The Ridgefield School District received an $806,645 insurance reimbursement last week for a misappropriation of district money that was uncovered last year.
In May 2009, district officials questioned Peggy Kane, who worked as the assistant business manager, when they noticed discrepancies in district accounts. Kane was charged with felony wire fraud in U.S. District Court in Tacoma, and in May, the 57-year-old pleaded guilty. She is scheduled to be sentenced Friday morning.
Ridgefield Superintendent Art Edgerly will present the school board with a list of recommendations for the use of the reimbursement for general fund expenditures.
The suggestions will be in line with the district’s mission statement and goals, which aim to improve student learning. Edgerly said he’s looking into programs or technology that can be utilized and sustained by the district.
“The money that we’re looking at is going to be directed at what we can do to improve student learning in our school district and how we can provide the supports for our students and how we can improve the instruction for our students,” Edgerly said.
The money will not be used to add personnel.
The reimbursement money will be earmarked for specific programs so the district can track how it is spent, Edgerly said. He expects to make the presentation in the next few weeks.
After uncovering the fraud last year, the school district implemented a fiscal protection plan to ensure money was accurately tracked.
At the beginning of the 2009-10 school year, the district hired a payroll and accounting specialist to work alongside the director of business services to verify the budget was in order. The district changed its finance system to an upgraded program that provides greater controls and efficiency. School office personnel also received extensive professional development training on the new finance system and sound business practices.
Previously, Kane had full control over payroll processing, unrestricted access to the district’s computer system and authority to transfer district money. Kane used that access to manipulate the payroll system to increase her net pay by more than $800,000 in a 10-year span.
If the judge follows the sentencing recommendations agreed upon by Kane’s attorney and federal prosecutors, Kane will receive a two-year prison sentence and three years of supervised release after her prison term and will owe $806,645 in restitution.
Marissa Harshman: 360-735-4546 or marissa.harshman@columbian.com.
