CLAREMONT — The School District has hired a Boston-based firm to conduct a forensic audit of the district’s finances from Jan.1 2019 to Dec. 31, 2025 as it continues to seek answers as to why the district found itself with a $5 million deficit last August.
The Augusta, Maine law firm of Bernstein, Shur, Sawyer and Nelson signed an agreement with the district last month on behalf of CBIZ Forensic Consulting Group.
CBIZ’s services “relate to an accounting investigation into the financial activities of the schools within the district,” the first page of the agreement states.
School Board Chairwoman Candy Crawford said this week that the district hired a forensic auditor for two main reasons: First, the New Hampshire State Police urged SAU 6 interim Business Administrator Matt Angell to hire a forensic auditor after Claremont Police declined the request. Second, many residents have demanded one.
“I’ve had many people say that no one is going to be happy until you actually get a third-party forensic audit, somebody who knows what they are doing to do the research and make a report,” Crawford said in a phone interview. “We don’t know what they will find and we are not even telling them what to look for. We just want somebody to go through the records on what was done and identify whether there is something that needs further investigation.”
The 11-page agreement describes in detail the scope of services, and its limits, with an estimated cost of $50,000, though that figure could increase because the fees are being charged on an hourly basis. A $10,000 deposit was required once the agreement was signed.
“We will not perform services that will result in billings that will exceed $50,000 without further written authorization from you,” the agreement reads.
There is no timeline for when CBIZ will complete its work and make a report to the board. A “right to disengage” condition provision allows either CBIZ or the School District to “terminate our engagement” at any time via written notice.
When the School Board publicly announced the deficit — which had been accumulating for years — last August, hundreds of people attended the next few board meetings. Several demanded an explanation and wanted someone held accountable for allowing the district’s finances to fall into disarray.
The agreement makes clear that forensic services designed to locate hidden assets and unreported income “are difficult to render and may be limited by the information available and provided to us or financial constraints.”
“CBIZ cannot and will not warrant the discovery of all assets or income as part of our analysis,” the agreement read. “Our engagement cannot be relied upon to disclose all errors, irregularities, fraud or other illegal transactions or conduct that may exist.
“We cannot and do not predict or guarantee results or final developments in this matter,” the agreement states. “Our total fees and costs in this engagement are not contingent upon the outcome of our analysis.”
The agreement with CBIZ does “not cover the provision of expert witness testimony or the rendering of other expert witness services. The rendering of such services would require a separate and distinct engagement letter.”
When the board authorized Angell to move forward with a forensic audit at a meeting in November, board member William Madden was skeptical that it would result in a successful prosecution.
“You said the books are so bad you are not optimistic about ever finding anything or prosecuting anyone,” Madden said to Angell, referring to a conversation they had.
Angell said at a later meeting, when asked by a resident, that two firms were contacted but declined to conduct a forensic audit. He did not name the firm nor say why they declined.
A condition of the agreement states that the information provided by the district “will be complete and accurate to the best of your knowledge.”
CBIZ agrees to have “periodic discussions in the form of oral presentations” on its work and will submit a final report to the district and the New Hampshire Board of Education.
Angell has reported to the board he expects the deficit will be eliminated by the end of the fiscal year on June 30 and the district will not have any balance due on a $4 million loan from the Claremont Saving Bank approved last fall.
In an immediate response to the fiscal crisis, the board voted just before the start of the school year not to go through with hiring 19 new teachers, cut 20 non-teaching positions and eliminated all funding for athletics and other extracurricular activities for about $3 million in estimated savings. In September, the board closed Bluff Elementary School to save further on expenses.
The School Board also immediately placed both Superintendent Chris Pratt and Business Administrator Mary Henry on leave and later reached agreements that ended their employment.
Former Superintendent Mike Tempesta, who the board fired in January 2024, hired Henry in July 2023. Pratt, the Stevens High School principal at the time, was appointed interim superintendent and later the interim label was removed.
Crawford hopes the audit confirms what the board believes probably happened.
“Mismanagement of resources, not being careful with documentation, too much money being returned to the taxpayer and overestimating revenue as reimbursements,” Crawford said about the causes of the deficits.
At a School Board meeting last May, Henry said the 2020 and 2021 audits revealed a deficit of close to $2 million. Henry said for both years combined, more than $3 million went back to the taxpayers, leading to the deficit.
“We thought we had this money, but we didn’t,” Henry said at the time.
Regular audits were not completed in 2016, 2017 and 2018 under former Superintendent Middleton McGoodwin. It has taken years for the district to get its audits up to date. The regular audits for 2023, 2024, and 2025 are nearing completion.
Pratt blamed the deficit on the district not applying for federal reimbursement of approved grants.
“We were spending the money, but not submitting to the state so they could reimburse us,” Pratt said.
Title I, Individuals with Disabilities Education Act, or IDEA, and Elementary and Secondary School Emergency Relief, or ESSER, must be claimed in a certain period of time, otherwise they have to be written off to the general budget, Henry said.
Patrick O’Grady can be reached at pogclmt@gmail.com.
