Andover Townsman, Andover, MA

February 13, 2014

Laptop deal in question

Officials point fingers over school lease

By Bill Kirk
bkirk@andovertownsman.com

---- — Even before the town manager’s proposed fiscal 2015 budget was released last Friday, a dispute erupted over the School Department’s leasing of 160 computers for special education teachers.

The four-year lease deal, which was requested by school Superintendent Marinel McGrath in conjunction with the town’s Chief Information Officer Paul Puzzanghera at the end of last fiscal year, came as a surprise to members of the Finance Committee, Board of Selectmen and at least one School Committee member.

Now, questions are being raised by town officials over who authorized the lease and how it will be paid for.

“Somehow they went from needing 400 computers to needing 560,” Finance Committee member Greg Serrao said recently. “They bought 160 computers, but it was not in the budget. They had surplus money and used the surplus, but leased the machines for three or four years. So this year, they have to pay for the computers out of the operating budget.

“Nobody knew they were doing this,” he added. “The selectmen didn’t even know. It makes you wonder about internal controls. The IT guy goes out, leases computers for $200,000 and didn’t tell anyone about the leasing.”

During a Tri-Board meeting in December, when the lease deal first came to light, several selectmen expressed astonishment at the deal.

“Who approved that?” Selectman Mary Lyman asked. “And why are we finding out about it now?”

Added Selectman Brian Major, “We are talking about money we hadn’t planned for. Government can’t work that way. That’s how you get into deficits. ... That’s a disservice to the citizens of the community and a disservice to us.”

A last-minute lease

In 2012, Town Meeting voters approved a $2.5 million plan to purchase IT equipment to modernize school and town offices. Part of that included using money from the Cable TV fund to lease 400 laptop computers over two years for so-called “knowledge workers,” such as teachers, administrators and town officials.

The computers, MacBook Pros, were leased from Apple for four years.

Puzzanghera worked last summer with school officials to get the district ready for an August 2013 opening, including installing a wireless infrastructure in all town buildings and digitization of all classrooms, according to McGrath.

McGrath said in an email to the Townsman that “throughout the process ... I brought to the CIO’s attention that the projected number of ‘knowledge’ workers he had listed for the schools (400) was inaccurate. I provided the correct number on multiple occasions, over the course of a year, but he did not factor in my requested changes.

“When it was time to order the laptops last spring, he discovered that additional laptops were needed that were not covered by the funding source.”

McGrath continued, “I let the School Committee know that due to the CIO’s error, the IT funding source for the computer lease would not cover the first lease payment that the CIO was preparing.”

Realizing that the district was going to come up short — and that special education teachers wouldn’t have laptops while everyone else would — McGrath said she felt the district could use some funds remaining at the of fiscal 2013 last June.

“I brought the situation forward to the School Committee chair, vice chair and budget subcommittee, who agreed that the schools could use these funds to cover the shortfall in the technology purchase,” she said.

McGrath added that it was agreed that while the first payment should come out of surplus school funds, the remaining three years of the lease for the additional 160 computers should come out of IT funds.

On June 28, 2013, McGrath put in a purchase order for the first payment of a four-year lease of 160 MacBook Pro 13-inch laptops. The first payment was for $46,455.74, for a total over four years of $177,760, which includes a $27,521 AppleCare Protection Plan. In the box under “Date Required,” it said: “ASAP.”

The lease document was signed by Puzzanghera as well as business manager Paul Szymanski and purchasing agent Tom Watkins.

Puzzanghera disputes some of McGrath’s statement.

“I wouldn’t characterize it as an ‘error,’” he said. “We used different assumptions.”

When asked if McGrath’s version of events was correct, he refused to comment.

“I don’t want to dispute the superintendent’s recollection, so I’m not going to comment on that,” said Puzzanghera, who reports directly to McGrath and Town Manager Buzz Stapczynski as part of a combined school-town Information Technology department.

Who will pay?

Finance Committee Chairman Jon Stumpf said it was while reviewing Stapczynski’s 2015-2019 Capital Improvements Plan in November that he noticed an oddity on page 93 that listed leases for teachers’ computers.

In 2013, 200 computers were to be leased, but in fiscal 2014, the number rose to 360. He said he recalled that the leases approved by Town Meeting in 2012 were in two batches of 200 each, so he didn’t understand what the additional 160 computers were for.

“I thought it was 400,” he said. He also noticed that the funding source for the additional computers in years two through four of the lease was the general fund, not the Cable TV account, which is funded by annual payments from Comcast and Verizon. The payment was incorporated into a $93,000 line item in the town manager’s proposed CIP plan.

At a Dec. 9 Tri-Board meeting, Stumpf questioned Stapczynski about the discrepancy.

The town manager stumbled somewhat in his response, saying, “This is a change that hasn’t come back to the boards.” He said it had to do with “additional machines acquired in June.”

Selectman Brian Major pounced on the issue, saying the town had agreed that 400 computers would be purchased out of the Cable TV funds, not the general fund.

“Why would we make that kind of change?” he asked. “Why make a unilateral decision ... without bringing it back to the boards to extend beyond the cable funds?”

Puzzanghera, who was in the audience, said that initially, it was determined 400 computers would be needed but that after an analysis of the school district’s needs, it was determined that an additional 160 computers were required for 560 staff members.

“That’s a 33 percent increase,” Major said, adding that “the remaining costs of the systems should come out of the school budget.”

Puzzanghera said it remained an “open question” how the latter years of the lease would be paid.

School Committee member David Birnbach agreed the money should come out of the school budget.

“That obligation should be through the entire life cycle of that asset,” he said. “It’s not fair or right that we cover year one, then go back to base camp and say, ‘How do we cover years two, three and four? I don’t think that’s cool.’”

McGrath disagreed, saying they should come out of the Information Technology budget because of a mistake made by the IT director.

“That was not the agreement,” McGrath said. “Those numbers were incorrect and I attempted to correct them along the way.”

While McGrath said she did get approval for the deal from School Committee members, Birnbach said, “This is news to me.”

A good cause

School Committee Chairman Dennis Forgue said that no matter what happened, the additional computers were for a good cause.

“It was an error in planning,” he said. “The decision for the children was for their teachers to have the equipment they needed for their kids. That’s the most important issue here.

“Was it the neatest thing in the world? Probably not. What prevailed at the end of the day was right for the students.”

He disputed Major’s contention that the matter represented a “disservice” to the community.

“A disservice is not doing the right thing for the community,” he said. “An error was made, the right thing was done for the kids, let’s move on.”

Forgue added, “We have to go back and make sure it doesn’t happen again. Mistakes get corrected.”