Peralta College District’s mind-boggling mismanagement revealed in new fiscal analysis

An impartial assessmement of the struggling Peralta Community College District rated its risk of insolvency as high and urged new leadership is needed to effectively rid the district of years of neglect. Poor communication among its four colleges is the norm and the district’s internal procedures are “simply broken,” according to the scathing report.

The systemic mismanagement at the Peralta Community College District has been documented in recent years, but rarely to this extent.

Based on a risk assesment scale created by the Fiscal Crisis and Management Assessment Team, which prepared the study, a school district with a score of 40 percent or more is rating as having a high risk of insolvency. Peralta’s score is a shocking 69.9 percent.

The report also raised concerns over increases in the number of full-time employees at two of its four colleges at time when enrollment district-wide has been dwindling for a number of years.

>>READ THE ENTIRE REPORT HERE

The report repeatedly references a general lack of communication at all levels of the district, and between colleges—College of Alameda, Merritt College, Laney College, and Berkeley City College. A symptom of which is that the chancellor’s office is too large, according to the report.

Including chancellor, which the district is currently searching for a replacement, Peralta has six vice chancellors when many districts of similar size employ two or three, the report said. “The current structure is cost-prohibitive, inefficient, and adds to the ineffective and poor communication throughout the district.”

Long-standing criticisms that the Peralta Community College District’s finances are chronically mismanaged may stem from a large number of vacancies in its finance and accounting departments. “The staff available to answer questions often were not knowledgeable and could discuss their specific function, but not how their responsibilities assist in the overall organization.”

The report also faulted Peralta for contracting with the same independent auditing firm for 17 years and urging them to hire a new firm. The district has also allowed an internal auditor postion to lay vacant for months. In addition, poor internal controls exist that put the district at a “severe risk of undetected fraud,” the report continued.

Furthermore, employment in the chancellor’s office is typically “based on that position’s relationships with specific people he may have hired or placed in specific roles. As a result of those relationships, some staff are perceived as ‘untouchable’ while others are perceived as ostracized,” the report said.

The Fiscal Crisis and Management Assessment Team issued its report on June 28 and will officially present its findings to the Perata Community College District Board of Trustees in Sept. 10.

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