Conroe ISD Superintendent Null refuses to meet with Oak Ridge North Mayor, City Council, others to discuss factual basis for $807 million bond line item expenditures

Conroe ISD Superintendent Null refuses to meet with Oak Ridge North Mayor, City Council, others to discuss factual basis for $807 million bond line item expenditures

Image: Conroe Independent School District clearly has an aversion to probing questions about the $807 million bond set for voter referendum on May 4, because there is no factual basis to support the massive debt and tax hike.

Conroe, April 12 – Conroe Independent School District (CISD) Superintendent Curtis Null angrily refused to meet with the City of Oak Ridge North Mayor, Council members, and others who have raised questions about the lack of factual basis behind CISD’s $807 million bond set for voter referendum on May 4 with Early Voting from April 22 to April 30. When Null, who is a licensed massage therapist with a Ph.D. in “Professional Leadership,” spoke to the Oak Ridge North City Council on March 26, 2019, two City Council members Alex Jones and Clint McLaren pressed the Superintendent on the lack of basis behind the cost estimates for the bond.

When the Chairman of the Children’s Hope PAC spoke to the City Council on Monday, April 8, 2019, Mayor Jim Kuykendall asked whether the Children’s Hope PAC would be willing to sit down with Null and others from CISD, along with members of the City Council, to discuss the factual basis for the CISD’s bond expenditures. The Children’s Hope PAC expressed a willingness to sit down with Null, the Mayor, and other Oak Ridge North leaders to discuss the facts with respect to the bond. Yesterday, afternoon, Null angrily responded to the request, “We do not have a meeting scheduled and I do not plan on adding one to my calendar.”

Screen shot of correspondence with CISD Superintendent Curtis Null.

In response to a request under the Texas Public Information Act for all backup documents, quotes, takeoffs, estimates, invoices, contracts, bids, or proposals for each and every line of expenditure for the CISD’s $807 million bond, Conroe ISD admitted that there are no documents of that nature for the $807 million bond. The only document CISD provided was the estimate document from PBK Architects for the 2015 bond package, but CISD didn’t hire any firm to provide real estimates for this gigantic bond package and tax hike.

In reality, Null doesn’t want to meet to show any justification for the line item expenditures, because CISD has made clear there is no basis whatsoever for the line item expenditures. As Oak Ridge North City Councilman Alex Jones described the process, CISD merely threw “spitballs against a wall” for the cost estimate amounts.

If you examine the supposed expense calculation backup on CISD’s bond advocacy website, http://bond.conroeisd.net/wp-content/uploads/sites/3/2019/02/P1-P2-P3.pdf, you find a 50-page spreadsheet (the “Expense List”) supposedly providing the backup to CISD’s massive bond and tax hike wish list. CISD has admitted, however, that the school district has received no estimates, proposals, or bids to back up the bond estimates. CISD’s Superintendent Curtis Null again admitted that point to the Woodlands Township Board of Directors during a presentation on Thursday, March 21, 2019, when Township Director Ann Snyder specifically asked Null a question about that fact.

In an effort to study CISD’s $807 million bond proposal, this newspaper conducted a detailed analysis of the 50-page spreadsheet (the “Expense List”) and made a stunning discovery: $21,562.50 is a cost estimate number which appears 117 times and it is NOT for the same type of item recurring frequently. For example, CISD has estimated the cost of the following:

  • Waterproofing at Armstrong Elementary, $21,562.50;
  • Installing additional fencing at Bush Elementary, $21,562.50;
  • Adding lightning protection at the Caney Creek High School Auditorium, $21,562.50.

$21,562.50 appears as an estimate for a wide variety of cost items 117 times. If one moves the decimal for that number, however, here’s what else one finds:

  • $21,562.50 appears as a cost estimate on CISD’s Expense List 117 times;
  • $2,156.25 appears as a cost estimate on CISD’s Expense List 29 times;
  • $215,625.00 appears as a cost estimate on CISD’s Expense List 12 times; and
  • $215.63 appears as a cost estimate on CISD’s Expense List 4 times.

The “21,562.50” group of bogus cost items comprise $5,173,706.27 in bogus cost estimates.

Now, let’s be very clear. As of Monday, March 18, 2019, Sarah Blakelock, CISD’s Spokesperson, told this newspaper in writing that CISD didn’t know the significance of those recurring numbers.

CISD’s Expense List includes other interesting cost estimates:

  • $7,187.50 appears as a cost estimate on CISD’s Expense List 92 times;
  • $53,906.25 appears as a cost estimate on CISD’s Expense List 12 times;
  • $28,750.00 appears as a cost estimate on CISD’s Expense List 67 times;
  • $14,375.00 appears as a cost estimate on CISD’s Expense List 68 times;
  • $1,437.50 appears as a cost estimate on CISD’s Expense List 15 times.

Those additional cost estimates total $4,233,137.50.

A page from CISD’s Expense List showing the recurrence of “21,562.50.”

Fraud and Benford’s Law

In internal auditing and false claims litigation, both under federal law and Texas law, one of the five major signs of fraud is the recurrence of numbers which appear random at first glance. Such recurrence indicates an effort by the originator to make the cost charges or estimates look genuine by making the dollar amounts look complex and uneven.

In statistics, there is a principle known as Benford’s Law, which holds “When numbers appear more often than they should, that’s a red flag that you have a questionable invoice or expense list in front of you.”

The circumstances with CISD’s $807 million bond proposal and the fake numbers contained in the Expense List are particularly egregious.

Blakelock, CISD General Counsel Carrie Galatas, and Null have all admitted that there are no actual bids, proposals, quotes, or even outside estimates for any of the numbers.

Instead, CISD has presented a group of cost estimates on the Expense List which they clearly intended to look as though precise estimates and calculations comprise their basis.

CISD’s Expense List is a classic example of a fraudulent expense list under Benford’s Law. For the more mathematically inclined, the full numerical exposition of Benford’s Law follows:

Benford’s Law to detect fraudulent invoices or expense lists.

CISD’s fraud and deceit gets worse

When Woodlands Township Director Snyder asked Null about the strange recurrence of the numbers, including $21,562.50, Null provided an answer. His answer actually reveals that CISD is more deceitful than it appears at first blush.

At the Woodlands Township Board of Directors meeting on Thursday, March 21, 2019, CISD Superintendent Curtis Null tried to explain away the odd recurrence of the number $21,562.50 as a cost estimate appearing 117 times for various different line items in the gargantuan bond package. His answer, in response to a carefully-staged question from former CISD Board member Ann Snyder, who now sits on the Woodlands Township Board, actually reveals how fraudulent the entire bond package is.

The staged colloquy between Snyder and Null after Null’s scripted presentation to the Board follows:

Ann Snyder: I do have one [question], Dr. Null. Thank you.

Null: Yes, ma’am.

Snyder: There’s a comment that was made at the very beginning. I don’t know if you were here, about specific numbers that you used repeatedly and one of the numbers was 21562. I’m curious were you here for that?

Null: I was not. I was at a CASA Board meeting but I can answer your question, I think.

Snyder: The comment was that 21562 sometimes it was, sometimes 2000, it was the same digits, were used over and over a multiplicity of times, to come up with the 807 [million dollars]. I think with all the residents here as well as with our board, if you are able without actually being here, if you could answer.

Null: Sure. I could speak to the process first. Everything that is included within the bond package, every line item dollar wise that is included in the package, is an estimate. None of the work has been designed. None of the work has been bid. So before anything is done through this package, everything will be competitively bid through the legal process and we will look for best value. It’s possible that things won’t match the number that you see.

[Publisher’s Note: Once again, Null and CISD have admitted repeatedly they’ve failed to obtain any actual cost estimates by takeoffs, proposals, bids, an architectural study, or quotes. CISD has simply plucked the cost of this bond and all of the line items under it out of the air. In the 2015 bond package, PBK Architects had provided a line-by-line cost estimate for every individual project in the entire bond.]

The number that you speak of an example of that, if the estimated cost of work would be $15,000, and an example that I remember as a line item in the package was adding additional HVAC air condition to a computer room, IT, in an older building to keep those servers from overheating. The estimated cost of that work is $15,000. Um from $15,000 you have to add the soft costs that are associated with that, as you well know, the legal responsibilities of a government entity that come with um our cost of doing work. So legally required architect fees, engineering fees, permitting, all the things that are associated. That’s usually a percentage somewhere between 40 and 45%. So you put that multiplier and I think the number specifically you gave, if you put a 43.75% multiplier, which is a common number that’s associated with that, you multiply that by 15,000, that gets you the number that you were speaking to. So what you see more commonly is our elementaries we’re on the 19th iteration of the exact same building and before that we were on the 15th iteration, so you see a lot of repeats in the lines, because if you’re going to do it at one of those buildings, you’re going to do it 19 times typically, so you will see some repeats. But where you go from a simple number to more of a complex number is based on that multiplier of the soft costs associated with the work. Did I hopefully answer that?

Snyder: Thank you.

Doesn’t Null’s answer explain why odd numbers such as $21,562.50 (appears 117 times in CISD’s cost estimates), $215,625.00 (12 times), $2,156.25 (29 times), $215.63 (4 times), $7,187.50 (92 times), $53,906.25 (12 times), $28,750.00 (67 times), $14,375.00 (68 times), or $1,437.50 (15 times), among many other similar numbers appear in CISD’s cost estimates? Don’t those numbers really just represent estimates one should honestly divide by 1.4375 to yield $15,000, $150,000, $1,500, $150, $5,000, $37,500, $20,000, $10,000, or $1,000? Doesn’t Null’s explanation reveal that the true fraudster is anyone who would dare question the validity of those estimates? Doesn’t Null’s explanation reveal that the true fraudster is anyone who would dare challenge the mere $807 million CISD so conservatively and thoughtfully prepared for the voters to consider and approve in a bond referendum? Isn’t it time for the community of Montgomery County to castigate the fat, uneducated ruffian who would dare challenge wonderful thoughtful stewards of the public fisc, such as Curtis Null, the CISD Board of Trustees, Charlie Riley, James Metts, and Marc Davenport?

Doesn’t Null’s explanation reveal that the true fraudster is anyone who would dare question the validity of those estimates? Doesn’t Null’s explanation reveal that the true fraudster is anyone who would dare challenge the mere $807 million CISD so conservatively and thoughtfully prepared for the voters to consider and approve in a bond referendum? Isn’t it time for the community of Montgomery County to lynch the fat, uneducated ruffian who would dare challenge wonderful thoughtful stewards of the public fisc, such as Curtis Null, the CISD Board of Trustees, Charlie Riley, James Metts, and Marc Davenport?

Isn’t it time that we follow the great leadership of CISD Board President Datren Williams who said, during the Woodlands Township Board meeting, that “people should consider the source” when they hear facts against the approval of CISD’s $807 million bond package?!

In order to get the castigation under way, Woodlands attorney Sharon Conway got the ball rolling on social media: “Oh my gosh, this is hilarious! Apparently Eric [Publisher of this newspaper] did not listen when this was explained at the Board meeting earlier this week. Seriously, this is ridiculous…I now have a child in school and this stuff is actually personal. We need our schools to keep up with our growth. And whether you like it or not, things like curtains on the stage are important for many aspects of a child’s well-rounded education. I am proudly voting YES for this bond because I actually care about something more and much bigger than the heft of my wallet.”

[Publisher’s Note: The Conroe ISD has admitted that there are no educational outcome metrics to support the $807 million bond package. Therefore, Ms. Conway’s suggestion that curtains are important for her child’s well-rounded education does not seem to have support. Conway is right on the mark, however, that she cares about more and bigger issues than the heft of her wallet. Clearly, Conway is quite concerned about reducing the heft of the wallets of all of the taxpayers in the geographic jurisdiction of CISD.]

Null’s “1.4375 multiplier” makes CISD’s $807 million bond package look worse

On many levels – far too many to discuss in one article in this newspaper, Montgomery County’s leading daily newspaper – Null’s “1.4375 multiplier” makes CISD’s $807 million bond package look a lot worse than it did before he dropped that bomb on the taxpayers. From now on, this newspaper shall refer to the 1.4375 multiplier as the “Null Multiplier.”

From a big picture standpoint, we now know that CISD’s $807 million bond package is not an $807 million bond package at all. Taxpayers, students, and parents won’t receive $807 million of value. Instead, they’ll receive value equal to

$807,000,000 divided by 1.4375 equals $561,391,304.35.

Another way of saying the same thing is that CISD’s bond package is really the following:

  • $561,391,304.35 in construction projects, plus
  • $245,608,695.65 in payments to architects, engineers, and lawyers.

That’s right, almost $246 million of CISD’s huge tax hike will go directly to lawyers, architects, and engineers.

Null’s “1.4375 multiplier,” the Null Multiplier, tells voters a LOT about CISD’s bond package

The Null Multiplier (1.4375 times everything) actually reveals enormous information about CISD’s bond package.

First, on one important level, CISD is lying to the voters, parents, students, and teachers of the school district. Why?

In 2014, the Texas Association of School Business Officials (TASBO), the Texas organization of public school district administration, finance, and purchasing officers, conducted a conference on Public Education Construction. During that conference, they noted several important points about school bonds.

One of the points TASBO made to its members, which include several employees of CISD, is that there is no requirement to use an architect or engineer for any public work either (1) that involves involves electrical or mechanical engineering if the contemplated expense for the completed project is $8,000 or less, or (2) a public work that does not involve electrical or mechanical engineering if the contemplated expense for the completed project is $20,000 or less, under Section 1001.053 of the Texas Occupations Code. That makes a lot of sense. For example, if one were to repair paving or repaint a parking lot for less than $20,000, it would be positively silly to hire an engineer or architect for such a job.

Similarly, as TASBO has noted, only a new building owned by a political subdivision having construction costs exceeding $100,000 or an alteration or addition to an existing building having construction costs exceeding $50,000 must have architectural plans and specifications prepared by an architect, under Section 1051.701(a) of the Texas Occupations Code. That also makes a lot of sense.

Therefore, one must go back to all of those line items in the CISD bond package, which the school district has listed as $21,562.50, but for which CISD has applied the Null Multiplier. According to Null, CISD plucked the number $15,000 out of thin air for each of those 117 line items, since CISD has not gotten any estimates from architects, contractors, engineers, or independent parties of any sort. CISD’s administration has repeatedly agreed with Null that the numbers behind the $807 million bond are merely pulled from thin air based upon the feelings of som unidentified and faceless employee or group inside of the CISD administration. After applying the Null Multiplier, 1.4375, to the $15,000 cost estimate, one obtains the product of $21,562.50.

Therefore, just start with the first of the 117 line items in the CISD bond package which costs $21,562.50: “Armstrong Elementary: Remove and replace exterior building waterproofing sealants throughout entire facility (including all wall control joints, through wall penetrations, around all doors and windows, and joints between building and paving).”

Under the TASBO analysis and Texas law, after dividing the Null Multiplier, we know that CISD’s “estimate” for that project at Armstrong Elementary is $15,000. It’s only more than $20,000 after application of the Null Multiplier. Clearly, removing and replacing waterproofing sealants doesn’t require electrical or mechanical engineering. Therefore, there is no need whatsoever for use of engineers, architects, or lawyers on that specific line item. As a result, the Null Multiplier is completely unnecessary. CISD should have listed that line item for Armstrong Elementary as an estimate of $15,000, not $21,562.50. CISD is overcharging taxpayers $6,562.50 for that one line item.

Under the TASBO analysis and Texas law, after dividing the Null Multiplier, we know that CISD’s “estimate” for that project at Armstrong Elementary is $15,000. It’s only more than $20,000 after application of the Null Multiplier. Clearly, removing and replacing waterproofing sealants doesn’t require electrical or mechanical engineering. Therefore, there is no need whatsoever for use of engineers, architects, or lawyers on that specific line item. As a result, the Null Multiplier is completely unnecessary. CISD should have listed that line item for Armstrong Elementary as an estimate of $15,000, not $21,562.50. CISD is overcharging taxpayers $6,562.50 for that one line item.

Here’s another example of the CISD scam: “Bush Elementary School: Install additional fencing (site fence is not continuous around property)…$21,562.50.” Once again, CISD has applied the Null Multiplier completely unnecessarily in order to inflate the amount of the $807 million bond package.

It’s worth mentioning right here a personal note to Conway, the CISD parent who wants this bond package for her enrolled child. Conway – and all other CISD parents – should remember that she’s supporting an inflated bond package that will get a lot less value than if CISD had developed the bond package as it should have with real estimates of the costs of each of the line items.

There’s a more important point, however, for Conway’s child as well as for all of the children enrolled in CISD. In 15 to 20 years, Conway’s child will be an adult and, knowing Conway, one would know that her child is likely to be intelligent and successful. In other words, Conway’s child will bear the property tax burden from this over-inflated bond package, since CISD intends to amortize the bond debt over 25 years. It’s sad that this community will burden Conway’s child – and all of the other children of CISD – with this yolk of heavy taxation long before they even have the chance to make their own lives as adults in our community.

There’s a more important point, however, for Conway’s child. In 15 to 20 years, Conway’s child will be an adult and, knowing Conway, one would know that her child is likely to be intelligent and successful. In other words, Conway’s child will bear the property tax burden from this over-inflated bond package, since CISD intends to amortize the bond debt over 25 years. It’s sad that this community will burden Conway’s child – and all of the other children of CISD – with this yolk of heavy taxation long before they even have the chance to make their own lives as adults in our community.

It’s important to note that, based upon the comments of Null at the Woodlands Township Board meeting, the entire list of cost estimates for all $807 million has gone through the Null Multiplier. Therefore, the entire $807 million bond package has suffered that artificial and, in the vast majority of instances, unnecessary, inflation.

Second, the folks at TASBO also discussed best practices for school construction and for development of bond packages to submit for voter referendum. Here’s a direct quote from the TASBO conference on school construction:

“In many cases, school districts will engage an architectural firm before a bond election to help determine what project or projects will be included in the bond election and the estimated cost of the projects.”

In 2015, CISD actually conducted the bond study in the right manner. CISD engaged PBK Architects to provide an estimate for the entire bond package and for each individual line in it. In contrast, in 2019, CISD didn’t engage any architectural firm to do such a study. CISD also didn’t ask contractors to perform takeoffs, or to provide quotes, bids, or proposals. CISD didn’t receive invoices for items CISD wants to buy with the bond money. In other words, CISD wholly failed to engage in best practices for development of bond packages in school district, as TASBO makes clear!

Third, Null’s comments at the Woodlands Township Board meeting also reveal how untruthful the entire $807 million bond package is. Not only are there instances of the fake numbers, after application of the Null Multiplier: $21,562.50, $215,625.00, $2,156.25, $215.63, $7,187.50, $53,906.25, $28,750.00, $14,375.00, $1,437.50, and many, many others.

There’s an odd group of numbers that this newspaper has not yet examined, the numbers which are entirely even.

Here are some interesting examples in the form of screen shots directly from CISD’s bond advocacy website:

Since the numbers and letters are small, here’s what those line items are from CISD’s website, as part of the $807 million bond package:

  • Collins Intermediate School, life skills addition, $120,000.00
  • Collins Intermediate School, needs gym addition, $6,000,000.00
  • Collins Intermediate School, Replace all air handling units (7 total), $1,725,000.00
  • Conroe High School, robotics lab and play field, $6,000,000.00.

Those are just a few examples of the hundreds of items on CISD’s cost estimate list which end in even zeroes like that.

Nevertheless, going back to Null’s statements to the Woodlands Township Board, there clearly is a problem. We know under Texas law and TASBO best practices, you must have architects and engineers for a $6,000,000.00 robotics lab and play field, or a $6,000,000.00 gym addition, or a $120,000.00 life skills addition, or a $1,725,000.00 replacement of air handling units.

Where is the Null Multiplier for each of those line items?! Is CISD really taking the position that the true cost of the $6,000,000.00 robot lab and play field is actually $4,173,913.04, but then with $1,826,086.96 in architect, engineering, and lawyer fees tacked on that, just by coincidence, somehow yields an exact cost of $6,000,000.00?

The “Aw C’mon Now Rule” kicks in right here.

Aw C’mon Now, Null and CISD. Please stop lying to us.

 

Comments

comments

You must be logged in to post a comment Login