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Private Company Wasted $495K In Taxpayer Money On 'Duplicate Services,' Adams 14 Schools Says

COMMERCE CITY, Colo. (CBS4) - The Adams County 14 School District released a long-awaited forensic audit Thursday they say shows misuse of hundreds of thousands of taxpayer dollars. The district says its state-mandated private management company - MGT Consulting - spent $495,486.18 on services the company was supposed to do itself.

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"(MGT) was already paid a significant amount of money to conduct these services, but then they would go out and hire another group to conduct these services at significant cost to the district," said Adams 14's lawyer, Joe Salazar, in a news conference Thursday.

Read the full audit by clicking here.

Adams 14 officials convened Thursday to explain the audit and why they say it was significant enough for the district to fire MGT, contrary to a state order requiring MGT to manage the district.

In 2018, the Colorado State Board of Education required Adams 14 to have a private manager after years of poor student performance. To learn more, check out this history of Adams 14's issues with the state. 

After three years of MGT managing the district, Adams 14 asked for a review of MGT's services and says school officials found they weren't getting what they paid for.

"This report represents the third independent appraisal that has shown that the promises made by our former external manager partner were not delivered upon," said Dr. Robert Lundin, Director of Communications for Adams 14.

Even though Adams 14 school board members approved many of the expenses laid out in the audit, board members said Thursday MGT kept them in the dark on what many of the contracts were for.

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"One of the big ones I'll point out is the HR consulting, it was almost $100,000 in one year, we knew nothing about it," said Renee Lovato, an Adams 14 school board member.

Adams 14 says the Adams County District Attorney investigated the audit and found no evidence of criminal actions.

MGT provided the following written statement Thursday:

"Today's press conference is another example of the Adams 14 Board of Education making much ado about nothing," said Eric Parish, Executive Vice President at MGT. "There is nothing here, as the District Attorney's office itself has said, and the auditors would have come to a similar conclusion if they had actually interviewed anyone from the district's Accounting or Finance departments or anyone from MGT.

The district's ongoing desire to create artificial distractions raises real questions about their interest and ability to lead the type of academic improvements that MGT accomplished during its time as lead partner."

Now that MGT has been let go, Adams 14 Superintendent Dr. Karla Loría says she's making student performance her number one priority.

"This is not about one person, it's about a whole group of individuals focused on what is best for children," she said.

But because Adams 14 fired MGT, the district is now in hot water with the state.

The State Board of Education has ordered an independent review of the district, and those results will come out in April. That's when the state could decide to create more charter schools, find a new management company, or dissolve the district altogether.

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The Colorado Department of Education Commissioner, Katy Anthes, released the following statement Thursday about the audit, and Adams 14's future:

"The forensic audit does not appear to provide conclusive evidence. It simply directs the district to review its contracts. In the end, this is a contract dispute between the district and MGT. It is not something within the jurisdiction of either CDE or the state board.

"We continue to focus on the goal of improving academic outcomes for students. The board will hold a hearing in April, and it is legally obligated under the Accountability Act to take action to improve student achievement. We are waiting for the input from the independent State Review Panel, and have invited the district to make a proposal as well during the April hearing."

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