Despite having to return about $270,000 in misallocated funds to
the Gavilan College Educational Foundation, Gavilan trustees
maintained their support for the organization that’s plowed $1.4
million back into the college over the last decade.
Despite having to return about $270,000 in misallocated funds to the Gavilan College Educational Foundation, Gavilan trustees maintained their support for the organization that’s plowed $1.4 million back into the college over the last decade.
According to its mission statement, the foundation was established to serve as an advocate for Gavilan College and to seek additional financial resources for college services to meet the needs of its faculty, students and services. Earlier this year, the foundation discovered that it had mistakenly dispersed $270,372 to Gavilan College that was earmarked for specific projects and programs. Last month, the foundation asked the college to return the money, a move Gavilan trustees unanimously approved at a recent board meeting.
“Did they blow it? Yeah, in my opinion, they botched it,” Gavilan trustee Mark Dover said of the foundation. “But as a board member, I have a hard time criticizing them with all the positive things they’ve done for Gavilan.”
The agenda item, which Gavilan trustee Elvira Robinson requested to pull from the consent agenda into the regular board meeting, garnered attention from speakers who questioned the impact the foundation’s mistake would have on the students.
Gavilan President Steve Kinsella, who also sits on the board of the educational foundation, assured attendees that the money being returned to the foundation would not affect class schedules or course offerings.
“These two items aren’t connected in any way, shape or form,” Kinsella said. “I want to caution people not to make this something that it is not.”
Although it is unclear what amounts of money were earmarked for which programs, and how those earmarked funds were actually dispersed, the money has been returned to the foundation, Kinsella wrote in an e-mail. To avoid the messy situation in the future, Joe Keeler, Gavilan’s vice president of administrative services, will oversee the foundation’s finances in an advisory role.
By establishing two checking accounts, one for earmarked funds and one for non-earmarked funds, the foundation will be able to avoid the commingling of the two types of funds and prevent internal borrowing, Keeler said. He emphasized that despite the reported error, the earmarked accounts still have all the money they should and all scholarship amounts will be fully funded. Checks must be signed by two people, usually Keeler and the foundation’s treasurer, Keeler said.
The foundation’s executive director, Ken Berry, did not return phone calls.
As a veteran advisor to the Gilroy Foundation’s board of directors, Denise Apuzzo – a trustee for the Gilroy Unified School District – called the error a “rookie mistake” that indicates a need for better oversight.
“This is such a bitter pill to swallow,” she said at the board meeting.
In addition to the appointment of Keeler as an advisor, Gavilan trustees said they felt regular reports on the foundation’s finances would help avoid a similar situation in the future.
“It keeps everyone honest,” Dover said. “They used money for one thing that was meant for another. That’s where they crossed the line.”
Despite the financial foul-up, Dover credited the foundation for boosting Gavilan’s public profile through community outreach and fundraisers.
“To shut it all down would not be in our best interests,” he said. “Personally, I would be sad to see it go.”
Trustees agreed that the recent mistake wasn’t an indication of the foundation’s long-term viability.
“There’s definitely problems that have to be taken care of, but if the foundation can be profitable and benefit the students, then we should have it,” Robinson said.
But trustees also acknowledged that there were still many questions that needed answers.
“It’s got to be simple for people like me to understand,” said Gavilan trustee Tom Breen. “We can’t play games.”
