Pa. auditor general faults education department’s charter oversight

Pennsylvania Auditor General Eugene DePasquale intends to hold a series of public meetings in February and March at locations across the state to “explore ways to improve accountability, effectiveness and transparency of charter schools.”

DePasquale, who took office in January 2013, said his office audited more than 300 school entities during the first year of his tenure.

In a radio interview (listen above), DePasquale argued that charters have been able to get away with misusing public funds largely because the state Department of Education has lacked oversight and been unwilling to hold “bad actors” accountable.

As a leading example, he described how some charter operators abuse the system through “improper lease reimbursements.”

Some charter operators put the deed of a building they own in the name of a separate foundation, DePasquale explained. Then, they name themselves the heads of said foundation, and, in a sense, lease the building to themselves.

Once they “pay the rent,” he said, they then turn around and ask the state for a reimbursement.

“We started looking at the deed[s], and saw that the names were the exact same names that were on the charter school[s],” he said.

“Charter operators are, in some instances, getting reimbursed for a building that they already basically own, and they’re getting reimbursed by state tax dollars. That’s ridiculous,” he said.

The state education department, which approves these expenses, “needs to do a better job to stop those payments from happening,” DePasquale said.

Of the 15 charter school audits that DePasquale has done since coming into office, he’s found that 10 of the charters received improper lease reimbursements in the millions of  “misused taxpayer dollars.”

With more than 160 charter schools across the state, he calculated that total improper lease reimbursements could potentially be costing state taxpayers “tens of millions of dollars.”

In 2010, Philadelphia City Controller Alan Butkovitz analyzed 13 of the city’s charter schools and found much the same misuse of public funds.

State Department of Education audit planned

The auditor general, who has questioned the method by which the state’s cybercharters are funded, said  more oversight of the state’s traditional public school districts is also needed.

The auditor’s office will soon conduct an audit of the education department, with the “core mission” of finding out “why their accountability of the school districts and the charters is so lax,” DePasquale said.

In response to DePasquale’s critique about “improper lease reimbursements,”  department spokesman Tim Eller emailed this reply:

“The department administers the laws and regulations for which it has authority. The department cannot hold schools accountable for what others ‘think” should be the law.’ The department must adhere to the laws as enacted by the General Assembly.”

Eller later added: “The current secretary is administering this section of the Public School Code based on past practice of former secretaries. If, in fact, the secretary was to change the eligibility factors, a statutory change would need to occur. The secretary has offered to discuss this in detail with the auditor general.”

DePasquale could not be reached for a response, but his spokesman said DePasquale stands by his critique.

A meeting has been scheduled between DePasquale and acting Education Secretary Carolyn Dumaresq for the end of January, the spokesman confirmed.

To listen to an extended interview with Auditor General Eugene DePasquale, click the “speaker button” next to the headline above.

 The public meetings will be held:

Allegheny County: 1 to 3 p.m., Tuesday, Feb. 25, Commissioners Hearing Room, Ross Township Municipal Center, 1000 Ross Municipal Road, Pittsburgh
Northampton County: 1 to 3 p.m., Thursday, Feb. 27, City Council Chambers, Sixth Floor, City Hall, 1 S. Third St., Easton
Cambria County: 1 to 3 p.m., Thursday, March 6, Commissioners Meeting Room, Cambria County Court House, 200 S. Center St., Ebensburg
Bucks County: 1 to 3 p.m., Friday, March 7, Township of Falls Administrative Building, Suite 100, 188 Lincoln Highway, Fairless Hills