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8 WNY school districts next for state audits

Eight school districts in Western New York are among 28 across New York that are next on the list for state audits, State Comptroller Alan G. Hevesi announced recently.

The eight districts are Springville-Griffith and Gowanda in southern Erie County, Lewiston-Porter in Niagara County, Silver Creek in Chautauqua County, Franklinville in Cattaraugus County, Elba in Genesee County, Holley in Orleans County, and Bolivar-Richburg in Allegany County.

Lake Shore, in late October, became the first local district to be audited as part of the state's five-year plan to review the books of every school district in New York.

The audits are looking at everything from multimillion-dollar contracts to how much money districts spend on meals during school board meetings. Hevesi noted that his auditors will be paying close attention to items such as cell phone use and travel reimbursement.

"The research on fraud shows that it develops and grows over time," he wrote in an annual report on the school district audits. "That is, the first actions by persons engaged in fraud are usually small, like padding a travel expense voucher. However, once the person engaging in fraud experiences success, the actions are repeated and expanded."

The state comptroller's office stopped doing routine school audits in the late 1970s, when the practice fell victim to budget cuts. Hevesi's office conducted several school audits on Long Island last year, in response to allegations of fraud by some school officials.

In the most high-profile case, the superintendent in Roslyn and several other officials were found to have spent, over eight years, more than $11 million of district money on personal expenses -- from paying mortgages to buying luxury cars. Six people, including the school superintendent, have been charged.

The downstate scandals led the State Legislature last summer to enact a law requiring the comptroller's office to audit each of the 699 school districts, 38 Boards of Cooperative Educational Services and 84 charter schools in New York by March 31, 2010.

So far, Hevesi's office has completed 18 school district audits, which have found fraudulent activity in Roslyn, Hempstead and Manhasset, according to the annual report.

In Hempstead, the district paid $1.1 million to temporary agencies for employees, apparently without requesting proposals from various agencies, the report found. The district also paid $900,000 on 18 professional service contracts without getting bids and paid a total of $117,000 to five officials for unused time off, though their contracts did not entitle them to those payments.

Several downstate districts were found to have "serious internal control deficiencies."

A total of 71 school audits are either under way or scheduled to begin soon, Hevesi said. He expects to complete 100 school audits in 2006.


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