$300,000 in Quake Money Is Unaccounted for at Marvin Avenue School, Audits Find

A series of audits at Marvin Avenue School this spring found that more than $300,000 in federal earthquake recovery funds could not be accounted for and that employees signed in for nearly 2,000 hours they didn’t work over a two-year period.

The audit reports, obtained by The Times under the California Public Records Act, also said that the school lacks records to account for $32,000 in outside donations, including $20,000 from the German government.

Among the other findings:

* Four big-screen televisions purchased with earthquake funds were missing.

* The school purchased more than 2,000 videotapes, about a quarter of them with federal earthquake funds.

* Excessive student body funds were spent on party supplies.

Officials at the school conceded that record-keeping mistakes were made by an office manager who has since been demoted, but denied that any school district funds were lost.

“The public is not ripped off,” said teacher Betsy Garvin, who was acting assistant principal during the period covered by the audits.

Garvin asserted that the earthquake money was spent on students and that mistakes in the payroll had been corrected.

Because the Los Angeles school district is under mounting pressure from the teachers union to take action against Marvin Principal Anna McLinn, district officials said Thursday that they have moved slowly in their investigation out of concern for protecting McLinn’s due process rights.

“The employee has had her detractors and her allies--all the more reason for us to play it by the book and decide it based on the evidence,” said district general counsel Richard K. Mason.

He said the investigation will attempt to determine whether the discrepancies were a matter of careless record-keeping or involved theft of school funds. Mason said he anticipated a decision in no more than two weeks.

The Marvin audits, which were completed in March, June and July, played a role in the termination this month of the district’s head of internal auditing, Wajeeh Ersheid, who pressed for immediate action against McLinn when he presented the findings to top administrators.

An item in his termination notice, which The Times obtained, cited Ersheid for “discourteous comments” toward McLinn when others made reference to her due process rights.

Ersheid, whose firing was precipitated by a conflict with some employees on his largely Filipino staff, contends that Marvin represents widespread deficiencies in financial checks and balances that leave the district open to hundreds of millions of dollars in waste and fraud.

He said at least 100 auditors would be needed to clean up the district’s accounts.

The Marvin audits indicated that about 100 employees had signed in for regular time that should have been recorded as absences, usually illness or vacation.

Garvin said that many of these errors were caught in semiannual reviews, and that the employees’ paychecks were adjusted to deduct the time. Although conceding that many of the errors were corrected only after the audits, she said she believes that they would have been caught in a semiannual review.

Payroll discrepancies, she said, were exacerbated by the switch from a traditional to a year-round calendar and that McLinn herself called for the audits to sort out the problems.

“Most of these mistakes were fixed last year when our new office manager came,” Garvin said.

The largest discrepancy found in the audits covered about a fourth of the $1.3 million the school received from the Federal Emergency Management Administration to replace classroom supplies and equipment damaged in the 1994 Northridge earthquake.

Auditors said they found receipts for only about $1 million, leaving $325,476 unaccounted for.

McLinn blamed the district central office for any deficiencies in accounting for the earthquake funds.

Every purchase was approved by the central office and the receipts delivered to it, she said.

Concerning the four televisions, she said that they were assigned to classrooms and that the teachers failed to report them missing.