Executive Summary

Background and Scope of the Audit

Broome-Delaware-Tioga BOCES ranked as the 17th largest BOCES in the State, in terms of total general fund expenditures, for the 1997-98 school year.

The audit examined management practices, records and documentation related to summarizing and reporting data used in the BOCES Report Card and the Chapter 602 Report for the period July 1, 1997 through June 30, 1998. The Employment Preparation Education (EPE) Program was reviewed for the July 1, 1997 through June 30, 1998 school year. This audit also followed up on findings and recommendations from the previous audit. The objectives were to: evaluate the adequacy of management controls over data reported to the Department and obtain reasonable assurance that the data are valid and reliable; determine how BOCES use data to monitor the performance of the schools within its supervisory district; determine how BOCES use data to monitor student outcomes; and evaluate the wide ranges of costs identified in the Chapter 602 Report and understand the reasons for the variances.

Audit Results

Presented below is a summary of the significant audit findings developed in response to the audit’s objectives.

· EPE contact hours eligible for aid were overstated by 96,497 hours for a total of $426,156 in excess EPE aid for the three-year period 1995-96 through 1997-98. (pages 3-6)

· Report Card data documentation was inconsistent. (pages 7-11)

· Not all data reported on the Chapter 602 Report were reported in accordance with the instructions. (pages 12-13)

Introduction..................................................................................................................................................... 1

Background.................................................................................................................................................... 1

Objectives, Scope and Methodology................................................................................................ 1

Comments of Broome-Delaware-Tioga BOCES Officials....................................................... 1

Employment Preparation Education (EPE).................................................................................. 1

Ineligible Students Included............................................................................................................... 1

Certain Reported Contact Hours Were Undocumented...................................................... 1

Recommendation.......................................................................................................................................... 1

Auditor’s Note................................................................................................................................................ 1

Comments of Broome-Delaware-Tioga BOCES Officials....................................................... 1

Report Card........................................................................................................................................................ 1

Data Accuracy and Supporting Documentation...................................................................... 1

Career/Occupational Education................................................................................................................... 1

Auditor’s Note................................................................................................................................................ 1

Alternative Education..................................................................................................................................... 1

Auditor’s Note................................................................................................................................................ 1

Adult Education............................................................................................................................................... 1

Special Education............................................................................................................................................ 1

Auditor’s Note................................................................................................................................................ 1

Curriculum and Staff Development.............................................................................................................. 1

Recommendation.......................................................................................................................................... 1

Comments of Broome-Delaware-Tioga BOCES Officials....................................................... 1

Chapter 602 Report........................................................................................................................................ 1

Report Accuracy and Documentation............................................................................................ 1

Special Education............................................................................................................................................ 1

Itinerant Services............................................................................................................................................ 1

Alternative Education..................................................................................................................................... 1

Distance Learning........................................................................................................................................... 1

Substitute Coordination................................................................................................................................. 1

Recommendation.......................................................................................................................................... 1

Comments of Broome-Delaware-Tioga BOCES Officials....................................................... 1

Data Collection and Use........................................................................................................................... 1

Follow Up – Recommendation Implementation Plan.......................................................... 1

Appendix A – Contributors to the Report

Appendix B – Comments of Broome-Delaware-Tioga BOCES Officials

Appendix C – Audit Review Proceedings

Introduction

Background

Public and legislative attention has been turned to data provided by Boards of Cooperative Educational Services (BOCES) and school districts with the issuance of Report Cards. Chapter 436 of the Laws of 1997 made the New York State BOCES Report Cards (Report Cards) available to the public on April 16, 1999. Graphically presented, the Report Cards summarize program accomplishments and services BOCES provide for children and adults.

In addition, Chapter 602 of the Laws of 1994 added Section 215-b to the Education Law to require the Commissioner of Education to prepare and submit to the Governor, the President Pro Tem of the Senate, and the Speaker of the Assembly, an annual report beginning January 1, 1996. The Chapter 602 Report details certain financial and statistical outcomes of BOCES, tuition costs for selected programs, per pupil cost information, and aggregate expenditure data for BOCES’ administrative, capital and service functions. The report is to include changes from the year prior to the report year for all data.

BOCES are organized under Section 1950 of the Education Law. Chapter 474 of the Laws of 1996 amended Section 305 of the Education Law to require the New York State Education Department (Department) to perform fiscal audits of BOCES at least once every three years.

Broome-Delaware-Tioga BOCES is headquartered in Binghamton, New York and serves 15 component districts which have enrollments of more than 39,000 students. Broome-Delaware-Tioga BOCES ranked 17th largest in the State, in terms of total fund expenditures, for the 1997-98 school year.

Objectives, Scope and Methodology

Pursuant to Sections 305 and 1950 of the Education Law, we audited management practices, records and documentation related to the data contained in the Report Card and the Chapter 602 Report for the period July 1, 1997 through June 30, 1998. We followed up on the status of prior recommendations made in audit report number BOC–0896-2 and reviewed the Employment Preparation Education (EPE) Program for the period July 1, 1997 through June 30, 1998 and expanded to prior years 1995-96 and 1996-97. The objectives were to:

· evaluate the adequacy of management controls over data reported to the Department and obtain reasonable assurance that the data are valid and reliable.

· determine how BOCES use data to monitor the performance of the districts within its supervisory district.

· determine how BOCES use data to monitor student outcomes.

· evaluate the wide ranges of costs identified in the Chapter 602 Report and understand the reasons for the variances.

· determine if EPE claims are adequately documented.

· follow up on the findings and recommendations from the previous audit, and determine whether timely and adequate corrective actions were implemented.

To accomplish our objectives, we reviewed applicable laws, regulations, policies and procedures; interviewed Department and Broome-Delaware-Tioga BOCES management and staff; examined records and supporting documentation; sampled transactions on a non-statistical basis; and reviewed Broome-Delaware-Tioga BOCES’ audited financial statements.

We conducted the audit in accordance with Government Auditing Standards issued by the Comptroller General of the United States. An audit includes examining, on a test basis, evidence supporting records and applying other audit procedures considered necessary in the circumstances. An audit also includes assessing the estimates, judgments and decisions made by management. We believed that the audit provides a reasonable basis for our findings, conclusions, and recommendations.

Comments of Broome-Delaware-Tioga BOCES Officials

Broome-Delaware-Tioga BOCES officials’ comments on the matters contained in this report have been included where appropriate. Their final comments have been included as Appendix B to this report.

Employment Preparation Education (EPE)

Broome-Delaware-Tioga BOCES operates an EPE Program. This categorical aid program serves students 21 years of age or older who have not received a high school or equivalency diploma (GED).

Part 168.4 of the Regulations of the Commissioner of Education (Regulations) states that EPE Program funds may be spent for personal services, employee benefits, equipment, supplies and materials, contractual services, travel expenditures, staff development and training, and other expenditures approved by the Commissioner. These expenditures are to be used only for EPE Program purposes.

Broome-Delaware-Tioga BOCES received a total of $1,051,837 in EPE aid for the period July 1, 1997 through June 30, 1998, based on reported contact hours. Education Law Section 3602 states that when total revenue received exceeds the entire cost of such program, State aid payable in the following year will be reduced by the amount of such excess. This means that Broome-Delaware-Tioga BOCES must refund the larger of revenues disallowed or expenditures disallowed, but not both. The audit report will be used by the Department to adjust future aid received by Broome-Delaware-Tioga BOCES.

The audit found that Broome-Delaware-Tioga BOCES claimed 37,488 contact hours for students who had graduated, and overstated contact hours by 1,903 due to clerical errors. The total net contact hours ineligible for 1997-98 for State aid amounts to 39,391, which equates to $178,441 in EPE aid (see table, page 6). Due to the systemic nature of the ineligible student problem, the audit included the two previous years according to audit protocol. The ineligible contact hours for 1996-97 were 14,865.5 ($64,814) and for 1995-96 were 42,240.5 hours ($182,901), which equates to $426,156 in EPE aid for the three-year period.

Ineligible Students Included

The audit found that the database used to prepare the EPE Aid Reports had included a large number of students who claimed they graduated from high school but could not document the fact. The audit discussed this matter with Department personnel from the Office of Workforce Preparation and Continuing Education. They replied that students are not required to document their high school diploma status.

The audit identified two groups of students whom Broome-Delaware-Tioga BOCES had incorrectly claimed for EPE aid: 1) students who said they graduated, but could not produce any documentation (49,481 hours); and 2) students who said they had received a GED, but could not document it (17,001 hours). A test of 20 students who claimed they graduated was conducted by contacting local high schools in the Binghamton, New York area. The audit found that 14 students graduated and the high schools had no record of the remaining 6 students. Broome-Delaware-Tioga BOCES reported 9,985 contact hours for the 20 students of which 6,085, or 61 percent, were for students with high school diplomas. Originally, the entire 49,481 hours were questioned.

The audit also conducted a test of students claiming to have their GED diploma by matching the EPE computerized records to Department GED data. Of the 17,001 hours originally reported, 3,122 hours were claimed for students who passed the GED during 1997-98. In addition, another 4,537 hours were claimed for students who passed the GED before the start of the 1997-98 school year. Originally, 7,659 hours were questioned.

Due to the large number of questionable contact hours, the audit requested that Broome-Delaware-Tioga BOCES officials review all EPE student records and provide documentation to confirm which students had high school or equivalency diplomas. Broome-Delaware-Tioga BOCES officials determined that 37,488 contact hours were reported for graduates, resulting in an overpayment of $169,821 (37,488 x $4.53/hr.). This figure also includes the GED hours that were questioned. The Department will withhold this amount from future EPE aid payments.

It has been Department protocol to expand the audit to the prior two years if a practice that involves either ineligible students or ineligible programs is discovered. The audit reviewed the prior two school years (1995-96 and 1996-97) to determine if Broome-Delaware-Tioga BOCES had reported contact hours for similar ineligible students. The audit selected a sample of students and had Broome-Delaware-Tioga BOCES contact area high schools to verify if students had graduated. Broome-Delaware-Tioga BOCES provided written documentation from the schools that showed which students did indeed graduate. The results are included in the table on page 6.

Broome-Delaware-Tioga BOCES officials agree that contact hours were claimed for students who said they graduated high school or had a high school equivalency diploma, but could not document that fact. Broome-Delaware-Tioga BOCES also agrees that a total of 96,497 contact hours ($426,156) were improperly reported for undocumented hours and ineligible students for the three school years 1995-96 to 1997-98.

Broome-Delaware-Tioga BOCES will ensure that only documented hours and hours for eligible students will be claimed for EPE aid in the future by no longer requiring documentation of high school or equivalency diplomas. Broome-Delaware-Tioga BOCES officials will verify all graduation information with the home district and the GED database and maintain a database including the number of contact hours for each student.

Certain Reported Contact Hours Were Undocumented

Education Law Section 3602(24)(d) states that school districts and BOCES providing approved programs shall be eligible for aid based on the attendance of persons 21 years of age and older who have not received a high school diploma or a high school equivalency diploma recognized by New York State. To ensure that EPE revenues paid to the district or BOCES are appropriate, contact hours must be documented and provided to eligible students. Otherwise, such contact hours will be questioned upon audit and revenues will be reduced accordingly.

Broome-Delaware-Tioga BOCES provided the audit with a listing of 249,685 contact hours. According to staff, students who documented possession of a high school diploma were deducted from this figure (19,394 hours), leaving a total of 230,291 hours. Broome-Delaware-Tioga BOCES actually claimed 232,194 hours and received $1,051,837 in EPE aid. This resulted in an overstatement of 1,903 hours, or $8,621 (1,903 x $4.53 EPE aid rate). Broome-Delaware-Tioga BOCES officials agreed with this figure.

Broome-Delaware-Tioga BOCES EPE Program Summary of Questioned Hours/EPE Aid 1995-96 to 1997-98
Year	Questioned Hours	EPE Rate	Questioned EPE Aid
1995-96	42,240.5	4.33	$182,901
1996-97	14,865.5	4.36	$ 64,814
1997-98*	39,391	4.53	$178,441
Total	96,497		$426,156

Source: Broome-Delaware-Tioga BOCES records and audit workpapers.

*Also includes questioned contact hours from ineligible students.

Recommendation

1. Ensure that only hours for eligible students will be claimed for EPE aid by not requiring documentation of high school or equivalency diplomas.

Auditor’s Note

The $426,156 in ineligible aid for the three-year period will be withheld from future EPE aid payments.

Comments of Broome-Delaware-Tioga BOCES Officials

Broome-Delaware-Tioga BOCES officials concur with the recommendation.

Report Card

The Report Cards, required by Chapter 436 of the Laws of 1997, were made available to the public on April 16, 1999. Graphically presented, the Report Cards summarize program accomplishments and services BOCES provide for children and adults. They are intended to be used as a tool for the continuous improvement of BOCES programs and services, and for providing information to communities.

The Report Card displays the following programs and services: Career/Occupational Education, Alternative Education, Adult Education, Special Education, Curriculum and Professional Development, Technology, the State Testing Program, and the 1996-97 Expended Budget. The State Testing figures are provided by the Department, not BOCES, so those figures were not included in the scope of the audit.

An objective of this audit was to determine the accuracy of the Report Card data and the adequacy of the supporting documentation.

Although several areas were noted where Report Card data were not accurate or supported by supporting schedules and/or student listings, overall the Report Card data were reasonably accurate considering this was the first year of the Report Card. The differences noted were as follows.

Data Accuracy and Supporting Documentation

Data included in the Report Cards must be valid and reliable in order to be used effectively. BOCES officials are given the opportunity to review the Report Card prior to its release. Each section displays charts and graphs to present data on enrollment, completion, tuition, and/or data expressed as a percentage of local totals or statewide totals.

Career/Occupational Education

The Department did not specify which date to use for enrollment figures or which students to include or exclude in the data reported. Tuition data are taken from the Chapter 602 Report. Career/Occupational Education is a two-year program for secondary students in grades 11 and 12.

· Broome-Delaware-Tioga BOCES included both adults and secondary students in the Completion Rate enrollment figures. Since Adult Education is a separate section of the Report Card, including adults in this section also creates inaccurate counts of secondary students in Career/ Occupational Education.

· Broome-Delaware-Tioga BOCES selected the month with the highest month-ending enrollment, October. Secondary students were not limited to only grades 11 and 12, but included students from grades 9 and 10 as well. However, Broome-Delaware-Tioga BOCES could not distinguish between the grades because the database did not contain data by grade level.

· Completers also included adults and secondary students.

Auditor’s Note

The CO-SER guidelines for Career/Occupational Education suggest the program is for students in grades 10-12. These guidelines do not appear to align with the Report Card.

· The enrollment figure for the Enrollment and Tuition section is taken from October 15 (which was agreed to by component districts for billing methodology) and only includes secondary students.

· Tuition is calculated by dividing expenditures by the highest month-end enrollment of secondary students.

· The percent of students enrolled in grades 11 and 12 may be overstated because students from grades 9 and 10 are included in the enrollment. Including students in grades 9 and 10 results in a higher percentage and should be noted on the Report Card.

Alternative Education

BOCES operate alternative school programs for students at risk of dropping out. The objective is to retain these students in the alternative education program until they graduate or return to a regular school setting. The Department did not specify a date for enrollment figures. Enrollment and tuition are shown for three years.

Data for 1995-96 and 1996-97 may include other than full-day programs. Data for 1997-98 reflect full-day and half-day programs separately if half-day programs were offered.

· Full-time enrollment was reported as 452 students instead of 352, an overstatement of 100 students.

· Student listings to support the reported enrollment did not agree as follows:

- Multi-Occupational Education enrollment was reported at 233, but student listings showed only 172 students. This is a half-day program.

- GED Alternative High School enrollment was reported at 119, but student listings only showed 112 students. This is also a half-day program.

· Outcomes are combined in the Report Card for students who remain in Broome-Delaware-Tioga BOCES and those who return to a school district, although the data are collected separately.

Auditor’s Note

Since there is no consensus as to whether it is better to retain students in the alternative school setting or to return them to a regular school setting, it may be more beneficial to separately report the number of students who remained in a Broome-Delaware-Tioga BOCES program and the students who returned to a school district.

Adult Education

BOCES sponsor both adult occupational education programs and adult basic education courses. Placement results for the 1997-98 adult occupational education programs will not be available until late Spring because agencies have 180 days from the date of graduation to follow up on any program which requires a license or exam. The results will be reported in the next Report Card.

The audit reviewed the student database for selected statistics and found the following differences:

· Improved Literacy for reading levels 0-5.9 was reported as 159, but the database only produced a list of 129 students.

· Students securing employment were reported at 236 full-time, but the database showed 405. Part-time students were reported at 300, but the database showed only 136.

· Broome-Delaware-Tioga BOCES reported 50 participants as receiving public assistance at enrollment who no longer receive public assistance, and 82 receiving a reduced grant due to increases in employment income. The combined total equals 132. The database showed a total of 168.

Special Education

When placing students, districts select among classrooms with different student/staff ratios consistent with each student’s Individualized Education Program (IEP). There are three alternatives: 12 students per teacher plus one paraprofessional (12:1:1); 6 students per teacher plus one paraprofessional (6:1:1); and 12 students per teacher plus four paraprofessionals (12:1+1:3).

· The Report Card shows figures for 6:1:1 classes, but Broome-Delaware-Tioga BOCES operates an 8:1:1 (a valid CO-SER) class instead.

· The number of students served included itinerants.

· Broome-Delaware-Tioga BOCES could not provide a student listing that supported the Report Card figures for students leaving special education programs (PD-5A). Student reports were available, but not in a format that could be used to determine the accuracy of the Report Card figures. The PD-5A files are submitted by the school districts.

Auditor’s Note

Graduation rates do not include IEP diplomas, which are the largest majority of special education graduates. This information would seem to be a valuable statistic for statewide comparison for a special education program.

Curriculum and Staff Development

The Curriculum and Staff Development section of the Report Card shows the number of professional staff who received training in State-targeted areas.

· Documentation was not retained to support the number of professional staff who received training in State-targeted areas. The figures are not mutually exclusive, so the same staff person may be counted more than once if they attended several training courses. The Report Card categories do not match the categories that are reported to the Department.

Overall, general inaccuracies or inconsistencies could alter the results of the Report Card. However, many of the errors had a limited effect, although certain misstatements had the following impact:

· Professional Development figures for the number of staff served may appear higher since the same individual can be counted more than once. The CO-SER guidelines may not align with the Report Card.

· Requiring Broome-Delaware-Tioga BOCES to use Professional Development categories that differ from the Department reports creates unnecessary work for Broome-Delaware-Tioga BOCES staff. The Report Card should use the same categories.

All reported figures are provided by program areas to the Business Manager who accumulates them into the Report Card. Supporting documentation is not attached to the reported figures. The program areas are relied upon for accuracy. This could explain why there were several differences in the Report Card figures.

The Report Card was new in 1997-98 and, as such, the Department was not certain which report statistics would best represent a BOCES’ outcomes. The Report Card has been modified each year since the first report. Reporting inconsistencies could be due, in part, to a lack of definitive Department guidelines while the Report Card format is changing.

Broome-Delaware-Tioga BOCES officials do not agree with the differences cited among the Report Card, supporting reports, and/or student listings. They request that guidelines and directions from the Department be clarified.

Recommendation

2. Improve procedures to ensure that reporting inconsistencies are eliminated.

Comments of Broome-Delaware-Tioga BOCES Officials

Broome-Delaware-Tioga BOCES officials concur with the recommendation.

Chapter 602 Report

Chapter 602 of the Laws of 1994 added Section 215-b to the Education Law to require the Commissioner of Education to prepare and submit to the Governor, the President Pro Tem of the Senate, and the Speaker of the Assembly, an annual report beginning January 1, 1996. The report is also provided to all school districts and BOCES.

The report details certain financial and statistical outcomes of BOCES, tuition costs for selected programs, per pupil cost information, and aggregate expenditure data for BOCES administrative, capital and service functions. In accordance with the statute, the report is to include changes from the year prior to the report year for all data.

Report Accuracy and Documentation

An objective of this audit was to determine the accuracy of the Chapter 602 Report data and the adequacy of the supporting documentation. The following describe the audit’s findings.

Special Education

· Special Class Option IV - Supporting documentation was not available for pupil FTE (25.1) or tuition per pupil ($21,079).

Itinerant Services

· Documentation was not available to support the full-time equivalent staff charge for School Psychologist ($22,827), Teacher of Speech Impaired ($40,398), and Teacher of Visually Impaired ($35,539).

Alternative Education

· Documentation was not available to support the pupil count (195.5).

Distance Learning

· Documentation was not available to support the number of courses (28) that was used to determine the tuition rate ($20,926).

Substitute Coordination

· Documentation shows 3,163 staff served, not 1,943 as reported.

The above findings show that without sufficient documentation there is no assurance that certain Chapter 602 Report statistics were reported accurately for Special Education, Itinerant Services, Alternative Education, and Distance Learning. For Substitute Coordination, the reported number of staff served may have been understated by 1,220, or 39 percent (1,220 divided by 3,163).

Broome-Delaware-Tioga BOCES officials disagree with the findings for Special Education, Itinerant Services, and Distance Learning stating that documentation was available. They state there is no requirement for Report Card data to agree with Chapter 602 data.

Broome-Delaware-Tioga BOCES officials agree in part that there was no supporting documentation for Special Education pupil FTE, FTE charges, and Alternative Education pupil count. Broome-Delaware-Tioga BOCES officials disagree that the number of reported FTE staff served was understated by 1,220, or 39 percent.

Broome-Delaware-Tioga BOCES will ensure that Chapter 602 statistics will be accurate and documented in the future by aligning their databases with information requested by the Chapter 602 Report.

Broome-Delaware-Tioga BOCES requests that the Department provide better guidance on how enrollment is to be reported if Chapter 602 data are to agree with Report Card data.

Recommendation

3. Maintain sufficient documentation to support Chapter 602 reported statistics.

Comments of Broome-Delaware-Tioga BOCES Officials

Broome-Delaware-Tioga BOCES officials concur with the recommendation. They state, however, that the lack of alignment among Department CO-SER guidelines, Chapter 602 Report guidelines, and Report Card guidelines forces them to maintain similar data in three different versions.

Data Collection and Use

BOCES have been asked five questions regarding data collection and use. The questions are being asked to ascertain best practices that might be shared among the BOCES. Broome-Delaware-Tioga BOCES did not respond directly to the five questions, but did send a letter and attachments. These data are included as Attachment B.

The five questions are listed below.