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Hanretty must pay Woodside School District $2.67 million for misappropriation

Original post made on Sep 11, 2013

Tim Hanretty, the former superintendent of the Portola Valley School District now serving a two-year prison term for embezzlement from that district and other financial crimes, must pay the Woodside Elementary School District about $2.67 million in restitution, a judge has ruled.

Read the full story here Web Link posted Wednesday, September 11, 2013, 11:00 AM

Comments (14)

Posted by Trish
a resident of Woodside School
on Sep 11, 2013 at 4:09 pm

why are none of the other district officials who were there at the time being investigated? Do you really think he could have done this all alone? Were others covering this up? Or just too stupid to know what he was doing? So many questions...

Posted by Menlo Voter
a resident of Menlo Park: other
on Sep 11, 2013 at 7:19 pm

Stupid? No. Not paying attention or applying appropriate financial controls, yes. Hanretty could not have done what he did without inadequate supervision and financial controls. That does not rise to the level of malfeasance on the part of the board. Misfeasance, yes, but that doesn't rise to the level of criminal behavior.

Posted by not Trish
a resident of Woodside School
on Sep 12, 2013 at 1:52 pm

Hanretty testified that his actions were known and approved by his supervisor in Woodside who unfortunately died a few years back.. Not sure how you prove or disprove this

Posted by A WES Neighbor
a resident of Woodside School
on Sep 12, 2013 at 4:07 pm

Trish, do you have a reference that Hanretty implicated anybody other than himself?

I have not heard that nor does it seem very likely to me to be the case based on the albeit limited information that I know of the case. I do know that what Tim Hanretty did was pretty sophisticated and it involved altering the board notarized loan document to increase the loan amount and duration but did not so substantially change the loan payment amount. Covering his tracks required essentially maintaining a double book accounting scheme to be able to present one set of information to the board and another to the auditors.

Routine audits did not uncover the discrepancy and it only came to light because of the WES board diligently following through with the school's new financial officer to completely understand the school's level of indebtedness.

Posted by Trish
a resident of Woodside School
on Sep 12, 2013 at 8:23 pm

not Trish - I understood the former boss is now in Los Gatos...not dead.

WES neighbor - I don't have any reference or info on him implicating anyone else...I was questioning how this could occur given the oversight of a boss and a board. As the case unfolded, I was surprised how long he was able to keep it under wraps. Shouldn't the Superintendent be signing these documents too? The process that had only one signature required, no matter who it was, seems flawed at best.

Posted by A WES Neighbor
a resident of Woodside School
on Sep 13, 2013 at 2:26 am

@Trish - Sorry, my inquiry about a reference was directed to "not Trish"
(that "not" was "not" helpful ;-))

Fwiw, Dan Vinson was the WES Superintendent through construction completion of the new classroom and office space on campus which opened January 2008.

Dr. Vinson retired in June 2008 citing some health concerns. He passed away October 2009. The Superintendent that followed Dr Vinson was recruited away by Los Gatos last year. The current superintendent has had uniformly glowing feedback from everything I've heard.

As I understand it, the notarized loan document carried multiple signatures including the Superintendent, School Board President, and possibly Mr Hanretty's as Financial Officer. But the modifications by Mr. Hanretty occurred after the signatures were affixed (but prior to submission) which turned a $.6M loan into a $2.6M loan.

Posted by Vicki
a resident of another community
on Sep 13, 2013 at 10:57 pm

As I understand it from friends in Saratoga, Los Gatos would gladly give Abbati back if you want her.

Posted by wonder
a resident of Woodside: other
on Sep 14, 2013 at 2:10 pm

Did Woodside pay 2.6 million for improvements they underestimated by almost 80 percent or;
did the district make an extra two million dollars worth of improvements to a single school without anyone noticing?
If the school received an extra two million in unanticipated improvements, how could that be overlooked?

Posted by A WES Neighbor
a resident of Woodside School
on Sep 15, 2013 at 1:53 am

As I understand it (and my understanding is very much second hand), Mr Hanretty misrepresented his success with bringing the construction project in at close to budget. Owing to a significant number of late change orders, he presented the facts as though he was operating 5% over budget when he was actually 20% over budget.

The improvement list was as anticipated by the board, but the budget for the work did not jive with reality. I am unclear exactly how and why this came to be though it should probably be noted that a forensic audit was ultimately undertaken and the construction contractor was not in any way implicated in the scheme.

Posted by ndnorth
a resident of another community
on Sep 16, 2013 at 7:24 pm

Please help me to understand if Hanretty benefitted from the 2.6 million or was it the school district that now has capital improvements reflecting that amount. If that is the case non withstanding the rightousness of the fraud conviction, he shouldn't have to pay the 2.6 million for what is a benefit to the district. So, what was the disposition of the loan amount?

Posted by Mike Keenly
a resident of Menlo Park: Allied Arts/Stanford Park
on Sep 17, 2013 at 3:14 pm

All the numbers are in the original article:

"According to District Attorney Steve Wagstaffe's report on the ruling, the court calculated the restitution total on the following: $1.968 million, which is the difference in principal on the actual loan amount and the amount that was authorized; $856,553, which accounts for the difference in the interest rate on a loan for the authorized $632,000 and a loan for $2.6 million, after the school district's attorney "renegotiated the interest to reduce it by $700,000"; $76,220 in attorney fees; and $35,788 in forensic audit fees."

Hanretty pled guilty and must now pay the restitution.

Posted by PV Resident
a resident of Portola Valley: Central Portola Valley
on Sep 19, 2013 at 7:26 am

As I understand it, Tim Hanretty falsified the loan documents after they original amount had already been signed off. This came to light when the Board found that Woodside was suddenly running quite a debt, after the project had been successfully finished, and they couldn't figure out where it had come from.

How they managed to overlook the fact that a gorgeous remodel had been done on only $900,000 +/-, I have no idea.

Tim did steal AT LEAST $120,000 from the PV School District----all of us who live here and have done any sort of home remodel realize that it had to have been at least 1/3 more than that, in order to have done what he did to his house (as well as sport a new car, etc).

The most recent article quotes him as saying that he stole from the PV District because he was "bitter and angry that The Board didn't take better care of him." That is narcissism and entitlement at its best--defending stealing from children in order to finance your own lifestyle betterment.

I feel terribly sorry for his partner, who is a very nice man, and who deserves better.

Posted by A WES Neighbor
a resident of Woodside School
on Sep 19, 2013 at 2:40 pm

> How they managed to overlook the fact that a gorgeous remodel had been done on only $900,000 +/-, I have no idea.

The entirety of the project was budgeted to cost $13.3M. The board was presented with a $.6M overage for which the loan was approved, but the project turns out to ostensibly have been $2.6M over budget.

As I understand it, the discovery came to light in late 2011 when the board asked the district's new financial officer to review the state of the district indebtedness and a board member inquired about the unexpected amount presented.

I have reviewed the district's 2008 audit report, which is the first audit which would have shown the November 2007 loan, and the amount is clearly documented as $2.6M towards a $15.492M modernization project on page 38. Oopsy.

Posted by A WES Neighbor
a resident of Woodside School
on Sep 19, 2013 at 2:44 pm

Sorry, page 37 for those that care about this kind of stuff.

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