Committee Report | September 2012

Report of

REGENTS AUDITS/BUDGET AND FINANCE COMMITTEE

to

The Board of Regents

September 11, 2012

The Regents Committee on Audits/Budget and Finance met as scheduled this morning, September 11, 2012.  Co-Chair Dawson, Chancellor Tisch, Regents Bendit, Phillips, Tallon, Tilles, Brown, Cashin, Cotrell, Rosa, and Young were in attendance.

Co-Chair’s Remarks:  Regent Chapey welcomed everyone and thanked the Internal Audit Workgroup for all the work done for the Committee.

Items for Discussion

Special Education Fiscal Oversight

The Committee was briefed on the results of a number of audits recently issued by the Office of the State Comptroller.  The audits were of preschool special education providers and included troubling findings ranging from inappropriate spending to fraudulent activity resulting in arrests.

The members were briefed on the history of similar audits, and provided background on the programs and services that are provided to eligible students.  The Department’s role in the establishment of tuition rates that are used by providers was also described.  

Recognizing the need to enhance oversight in this area, staff describes actions that have been previously taken with public schools, and described actions that have been taken against the providers that were audited.  An internal workgroup has identified five key areas that will be further researched and which may identify improvements in the rate setting methodology.

The Department has identified some specific recommendations to strengthen approval/renewals, certifications, training, and data reporting; sought the input of the Members of the Committee and asked for time to do further research and analysis of the applicability of school district accountability requirements to special education providers.       

Completed Audits

The Committee was presented with 17 audits this month.  One audit was issued by the Office of Audit Services (OAS), 15 by the Office of the State Comptroller (OSC), and 1 by the New York City Office of the Comptroller.  The audits were of 9 school districts including 2 New York City high schools, 4 charter schools, 2 degree-granting college’s Tuition Assistance Program (TAP) payments, and 2 New York City Department of Education initiatives.  

The findings were in the areas of procurement, payroll, cash, information technology, extra-classroom activity fund, and conflict of interest.

August 2012 Fiscal Report

Our Executive Deputy Commissioner briefed the Committee members.


Extensive spending controls continue on all funds.  Overall spending in the General Fund  reflect a 2.5 percent reduction from the 2011-2012 levels as included in the 2012-2013 enacted budget. General Fund accounts are in structural balance with the exception of the Tenured Teacher Hearings (TTH) Account, although fiscal and programmatic reforms were included in the enacted state budget, there continues to be a deficit of an estimated $9 million in unpaid bills due to chronic under-funding of this program.

All special revenue accounts are in structural balance on a current year basis and the accumulated negative balance in the Cultural Education Account is being reduced by approximately $700,000.

October 1, 2012