THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, March 20, 1996 TAG: 9603200463
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY ALETA PAYNE, STAFF WRITER
DATELINE: VIRGINIA BEACH LENGTH: Medium: 60 lines
School Director of Budget Development Mordecai L. Smith, who has been a key player in the ongoing controversy involving the division's finances, resigned Tuesday.
Smith was not present when the school board announced its decision to accept his resignation after a closed session at the end of its meeting. Neither Smith nor his attorney was available for comment.
Smith resigned in the wake of a scathing special grand jury report,which also prompted former Superintendent Sidney L. Faucette to leave his superintendent's post in Gwinnett County, Ga., earlier this month.
Three board members have stepped down and two others have announced their resignations effective in May. The report called for Smith and seven of the nine school board members to resign or face malfeasance charges. Board members Tim Jackson and Ferdinand V. Tolentino have said they will remain and fight the matter in court.
Had Smith not resigned, board members had indicated his future with the district would be reconsidered, and there appeared to be enough votes to fire him.
In September 1995, Smith was placed on paid administrative leave as the state of the district's finances unfolded, revealing substantially unrealistic revenue and expenditure projections in at least the last two years' budgets.
The district ended the 1994-95 fiscal year with a $12.1 million shortfall. Despite strict cost-cutting measures, it will likely need more than $2 million from the city to balance the books this year.
Smith had served as chief financial officer since 1994 and director of budget development since 1989.
Last month, the school board voted 7-4 to reinstate Smith as director of budget development on a probationary basis, but not to return him to his job as chief financial officer. That decision sharply divided the board, prompting the resignation of one member, Susan L. Creamer, who did not agree with Smith's return. It also clearly infuriated the special grand jury investigating the district's finances. In their report released in late February, the jurors were highly critical of that decision and of the board members who made it.
Smith had assured the district's top leaders just days before the deficit was disclosed that the books for the 1994-95 fiscal year would end with a surplus. Instead, school officials had to ask City Council for money to resolve the largest financial crisis in the division's history.
Smith has since said repeatedly he was following Faucette's orders.
Donald F. Bennis, one of the board members who had originally voted to reinstate Smith, said new information since that decision led him to change his mind. ILLUSTRATION: Photo
Mordecai L. Smith wasn't present when the board accepted his
resignation.
KEYWORDS: VIRGINIA BEACH SCHOOL BOARD BUDGET by CNB