The Delaware State Auditor’s Office will conduct a special inquiry into the Appoquinimink School District - on top of its annual audit in the wake of severe accounting errors.
The errors – totaling about $1.2 million – were one reason the school board approved taking the full 10 percent increase allowed following the recently completed property reassessment. That’s after reassuring residents a hike without referendum would not be necessary.
New Castle County Council member Kevin Caneco was the first to call for the audit after learning of accounting errors made by district officials.
Caneco said administrators, teachers and school board members have been reaching out.
“Let's look at where the money's going, right?” Caneco said. “Where is the money for the $1.2 million that hasn't been accounted for? They still have not addressed that question. So something is wrong in the Appoquinimink School Board-District.”
A letter signed by seven state lawmakers who represent the district asked the State Auditor for a forensic audit on Monday. State Sen. Nicole Poore was among them and said she’s not ready to point fingers yet.
“What we want to do is make sure that we are building trust with inside our communities,” Poore said. “It has been a tough year for a lot of folks, whether it is from the cost of utilities or just cost of living in general. It definitely did not inspire a lot of trust when there [were] talks about a deficit in the budget for Appoquinimink.”
State Sen. Stephanie Hansen, State Sen. Kyra Hoffner, State Rep. Jeff Spiegelman, State Rep. Kevin Hensley, State Rep. Rae Moore and State Rep. Eric Morrison also signed the letter.
“Taxpayers, parents, and educators deserve full transparency and accountability from district leadership,” the letter said. “This audit would provide critical information to inform future oversight, budgetary planning, and legislative decision-making.”
The General Assembly members sent out the letter one week after Caneco’s office announced the audit request. Caneco said he’s excited the lawmakers joined in, but they did so late.
“The fact of the matter is they're not doing their homework, and they're not doing what they need to do to understand and to assess what's happening,” Caneco said.
Poore said she, her colleagues and constituents want to see more parties involved in addressing this issue.
“We thought that this would be a better avenue rather than the board itself doing any audits – take it to the outside,” Poore said. “Let our auditor do her job, have her team do the job, and be able to present back to the communities.”
The lawmakers also asked that the Auditor’s Office look into New Castle County’s tax collection process in 2024. Appoquinimink School Board Finance Committee member Karen Felix reported “major inequities” in the process where some residence and commercial properties were taxed and others were not.
Caneco said the deficit is a failing on the school board and former CFO’s parts. The district’s previous CFO Eric Loftus resigned last month after being in the role for nearly seven years.
“Why do we have a CFO [...] that left in the middle of night? Where's that information? They don't want to comment on that,” Caneco said.
Poore said there are problems within the district that the State Auditor will look into.
“Everything hinges on your CFO, right?” Poore said. “That's why you hire that type of person – to run those budget numbers, to be able to project, to anticipate raises, to anticipate program growth. I'm going to reflect back into wanting to know how the budget was set and numbers that were discussed.”
Appoquinimink School District officials have not publicly provided a reason behind Loftus’s resignation.
“I think it's complete mismanagement by the Appoquinimink School Board-District, and this is 100 percent on the school board president, Mr. [Richard Forsten], who has not known what's been going on,” Caneco said.
He went on to call for Forsten’s resignation.
Delaware State Auditor Lydia York’s response to the lawmakers’ letter confirmed she received several reports regarding the Appoquinimink School District’s fiscal health. York said her office will conduct a special inquiry into the district’s budget shortfall.
“The inquiry will cover this limited scope to allow my team to move quickly and incur minimal costs,” York wrote.
The report is expected to be complete and published in the next couple of months. Once that is done, York and other auditors will determine next steps.
The school district and its schools are still subject to annual audit as mandated by Delaware code.
