Actions of McKay's supervisor questioned

Larry McKay's supervisor at the Clark County School District had concerns about McKay being the district's athletic director and the manager of a private basketball tournament, but the supervisor did not share those concerns with anyone, a transcript of grand jury testimony showed.

That prompted one of the grand jurors to ask why the supervisor didn't act on those concerns, to look out for the best interests of the district and taxpayers, but the prosecutor in charge of the grand jury proceeding shut that line of questioning down.

McKay is scheduled to stand trial Sept. 6 on four counts of felony theft for allegedly misappropriating $94,147 in school district funds. Prosecutors allege that McKay used monies from the district's athletics budget to pay Clark County School District Police officers to serve as security at the annual Holiday Prep Classic basketball tournament. McKay founded the tournament, which was co-sponsored by the district, and served as its director.

McKay was also involved in the Big Time summer basketball tournament, which was held in school gyms during the summer but was not affiliated with the district. During an audit of the district's summer utility bills, questions were raised as to why the district was paying to keep the gyms open for the private tournament. That led to closer scrutiny of McKay's involvement and an internal audit of the athletic department's operations.

Stephen Augspurger, who was an area superintendent prior to the district's reorganization in 2001, was responsible for overseeing McKay and wrote his annual performance evaluation. Augspurger testified March 3 before a grand jury that he had concerns about McKay's involvement in the Big Time basketball tournament.

"Did you ever communicate them to Mr. McKay?" asked Chief Deputy District Attorney Eric Jorgenson.

"No, I did not," Augspurger replied.

Augspurger also told the grand jury that he was never asked by McKay to authorize the use of district funds for a non-district event such as a private basketball tournament, nor would he have approved such a request had it been made.

Later in his testimony a member of the grand jury pressed Augspurger on why he did not report his concerns.

"Why wouldn't you, if you had concerns and you had the school district's interest at stake because you were employed by the school district, why wouldn't you have said anything?" the juror asked.

Jorgenson interceded and said he did not believe the question was appropriate, according to the transcript. After a brief exchange with Augspurger off the record, the testimony resumed and the question was never answered.

Jorgenson explained the exchange Wednesday, saying he objected to the question because it wasn't relevant to the proceedings.

"Asking why a witness did a particular thing is irrelevant to whether there was sufficient evidence to indict Mr. McKay," Jorgenson said.

Augspurger, who is now executive director of the Clark County Association of School Administrators, declined to discuss his grand jury testimony Wednesday.

"I'm going to wait until this thing (McKay's criminal trial) unfolds," Augspurger said. "I will answer questions at the appropriate time."

McKay's former athletic department secretary, Edith Whitehead, told the grand jury that she collected overtime slips from school police officers who worked athletic events and turned them over to the district's accounting department.

The same overtime slips were collected for both district-sponsored events and for non-district events, Whitehead said. In the case of non-district events Whitehead said she sometimes sent invoices to the outside sponsors for reimbursement for security, but not always.

Whitehead, who worked for 20 years as a school district support employee and followed McKay from Valley High School when was named athletic director in 1997, said she never questioned the invoicing methods her boss used.

"You have to know I just trusted Larry McKay," Whitehead testified. "After the fact now, but at the time I trusted him that he knew what he was doing."

Other grand jury testimony included Carmen Monica Robles, an internal auditor for the district, who conducted the initial investigation.

"He (McKay) assured me that he had the financial information that I would need to conduct my audit and that he was very good with numbers because he had been a math teacher," Robles said.

McKay, who retired after 30 years with the district in June 2003, currently teaches math at Odyssey Charter School.

McKay's attorney, Bill Terry, is expected to ask that two of the theft charges be dropped on the grounds that they are alleged to have occurred in 1998 and the statute of limitations on theft is four years.

An audit of McKay's handling of the Holiday Prep Classic basketball tournament, authorized by Clark County Schools Superintendent Carlos Garcia in January 2003, was completed that fall. Clark County School District investigators then spent the better part of a year looking into McKay's activities before turning over their findings to the District Attorney for review. McKay was arrested in August.

Some critics had accused the district of dragging its feet in the investigation and not taking action promptly when concerns were first raised by a whistleblower in the fall of 2002. Garcia could not be reached for comment Wednesday but in prior interviews with the Sun he said the district took action as quickly as possible.

Clark County School Board member Shirley Barber said she was disappointed to learn that some of the charges against McKay could potentially be dismissed because too much time has passed.

"This whole matter should have been taken care of a long, long time ago," Barber said.