September 13, 2023 — Regular Meeting
Conroe ISD Board Meeting — 2023-09-13
Regular Meeting — Unofficial Notes
Based on auto-generated transcript. Not an official record.
Generated 2026-03-28 16:02 UTC
Unofficial Meeting Notes
Conroe ISD Audit and Investment Committee Meeting
September 13, 2023 — Regular Meeting
Note: These are unofficial notes based on an auto-generated transcript of the meeting. They may contain errors or omissions.
Attendance & Quorum
A quorum was not present for this meeting. As a result, the committee could receive information on agenda items but was unable to vote or take formal action on Items 2 and 6. Item 2 (approval of prior meeting minutes) was skipped and will be addressed at the next meeting.
Citizen Participation (Item 1)
No members of the public signed up to speak.
Item 3: Status of 2022–2023 Internal Audit Plan and 2023–2024 Internal Audit Plan
2022–2023 Audit Plan (Complete)
Activity Fund Audits: All completed.
Katy Creek Upgrade Construction Audit:
- Backend audit reviewing numbers against invoices, subcontractor contracts, etc.
- CISD Planning & Construction was found to have great controls over their financials.
- One observation noted: 2 out of 37 subcontractor pay applications lacked detailed information sufficient for an outside auditor to determine what costs were for. P&C staff understood the items, but documentation was insufficient for independent review.
- Discussion about whether P&C can maintain this quality level if the district scales up with a potential new bond. The internal auditor suggested it would be beneficial to have an outside expert verify that materials ordered match what is delivered.
PEIMS Attendance Audit:
- Conducted annually to ensure attendance is taken accurately, as state revenue depends on it.
- Methodology was refined this year: Missing submissions were cross-checked to confirm the teacher was actually present that day (substitutes take manual attendance that doesn't register in the electronic system).
- Sample: 10 schools over 5 different dates.
- Error definition: Attendance taken more than one hour after the designated time (when students are no longer present) or truly missing submissions where the teacher was present.
- Results:
- ~4,600 class instances reviewed
- 413 errors (attendance taken outside the one-hour window)
- 214 actual missing submissions (teacher present, attendance not taken)
- Overall error rate: 13.5% — an improvement from the prior year
- High schools had higher error rates than elementary and junior high, attributed to the fact that high school teachers must take attendance multiple times per day (4–7 periods), making it more burdensome.
- Some high schools now use a special bell at the official attendance time as a reminder.
- Automated solutions (e.g., smart ID tags/scanners) were briefly discussed but deemed cost-prohibitive and potentially problematic (tracking concerns, lost cards, etc.).
- Dr. Null requested that this data be shared with assistant superintendents and principals, noting that principals are competitive and seeing campus-level comparisons could help motivate improvement.
2023–2024 Audit Plan (In Progress)
Audits planned for the current year:
1. Activity Funds — one already completed
2. Payroll Audit — in final week of field work; focused on process, controls, segregation of duties, and flow-charting all processes for future reference. Last payroll audit was 3 years ago. A new payroll director (Chase) is also in place.
3. Accounts Payable — including a review of the travel card program
4. Cybersecurity Risk Assessment — Weaver engagement; kickoff meeting scheduled for January 11, 2024, with field work starting January 15, 2024
5. Field Trip expenditures (~$1 million/year)
6. Hometown Athletic Ticketing System — will have been in use for a year
7. Child Nutrition follow-up
8. Band Inventory — high schools in May, all others in November
9. Maintenance follow-up
10. Annual PEIMS attendance review
11. Construction Audit
12. Print Shop (lowest priority; will be completed if time permits)
Notable Discussion — Travel Cards:
- The district historically was "very anti-credit card" and had only 3 district credit cards for emergencies.
- As hotels increasingly refuse checks, the district implemented pre-loaded travel cards with merchant category code restrictions (cards only work at the designated hotel).
- Cards are checked out by employees, loaded with the specific PO amount, and returned with receipts after travel.
- Cards can be adjusted remotely in real time if needed and deactivated immediately if lost.
- The district has approximately 100 cards stored but they carry zero balances until activated for specific travel.
- The program started with student travel in spring 2023 and expanded to all employee travel as of September 1, 2023.
- The district does not use P-cards (purchasing cards). Maintenance and other departments use internal purchase orders for procurement.
Item 4: Potential Independent Program Analysis of Planning & Construction
Dr. Null presented a proposal to engage an independent industry expert to evaluate the Planning & Construction Department's front-end processes ahead of the potential new bond program (~$1.6–$1.8 billion in construction work).
Background:
- Community members during the 2019 bond cycle asked how the district ensures it gets the best prices.
- Previous backend audits have confirmed the district gets what it pays for; this initiative focuses on the front end — procurement, guaranteed maximum pricing, contracting, and organizational structure.
Proposed Scope:
- Organizational structure and staffing adequacy
- Procurement methods and bidding processes
- Interview/selection processes for contractors and architects
- Oversight of contractors and architects
- Project management practices
- Construction standards
- Compliance with applicable law
- Financial processes on the back end
Key Details:
- Kyle Holland, President/CEO of the Associated General Contractors of America (Houston Chapter), helped identify a potential consultant — a former school district P&C leader (~15 years experience) now working as a consultant evaluating such programs.
- The consultant would report directly to the Audit Committee to maintain independence.
- No contract has been signed yet; the committee was asked for feedback.
- Mr. Foster (head of P&C) is reportedly supportive and sees it as an opportunity for improvement.
Committee Discussion:
- Trustee Chase emphasized interest in the exact scope of work, the consultant's evaluation expertise, and how "best value" is defined (not just cheapest price, but also risk transfer).
- Noted the district already uses Construction Manager at Risk (CMAR) as its default construction method.
- Raised concern about Key Personnel Risk — the district is lean, and much institutional knowledge exists only in individuals' heads, which creates risk, especially with scaling up.
- Dr. Null committed to sharing the proposed scope of work with Trustee Chase for review.
No vote taken (informational item).
Item 5: Investment Review and Results Update
Presented by Cara (Finance staff).
Investment Strategy
- Operating funds invested in: State pools, WoodForest National Bank, commercial paper, and short-term government securities (≤1 year maturity)
- $50 million of unassigned fund balance managed by TCG Investment Advisors in a 36-month investment ladder
General Fund Portfolio Composition (as of 8/31/2023)
| Category | Amount | % of Portfolio |
|---|---|---|
| Agency Securities | $16.6M | 8.91% |
| Money Market (WoodForest) | $76.3M | (significant increase due to new depository contract: 90-day T-Bill + 25 basis points) |
| Municipal Bonds | $5.1M | 2.74% |
| State Pools | $56.5M | 30.25% |
| Treasury Securities | $32.2M | 17.25% |
| Total General Fund Par Value | $186.99M | |
Interest Revenue (5-Year Trend)
- FY 2022: $1.47 million
- FY 2023: $11.4 million (significant increase due to rising interest rates)
Combined Portfolio (All Funds, as of 8/31/2023)
- Total par value: $433.92 million
- Largest holdings: State pools ($32.9M noted, though this may reflect a transcript discrepancy with the general fund figure), Treasury securities ($32.2M), agencies ($16.6M), money market ($76.5M), municipal bonds ($5.1M)
- Combined portfolio yield: 5.11%
- Benchmark (90-day T-Bill): 5.29%
Benchmark Analysis
- The portfolio has been playing "catch-up" to the 90-day T-Bill benchmark following 11 Fed rate increases since March 2022.
- State pools take approximately 60–90 days to adjust to rate increases.
- The gap between portfolio yield and benchmark has been narrowing.
Item 6: Conroe ISD Investment Policy
Unable to vote due to lack of quorum. Information was received.
- The following items will be brought to the full board meeting the following Tuesday for approval:
1. Annual approval of the Local Investment Policy (no changes recommended)
2. List of designated investment officers
3. Sources of instruction for required 8 hours of investment training every 2 years
4. List of approved brokers/dealers
Item 7: Proposed Meeting Dates for 2023–2024
Proposed dates:
- January 10, 2024
- May 8, 2024
Both dates were agreed upon by members present. No formal vote was required; dates are already on the district calendar.
Adjournment
The meeting adjourned at 8:31 a.m.
These are unofficial notes based on an auto-generated transcript and may contain inaccuracies. For official minutes, please refer to the approved minutes published by Conroe ISD.