School Committee accountants B&E took the stand today as the Caruolo action between the Portsmouth School Committee (SC) and Town Council (TC) entered its second day. B&E principals Thomas Sweeney and Walter Edge were questioned by attorneys Stephen Robinson (SC) and Denise Lombardo Myers(TC). Superior Court Judge Gilbert Indeglia joined in, firing sharp questions at the witnesses and evincing open skepticism about the necessity of a future program audit.

Court convened at 2:10 with Myers picking up yesterday's cross-examination of Sweeney. After complaining about the difficulty both she and the TC expert had in reading the school budget numbers, she asked, "So the people of the town should look at this and blame the software?"

Sweeney clearly identified the 12-year-old computer system as the root cause. "It doesn't meet the requirements [of the new State accounting standards]. Money has not been available to upgrade the administration software." Nor was the money likely to be available; it is outside of the scope of Caruolo, and "Admin is the toughest money."

Myers then picked at other key numbers: the salary for the unfilled Finance Director position, the cost of retirees, and the Little Compton tuition. In all the cases, she seemed to be leading in the direction of caution. Although no one suggested that Little Compton would renege on their contract, she asked, pointedly, "Isn't it true that the Town Council would be required to come up with this shortfall -- up to 200K -- if this doesn't come in?"

On redirect, Robinson asked Sweeney to clarify the difference between the work B&E had done and a program audit. "When we do Caruolo," said Sweeney, "Our job is to testify that they need this kind of money [to finish the year]. In a program audit, we look for efficiencies over time."

Judge Indeglia voiced some skepticism about the need for a program audit. "There's a question if it's required subsequent to this hearing. The purpose is to assist this court -- if not done prior, it's not necessary."

Walter Edge then took the stand for the School Committee, and after establishing his credentials as an expert witness, Robinson got right to the point, asking what B&E had determined relative to the School Department being able to complete the year with the Tent Meeting budget. "Impossible," said Edge.

Robinson questioned Edge about the process they had used to analyze the school accounts, how they got to the number, presented at the workshop on 10/27, of a 770K deficit, and the slightly lower number in January, based on use of some Medicaid cash reserves. But Indeglia wanted to get back to the program audit.

"We know what Caruolo says," said Indeglia. "The Town Council has to appoint an auditor. Is that different from your role?"

"Well," Edge explained, "There's been an evolution." In the first Caruolo actions, he had done work that combined some program auditing with financial review.

Indeglia didn't sound like he was buying it. "That's my problem," he said. "If Caruolo is a 1-year issue, why would the legislature not want the system audit to be used? The Legislature wanted this audit to be a 3rd-party tool for the judge. At the time of hearing, or not necessary."

This put both Robinson and Myers in the apparently peculiar position of both defending a program audit. "This is strong public policy, " argued Myers, saying that since the court was only ruling on one year, the legislature wanted to ensure the system was reviewed going forward. Robinson concurred, interpreting the Legislature's intent as saying, "If you're going to put a town through Caruolo, we want a post-facto analysis as to whether the school system is efficient."

"I think that's reading a lot into the legislation," said Indeglia.

After further questioning to bring in exhibits detailing analysis, with some special attention to the validity of amortizing Medicaid cash over three years instead of throwing it all at this year's deficit, the final number came out.

"Do you have an opinion on the number the Portsmouth School Department needs to finish the year," asked Robinson.

"Yes," said Edge, "$787,051."

With the position of the SOS supporters at the Tent Meeting validated under oath (300K off the budget was the first compromise position; if the PCC had accepted it, we would have saved months of time and at least $100K) court adjourned until 10:30 tomorrow.

BTW — Today, the half-dozen PCC folks in the gallery (At one point, Forest Farm Golden slid up to the bar to pass a paper to Karen Gleason) were joined by what looked like their lawyer, Thomas Wigand. If I were a PCC contributor, I would be concerned about the wisdom of paying an attorney to sit through the proceedings, even if they are planning to mount some kind of Hail-Mary legal appeal. I mean, he can just review the transcripts, no? This couldn't be cost-effective. Unless he's a really slow reader.