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State audit: Kettering schools kept paying arrested employee

Kettering City Schools overpaid food service employee Shelley Smith by $3,105 according to a finding for recovery in the school district’s 2016-17 state audit that was released Tuesday.

Treasurer Dan Schall self-reported the issue during the pre-audit meeting, and the amount has already been repaid, largely by Schall, according to the state’s document.

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Smith, who worked at John F. Kennedy Elementary School, was arrested with two others in a December 2016 residential drug raid. She was indicted in July 2017.

“I believe she was on administrative leave first, then it went to unpaid leave and finally termination,” Schall said. “And in that process, I paid her for some weeks that I shouldn’t have.”

The audit says Smith continued to get payroll checks, receiving $2,724 more than her earned wages, and during that time the district kept paying its share of Smith’s pension withholdings, accounting for another $381.

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Schall repaid the school district $2,331 of the overpayment out of his own pocket because the audit issued a finding for recovery specifically against him. The rest was reimbursed from the state retirement system ($654 in district and employee withholdings) and the school employees union ($120 in dues deductions).

Schall said he is assessing whether it’s worth filing in small claims court to recoup the $2,331 that he paid from Smith, who actually received the unearned money.

In the audit, the school district said it has “tweaked the process by which employee payment is stopped so as to respond more quickly in the event of employee discipline.”

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“This is first (finding for recovery) I’ve had in my career,” a disappointed Schall said. “We self-reported to the auditor, and the auditor said, you know, we probably wouldn’t have found this. I said yeah, but this is the first one in 18 years that I knew about, so I’m going to tell you.”

The state audit otherwise gave Kettering an “unmodified opinion” on its financial statements, which is a clean report. Kettering City Schools won the Auditor of State’s award with distinction the previous two years.

Smith, who was charged with multiple drug offenses in July, was eventually convicted on a misdemeanor count of endangering children — as a parent in her home, not as a school employee. She received treatment in lieu of conviction on the drug charges and was placed on five years of probation.

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