LANSING, Mich. (WLNS) – Hundreds of thousands of unaccounted for dollars revealed in a Potterville Public Schools budget audit earlier this month are likely the result of “messy records,” Acting Superintendent Sam Sinicropi told 6 News in a phone interview .

“I don’t think any money was stolen,” says Sinicropi. “I don’t think he did. I think I had messed up bookkeeping. The spending that wasn’t — there wasn’t — a lot of oversight of what we’re spending.”

He says the council revised their budget in June. That budget concluded that the fund balance — essentially the difference between the district’s receipts and expenditures — would be about $750,000.

“You look at it and see what the difference is. At the time, Potterville Schools was about $750,000 in a fund balance,” he tells 6 News. “So that means we get more, we came in more than we spent. When the auditors audited, it ended up being $750,000 instead; it was $71,000.”

That cut puts the district at risk of state oversight. Michigan law requires that a school district’s fund balance be 5 percent or more of the budget. The audit found the district was less than 1 percent of the budget. The oversight could lead to additional monitoring by state treasury and education officials and potentially, though unlikely, a takeover by state authorities.

The budget was drawn up on the basis of a contract with Rehmann. In addition to preparing the budget, the company also had to oversee budget expenditures and warehouses. The company was paid between $12,000 and $15,000 a month for these services, Sinicropi says.

Rehmann’s contract was ending after the Board of Education voted in May to end the deal. The company was expected to continue to provide services to help with the audit, and once the audit was completed, Sinicropi says, the contract was terminated.

A spokesperson for Rehmann sent a statement to 6 News.

“Due to client confidentiality, Rehmann cannot comment on the work we have done for the Potterville schools,” the emailed statement read. “Rehmann is committed to integrity and transparency in every transaction between the firm and the client and we reject any allegations of impropriety. We are relentlessly committed to maintaining the highest level of professional and ethical standards and adhering to industry guidelines in all aspects of our work.”

Stacy Ann Sipes, president of the Potterville Public Schools Board of Education, told 6 News the decision in May to end the relationship with Rehmann was two-fold. She says the business needed to train the business manager to oversee the budget. The business manager is Monica Baker.

“We never touched the budget, we just presented the budget,” says Monica Baker. She also tells 6 News that she was never given any in-depth training by Rehmann.

Potterville officials have repeatedly declined to discuss Baker’s employment status with the school district. Baker, however, confirms to 6 News that he is on paid leave.

“I am still an employee of the district. I’m on non-disciplinary administrative leave,” Baker tells 6 News. She was placed on leave on or around August 20, she says.

She says the reason she was put on paid leave was “because there was a cyber attack on my computer.”

Both Sinicropi and Sipes declined to comment on Baker’s employment status with the district.

The second reason the contract was terminated, Sipes tells 6 News, was the result of a budgeting error in the 2023-2024 budget. That error double-counted a $450,000 grant, creating a $450,000 budget hole. The board in December adopted a plan presented by Baker to cut the district’s budget by 15 percent.

Sipes says the contractual relationship dates back to 2019.

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