It was the worst audit report ever issued about a Missouri school district.
But in a follow up report issued Monday, the state auditor says the St. Joseph School District is making progress.
The auditor report released in February — the only time the state auditor has ever given a school district a "poor" rating — was scathing.
The St. Joseph district, the report said, had a confusing and inconsistent payroll system that resulted in up to $40 million in unapproved stipend payments going back to 2000.
The report also said the district wasn’t tracking overtime, nepotism was unchecked and there were numerous Sunshine Act violations.
But Auditor Nicole Galloway says things are getting better.
“So although additional work is necessary the district has made clear improvements over the last six months," she says.
The state auditor will conduct follow-up reports on audits that are particularly worrisome. The February report discovered 40 area where the district was failing or needed improvement. For the follow-up report, Galloway says, auditors reexamined 22 of those.
A dozen of the report's recommendations are still being worked on but ten have been fully implemented. Galloway also praised the district for sharing progress with patrons on its website.
"I think the community has been engaged in the school district's progress and they'll continue to move forward," she says.
The district says some of the more complicated changes, like a new payroll system, will take time to implement.
"There are other areas that are in process and will require time and diligence to fully complete, but we are confident that will happen," Interim Superintendent Robert Newhart said in a statement.
"We appreciate the patience of the St. Joseph School District staff, students and St. Joseph community as we continue to work through this process and correct our policies and procedures that will make our district stronger and better than ever before."
That will be a tall order. The FBI continues to investigate the district and it is also being audited by the IRS.
The most recent scandal involves former superintendent and school board president Dan Colgan. The state retirement system is reviewing Colgan's last several contracts to determine whether he improperly and quietly inflated his salary to significantly boost his pension.
Colgan's pension could be reduced and the state could sue him for any overpayments. Reports suggest he could be on the hook for several hundred thousand dollars.