School Cost Report Ordered

Board of Education Treasurer Wüliam Wade has two weeks to prepare an audit report of administrative expenses for the years 1971-72 and 1970-71. The directive was issued last night by Trustee Cecil Warner at the Board of Education meeting. On Monday The News published an article which compared the administrative costs for 1971-72 and 1970-71, using audit reports by Icerman, Johnson and Hoffman of Ann Arbor. The 1971-72 report was adopted by the board last week. In 1970-71, the administrative costs totaled $719,936. The report for 1971-72 shows $980,051 listed in the operating expenditures under administrative costs. The district spent $52,700 more in administrative costs than the amount appropriated, $927,351, according to the auditór's report. Administrators called the disparity in the auditór's reports comparing "apples to oranges", saying some costs were included in the 1971-72 report which were in other accounting areas such as instruction in 1970-71. Warner said his action could be mistakenly construed as political since it follows The News article, but said about one month ago he reviewed the final quarterly report for the 1971-72 school year and noted administration expenses were exceeding what had been appropriated. At that time he asked for an audit of administrative expenses. A two-page memo from Supt. R. Bruce McPherson was given to the board at its meeting one week ago, Warner said. That report was not sufficient, he added. The News did not use some figures in the memo because they were not consistent with the auditor's report. For instance, revenues from state and federal grants were said to have increased from $417,410 in 1970-71 to $966,983 in 1971-72 in McPherson's memo. The auditor's reports showed revenues from state and federal grants increased from $522,174 in 1970-71 to $900,023 in 1971-72. McPherson's memo said expenditures for capital program services were reduced in the operating budget by $21,500 in the 1971-72 school year. The reduction in cost carne when Sooren Gozmanian, planner-expediter, left the district in October 1971 and wasn't replaced. Instead of $21,500 being saved, tbput $14,000 was realized because the district paid him from July through October, a check of school records shows. Warner said last night it is the board's responsibility to function as managers, reviewing expenditures and budget. "A very simple rule of business is that you set goals and allocate resources to meet those goals," Warner added. He said in 1969-70, 2.62 of the operating budget (including food services, general funds, federal projects and student activitiés) was spent for administrative costs. In 1970-71, 3.08 per cent of the I operating budget went for administration I and in 1971-72, 4.06 per cent was spent, according to auditor reports. The trustee added the increase in penditures for administration may be I r e ] a t e d to implementation of board I goals. From 1967 to 1970 Warner said there I was no great thrust toward establishing I and implementing goals. More recently I the board has adopted the goals of 1 tablishing four-year high schools, middle I schools and small houses, Warner said. I 'To do this it requires people." He said the administrative costs may I be out of line or may be all right, but he I added: "I don't know until I determine I what the administrative expenses are and I f they are directed toward goals." Warner initially asked for the report in one week. McPherson said he would honor the request in the shortest time possible. He expanded the data to be provided to include line item accounts of the administrative costs, how the goals are related to administrative costs and additional data on other ways of viewing administrative costs. Warner said he could wait for two weeks for the report. In McPherson's memo he originally asked for a report by March 1 of similar data being requested by the board member. Of The News article, McPherson said: "I do object to the report in The Ann Arbor News which took a small portion of the administrative expenses. I would like to teil the Mier story to the board and the public." The News asked the administration Monday for positions and salaries which were used to make up the administrative cost totals published in the audit reports of 1970-71 and 1971-72 as well as the current adminstrative salaries. When asked this morning why the figures were not forthcoming, William Stewart, public information officer for the school district, said: "I submitted the requestto Mr. Wade (controller). He said it would take some time to prepare." -