Five school districts in Wisconsin are going to be given some money they didn't know they would get back. D.C. Everest, Marathon, Abbotsford, De Pere and Waunakee school districts will all receive a portion of $4 million dollars given to the government by the construction company the five districts used between 2003 and 2008.
The FBI had done an investigation into Neenah-based Miron Construction's billing practices. The U.S. Attorney General said the investigation found Miron over billing the districts for labor costs, raising costs by 45%. They also said it routinely did something called "cost smoothing," moving costs from less profitable projects to unrelated ones that could absorb the additional costs and still appear profitable. In April, Miron reached a Non-Prosecution Agreement where it would pay the amount the federal government determined was overcharged, $4 million.
Recently, the districts received a letter detailing their portions of the $4 million dollars based on the projects that were done. In 2005-2006, D.C. Everest built Mountain Bay Elementary, which cost about $12 million, along with other projects around the district. They're being awarded just under $1.4 million.
"Because those dollars were referendum approved dollars," said D.C. Everest Assistant Superintendent for Business and Personnel, Jack Stoskopf, "it's only responsible and legal that we give that money back to the tax payers. Right now, we're working with the department of public instruction as well as our auditor to see the proper way to do that. Most likely it will be put into a trust fund and then money will be pulled out each year to reduce our debt service levee."
Marathon put on new additions to their high school during the 2005-2006 year as well. They put in a new wellness center, gymnasium, technical education rooms, art room, and music room. They are receiving $680,463.
"We don't have plans per-say put in place as of yet," said Marathon District Administrator Richard Parks. We've certainly been in touch with legal council. We've been in touch with our auditors. We've been in touch with public instruction as well. Looking at all of the options, trying to determine what the best avenue may be for our taxpayers as this was a referendum."
He said the school board plans to at least make a decision on what type of fund the money will go into at their meeting next week. He said despite the circumstances, the work was done and done well.
The U.S. Attorney General appointed a monitor on Monday to keep track of Miron's practices. Miron released a statement saying they did not have a hidden profit multiplier, let alone one of 45 percent. It also said they did not intentionally and systematically over bill hidden profits. Since 2008, the company said it implemented a series of "best practices" to provide transparency. They added that they actually suggested that monitor be appointed and look forward to working with him and believe he will verify their transparency and "best practices."
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