The Long and Winding Road…To the New York ‘Reading First’ Decision

March 16, 2012 | By Thompson Education | Post a Comment

(This post originally appeared on Title I-Derland, Thompson’s blog on federal K-12 education, and was written by Chuck Edwards, senior executive director for Thompson’s education products.) One of the things that immediately jumps out on reading the recent Reading First decision is the simple fact that it took five years to resolve the audit. The program itself ended three years ago!

The ignominious end of the Bush administration’s billion dollar reading initiative for grades 1-3 came about in 2009 due to questions about federal officials’ administration of the program, capped by a U.S. Department of Education report questioning its effectiveness.

The OIG audit report questioning New York’s subgrant procedures appeared Nov. 3, 2006, but the OIG had informally flagged problems a full year earlier.

Since then, the state worked to improve its subgranting and record retention procedures, so ED Assistant Secretary Michael Yudin’s “program determination letter” essentially just affirmed that New York’s reforms were well-warranted. In terms of the ultimate objective of an audit, which is to improve the operation of federal programs, one might argue that the system worked (although most of the money was already out the door).

But at what a cost!

Program officials at both the state and federal level engaged in site visits and numerous conference calls. A substantial number of records had to be compiled and reviewed. The PDL details the considerable time and resources dedicated to this process.

And the sheer duration of the resolution process is breathtaking. But, unfortunately, not at all extraordinary. ED’s own internal target for resolving an OIG audit is six months. In fact, it rarely, if ever hits this target. It typically takes at least two years. Five years is no record.

This has significant legal consequences. Completely unmentioned in the PDL is the fact that even if ED had upheld all or part of the OIG’s fiscal demands, it could not have compelled repayment anyway. The audit covered the period May 2, 2002, through Sept. 30, 2005. And there is a five-year statute of limitation on repayment demands. That period lapsed over a year and a half ago.

Why so long?

I can only speculate, but part of the problem may arise from the increasing scope of OIG audits. Over the past decade, the auditors have taken on very large and complex projects, and resolving them takes a commensurate amount of time and effort. And the officials involved all have day jobs.

Certainly, the department is aware of the problem, and ED risk management officials have flagged it as a priority. In fact, this kind of situation may lead to the resurrection of ED’s long-neglected Cooperative Audit Resolution and Oversight Initiative (CAROI). This process would replace the adversarial audit resolution process — an undoubted contributor to the length of the process — with a more collaborative approach. It is prominently featured in the sweeping audit reform proposal recently issued by the Office of Management and Budget. So maybe these five-year epics will finally recede into the past.

Photo Credit: Rainer Schuetz

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