The Amarillo College Board of Regents received detailed findings Tuesday evening, Feb. 24, from a forensic audit examining financial activity tied to the college’s 2019 bond program and related construction projects.
The audit, conducted by national accounting firm Weaver, reviewed financial records spanning from 2019 through 2025. Regents heard directly from auditors during the meeting as they walked through the scope of their work and the conclusions drawn from months of analysis.
Key Findings: Funds Accounted For, Oversight Gaps Identified
According to the audit, all institutional funds were accounted for, and investigators found no evidence of missing money or payments made to unknown vendors.
However, the report highlighted significant concerns regarding oversight and communication tied to the bond-funded construction program.
Among the primary findings:
Bond program projects ultimately cost more than originally anticipated.
The scope of several construction initiatives expanded over time.
Construction management costs increased beyond expectations.
A key contract tied to the Master Program Plan Manager was renegotiated and increased without approval from the Board of Regents.
These cost increases and scope expansions were not adequately communicated to the board.
Much of the additional expense was paid using the college’s unrestricted funds.
The use of those unrestricted funds was not reported to the board in a timely or sufficient manner.
Board Chairman Jay Barrett said the meeting allowed regents to better understand both the audit process and its implications.
“What I think we discovered at tonight’s meeting was, we heard directly from the auditors themselves, and we were able to go through the process with them and how they saw things, and really we were able as individual board members, as individual regents, asked questions and then as a board, we were able to collectively come together a say we were glad we did this audit, but there are things we still need to do to find out,” Barrett said.
He added that one consistent issue raised by auditors involved actions taken without formal board approval.
“One thing that came through was over and over again, things that happened without board approval, and they said, specifically, there is policy in place that says that things that happened must have had board approval for them to be legitimate, and that just didn’t occur,” Barrett said.
Bond Program Background
Voters approved a bond package in 2019 totaling nearly $90 million to fund campus improvements and new facilities.
By October 2025, college leadership identified a shortfall of approximately $2.3 million needed to complete remaining projects. At that time, Amarillo College President Jamelle Conner proposed opening a $5 million line of credit with Amarillo National Bank to bridge the funding gap.
That proposal coincided with the decision to initiate an investigation into project spending and financial controls. The forensic audit was formally commissioned through outside legal counsel.
Scope of the Audit
Weaver’s forensic review included:
Analysis of bank and investment account activity
Review of monthly financial reports submitted to the Board of Regents
Reconciliation of reports with underlying financial records
Examination of bond expenditures tied to master plan construction projects
Review of email communications belonging to former Vice President of Business Affairs Chris Sharp
Auditors ultimately determined that although funds were properly accounted for, decision-making and reporting processes did not consistently align with governance policies.
Contract Changes and Vendor Payments
A central focus of the audit involved payments to contractor Danny K. Smith, who served as Master Plan Program Manager.
According to the findings:
Smith’s payments increased significantly over time.
His compensation rose from $88,994 in 2020 to $154,046 in 2021.
Payments reached $174,145 in 2022.
By 2024, they climbed to $350,397.
In 2025, payments totaled $358,580 after peaking at $502,908 earlier.
Total payments amounted to approximately $1.66 million.
Auditors found that Amarillo College paid roughly $1.68 million to Smith during the contract period — nearly $760,000 more than the amount originally authorized by the board.
While the initial contract terms received board approval, subsequent amendments appeared to have been renegotiated between Smith and Sharp without being presented to regents.
In one example cited in the audit, Smith emailed Sharp requesting a fee increase due to the “level of work performed being more involved.” Although Sharp asked for an estimate of the increase, the matter was not shared with the board.
Project Cost Growth
Auditors also detailed substantial cost growth across several projects within the master plan.
Examples included:
The Innovation Hub increased from approximately $6.3 million to more than $15.5 million.
The Carter Fitness Center renovation rose from about $5.8 million to over $12.6 million.
The First Responder Training Facility expanded from an estimated $8.6 million to more than $22.7 million after being relocated.
Auditors described these developments as indicative of limited transparency, particularly regarding the use of unrestricted funds.
“It showed a lack of transparency,” said auditors Travis Casner and Blake Bogden, referring to expenses drawn from unrestricted funds.
Governance and Communication Challenges
The audit further revealed that:
The board stopped receiving reports on reserve funding during the same timeframe.
There was no Guaranteed Maximum Price (GMP) structure in place to cap project costs.
Amarillo College did not maintain an internal audit function.
Auditors noted that internal auditing and GMP frameworks are commonly used to control project spending and may have mitigated some of the cost escalation.
Barrett acknowledged that detecting such issues through routine oversight would have been difficult.
“The auditors even said this would be impossible for us to catch,” he said. “We would have had one board member just sit there and look at line by line by line, every single thing, and that’s why we hire people to do that. We trust people and put them in places of responsibility and accountability to do that for us, to give us those reports each month, that just did not happen.”
Steps Toward Future Controls
During the meeting, regents discussed measures to strengthen financial oversight moving forward.
Barrett said the board plans to hold a special meeting to begin developing safeguards to prevent similar issues.
“One thing you heard in there and we already started talking about was perhaps getting an internal auditor, some sort of audit function that reports directly to the board, so we don’t have this happen again,” he said.
President Conner outlined procedural changes already implemented:
“We have been reviewing our procedures and our systems as it relates to our software for our financials,” she said.
Among the immediate changes:
Multiple approvals are now required before any changes to certificates of deposit.
Weekly cash reports are being delivered to the president.
Expenditures exceeding $5,000 are now tracked in regular reports.
Conner said these measures are intended to improve visibility into cash flow and spending.
Possible Legal Considerations
Regents also discussed whether legal action may be warranted.
Amarillo College Executive Vice President and General Counsel Mark White indicated the board would need to review its options.
“We want to pursue anything that our attorneys, that our legal counsel, says we need to do, we are going to weigh our options,” Barrett said. “There are costs to everything, so we have to figure out is this something we need to pursue as a legal matter; we will just have to decide that as a board.”
At one point in the meeting, a board member asked auditors whether the situation could warrant charges. Auditors responded affirmatively, though no decisions have been made.
Timeline of Funding
The audit noted that bond funds were fully exhausted between May and June 2025.
Much of the subsequent financial activity involved online transfers rather than traditional check payments, according to findings presented to the board.
Auditors also recommended moving toward a flat monthly payment model for project management services instead of percentage-based compensation tied to contractor invoices.
Next Steps
While the audit did not identify missing funds, it raised ongoing questions about communication, governance processes, and financial oversight.
Regents formally approved the audit findings during Tuesday’s meeting and agreed to schedule a special session to determine potential policy changes and other actions.
As discussions continue, college leadership and trustees are expected to focus on strengthening internal controls and clarifying reporting structures tied to future capital projects.
