The Ventura County Office of Education broke state law regarding employee pay and benefits dozens of times over the past five years, according to a forensic audit commissioned by the elected board that oversees the agency.
The audit report was prepared by national accounting firm Weaver and presented to the Ventura County Board of Education on Oct. 15. The board ordered the investigation into the office's finances in response to public admissions by César Morales, Ventura County’s elected superintendent of schools, that he had paid himself an unauthorized bonus and given his top deputies unauthorized benefits.
State law requires board approval for any increases to a county superintendent’s salary or any increases to the retirement benefits of
any employee. The board was never notified of a $15,750 bonus Morales paid himself in 2024 or new contracts that gave lifetime health benefits to five top-level employees of his office, starting in 2023.
Morales paid back the bonus and canceled the lifetime health benefits in May, after their existence was disclosed in public records released to The Star and to a local political blogger named Jess Weihe, who writes as "Anonymous Mommy."
Weaver's forensic audit confirms those apparent violations. It also found that Morales and the office’s top finance executive appear to have repeatedly violated a different provision of the California Education Code when they gave 16 separate salary increases and eight one-time bonuses of more than $10,000 each to the office’s top management employees.
State law requires that the Board of Education be notified any time any employee’s pay is increased by $10,000 or more. According to the Weaver report, between 2021 and 2025, six Office of Education employees each received multiple raises in excess of $10,000, adding up to $375,000 in total undisclosed raises. The report also lists nine one-time bonuses that exceeded $10,000 and were not reported to the board, adding up to about $114,000 in undisclosed bonuses.
After hearing a presentation on Oct. 15 from Travis Casner, a partner at Weaver who led the forensic audit, the board voted to send a letter to Ventura County District Attorney Erik Nasarenko asking him to investigate possible legal violations described in the report.
The district attorney's office has received the report and submitted it to its public integrity unit for review, said Joey Buttitta, a spokesperson for the office.
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Morales did not attend the meeting because he is on a previously scheduled vacation, said Dave Schermer, the office's chief spokesperson. Schermer provided a written statement from Morales regarding the report's findings.
“I appreciate the thorough work of the auditors and will carefully consider the recommendations in their report as we work to maximize transparency and rebuild trust," Morales' statement said. "As noted by the auditors, the VCOE fiscal team was instrumental in providing the records that supported the findings, and I want to thank them for their diligent efforts.”
Casner told the board that when he interviewed Morales and his deputies as part of the audit, they said they were unaware they had been violating the state Education Code.
“There are only a handful of Ed Code provisions that are specific to county offices of education," Casner said. "We can't speak to whether they were or were not aware, but based on their positions, they should have been.”
'Don't put things in writing'
The 64-page report was based on interviews with 18 people, including current and former employees and reviews of thousands of documents and financial records going back about five years.
The office's current interim head of finance was "very responsive" and gave Weaver all the documents the firm asked for, Casner said. But it was sometimes difficult for the forensic audit team to figure out the process behind decisions by Morales and Misty Key, who until recently was the office's assistant superintendent for fiscal and administrative services.
According to the report, Key and Morales "discouraged VCOE employees from using email to discuss or authorize certain decisions, as evidenced by the use of handwritten sticky notes by VCOE staff to document verbal directives from leadership."
"Numerous employees spoke to the culture of ‘don’t put things in writing, don’t put it in an email,'" Casner told the board.
"That shocked me, that it was discouraged to write things down, that they didn't want written proof," said Trustee Michael Teasdale, who represents the Conejo Valley area on the Ventura County Board of Education.
One example of a poorly documented decision, according to the forensic audit, was the choice to pay "off-schedule" bonuses to Morales and the five members of his cabinet who hold associate superintendent, assistant superintendent or deputy superintendent titles.
The Office of Education had promised its employee unions in their 2022 contracts that union members would get one-time bonuses if the office had a budget surplus. The office typically extended those bonuses to non-union employees as well. But there was no clear policy about whether the executives at the very top of the organizational chart would get the bonuses.
In December 2022, the employees all got bonuses equal to 4% of their annual salary. The same bonus went to Morales' top cabinet members, but not to Morales himself.
The next year, the employees got another 4% bonus. This time, the cabinet members did not get the extra pay.
Then in 2024, the employees got a bonus of 5%. It was also paid to the five top cabinet members and to Morales, who got $15,750 and returned it 18 months later.
The decisions about who got the one-time payments were made by Key and relayed to the payroll department verbally or with handwritten notes, employees told the auditors from Weaver. The only written record of those decisions described in the audit report was a handwritten note made by a payroll manager in 2024, stating that Key said to include top management in the payments.
The Weaver report states that "it is our understanding" that prior to 2022, top managers were not included in one-time payments negotiated with labor unions. But the forensic audit did not examine records from before Morales became superintendent in 2021.
After Casner's report to the board, the trustees voted to ask him for an addendum to the report that addresses how employee raises and bonuses were handled going back to 2006.
The decision to give five top managers new contracts that included lifetime health coverage for them and their spouses had a similar lack of documentation. The first four managers got their new contracts in 2023, while the fifth was awarded in 2024 after the employee was promoted to an assistant superintendent position.
In each case, the provision for lifetime health insurance was added at Morales' direction, the Weaver report states. Only Morales, Key and Morales' assistant knew about the change.
"In our interview of Dr. Morales, he stated that he did not seek guidance from VCOE’s legal counsel or request a cost analysis of future liabilities prior to authorizing lifetime health benefits for cabinet members," the report states.
If the lifetime health benefits had not been rescinded, they would have cost the Office of Education somewhere in the range of $3 million to $5 million over the next 30 years, Casner told the board.
Though Morales was never granted lifetime health coverage, it's possible that he would have received it anyway, if the benefits had not been rescinded. The contracts gave lifetime coverage to the employees and their spouses, and Morales and Key have been engaged since July 2025, the Weaver report states.
Transfers lacked 'justification or visibility'
Key left the Ventura County Office of Education in August and is now a deputy superintendent at the Orange County Department of Education. Until she left, she was the chief finance and business official for Morales' entire tenure as superintendent.
Key received raises of 8.7% in 2023 and 8% in 2024, bringing her salary to $302,400. Both raises were more than $10,000 and were not reported to the board as required by law.
Key was also responsible for another possible violation of state law, the audit report states. The California Education Code requires board notification of any changes to the budget in excess of $25,000. According to the Weaver report, between 2022 and 2026 Key transferred a total of $12 million out of the office's general fund and into two reserve funds and only included $2 million on those transfers in her reports to the board.
One of the reserve funds is earmarked for paying for lifetime health benefits for retirees. The Ventura County Office of Education stopped offering that benefit in 1995, and only people who retired before that date are eligible for it. There are about 13 people still receiving the benefit.
Casner said it's possible that the transfers were related to the contracts promising lifetime benefits to Morales' top deputies, but without any documentation as to why the transfers were made, it's impossible to say for sure.
"This was at the discretion of the former deputy superintendent without much justification or visibility into why," Casner said.
Starting in 2021, Key has been a consultant to the Fiscal Crisis and Management Assistance Team, or FCMAT, a joint powers authority that helps local school districts in financial trouble. Over the past five years, she billed FCMAT a total of $65,000 for work she did for the agency, plus $8,000 in travel reimbursements.
Key told the auditors from Weaver that she only did her consulting work for FCMAT on evenings and weekends or when she used vacation time from the Office of Education. But the audit report states that there were eight weekdays in which Key billed FCMAT for her work while she was also working for the Office of Education.
Morales and Key began dating in early 2025. The Weaver report states that Morales told board members about the relationship in the spring and summer of 2025.
In July 2025, around when Morales and Key got engaged, Morales restructured the office "to avoid a conflict of interest if Ms. Key continued to be supervised and evaluated by Dr. Morales," the report states.
Instead of Key reporting directly to Morales, she began to report to Lisa Salas Brown who was promoted from associate superintendent of educational services to deputy superintendent of educational services. The move gave her the same rank in the office as Key.
The promotion resulted in a raise for Salas Brown from $283,500 to $302,400. Like the other raises of $10,000 or more, it was not reported to the board as required by law.
Both before and after her promotion, Salas Brown was the top official in charge of educational services, though Morales told the auditors that her new title did come with some additional duties.
Swag spending didn't break any laws
The forensic audit report also addressed the hundreds of thousands of dollars that Morales' office spent on "swag," or branded promotional items such as mugs and tote bags. Weaver's auditors found that the Office of Education spent just under $1 million on such items between 2021 and 2026, with a big spike in 2024.
The Star previously reported about $729,000 in spending on branded merchandise from 2022 to 2026, based on purchase orders the Office of Education released in response to a public records request from the Ventura County Taxpayers Association.
Casner told the board on Oct. 15 that the office began purchasing the items in bulk in 2024. He said the audit didn't reveal any legal violations with these purchases. The vendor the office used appeared to have the best available prices, though there wasn't always documentation of a competitive bidding process.
The report states that the amount spent on promotional items "raises concerns of potential wasteful spending."
"The inclusion of the superintendent’s name with the VCOE logo on branded items also raises concerns about whether the branded items serve to promote VCOE or the superintendent, especially given that it’s an elected position, though no violations of policy or government code were identified," the report states.
Morales lost his bid for re-election in June. He finished third in a three-person race and became the first incumbent county superintendent of schools to lose an election since 1890.
The top two finishers, Karen Sher and Maggie Marschner, will face off in the November general election.
Tony Biasotti is an investigative and watchdog reporter for the Ventura County Star. Reach him at tbiasotti@vcstar.com. This story was made possible by a grant from the Ventura County Community Foundation's Fund to Support Local Journalism. The foundation plays no role in story selection. The Star retains full editorial control.
This article originally appeared on Ventura County Star: Paper trail discouraged in county superintendent's office, report says
