This story has been updated.

Alexandria Vice Mayor Kerry Donley on Tuesday called for the resignation of Superintendent Morton Sherman as a result of the external audit which found the management of the school system’s capital improvements budget was dysfunctional.

Alexandria Vice Mayor Kerry Donley.

“In the end, it comes down to accountability and responsibility,” Donley said. “It is my opinion — and I am speaking mainly as a member of Alexandria City Council and within my capacity as a fiduciary steward of the city’s taxpayers — it is my opinion the superintendent should resign.”

Sherman, who has been superintendent since 2008, reports to the elected Alexandria School Board. His contract was renewed last September through June 30, 2015, at his current salary of $250,000 a year with a $40,000 tax-sheltered annuity. He has blamed the controversy on  “renegade, rogue employees” and two higher-level managers who “should have known” what was going on.

In a statement, Sherman said: “I have tremendous respect for Mr. Donley and his exceptional service to Alexandria and the Commonwealth of Virginia. We disagree on the CIP conclusions. I am sure that Mr. Donley is frustrated and angry about the CIP situation, but not nearly as frustrated and angry as I am. The facts are clear: As soon as I knew that there was a problem, I alerted the board and the board attorney, stopped what was going on in the facilities department, called for an independent audit, made personnel changes, and began to make changes in procedures and controls.”

The School Board, which will meet in closed session Thursday over personnel matters, and in its regular session March 22, said in a statement that it wants an independent compliance audit within 45 days.

“I was very disappointed that Mr. Donley chose to make his opinion public last night,” said School Board Chairman Sheryl Gorsuch on Wednesday. “The School Board is taking the external CIP report very seriously. We too are concerned, and frankly share some of the same questions the council asked last night.”

Donley, former Alexandria mayor and vice president of Virginia Commerce Bank, said that when he was athletic director at T.C. Williams High School, he had to get two signatures just to transfer $100 from one budget to another.

“What I find troubling is all we’ve heard since (the audit came out) is rogue employees, pointing blame and . . . we’ve stayed within our CIP,” Donley said. “That kind of response that we’ve gotten is a mischaracterization of what is the true scope and it doesn’t get to the heart of the issue and the heart of the issue for me is accountability and responsibilty. A resignation is in order.”

All the other city council members, during their end-of-meeting comments period, expressed anger and disappointment over the results of the audit and the management issues, although none explicitly joined Donley’s call for Sherman’s resignation.

Sherman “seemed to find others to blame for this and I hope he will be thinking very long and hard about this situation because he is truly the bottom line,” said council member Redella S. “Dell” Pepper.

This post has been updated since it was first published.