Auditor’s departure leaves probe of construction costs in limbo


The internal auditor’s office at the Dallas school district was prepared to launch a deeper dive into alleged overbilling on construction projects before its chief, Steven Martin, stepped down in February.

Now that effort which had preliminarily found up to $285,000 in overbilling on nine projects, appears to have stalled, even after the school board’s audit committee encouraged Martin to push forward with it. But Martin stepped down before the audits were completed. The status of the inquiries is unknown.

Alan King, who served as chief internal auditor at the district in 2013, is Martin’s temporary replacement. He did not return a call seeking comment for this story.

Martin and his auditing team reported late last year that the district had been overbilled for a total of $334,000 on construction contracts at Tom C. Gooch Elementary School and the Paul L. Dunbar Learning Center. The contracts together were worth $1.2 million.

However, those audits were disputed by several trustees and the district’s administration and have been taken down off the district’s website.

“The audits were removed by the Internal Audit department,” Dallas school district spokeswoman Robyn Harris said in an email. “The Internal Audit department currently has a team of auditors reviewing these audits.“

She said the team “includes the staff members who were responsible for most of the audit work surrounding Dunbar and Gooch so that appropriate findings can be re-addressed and submitted to the audit committee upon completion.”

At a meeting of the district’s audit committee in November, trustee Dustin Marshall congratulated Martin on focusing on contracting issues. He asked if there was a remedy for the overbilling.

“We’ve issued and you’ve finalized two audit reports, Dunbar, and Gooch, “ Martin said. “And neither of those contractors have indicated to me that they are going to refund the district.”

Martin resigned after the school board called for a peer review of his department’s work.  He did not return a phone call seeking comment.

Numerous other audits completed under Martin, who was hired in early 2019, remain on the website. Those audits, though, were not disputed by the district’s administration.

They include reviews of student activity funds, grant spending, purchases at several schools and spending on temporary service workers. Some of the audits found misspending, and the administration agreed with the findings.

The Gooch and Dunbar audits were by far the most damaging. Those reports were approved by both the audit committee and the school board, but the administration disagreed with almost every finding in them.  

Removal of the disputed audits came as district administrators and board members prepare a multimillion-dollar bond offering to voters in November. 

Following the two audits from Martin and his staff, district administrators pushed back. After disputing the audits in published remarks, the officials, including Superintendent Michael Hinojosa and Scott Layne, the district’s chief operating officer, began work on a series of policy changes that some board members said will reduce the authority of the internal audit department. While at least one of the proposed changes was dropped after board members disagreed over it, trustees earlier this month approved changes to the procurement process that one board member said would give the administration more control of contracts.

The school district has a history of trouble in its procurement and contracting dating back to the mid-2000s, when a financial audit found numerous problems, including poor internal controls, meager fraud detection programs and a pattern of failure by district leaders to fix problems found in financial reviews.

Steve Miller can be reached at [email protected]. 


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