State to seize polygamy town's schools

By HOWARD FISCHER
Capitol Media Services
08/12/2005

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PHOENIX -- State officials are moving today to seize financial control
of the Colorado City Unified School District on the state's northern
border.
The move -- unprecedented in state history -- follows an investigation
that Attorney General Terry Goddard said shows a "very serious story of
mismanagement of public money." That includes an administrative payroll
padded with members of a church that controls the community,
unnecessary expenses and misuse of district property.

"And the children who attend the school district, the schools in
Colorado City, ultimately are the victims," he said.

But Goddard said he could not act until a law permitting a district to
be placed in receivership took effect. And that was not to occur until
today.

The petition filed with the state Board of Education charges that
school board members, administrators and employees "have routinely
charged personal expenses to district-issued credit cards." But Goddard
said that isn't the only problem.

He said there were more than 1,200 students in the district in 2000
before Warren Jeffs, leader of the Fundamentalist Church of Latter Day
Saints, ordered followers in his polygamous sect to pull their children
out of public schools. Goddard said while enrollment dropped to fewer
than 250, the number of administrators -- mostly FLDS members -- not
only remained the same but the district in 2002 bought a $200,000
airplane.

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Yet checks made out to teachers last school year bounced, forcing the
state's Schools Risk Retention Trust -- essentially an insurance fund
for schools -- to loan the district $1.4 million to cover payroll
costs.

Goddard also said the district leased five buildings for classroom
space from the United Effort Plan Trust, controlled by FLDS leaders,
paying multi-year contracts up front. In 2002, the district abandoned
three of the leases, forfeiting about $190,000 in prepaid rent.

Yet last year the district asked the state for a new elementary school
to alleviate overcrowding.

And the buildings abandoned in the lease, Goddard said, now are being
used by an FLDS-controlled private school. That, said Goddard, shows at
least an indirect subsidy of church-run schools by taxpayers.

The district has 15 days after being served with the petition to
respond, with the state Board of Education able to act no sooner than
20 days after that.

Calls to the district office were not answered; a message left at the
home of district Superintendent Alvin Barlow produced no response.

Goddard said he presumes the district will challenge the petition. And,
he said, school officials are entitled to use taxpayer dollars in that
fight.

There is no precedent in Arizona for having a receiver run the
financial operations of a school district. State School Superintendent
Tom Horne said his office is soliciting bids and already has one offer
from a forensic accounting firm.

Goddard said even if the state board approves the move, that still
leaves the locally elected school board in place. He said members would
remain free to make any decisions that do not involve finances.

But it would be up to the receiver to decide whether to keep the
superintendent.

The receiver would have 120 days to come up with a plan to fix the
district's finances, including repaying that $1.4 million to the school
trust. But Goddard said he doesn't know how long the receiver would run
the district or when the local board would be able to resume control.