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Another Delaware charter dinged for misusing money

 (School supplies, hundred dollar bills via ShutterStock)

(School supplies, hundred dollar bills via ShutterStock)

For the third time in less than a year, Delaware’s state auditor said a charter school administrator used state funds to make large personal purchases.

This time, the accused school is Providence Creek Academy, located in Clayton, Delaware. The auditor’s inspection report, released Wednesday, found the school’s former finance and human resources manager spent $11,743 of the school’s money on personal items. The auditor couldn’t verify the purpose of another $20,609 charged to the school’s state purchase card.

Shanna Simmens, the administrator accused of misconduct, was fired from the school in December 2014, shortly after the auditor received a tip about potential wrongdoing. That tip came from suspicious school officials, according to Kendall Massett, executive director of the Delaware Charter Schools Network.

“They found the issue. They reported the issue. And the auditor’s office did what they’re supposed to do,” Massett said.

The auditor’s investigation covered the period from July 2011 to the end of 2014, during which the school, “lacked sufficient controls to prevent or detect various improprieties and non-compliance,” according to the report.

Simmens, the report said, used school money for a wide variety of personal purchases. They included dental work ($600), timeshare renewal and upgrade ($872), and inpatient rehab services for an employee with whom Simmens was close ($4,200). Simmens even used school funds to cover a $215 fine she received for using a handicapped parking spot, according to the report.

The auditor’s office paid special attention to a trip Simmens took to Las Vegas for a national charter school conference. During the sojourn, which began three days before the conference kicked off, Simmens used her state purchase card to buys hundreds of dollars worth of alcohol, as well as four tickets to a comedy show. In all, Simmens used more than $1,100 in school funds during her Las Vegas getaway, according to the state auditor.

A call to Providence Creek Academy was redirected to the head of the school, Charles Taylor. Taylor has yet to respond to requests for comment.

Policing charters

Wednesday’s report will likely inflame an ongoing debate over how the state polices its charter schools. Charters are already required to pay for yearly financial audits conducted by an outside firm of their choosing. State Representative Kim Williams, D-Newport, introduced a bill last year that would empower the state auditor’s office to pick and manage the firms that conduct annual charter school audits.

Earlier this month, however, state Senator Dave Sokola, D-Newark, submitted a rival measure that would clarify which types of private firms are eligible to perform charter school audits and require those audits be shared regularly with state agencies. It would, however, allow charter schools to remain in charge of choosing their own independent auditors.

Checks and balances

The state auditor’s office favors Williams’ proposal.

“When the charter schools contract for the audit, the auditors are working for them,” State Auditor Tom Wagner said.

Under the current arrangements, Wagner said, charter officials can defraud taxpayers for years before even a whiff of malfeasance reaches his office. He pointed to cases at Providence Creek Academy, Family Foundations Academy, and Academy of Dover as proof.

In each instance, either a school leader or top administrator used taxpayer money to buy personal items. The schemes dated back years, and all three were the subject of auditor’s investigations during the past year. During that same time, the state auditor also found lesser degrees of financial mismanagement at two other Delaware charters.

“Every single one of [the cases] should have been caught earlier and addressed earlier,” Wagner said. “We’re going in well after the fact.”

Kendall Massett, the executive director of the Delaware Charter School Network, disagreed with Wagner’s diagnosis. She argued there’s no way to “legislate away bad people,” and said it was unlikely either proposed bill would have prevented further damage.

Massett also called on prosecutors to get tougher with charter administrators who swindle taxpayer money. None of the school administrators involved in recent financial scandals have been formally charged, she said.

“Where are the criminal indictments for the people who have done these things,” Massett said. “Where are they? Why are they still walking the streets?”

The Delaware Charter Schools Network supports Sokola’s proposal to set higher standards for firms conducting charter school audits. Taylor, Providence Creek’s head of school, is also president of the Delaware Charter Schools Network.

The Delaware Department of Education expressed support for both charter audit measures.

“The department is in support of strong audits and believes both bills address this. We look forward to the General Assembly considering each,” said department spokesperson Alison May in an e-mail.

Providence Academy’s fiscal woes under Simmens went beyond extravagant personal purchases, according to the auditor’s investigation. The school doled out more than $50,000 in staff bonuses without proper documentation. Roughly half of that money lacked required approval from the school’s board of directors.

Meanwhile, a little more than $160,000 in salary costs didn’t have either a contract, time sheets, or hourly rate approval to substantiate the payments.

Wagner said charters in Delaware often lack the bureaucratic infrastructure to maintain good accounting practices. As a result, many can’t detect and combat fraud perpetrated by bad actors in positions of power.

“One of the beauties of the charter schools is they have very little administration so more of the money goes to the classroom,” said Wagner. “The downside is that when you have little administration you don’t always have the checks and balances you have with more bodies.”

Wagner said his office didn’t find any evidence that Simmens, the fired financial manager, had reimbursed the school for any of the improperly spent money.

The state renewed Providence Creek Academy’s charter in December 2015 despite indications that it knew of Simmens’ transgressions. A review from the state’s Charter School Accountability Committee noted “misuse of funds” by a former employee and said the school did not meet standards on its organizational framework.

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