A newly released state audit is asking former Superintendent of Gary Schools Cheryl Pruitt to repay nearly $7,200 to the school district and state for inappropriate spending of taxpayer dollars.

The audit was released to The Times on Thursday, just days after Pruitt was charged with theft in Lake Criminal Court in connection with a 2016 luxury trip to California.

The new State Board of Accounts special investigation also names two other Gary school officials — a former spokeswoman and board member — for inappropriate reimbursements totaling $645 in 2015 and 2016.

In each case, reimbursements were paid out of the district’s ECA, or extracurricular account, that did not have proper oversight. The account is funded primarily by donations, sporting and theater production ticket sales, and field trip fees.

Pruitt, as one of the primary overseers of the extracurricular account, is also on the hook for $3,531.04 incurred by the state in audit costs into the investigation of wrongful disbursements. 

Such costs incurred because of thefts and shortages may be the personal obligation of the responsible employee or official, SBOA records show. 

Pruitt's attorney, Scott King, declined comment on the report, saying he has not had a chance to review it in detail. 

Disbursement checks made from the account only required one signature, that of the account treasurer. The treasurer was responsible for recording transactions to ledgers and reconciling the bank account. The audit states there is no oversight by management or the School Corporation over this account, which is necessary for internal controls, the audit states. 

The new State Board of Accounts audit reveals the district’s former spokeswoman, Charmella Greer, allegedly sought $508 in personal reimbursement for teacher appreciation plaques in 2015. Greer made $41,305.72 annually as the district's spokeswoman in 2016, records show. 

The report states Greer submitted three invoices to the district for plaques, and yet the same invoices were also presented to the district as supporting documentation for payments made directly to the vendor.

In one instance, the invoice presented to the district’s ECA account had a notation on it indicating it had been paid in cash, while the same invoice presented to the School Corporation for vendor payment did not have the same notation.

The investigation also shows school board member Antuwan Clemons charged meals to a credit card account designated for School Board use totaling $136 in 2016. Yet, he also submitted a claim for per diem, paid for by the School Corporation, the SBOA alleges. Clemons was compensated $9,250.00 in 2016 as a board member, according to state records. 

After receiving a copy of the report from a Times reporter, Clemons said Thursday it's difficult for him to comment at this time. He said the report was "too vague" and that he didn't have all the details.
"I would like to talk to school officials regarding the matter. However, if the process wasn't done correctly the money should be paid back," he said in a social media message. 

Pruitt’s China trip, mileage reimbursements

The audit revealed Pruitt paid for flight ticket upgrades and exchanges using the same ECA account when she and her daughter accompanied students on a trip to Bejing, China, in October 2014. 

Students, faculty and chaperones were to depart Oct. 17, 2014, but Pruitt exchanged the tickets so she and her daughter could depart Oct. 19, with no explanation given. The exchange fees were $850, paid out of the district’s ECA account.

On the day of the flight, Pruitt used a district credit card to upgrade seats for herself and her daughter for $358, records show.

The SBOA is asking Pruitt repay $1,208 for the departure date change fee and seat upgrades.

The SBOA alleges Pruitt owes the district $835.45 for inappropriate reimbursements for mileage expenses tied to her personal vehicle from 2014 to 2017. Pruitt was already receiving $1,000 in monthly compensation for use of her personal vehicle, per her employee contract, records show.

May 2016 trip to California

Pruitt has been charged in Lake Criminal Court in connection with a May 2016 trip to California. During that trip, Pruitt allegedly charged $1,504 to a district credit card for a three-night hotel stay, dry cleaning fees, two spa/massage appointments, two meals, a taxi ride and miscellaneous taxes, criminal court records state.

On May 13, 2016, Pruitt submitted a voucher seeking $1,256 in reimbursement from the district, which excluded the $248 in spa expenses because that was considered personal use, records show.

The district's finance department paid off the credit card using money from the district's extra-curricular account, but also separately paid Pruitt $1,256 after she submitted a voucher seeking personal reimbursement for a portion of trip expenses, records state.

Court records show Pruitt was in "a period of financial problems" at the time she sought reimbursement. On May 13, 2016, she had a negative balance in her bank account of $643.38 and several incurred overdraft fees.

According to the new SBOA audit, released Thursday, Pruitt owes the district a total of $1,621 for the hotel, meals, laundry/dry cleaning, and spa/massages.

Spa treatments are considered personal in nature, and thus are barred from reimbursements under the district’s travel policy. Laundry/dry cleaning services are specifically excluded in the School Corporation's travel policy, so the responsibility falls on Pruitt in both cases, the investigation concluded.

Pruitt said under questioning by the FBI she generally charged everything, excluding hotel and flight expenses, to her personal credit card, and then submitted receipts to her secretary for reimbursement.

She admitted the school paid twice for the Los Angeles trip, but it was not done “intentionally or maliciously,” records state.

Pruitt served as superintendent from July 1, 2012, until her resignation in February, more than a year before her contract was scheduled to end.

In April, Pruitt agreed to repay a $30,000 bonus that she said had been approved by the school board in March 2016.

The issue arose when the Indiana State Board of Accounts conducted a special audit and alleged Pruitt's 2012 contract referenced a growth incentive plan and bonus, but no plan was outlined and no dollar amount for a bonus was listed in the contract. 

The financially troubled Gary school district last year was put under the control of a state-appointed emergency manager after trustees repeatedly failed to match the district's spending to its declining revenue and racked up more than $100 million in debt.

Emergency Manager Peggy Hinckley said in a statement the management team learned the situation last week when SBOA auditors shared the audit, which was conducted prior to the team's assignment to the district. 

"As has been the case since we engaged in this important work, we partnered with state officials and cooperated fully with them. (The team) is committed to doing everything possible to return Gary Community Schools to a condition of fiscal solvency and academic success so that the schools corporation serves the students of Gary and NW Indiana in the best possible manner," Hinckley said.  

Gary Mayor Karen Freeman-Wilson declined comment. 

The SBOA report was forwarded to the Indiana Attorney General and local prosecuting attorney's office. 


Northlake County Reporter

Lauren covers North Lake County government, breaking news, crime and environmental issues for The Times. She previously worked at The Herald-News in Joliet. She holds a master’s degree in Public Affairs Reporting.