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Dining on DISD's dime: Indulge and charge

Credit card-toting employees spent millions on rewards
TAWNELL D. HOBBS, KENT FISCHER and MOLLY MOTLEY
The Dallas Morning News

Dallas school employees like to use their district-issued MasterCards to reward students and staff with catered meals, "incentive" gifts and other awards – to the tune of $2.7 million over two years. The Dallas Morning News reviewed thousands of Dallas Independent School District transactions made from Jan. 1, 2004, to March 28, 2006, and found:

•Employees spent $1.5 million at restaurants and on caterers.

•They spent $1.26 million with companies that specialize in giveaway items, such as T-shirts, trophies, retirement gifts and trinkets stamped with district and school logos.

Your Schools, Your Money
DISD credit card oversight lax
• Graphic: Your tax dollars at work

Secretary charges $383,788, has no receipts
• Graphic: One big spender

Dining on DISD's dime: Indulge and charge
• Graphic: Bill of fare

Banned gift cards keep on giving

Where the cards are used (.pdf)

DISD procurement card manual (2005 version, new policies began Saturday) (.pdf)

About this series
The purchases are among thousands – totaling about $20 million a year – made by employees on district-issued MasterCards, called procurement cards, or P-cards. More than 1,200 employees can have active cards at any one time.

While P-card users receive individual, monthly statements, they do not pay the bill. The district does – in one large payment every month to cover the MasterCard charges.

For restaurant spending, Jason's Deli was the most popular spot, with cardholders spending $214,454 there during the period reviewed by The News. Chandler's Cuisine, a catering company in Dallas, also was popular, with $125,761 in sales.

The News found that the credit cards were used at many kinds of restaurants, from close-by destinations like White Rock Yacht Club, where an executive director spent $555 on one day, to a high school teacher's bill of $101 at the House of Blues in Orlando, Fla.

Charges also included the absurd – 22 cents at the Baby Back Shack in Dallas.

In a district struggling to balance its budget, school trustee Jerome Garza said cardholders must not make frivolous purchases for food or any other commodity.

"Maybe what we need to do is have the checks and balances on the front end, not the back end," he said. "I'm really disappointed."


$1,000 limit

DISD rules do not prohibit employees from using the cards for restaurants or caterers at school or district events. District officials said last week they do not scrutinize where food is bought, but card users are not supposed to spend more than $1,000 per event.

Some cardholders explained why they were making large food purchases that do not appear to be directly related to educating the district's 161,000 students. Some wanted perks to boost morale or provide incentives to staff members and students.

That was Roosevelt High School principal Leon Dudley's reason for the $903 steak dinner he bought his basketball players and cheerleaders in Austin in March.

"Hey, man, they just won a state championship," Mr. Dudley said. "It was all about the kids."

Schools and departments holding staff functions or faculty meetings made some of the more costly food purchases.

Bryan Adams High School paid $2,290 for food (including a $344 gratuity) from On the Border to be delivered for the school's "end of semester training" in 2004. An agenda for the meeting listed five items, including the recognition of staff members with perfect attendance, a first-year teacher singalong and the announcement of successes at the school.

Cary Middle School spent $2,475 at Trail Dust Steak House for an annual Christmas luncheon for 120 employees. Cary principal Santiago Camacho bristled when asked about the event, saying only that he "reported all that" to the district.

Joan Bonner, the parent of a recent DISD graduate, watches district finances closely. A resident of the old Wilmer-Hutchins school system, which was closed for financial and academic problems, she wants to make sure Dallas schools operate efficiently. She says the kinds of perks and incentives some people bought with procurement cards should be forbidden.

"If a school district can afford all these perks, maybe their budget should be cut," she said.

Spending on the cards may soon be reined in. DISD planned to implement new rules targeting card misuse and impulsive buying last weekend.

The new rules require cardholders to receive pre-approval from their supervisors before making purchases, said Sherri Brokaw, DISD's director of Financial Control and Card Services. The district also is looking at limitations on using caterers, she said.

"We're going to try and put as many controls in ... as possible," Ms. Brokaw said. "The rules will be spelled out and the punishments."

Spending limits depend on the type of account a person is using, and whether it's funded by local, state or federal tax dollars or from donations and fundraisers.


$1,000 limit

Credit card purchases for restaurants and caterers cannot exceed $1,000, while charges paid for with money from student fundraisers must not exceed $40 a year per person, district officials said.

Ms. Brokaw said cardholders are warned about inappropriate purchases and are told: "Don't spend this money any differently than you'd spend your own family's money."

Three employees in the district's Financial Control and Card Services Department, including Ms. Brokaw, monitor the card purchases. Under the new rules, more employees will do that work.

Food wasn't the only commodity cardholders buy to reward good work and provide incentives. The district also spends a lot on trinkets.


Bullet-shaped flasks

One principal, who is no longer with the district, spent $1,552 on stainless steel flasks shaped like bullets. He imprinted the flasks with his school's logo and gave them out to teachers at the start of the school year. In a note to the district, the principal said the flasks were to get teachers thinking about "Biting the Bullet," to crack down on discipline problems in the coming year.

The Area 1 office manager spent $199 in moisturizer from Bath and Body Works. A note scribbled on the receipt says the lotion was an "incentive" given out at an annual staff meeting.

At the end of last school year, one principal bought $3,800 in key chains, watches, portfolios and travel bags, all of them emblazoned with the school's logo. High-achieving kids got the watches and key chains, staff and parents got the portfolios, and teachers who did not miss a day of work got the travel bags.

Those trinkets, however, are just the beginning. Card users spent $256,470 at T-shirt shops. They also spent $39,044 on movie tickets, $22,543 at doughnut shops, $9,972 on party rentals and $4,125 on pro-sports tickets.

The district's Area 6 and Area 1 offices spent $4,055 on embroidered polo shirts, denim shirts and cardigan sweaters from Lands' End. According to a memo, the purchase was necessary so that staff and principals would be identifiable at district activities, such as the superintendent's leadership training.

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