Robert Lloyd, director of business and finance for the school system, said his office paid bills from Perry and Walters that were intended for the Georgia School Boards Association Risk Management Services, the school system’s insurer.
“Those bills for $130 (hourly rate) that should have been for GSBA went to us,” he said. Payment of them, he said, was “an administrative error on our part.”
Per the school board’s contract with Perry and Walters, the hourly rate for counsel is $95 and for trial work, $105.
Until recently, some statements from Perry and Walters to the system did not cite the hourly rate. However, the statements in question do cite the rate of $130 per hour.
Tommy Coleman, a partner at Perry and Walters, has given three reasons for the errors: Transitional changes related to changing law firms and a new billing system, as well as nonpayment from GSBA.
Coleman said at the board’s March 10 regular meeting that if the DCSS received a bill for $130 per hour, that it must have been an error on his firm’s part. But later that week, after questioning staff about the matter, the situation turned out to be different.
Coleman, who was not present at Wednesday’s Dougherty County Board of Education midmonth work session, told The Herald last week that his firm had not been paid in months by the GSBA for trial work for the Dougherty system. In an effort to get paid, he said, his secretary called the DCSS business office, where a representative said the problem would be taken care of.
Coleman said then that the system paid the bills with the assumption that it would be reimbursed by GSBA.
On Wednesday, Lloyd said there was a reason why he was looking at the Perry and Walters litigation statements, but “I can’t remember the specific reasons why.”
Lloyd said that there “could have been conversations between our accounts payable offices,” but does not recall the details of those conversations.
“But the school system never agreed to act as a bank?” Dougherty County Board of Education member David Maschke, who brought the matter of the incorrect rate to the board, asked Lloyd.
“No,” the finance director said.
“We don’t have any recollection or knowledge of that?” Maschke pressed.
“I have no recollection of that,” Lloyd said.
“It’s safe for us to assume ... that that’s just not the way we (the Dougherty County School System, Dougherty County Board of Education) do business,” Maschke said.
While the board met in closed session to discuss personnel matters, Lloyd shared the issue seems to be a communications mix-up between Perry and Walters and the DCSS accounts payable office.
Lloyd confirmed recent reimbursement of $8,538.90 from Perry and Walters for the litigation statements intended for GSBA. Perry and Walters rebilled the system for nearly $7,000 in work. The difference is about $1,600.
Still, without an exhaustive audit of statements — from Coleman’s current firm, Perry and Walters, and his from his former firm, Hodges, Irwin, Hedrick and Coleman, as well as of statements the system doesn’t have access to — the DCSS won’t know if its deductible has been met nor if the $1,600 difference is accurate,.
“That’s when he (Lloyd) said they (the attorneys’ offices) are the ones with of all the records,” Maschke said Wednesday afternoon, “so he (Lloyd) is unable to figure out the deductible.”
Lloyd told the board that he contacted GSBA to inquire about its payments to the firms, but that the agency cited attorney-client privilege.
“So the bills, as of today, are sitting in Lloyd’s office unpaid until they can verify the accuracy,” Maschke said.
Said Lloyd, “I think that there should be a built-in trust (between the school system and the law firm), and the attorney has (admitted) to this (rate) mistake.”
Lloyd, who signed off on payment to Perry and Walters, said that his accounts payable staff now knows the correct hourly rate for services by Perry and Walters.