Mr. Hanretty, the former Portola Valley School District Superintendent and Woodside Elementary School District finance officer, pleaded no contest to six felony charges of embezzlement and misappropriating public funds in both school districts in July of 2012 and was sentenced to two years in prison the following October.
In Woodside he was accused of forging documents that allowed a loan of up to $3 million to be made to the district, despite the fact that the school board had approved borrowing only $632,000. He eventually obtained a loan of $2.6 million, which district officials say was spent on school projects. He changed the loan terms from a 10-year payback to a 21-year payback.
In Portola Valley further investigation found Mr. Hanretty had turned in $100,926 in invoices for work on his own home, to be paid by the district's solar panel fund.
Beth Polito, superintendent of the Woodside Elementary School District, said the district learned from the district's county counsel, John Nibbelin, that Mr. Hanretty had been released from prison. The district has asked Mr. Hanretty's probation officer to have him "steer clear of us because it's awkward and uncomfortable," Superintendent Polito said.
In September Mr. Hanretty had been ordered to repay the Woodside district about $2.67 million to reimburse the cost of the loan he had fraudulently obtained, plus interest costs and the costs involved with uncovering the crime.
That total — nearly $2.937 million — was reduced to reflect $20,000 Mr. Hanretty has already paid toward restitution and $250,000 from insurance payments to the district.
Mr. Markowitz had argued that the Woodside district had benefited from all the loan proceeds, and had fought the district's attempt for restitution based on an unauthorized debt that it was saddled with. The district sought about $3.63 million in restitution.
Superintendent Polito said the district realizes there are "substantial obstacles to any significant recovery of the restitution," but they are working with the probation department to try to get as much as possible repaid to the district. Superintendent Polito emphasized that the district is not in financial trouble and should "be able to meet all of their financial obligations in the current year and in all future years."
Mr. Hanretty had already been ordered to reimburse the Portola Valley School District for the money spent on his home, plus associated costs of investigating the theft for a total of nearly $182,000. By September he had repaid almost $121,000, according to Karen Lucian, the district's administrative coordinator.
The misappropriation of public money was first discovered in 2011 when a Woodside school board member questioned the amount of debt service the district was paying.
After investigation uncovered the dubious loan, Mr. Hanretty resigned in January as the Portola Valley district superintendent, a job he began in August 2010. Before that, he had served as chief business officer of both districts.
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