State Releases Audit of Seattle Schools' Federal Programs

State Auditor Troy Keller released his office's report on SPS's "financial statements and compliance with federal laws and regulations."

It's a lengthy report but that is because it contains page after page of district financial reports.  It makes for interesting reading if you have the time.   Page 49 has the investments that the City puts into SPS.

There were no major issues with financial statements or internal controls over major programs.  The programs reviewed were:

• Child Nutrition - School Breakfast program
• Child Nutrition - National School Lunch program
• Title I, Part A Cluster - Title I grants to local educational agencies
• High school graduation initiative
• ARRA School Improvement Grants
• Head Start

High School Graduation Initiative

The District did not have adequate internal controls to ensure all High School Graduation Initiative funds were used for allowed activities. 
 
In 2012-13, the district received from the DOE a high school grant for $2.2M over five years. It was to support "school dropout prevention and reentry efforts."  The Auditor's office reports that in the prior year's audit:

We found deficiencies in internal controls over compliance with program requirements that collectively constituted a material weakness and issued a qualified opinion on the District’s compliance with grant requirements. We reported noncompliance with activities allowed and allowable cost compliance requirements and questioned costs of $499,936, or 24 percent of the program total. 

This year they found:

We found the District used grant funds to pay for activities that were not allowed by the grant agreement or were not specifically approved by the federal grantor. Specifically:
The District claimed $61,348 in payroll costs for a Family Support Worker position that were not allowed by the grant. 

The District used $291 of grant funds to purchase a piece of furniture. This expenditure was not made for the purpose of the grant. 

So the Auditor is questioning these costs which total $61,640.  (Editor's note; that seems that a pretty good salary for a Family Support Worker.)  The district concurred and said that those costs are now back into the General Fund.  

On prior findings for The Indian Education grant, the Auditor had this to say:

The District has a long history of noncompliance with eligibility requirements for this program. In the past three audits, we reported findings and questioned costs for noncompliance. The District has not put into effect recommendations from prior audits. The District did not retain sufficient documentation in accordance with program guidance to demonstrate compliance with eligibility requirements. We questioned costs for 29 students or $6,530. 

They say that this issue is "partially corrected."  It appears that the district is moving towards having all the issues corrected.  It's only taken four years so cross your fingers for next year.