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Board of Education Spent $112,569 in One Month on Law Firm Reviewing Credit Card Expenditures

Board president says firm was hired to make sure "taxpayer dollars were being used appropriately"

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Earlier this week, the Montgomery County Board of Education released its monthly legal fees report. Included in the report was one line, “The Venable bill for June 2014 totaled $112,569, all of which was related to the review of expense reimbursements.”

The board also paid Venable LLP, of Washington D.C., $15,556 to review expense reimbursements in May.

The Board hired Venable in May to review board members’ spending using credit cards issued by Montgomery County Public Schools after widespread criticism arose last spring concerning improper and possibly illegal spending practices. Karl Racine, a Venable lawyer, later issued a seven-page report informing the board it should get rid of the cards altogether, a decision it later made.

Why would the board spend more than $128,000 in legal fees for advice on an issue in which they were criticized for improper spending in the first place?

According to Board President Phil Kauffman, who responded to a Bethesda Beat email about the issue, the board thought it was important to have an independent counsel “thoroughly examine the records to ensure that taxpayer dollars were being used appropriately.”

“Outside counsel was also essential in working with the Office of the Statewide Prosecutor,” wrote Kauffman. “We were confident that there was no wrongdoing and therefore it was imperative to have an expert ensure that the facts were clearly presented to the prosecutor so they could reach the decision that they ultimately did—that there was no wrongdoing on our part.”

Kaufmann added the outside counsel validated the proposed policy that the board later adopted—to get rid of the cards and alter its spending practices.

“Our goal always is to have reasonable legal costs and to get good advice from experts to help us make the best possible decisions,” Kauffman wrote. “I am confident that we did that here and I believe that our new processes and procedures will ultimately serve the board and public well.”

The board became entangled in the credit card scandal after it was reported in May that board member Christopher Barclay used his MCPS credit card to pay for about $1,500 in personal purchases. He later repaid the district and apologized. After that, several news reports detailed board members’ use of the credit cards to pay for expenditures ranging from prime rib dinners to stays in nearby hotels.

The legal fees bill was first highlighted by the Parents’ Coalition of Montgomery County in a blog post Wednesday. The Parents’ Coalition is the same advocacy group that first published board members’ credit card expense reports that touched off the review of its spending practices.

The board eliminated the use of district-funded cards in July and set up per diem allowances for members to travel to board-approved conferences as part of its new expenditure policy.

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