Experts Criticize California’s Reimbursement System

Published: July 26, 2007

SACRAMENTO, Calif. – Over the last five years, the Los Angeles Unified School District (LAUSD) has undergone nine audits and returned more than $57 million out of $62 million state reimbursements, leading some experts to complain that California’s auditing system is too difficult to follow.

Authorities in the State Controller’s Office, the organization responsible for performing the audits, attribute the statistics to its size. As the largest school district in California, LAUSD naturally attracts a great deal of attention.

But others take issue with the complicated process of applying for government funding only to have to return it when a district fails to pass an audit. District officials say the procedure takes up valuable time that could be spent teaching students.

When the state legislature passes a law that puts new cost requirements on schools, the districts can apply for reimbursement funds, a process that often takes years. Furthermore, the amount the legislature sets aside for reimbursement funding varies from year to year. In 2007-08, it is not expected to allot any money at all.

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If the State Controller’s Office decides to perform an audit, they look for extensive documentation of how school and district officials spent their time. If paperwork is missing, the auditors can force the district to return its funds. Many education experts have complained that the rules are unclear, leaving officials in the dark about which documents they need to retain.

The State Controller’s Office is currently working with state legislators, local school districts and the Department of Finance to improve the efficiency of the state mandate reimbursement process.

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