SCHOHARIE — Nearly three years after current school administrators say they noticed payroll discrepancies, former Jefferson Central Schools superintendent Edward Roche was arraigned Wednesday on four felony charges including grand larceny and defrauding the government.

Roche is suspected of receiving about $107,189 in improper or questionable pay, based on a 2006 audit released last July [2007] by the state comptrollers office.

Roche pleaded “not guilty to each and every count in the indictment,” his attorney, James M. Hartmann, told Schoharie County Judge George R. Bartlett III.

Roche, a resident of Delhi in Delaware County, declined to comment after the court proceedings.

“He’s pleading not guilty, that’s all he has to say,” Hartmann told a reporter outside the courtroom.

Roche was released without bail, with the requirement that he notify court officials if he travels out of state.

Roche retired in 2005 after 21 years of leading the rural 282-student school district in southern Schoharie and northern Delaware counties.

Shortly after current Superintendent Carl Mummenthey took over, payroll issues were detected, Mummenthey said Wednesday. That was in September 2005.

State auditors began investigating in August 2006, he said.

When the audit findings were announced in July 2007, Mummenthey said he had discovered the irregularities during routine reviews of payroll and severance payments to Roche shortly after Mummenthey was hired as superintendent.

According to the audit and school officials, Roche’s record keeping was lax and he allegedly handled much of his own contract and reimbursement procedures, regularly approving payments to himself.

“Examiners from the comptroller’s office found 14 different versions of the employment contracts for Mr. Roche during the last five years of his employment,” Mummenthey said during a July 2007 news conference.

“Jefferson taxpayers are on the hook for more than $100,000 because the former superintendent was able to alter his own contract,” state Comptroller Thomas DiNapoli stated at the time.

Allegedly improper payments included:

u $47,437 for duplicate vacation days and insurance buy-outs;

u $34,473 for 62 unearned vacation days paid at an inflated rate;

u $3,133 for unauthorized salary;

u $3,103 for inflated vacation day buy-out rates;

u $356 in reimbursements related to dinners “honoring elected state officials” that were deemed not a legitimate district expense.

When Roche retired, at a base annual salary of about $97,000, he was paid for 45 days of sick time and 72 days of vacation time. As a result, Roche was overpaid $34,473 for 62 vacation days calculated at the wrong rate, according to the audit.

After DiNapoli released the audit, the district requested Schoharie County District Attorney James Sacket to investigate potential criminal actions.

Mummenthey said Wednesday he and the school board are also seeking to recover any funds owed to the district.

Roche was charged by a county grand jury June 25, but the indictment remained sealed to public view, by law, until Wednesday’s arraignment because it was the beginning of the criminal proceedings, Sacket said.

The indictment “lays out two different theories” relating to “a scheme constituting ongoing course of conduct with intent to defraud.”

One charge of first-degree scheme to defraud relates to allegedly defrauding 10 or more persons, while another count of the same charge relates to defrauding more than one person. Both charges are class E felonies.

Roche is also charged with third-degree grand larceny, a class-D felony, and defrauding the government, a class E felony.

The period covered by the charges is August 2003 through Aug. 31, 2005. “We’ve tightened our internal controls,” after the financial discrepancies were uncovered, said Mummenthey, who was in the courtroom audience during the Roche’s arraignment.