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Payroll system switch shortchanges hundreds of teachers, leads to finger-pointing by state and local officials

[1]
Bobbie Cavnar in 2018 interview with NC Policy Watch. (Photo: Clayton Henkel)

State lawmakers aware of the erroneous deductions in March

Bobbie Cavnar, a Gaston County Schools high school English teacher, was shocked last month when his paystub showed $1,600 worth of unexplained deductions.

Fortunately for the 2016-17 North Carolina Teacher of the Year [2], his spouse works, and the couple could transfer money from savings to cover monthly bills.

Dipping into savings to pay bills isn’t something the Cavnars like to do, but both felt lucky to have extra money available to cover the errant deductions.

“We didn’t have to default on anything but there are plenty of teachers who could not weather a month without pay or a $1,500 deduction,” Cavnar said. “We’ve heard stories from teachers who’ve had to help each other out by buying things like grocery gift cards and things like that to kind of weather through.”

At least one Gaston County teacher quit her job because of payroll issues.

After the discovery of the erroneous deduction in his pay, Cavnar contacted the school district about the missing money. District officials could not explain why he was charged the two deductions, one totaling more than $1,500 and another of more than $80.

“I said what are these?” Cavnar said. “They said, ‘We don’t know. The system did something crazy and we’ll put it back.’”

The attempt to replace the missing money resulted in more errors.

“They tried to put it back the next week, then there were two more deductions for $400 out of that payment, and no one knew why. I tried to reach out to the county again and I have not received any response from that one.”

Cavnar was one of the hundreds of Gaston County teachers who didn’t receive timely direct deposits or were underpaid or overcharged for payroll deductions after the district switched to a new modern payroll system in January.

Gaston County Schools explained the payroll errors in a statement to media outlets that read in part:

In the business world, an employee is typically hired to do one job and is paid for working that one job. In a school system, one employee may have two or three jobs. For example, an employee’s primary job is a teacher, but that employee is also a coach and a bus driver. Oracle recognizes the employee as a teacher and pays that employee as a teacher; however, we have encountered issues with the system not recognizing that the teacher also has to be paid as a coach and a bus driver. This factor has contributed to the issues that we have experienced.”

Gaston and New Hanover county schools were the first districts among 10 scheduled to pilot the new systems managed by Cherry Road Technologies and Oracle (Gaston) and Tyler Technologies for Munis (New Hanover).

The “modern” systems were mandated by the General Assembly in 2016 with the passage of the School Business Systems Modernization (SBSM) law intended to help districts replace “discontinued and obsolete” systems such as IBM’s AS/400. Eventually, all 115 school districts are expected to upgrade systems for managing financial and payroll information, human resources information and capital and repairs and renovations planning information.

Union, Charlotte-Mecklenburg, Craven, Swain, Cumberland, Macon and Guilford schools and Triangle Math and Science Academy, a Cary charter school, were scheduled to join the Gaston and New Hanover school districts by launching pilots between August 2021 and January 2022, according to an SBSM update presented to the State Board of Education in August 2021. [3]

Gaston County Schools changed over to the new system in January. Its original “go-live” date was scheduled for July 1, 2021. New Hanover County Schools was also scheduled to go live that day and did so.

Most school districts scheduled to “go live” during the period between August 2021 and January 2022 did not make the switch after Gaston began to experience substantial problems.

[4]
NCDPI spokeswoman Blair Rhoades

“NCDPI (N.C. Department of Public Instruction) put a pause on go-lives in March in order to establish new governance and reset expectations,” NCDPI spokeswoman Blair Rhoades said in an email response to questions about pilot districts. “All remaining pilots/new pilots are on hold while we reset.”

Rhoades told Policy Watch that NCDPI has worked to help Gaston County School resolve its issues with additional support and training beyond that offered by the vendor.

New Hanover went live using the MUNIS platform, Rhoades said, and “experienced some hiccups” adjusting to a new system. The vendor also had to adjust to doing business in North Carolina, she said.

“NCDPI worked with the district and the vendor to outline necessary functional changes and the vendor continues to develop and implement those product enhancements systematically,” Rhoades said.

[5]
Rep. Kelly Hastings, R-Gaston

She added that districts in Swain and Union counties have partially launched with Tyler MUNIS, but the changeover does not include system changes to manage data for payroll or human resources.

“Swain and the vendor are working through a new ten-page Pre-Go-Live Checklist implemented by NCDPI in June before a possible 2023 payroll go-live following multiple months of full parallel payroll testing,” Rhoades said in the email.

In recent days, State Rep. Kelly Hastings, R-Gaston, has questioned Gaston County Schools’ decision to transition to the new system, taking to Facebook to contend that the district did so after being advised by NCDPI to delay switching to the Oracle system.

Hastings said he’s received hundreds of messages about the “payroll issue” in Gaston County. Many of them blame the General Assembly for the problem, although NCDPI advised the school district in January to not go live with the new system.

Lawmakers started hearing about the payroll problems in Gaston in February and March, Hastings said.

“We discussed with [NC] DPI and learned that Gaston County had chosen to go live with their new payroll program in January against the recommendations of both [NC]DPI and the vendor,” Hastings wrote. “Since then, [NC] DPI has taken a more active role in monitoring the implementation and requiring the LEAs (school districts) and vendors to complete a go-live checklist before they are allowed to do such.”

Hastings also shared email with the Gaston Gazette this week in which Stephen Bailey, a fiscal analyst in the Fiscal Research Division, told Hastings that Vanessa Wrenn, NCDPI’s chief information officer, sent the division an email stating that “Gaston was advised by DPI not to go live.”

Hastings’ office did not return calls from Policy Watch seeking copies of the email. Gaston County Schools spokesman Todd Hagans also did not return calls requesting comment.

Meanwhile, Cavnar said the finger-pointing between state officials and local officials over the payroll fiasco hasn’t been helpful.

“We don’t know who to believe, and in the meantime, we’re still not having our retirement pay or 401K withdrawals or paychecks correct,” Cavnar said. “It causes a lot of stress for people living paycheck to paycheck to never know if I’ll be the next one to not get paid, and can I weather that.”