009, the Broken Arrow School Board received the required written notice from 10 Broken Arrow taxpayers as a condition precedent to a qui tam/taxpayer lawsuit. In partial response to the demand letter, the Broken Arrow School Board unanimously voted to engage the State Auditor’s office to conduct an audit of the School District to address the assertions in the January 7, 2009, Taxpayer Demand letter. A taxpayer lawsuit based upon that Demand letter remained a possibility. Because of this possible litigation, however remote it may be, the State Auditor’s office perhaps should hold the exit interview in Executive Session rather than in separate sessions.

“Having the exit interview for presentation of the Audit Report in Executive Session will help maintain confidentiality and possible misrepresentations or inaccurate information from becoming public. Holding it in Executive Session assures fairness to all parties as well as maintaining the integrity of the Audit Reporting process.

“3. My third request is that the law firm of Rosenstein, Fist & Ringold be excluded from participating, sitting in the exit interview(s) regardless of the format. I suggest that the Attorney General’s office be asked to provide an objective, neutral attorney to monitor the exit interview(s). This would remove any questions about the involvement of a law firm that might become – directly or indirectly – the subject of various issues. Certainly, it would avoid inevitable allegations of conflicts of interest in the participating lawyers. This would remove all doubt and it would be no inconvenience to the Board because all Board Members will hear first hand the Audit Report. It would not deprive any legal counsel in any because they will have the Audit Report in 14 days any way. If Rosenstein, Fist & Ringold or members of that firm should end up being the subject of investigation (or is the subject of investigation), then we are all going to look pretty bad about having them involved in the exit interviews and paying them several thousand dollars in legal fees to sit there all day.

“It seems needlessly repetitive [to] have lawyers sitting in multiple exit interviews having the same report repeated 3 or 4 times.

“Thank you for your consideration of my own personal thoughts and concerns. PLEASE KEEP THIS STRICTLY CONFIDENTIAL.”

CapitolBeatOK requested the document, and decided to post its contents, after learning it was a government record open to disclosure, and in the possession of others who have monitored the Broken Arrow scandal.

Trey Davis, spokesman for Auditor & Inspector Burrage, told CapitolBeatOK that in response to Stover’s note, “State Auditor Steve Burrage spoke with Mr. Stover by phone. … Mr. Stover expressed his concerns regarding the attorneys from [Rosenstein, Fist & Ringold] being present during the exit conferences. At the time of Mr. Stover’s exit conference on August 18, he did not request the attorney be excluded from the meeting. It is my understanding that only one [Rosenstein, Fist & Ringold] attorney was present for Mr. Stover’s exit conference.”

CapitolBeatOK has learned that attorney was Doug Mann, a principal partner at the firm.

In a related matter, CapitolBeatOK learned that Stephanie Updike, a former Broken Arrow School Baord member, serving until March of this year, had asked to be included in the exit interview.

Davis told CapitolBeatOK Updike’s “request was respectfully declined because she is not currently a … board member.” Dr. Jim Sisney and Dr. Gary Gerber, the immediate past superintendents before Dr. Jarod Mendenhall began his tenure as Broken Arrow superintendent this summer, were also not included in the recent exit interviews.

CapitolBeatOK had asked the auditor’s office if the agency lacked authority to “follow the evidence” in pursuing possible criminal wrongdoing in audits. In a story posted earlier today, part of Davis’ response to that issue was included.

Davis elaborated on the matter, drawing distinctions between the auditor’s function and the role of local district attorneys. In so doing, he referenced another recent public school scandal:

“Without intending to speak for the Tulsa County DA or the grand jury in the Skiatook Schools’ case, our audit did not extend to the vendor in the case who was billing Skiatook Public Schools for janitorial supplies at a rate 100% to 500% above the market price. The audit contained facts and documentation of the transactions but it did address an issue of potential kickbacks or embezzlement. These issues were addressed by the grand jury and will be prosecuted by the Tulsa County DA. The grand jury also requested that the [Oklahoma state Bureau of Investigation]  take a look at the vendor’s records to determine possible collusion between the vendor and the former superintendent.

“The purpose of a special audit is not to determine any party’s guilt or innocence. The purpose of the audit is to present the facts resulting from a thorough, independent examination of an entity’s records and interviews conducted among its personnel. An audit may, in turn, be used to support the prosecution of one or more individuals but that decision is not made by the auditor.”

A criminal investigative audit of the Broken Arrow Public School district began this week at the request of Attorney General Drew Edmondson. The scandal surrounding the district has been described as including “lots of moving parts.”