November 6, 2002 |
2002-R-0897 | |
ACCOUNTABILITY FOR STATE EDUCATION GRANTS | ||
By: Judith S. Lohman, Chief Analyst | ||
You asked how the state ensures that towns and school districts spend state education grants for their intended purposes.
SUMMARY
Town and school district spending of state education grants is monitored in several ways. Not only do many education grants have specific reporting and accountability requirements written into their authorizing statutes but education grants are also subject to three general reporting and auditing laws.
State education grants are covered by the state Single Audit Act, which mandates annual financial and compliance audits for nonstate entities receiving state grants. These audits, which must conform to state requirements, are performed by independent certified public accountants hired by the grant recipients. Auditors must assess both the financial controls and legal and regulatory compliance of entities receiving state grants. Another law gives the Auditors of Public Accounts the authority to audit school district or municipal records related to state education grants. Finally, the State Department of Education (SDE) requires school districts to make extensive annual financial reports on their operations and expenditures. School superintendents must certify to the accuracy of these reports.
In addition to these general accountability requirements, many state education grants have explicit reporting and review requirements written into the grant authorization laws. These reviews and audits are performed by the State Department of Education.
GENERAL STATUTORY ACCOUNTABILITY REQUIREMENTS
There are several financial accountability statutes that apply to all state education grants to school districts and municipalities.
Single Audit Act
Municipalities and school districts receiving state education grants are subject to the state Single Audit Act, which requires municipalities and municipal entities, such as special districts and regional school districts, and nonprofits agencies that spend $ 100,000 or more in state grants in any year to be audited (CGS § 4-230-4-236). Local entities that spend less than $ 100,000 per year in state grants are subject to program audits of the state-funded programs.
The audits must be performed by independent certified public accountants hired by the local entity. The law requires auditors to report on both the entity's compliance with state laws and regulations and on its internal financial controls. Audits must be filed annually with the Office of Policy and Management (OPM) and with the agency that gave the grant.
According to Ray Inzero, manager of the State Department of Education's (SDE) Internal Audit Division, each department that gives out grants must give OPM a so-called "compliance supplement" for each grant. The compliance supplement sets out grant-specific criteria for the auditors to assess during their annual audits. It is these compliance supplements that allow auditors to report on grantees' compliance with specific statutory requirements on how education grants must be spent. Although OPM is the lead agency for municipal single audits, reports on education grants are also sent to the SDE.
Auditors of Public Accounts
In addition to the Single Audit Act requirements, state law gives the Auditors of Public Accounts authority to examine the accounts and records of any town or local or regional board of education in connection with any state grant made by any state agency (§ 10-260a).
Financial Data Reports
The law requires each local and regional board of education, through its school superintendent, and each regional educational service center, through its executive director, to submit an annual report of expenditures, receipts, and other financial statistics for each grant to the SDE by September 1 annually (§ 10-227). This report (Form ED 141, copy attached) requires the superintendent or executive director to list grant expenditures in several categories and to certify its accuracy. According to Inzero, the information on the ED 141 allows SDE to monitor expenditures for each line item in a grant and to match expenditures to annual grant budgets that districts must submit prior to receiving a grant for each year (Form ED 114, copy enclosed).
ACCOUNTABILITY REQUIREMENTS FOR SPECIFIC GRANTS
In addition to the general audit and financial controls summarized above, many state education grants have additional statutory accountability requirements. These are summarized in Table 1.
Table 1: Statutory Accountability Requirements for Specific Education Grants
Grant |
Requirement |
Statute |
Telecommunications Projects |
· Reports and financial statements as required by the SDE · If the education commissioner finds the grant is not used for purposes set out in the law, he can require repayment |
10-4h |
Connecticut Career Certificate |
· Reports and financial statements required by the SDE · If the education commissioner finds the grant is not used for purposes set out in the law, he can require repayment |
10-20d |
Exemplary Classroom Projects |
Financial statement of expenditures and annual project report |
10-66n |
Charter Schools |
Annual report on school's financial condition, including certified audit statement of all revenues and expenditures |
10-66cc |
Young Parents Program |
· Reports and financial statements as required by the SDE · If the education commissioner finds the grant is not used for purposes set out in the law, he can require repayment |
10-74c |
Special Education |
Claims for reimbursement must be audited annually by certified public accountants hired by the State Board of Education (SDE) |
10-76m |
Dropout Prevention |
· Annual statement of expenditures, project report, and financial audit · If the commissioner finds the grant is not used for purposes set out in the law, he can require repayment |
10-202f |
Schools in Need of Improvement |
· Annual expenditure reports · Districts must refund any amounts unspent at the close of the program and any amounts not spent in accordance with the grant application |
10-223c |
School Technology |
· Annual expenditure reports · Districts must refund any amounts unspent at the close of the program and any amounts not spent in accordance with the grant application |
10-262n |
Transitional Districts |
If the education commissioner finds the grant is not used for purposes set out in the law, he can require repayment |
10-263c |
Magnet School Capital Expenditures |
Education commissioner must provide for a final audit of all project expenditures and may require repayment of ineligible expenditures |
10-264h |
Magnet School Transportation |
Annual statement of expenditures |
10-264i |
Vocational Education Equipment |
Expenditure report as required by SDE |
10-265b |
Early Reading Success |
· Expenditure reports as required · Districts must refund any amounts unspent at the close of the program and any amounts not spent in accordance with the grant application |
10-265f |
School Building Improvement |
· Expenditure reports as required · Districts must refund any amounts unspent at the close of the program and any amounts not spent in accordance with the grant application |
10-265h |
Summer School |
· Expenditure reports as required · Districts must refund any amounts unspent at the close of the program and any amounts not spent in accordance with the grant application |
10-265m |
Priority District |
Annual project evaluation and financial audit |
10-266r |
Extended School Hours |
Annual program report, statement of expenditures, and financial audit in conjunction with state single audit process |
10-266u |
School Breakfast Program |
· Annual expenditure report · If the education commissioner finds the grant is not used for purposes set out in the law, he can require repayment |
10-266w |
School Construction Grants and Interest Subsidy Payments |
If commissioner determines a project has not met the approved conditions of the original application, the SBE may (1) withhold subsequent grants for the project until remedial action is taken or (2) may require repayment of the grant |
10-287; 10-292j |
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