HARRISBURG – Auditor General Eugene DePasquale said Wednesday his office's audits revealed more than $8 million in reimbursement errors in 42 school districts.
In the 2016-17 school year, the state issued $522.5 million in transportation reimbursements toward a total cost of more than $1.56 billion. Local school taxpayers are responsible for the difference.
Recent audit results for a number of school districts indicate “a troubling trend,” DePasquale said.
DePasquale said that since the $8 million came from just a fraction of the state’s 500 school districts, it’s likely the statewide total in transportation reimbursement errors is much higher.
“Some districts could not provide documentation to our auditors, which thwarts our ability to determine if a district is receiving the correct amount of money,” DePasquale said. “Local school taxpayers pay costs not reimbursed by the state, meaning this problem can affect how much money makes its way to the classroom — where it is needed to help develop Pennsylvania’s future workforce.”
DePasquale said the errors in reimbursement are corrected by the Pennsylvania Department of Education (PDE) in future payments to the schools. But those corrections only happen when they are pointed out by his office. And because his office doesn’t audit each of the state’s 500 school districts every year, there can be years of lag between when the errors are made and when they are discovered.
Eric Levis, a spokesman for the Department of Education, said staff at that agency rely on the auditor general to flag errors in the transportation reimbursements.
“If discrepancies are found and a finding issued to the school district, the (auditor general) subsequently forwards the finding to PDE to address the subsidy over- or under-payment,” Levis said in an email.
Levis said the department makes adjustments in subsequent transportation reimbursements to compensate for earlier errors.
“We can only do this following receipt of information from (the auditor general),” he said.
Since May, six school district audits have been released covering the 2012-13 to 2015-16 school years with findings involving a lack of documentation for transportation reimbursements: Springfield Township, Montgomery County; Steelton-Highspire, Dauphin County; Garnet Valley, Delaware County; East Allegheny, Allegheny County; and Jeannette City and Monessen City, Westmoreland County.
Together, these six districts received $10 million in reimbursements, but a lack of documentation prevented auditors from determining if that total was exactly what the districts were owed.
“While I do not believe districts are doing this on purpose, I want all districts to keep better records moving forward. Should we find any evidence of districts ‘padding’ their numbers, we will refer such cases to local prosecutors,” he added.
DePasquale released a list of 42 school district audits completed since July 1, 2015 that identified more than $8.4 million in incorrect reimbursements.
That included $4.77 million in overpayments to school districts and $3.67 million in underpayments.
Among the school districts that received incorrect reimbursements were:
- Central Cambria, which was underpaid by $119,517 according to a 2016 audit.
- Greater Johnstown Area School District, underpaid by $17,710 according to a 2016 audit.
- Shade Central City School District, was overpaid by $11,935 according to a 2018 audit.
- Sharon City School District, underpaid by $187,021 according to a 2018 audit.
The errors involved districts incorrectly reporting the number of students transported; the number of days transporting students; mileage; and/or the amount paid to transportation contractors.
DePasquale said he thinks the state Legislature needs to take a look at simplifying the formula used by schools to calculate the reimbursements.