Schools misused funding, state says
Arizona Republic

Pat Kossan

The state paid four northern Arizona school districts $1.8 million to educate 364 high-school students who had already graduated and went to school for only about a half-hour a week, or not at all, according to audits released this week.

The Arizona Department of Education wants the money back. It says it expects to find other examples of misuse of state education money as its newly beefed-up auditing division goes about tracking all $5 billion of aid for district and charter schools.

"If the Legislature wants to save money, all they have to do is give us more auditors," said Tom Horne, Arizona superintendent of public instruction. Horne increased the number of auditors from one to nine, with additional support staff and said he could use more.

"Overall, our emphasis has been on service first and compliance second," Horne said.

The state pays a school for each student who attends. State auditors will be taking a close look at the number of students reported by each district and charter school. It's an area long susceptible to mistakes and deceit.

The first four audits at Blue Ridge, Page, Show Low and Snowflake unified districts were triggered by special-education program monitors. They had questions about a vocational program that kept students enrolled for a fifth and sixth year.

After examining the paperwork, auditors found these students had enough credits to graduate. The schools didn't document the students' progress in the program, and the kids were on campus less than five hours a week, sometimes not at all. That made these young adults ineligible for state K-12 funds.

In a different program, Blue Ridge Unified District in Pinetop-Lakeside claimed K-12 money for regular-education students who already graduated and were attending college. The district used part of the state money to reimburse the students' college tuition and books but kept the bulk of the cash.

Each district has a chance to respond to the audit findings and appeal. The state could begin deducting money from the districts' monthly payments as early as February.

Both programs had been running a long time at Blue Ridge Unified.

Superintendent Michael Alystock said the intent was to help the students, but the record-keeping became sloppy, and state laws and regulations had changed since the programs were put into place.

"If we didn't do that properly, we'll make whatever changes have to be made," he said.

He also said it's likely the district will agree to be docked any money it owes and not appeal.


The Texas welder

About a year ago, education auditors were alerted to problems at Blue Ridge Unified District. They discovered the state was still paying the district for a 21-year-old special-ed student who had graduated in 2006. The student was working in Texas as a welder.

Auditors and special-ed monitors headed to Blue Ridge Unified with plenty of questions. In the Blue Ridge audit issued this week, they determined the district had received state compensation for 72 full-time students in the Youth Transition Program from 2004 to 2006. Only two were eligible for the program.

Auditors said Blue Ridge owes the state more than $300,000.

The Youth Transition Program is in more than 23 Arizona districts. The Department of Education plans to audit most of them.

The program is designed to help guide special-ed high-school students into jobs after they graduate. It helps schools upgrade their vocational training. It also links students to the state's rehabilitation-vocational services, where they can receive tools needed to compete for a job, such as welding.

State law allows special-ed students to stay in school a fifth or sixth year, even after they've earned enough credits to graduate. Schools teach these students skills that help them get a job, go to college and live independent of their family. But the school is obligated by state and federal law to document and track a fifth- and sixth-year student's career and learning objectives in an Individual Education Plan.

That plan must be developed, and a student's progress must be discussed at regular meetings. None of Blue Ridge's 70 students had an appropriate Individual Education Plan, and all had earned enough credits to graduate.

These students were obligated to check in with a campus coordinator for 30 minutes a week, not enough time for the school to meet the criteria for even minimum state payments.

The auditors found similar problems with the Youth Transition Program during the same three years at Snowflake, Page and Show Low unified districts. The state wants to dock all four districts a total of $1.5 million dollars.


More problems

Arizona Department of Education auditors were looking into the Youth Transition Program at Blue Ridge Unified District when they discovered that, from 2004 through 2006, the state had paid for an additional 100 students who had already graduated.

These were regular-education students who were participating in the district's "Program for Learning with Extended Support in Education," or P.L.E.S.E. So far, auditors have found the program only at Blue Ridge Unified.

The district collected full-time state compensation for most of the graduates and used the money to reimburse these students for tuition and books at Northland Pioneer College near the high-school campus.

From 2004 to 2006, Blue Ridge gave its graduates $31,669 for tuition and books, paid a staff member $7,628 to monitor the program and kept an additional $351,260.Superintendent Alystock said it was hard to pinpoint how the district used the extra money and said it went "into the big pot."

To participate, students and parents signed a P.L.E.S.E. agreement that warned them not to write a high-school graduation date on any forms for the college because it put the program "in jeopardy." It further said past students who did not comply "were exited immediately from the program and became ineligible for any reimbursement."

It also cautioned, "We are funded through the state, and they as well as other schools in the area are scrutinizing our program."

Alystock said the school shut down the program this year after the Arizona Department of Education auditors visited the district in the summer. The state wants $388,998 back.