Legislative auditors on Friday questioned more than $500,000 in spending of federal grant money by three educational programs in Bald Knob and Russell over a period of about three years through July 31, 2016.
Russell United Methodist Church was awarded a five-year, $660,000 federal 21st Century Community Learning Centers grant by the state Department of Education for Russell's after-school program, and the Bald Knob Fine Arts Council was awarded two five-year, $660,000 federal grants for the city's after-school and summer programs, said Assistant Legislative Auditor Kim Williams. Bald Knob is about 12 miles northeast of Searcy, and Russell is about 5 miles northeast of Bald Knob.
The federal grants are designed to establish community learning centers that offer academic, artistic and cultural enrichment opportunities to students during times when school is not in session, Williams told the Legislative Joint Auditing Committee.
Tammie Cloyes provided primary oversight of the 21st Century Community Learning Centers program as its coordinator at the state Department of Education until she left the department on June 30, 2016, Williams said.
The state receives a total of about $8 million a year in those grants and now has about 72 grants, said Traci Boyd, an internal auditor and grants programs coordinator for the Department of Education.
The department suspended grant funding to the three programs in Russell and Bald Knob in April after auditors raised questions about their expenses, said Education Commissioner Johnny Key.
"In this case, the department failed to meet the standards of the people of Arkansas and certainly this committee," Key told lawmakers. "When we fail to meet those standards, it's important that we immediately take corrective actions and we put in place measures to make sure that these type of things don't happen again."
Boyd said the department conducted an internal audit review of the programs for the period of Aug. 1, 2016, through April 4, 2017, at the recommendation of Arkansas Legislative Audit, which reviewed the period from July 1, 2013 through July 31, 2016.
"I found many of the same issues that Legislative Audit has in their report," Boyd said.
The Education Department aims to regain $476,495 of the money.
Based on its review, the department plans to soon ask the Russell after-school program to pay back $303,638, the Bald Knob after-school program to repay $131,563 and the Bald Knob summer program to pay back $41,294, Boyd said after the legislative committee's meeting.
Legislative Audit staff raised questions about more than $500,000 in spending:
• The Russell after-school program paid $212,729 for undocumented compensation, contract labor and goods and services; $75,087 on related-party transactions; and $46,401 for unallowable compensation and goods and services that failed to comply with state guidelines during the approximately three-year period reviewed by auditors.
The program started getting grant funds in the 2013-14 school year, and Russell Mayor Renee Garr and Bald Knob School District instructor Davissa Brimer have been the paid coordinators, Williams said. The program was held primarily in the facilities of Russell United Methodist Church.
• The Bald Knob after-school program spent $75,064 for undocumented compensation, contract labor and goods and services; $52,098 for related-party transactions; and $10,255 for unallowable compensation and goods and services that that didn't comply with state guidelines.
This program began receiving the funds in the 2014-15 school year, and Brimer and Garr have been the paid program coordinators, although LaDonna Gibson, artistic director for the Bald Knob Fine Arts Council, oversaw the day-to-day operations, Williams said. This program was held at Christ Community Church in Bald Knob and was held simultaneously with the Russell after-school program, she said.
• The Bald Knob summer program paid $24,883 in related-party transactions; $11,031 for undocumented compensation, contract labor and goods; and $5,019 for unallowable compensation and goods and services that failed to comply with Education Department guidelines. This program was also held at Christ Community Church in Bald Knob and began receiving grant funds in the 2015-16 school year. Gibson has been the paid coordinator to oversee the day-to-day operations, Williams said.
Brimer was paid $86,810 during the three-year period reviewed by auditors, Garr was paid $83,642, and Gibson was paid $10,010, but time sheets required by federal guidelines were not maintained, Williams said. Thus, Arkansas Legislative Audit staff members were unable to determine if the salaries paid were actually earned, she said.
The Russell after-school program overpaid Brimer by $11,213 and Garr by $9,952, and the Bald Knob after-school program overpaid Brimer by $2,472 and Garr by $1,190, Williams said. But officials for the programs said the payments were made at the advice of department employees.
The three programs' more than $150,000 in related-party transactions included payments to relatives of Cloyes, Brimer, Garr and Gibson; payments of conference fees and travel for Cloyes' husband; and purchases of goods from Brimer, other employees and Gibson's employer, Williams said.
In a letter to the Legislative Joint Auditing Committee, Garr and Brimer said Garr is retired from the Bald Knob School District and Brimer has 24 years of teaching experience and teaches fourth grade at Bald Knob.
"As you may have guessed from the audit report and as we admit openly in this response, we are not accountants," they wrote in their letter. "Like most educators, our main concern at all times is the children we serve in the program. This does not excuse us from the mistakes we made, but it should give you an idea of our perspective and may help you understand why our decisions were not obvious mistakes to us at the time."
Garr and Brimer said they worked with the 21st Century Learning Community Centers grant program through the Bald Knob School District from 2009-13 and "when the school did not reapply for the grant, we took it upon ourselves to keep the program open by applying through the Russell United Methodist Church.
"When we were on our own, we realized just how much we didn't know, and we relied heavily on the Arkansas Department of Education for guidance," they wrote in their letter. "We signed the grant assurances stating that we would keep timesheets for all employees, and we should have kept better timesheets."
Three officials for the Bald Knob Fine Arts Council said in a letter to the legislative committee that they would "document our expenditures in a more detailed manner and strive to be better stewards of the funding."
"These programs are essential to the many students at Bald Knob that utilize them," according to the letter from Gibson, arts council chairman Paula Gilbee and treasurer Jane Ellis.
Metro on 12/09/2017