NEW: Central MA Education Collaborative Overcharged Worcester Schools

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Tuesday, July 31, 2012

GolocalWorcester News Team

An audit revealed that the Central Mass Education Collaborative (CMSEC) overcharged Worcester Schools resulting in a surplus of more than $4.5 million. Payroll errors and a pattern of problems were also revealed.

The audit was issued by State Auditor Suzanne Bump and showed that the multi-community partnership charged Worcester and Webster school districts fees that exceeded the actual costs.

“The problems we found at the Central Massachusetts Special Education Collaborative are typical of those found in past audits of the education collaborative system,” said Auditor Bump. “Our audits of collaboratives have provided the basis for meaningful reform. I hope this audit will continue to assist policy makers in strengthening the oversight and accountability of Education Collaboratives.”

CMSEC provides the school districts with educational services to approximately 500 special needs students.

Guidelines set by both the Massachusetts Department of Revenue and the Office of the Attorney General state that fees from a government agency should not exceed the actual cost of the service provided. Auditor Bump recommended that the collaborative amend its pricing methodology and establish an appropriate method to remit surplus funds to its member districts.

Besides the overcharging, the report also shows that CMSEC failed to administer its retirement benefit program. CMSEC never transitioned employees from Social Security to the state system and, as a result, denied some employees the opportunity to receive thousands in additional annual retirement income.

The audit noted deficient internal controls over certain financial and management activities including CMSEC’s spending of $24,000 on procurements without soliciting competitive bids. Collaborative employees were not required to submit adequate documentation to justify expenses. In a sample, Auditors found $21,314 in expenses that either lacked any supporting documentation or lacked an identified business purpose.

Errors made in payroll records led to employees earning $1,630 in unearned sick time.

“I am pleased to have worked with the Chairs of the legislature’s Education Committee, Representative Alice Peisch and Senator Sonia Chang Diaz, to use the result of our past audits of collaboratives to generate real reform,” said Auditor Bump. “The recently passed reforms will address findings from this audit. Collaboratives are now required to follow generally accepted accounting standards and must form new written agreements with their member communities that set limits on allowable surpluses.”

CMSEC has responded positively to all findings and is pursuing implementation of all of the Auditor’s recommendations.

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