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Spotlight:
Performance Audits Provide Local Officials
with a Roadmap to Financial Success

By Steve Faulkner – Public Affairs Staff Writer

The primary focus of John Burkhart’s job as the director of business affairs for the Medina City School District is to be on constant watch for ways to improve efficiency and save taxpayers’ money. After all, he manages the business operations of a busy 7,500-student school system, with oversight of custodial and food services, maintenance, transportation and other complex functions.

Soon after arriving in Medina two years ago, Burkhart contacted Auditor of State Mary Taylor’s Performance Audit section for assistance. He is rather familiar with performance audits – and their benefits – having experienced the process in similar positions with the Olentangy Local School District in Delaware County and the Mansfield City School District in Richland County. In those earlier settings, Burkhart relied on the independence of state performance auditors to provide an objective look at his ideas to cut costs and improve operational efficiency – recommendations that, at times, may not have been very popular with some administrators.

“It helps when the Auditor of State’s office is standing there beside you when recommendations are made, because [performance auditors] have this global view of what is going on,” Burkhart said. “When you bring the Auditor of State into the district, some people get worried and they get concerned, but this isn’t a group of people coming here to criticize, this is a group that is here to help.”

The Medina City School District is unique in that it has already been through one performance audit experience and has implemented most, if not all, of the recommendations from that earlier audit, released in 2003 – long before Burkhart arrived on the scene. In fact, the district’s current strategic plan relies heavily on recommendations outlined in the Auditor of State’s initial performance audit of Medina City Schools, helping the district maintain a sustainable, accountable budget.

While the district is not currently experiencing financial difficulties, Burkhart has taken a proactive approach to ensuring financial accountability and transparency to the community. That is why he asked the Auditor of State to return to Medina to conduct a new performance audit.

“We need another performance audit to help identify our spending at a much deeper level than what we currently track. Having the Auditor of State’s performance team endorse what we do, goes a long way to rally the community behind our mission, which is to educate students in a cost effective manner,” Burkhart said. “We’re not too proud to ask for help.”

Auditor of State Mary Taylor’s Performance Audit section serves as a valuable resource for state and local government offices across Ohio, like Medina City Schools, which are seeking to improve operations, identify cost savings and produce sustainable, balanced budgets. By definition, performance audits report on the efficiency and effectiveness of government operations through peer comparisons and benchmarking to industry standards.

Earlier this year, Taylor’s office officially kicked off the new performance audit of the Medina City School District, including a thorough examination of district spending. The new report should be completed later this year.

According to Betsy Bashore, assistant chief auditor in Auditor of State Mary Taylor’s Performance Audit section, Medina is one of only a couple of Ohio public school districts she knows of that are using performance management principles to drive district spending. Administrators measure results and prioritize educational programs, then look at the effect their spending decisions have on the financial and academic bottom line. Board members and other decision makers use the information to evaluate which programs are working and which programs fail to produce results. Funding can then be funneled into successful and effective programs.

“The Medina City School District is on the leading edge regarding its approach to prioritizing spending. District officials seek to be very transparent about where the money is spent and how they fund certain programs – and they want to capitalize on this process to improve educational programs,” Bashore said. “Our performance audit will help them achieve their goals of accountability and transparency. The decisions district officials make using their performance information should help them produce a long-term, sustainable budget.”

A long-term, sustainable budget is also a goal of Lancaster City Schools Superintendant Denise Callahan. Today, her district’s budget is balanced and even maintaining a small surplus that is carried over from year to year. However, that has not always been the case. In 2005, Lancaster City Schools qualified for a state funded, comprehensive performance audit through a provision enacted in the state budget bill that year. Subsequently, on January 31, 2006, the state placed Lancaster City Schools in fiscal caution soon after a serious budget deficit was projected.

Callahan used the Auditor of State’s performance audit of the district’s operations – released in August 2006 – as a blueprint for making the tough decisions necessary to get Lancaster City Schools back on track financially.

“The performance audit was something we truly wanted because we have to be efficient and we have to live within our means,” Callahan said. “We eliminated programs that were not self-supporting and those are tough decisions.”

The Lancaster City School District was removed from fiscal caution on April 4, 2008, and Callahan credits the recommendations outlined in the performance audit for helping the district reach that milestone. In fact, she applauds the Auditor of State’s public release of all final audit results as a way to enhance transparency.

“The performance audit is a great tool because it’s posted on the Auditor of State’s Web site and those who are interested can go in and read it. That’s a little scary for school boards and superintendents because it does point out inefficiencies but at the same time it forces us to address them,” Callahan said.

Performance audits are a valuable resource Auditor of State Mary Taylor offers, not only to the state’s public school districts, but to any state or local government office in Ohio. In fact, performance audits are available and recommended for all levels of Ohio government, including cities, counties, state agencies and universities.