HARLEM — An audit of Success Academy Charter Schools by Comptroller Scott Stringer's office found financial deficiencies and said the network should return $50,000 in special education funding because it's unsure whether the services were delivered.
The audit, among a series conducted on charter schools by the comptroller's office, found that the charter network, headed by former City Councilwoman Eva Moskowitz, also did not conduct staff background checks in a timely manner, failed to properly catalog its $25 million inventory and received lax oversight from its board of directors.
“Any entity receiving taxpayer dollars must operate efficiently and follow the rules. We found irregularities in this audit of Success Academy that raise serious concerns," Stringer said in a statement.
Success Academy disagreed with many of the findings and filed a 27 page response that said Stringer had failed to conduct the audit in an "impartial and objective" manner. In a statement, the group and accusing Stringer of "political grandstanding" and failing to give them enough time to respond to the audit.
Stringer beat Moskowitz in the Manhattan Borough President's race in 2005.
"The comptroller's office spent two years preparing this report but couldn't unearth anything of substance. To prevent Success from disproving its claims and correcting its mis-understandings, which would have been simple, Mr. Stringer ambushed us — providing less than three days to respond," the network said in a statement.
Stringer spokesman Tyrone Stevens said the audit was handled like any other involving taxpayer money and that Success made the process more difficult by refusing to cooperate.
“This audit took more than two years because Success took months, and in some cases more than a year, to turn over routine business records," said Stevens. “Like every other audit subject, they got 10 business days to respond to our draft report."
Among the most serious findings of the audit is that Success Academy did not deliver special education services to some students at its Harlem 3 school.
According to the audit, a review of 21 sampled special education students found that six did not receive services for the length or the scope that Success Academy said they did. Mandated special education services were not provided for 10 of the students.
The finding is a critical one at Success Academy because the network has often been accused of not accepting special education students or pushing them out of the schools as a way to keep test scores up.
In January, a group of 13 parents from eight of Success Academy's 24 schools filed a lawsuit against the network charging that they failed to provide special needs students with the proper care and tried to force them out.
In its response to the audit, Success Academy says it provided all required services to special education children and that the comptroller's office did not understand how the Department of Education is invoiced for those services.
Background checks at Success Academy's Harlem 3 school were also not conducted in a timely fashion. Of 44 staff members surveyed, 27, or 61 percent, began working before the screening was completed.
Success Academy also failed to properly catalog millions of dollars in inventory such as laptops, cameras and smartphones. The items were not assigned to a specific school or employee and Success Academy did not conduct an annual inventory inspection.
The failure means that the Department of Education could not determine whether the items were being used properly or were necessary purchases.
Success Academy felt that the yearly inventory was just a guideline that was not beneficial for them to follow.
"We have determined that the inventorying of our fixed assets would exceed any financial or operational benefits," Success Academy said in its response. The network also felt that the overwhelming majority of its "assets" consisted of software or renovations that do not need to be inventoried.
The audit also found that Success Academy's board of trustees did not provide proper oversight by failing to "adequately monitor some aspects" of the network's "financial affairs," including a merger of seven schools.
The board also did not host the required number of meeting in two out of three years examined and failed to have a quorum at some meetings.
Success Academy says that it its bylaws allow a meeting without a quorum and that its board members were found to be "deeply knowledgeable about school governance and provides rigorous oversight regarding schools’ academic outcomes, financial standing, enrollment levels, and facilities planning" by the State University of New York, which renews the group's charter.
"Success Academy employs one of the world's top accounting firms to routinely and rigorously audit its finances," the group said.
