TALB audit finds questionable political spending
By Kevin Butler, Staff Writer
08/01/2008


LONG BEACH - Over the past two years, the Teachers Association of Long
Beach appears to have used general fund money for political expenses and
may have spent at least $110,000 more on its election campaigns than
union leaders had authorized, according to an audit obtained by the
Press-Telegram.

The California-based audit firm Hemming Morse Inc. was hired by the
statewide teachers union - the California Teachers Association - to
investigate allegations of fiscal mismanagement at its Long Beach chapter.

The
CTA assumed control of the Long Beach union last October amid a
leadership controversy that pitted TALB President Michael Day and
then-Executive Director Scott McVarish against some members of the
union's board of directors seeking McVarish's ouster.

McVarish announced his resignation from TALB in February.

The audit, unsealed as part of a lawsuit, analyzed TALB finances to
determine whether the union properly managed the funds earmarked for
election campaigns in 2006 and 2008.

The union spent funds on behalf of school board candidates in 2006 and
2008 and on Long Beach City Councilwoman Gerrie Schipske's successful
run for council two years ago. Schipske works for TALB as the union's
attorney...

Barbara Kerr, whom CTA placed in charge of TALB as trustee in October,
said that the union has addressed the problems in the audit through new
policies and procedures.

"We have taken care of all of those issues," she said...

TALB maintains separate accounts for union operations - its general fund -
and for its political affairs. Teachers can choose not to have their dues
spent on political causes...

Also part of the $39,629 total was a nearly $29,000 check from TALB
general funds made out in August of 2006 to attorney Fredric Woocher for
the payment of legal fees. An invoice from Woocher's law firm did not
specify the exact purposes of the legal services that were provided,
according to the auditors.

Citing information provided by McVarish, auditors reported that the money
may have been for Woocher's work defending TALB-backed school board
candidates David Barton, Michael Shane Ellis and Jim Deaton in a lawsuit in
2006.

The lawsuit filed against the candidates centered on a "blueprint speech"
TALB provided the candidates for their campaign in an effort "to revamp the
district," auditors wrote.

TALB paid for the legal expenses in that lawsuit, the audit stated...

If Woocher's invoice was for legitimate legal expenses relating to the
campaign, the money should have been allocated to the union's political
accounts, auditors concluded...

Union President Michael Day, who in 2006 was on the TALB board and was
co-chair of the union's political action committee, said that after the audit the
expenses were reviewed by CTA-affiliated experts...

Kerr said the problems were resolved.

"Members know that they have the option to be involved in political action or
not," she said. "They do know that, and the problems were fixed."

But Dale McVey... questioned Day's response, especially the legal work
Woocher's firm allegedly performed for candidates.


But TALB ledgers showed that at least $490,305 was spent on the
2006 campaigns, about $110,000 over the approved budget amount,
according to the audit report...

TALB board member Dale McVey, whose lawsuit led to the unsealing
of the audit, said that board members were kept in the dark about
campaign spending.

Board members not serving on the political action committee often were not
even told the times and locations of the committee meetings, he said.

"They were held outside TALB offices in secret places, and we had no idea
where they were," McVey addedl...

It shows a total lack of accountability for our senior staff and executive
officers, because they bypassed the board (and) the Rep Council," McVey
added. Loan repayment criticized...

The minutes, which understated by about $20,000 the total amount of the
first two loans, indicate that the Rep Council did not vote to approve the
loans...

Kerr said that such problems, like all those pointed out in the audit, have
been fixed. ..

Kerr said in her communications with members she did not tell them
specifically of the audit's findings that general fund money may have been
spent for political purposes.

Kerr said that teachers, including members of the Rep Council, were told
that the audit had found that mismanagement occurred and that the
problems have been fixed due to new procedures and policies.

"The membership was kept informed," she said.

The TALB board of directors has not made a decision on publicizing the
audit's contents, as the document mentions individual employees and
therefore contains personnel information that is not appropriate to disclose,
she said.

But TALB board member McVey said that members have the right to see
details of the audit, such as the political spending issues.

"It's the members' association," he said. "It's the members' money ... Of
course they have every right to know."

McVey obtained a court order unsealing the audit as part of lawsuit he and
other board members filed last year demanding TALB financial documents
and a union membership list.
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