New York Lawmakers Demand Audits of Special Ed Pre-K Contractors

Lawmakers in New York want to take a closer look at how the money allocated for pre-school educational programs for disabled students is spent. David M. Halbfinger reports in The New York Times that both houses of the state Legislature approved a bill that would subject every pre-K special education contractor to an audit by 2018.

The move comes in the wake of a report by the State Comptroller Thomas P. DiNapoli that found rampant mismanagement in the system. DiNapoli uncovered instances of the state being charged for things completely unrelated to child care such as vacations for contracting company employees, trips to the spa, jewelry and even groceries.

In addition, some contractors have taken advantage of loose regulations by falsifying children’s evaluations in order to sell expensive therapy regimens provided by their own companies.

The legislation now goes to Gov. Andrew M. Cuomo, whose office did not indicate whether he would sign it. Under the bill, school administrators would not be permitted to assign a child’s services to the same prekindergarten contractor that evaluated him or her, unless they stated in writing that “such placement is an appropriate one for the child” and notified the state education commissioner of the assignment.

That is intended to address conflicts of interest that have occurred when companies evaluated children, exaggerated their disabilities and then provided the services.

DiNapoli said that the bill was necessary to make sure that the state’s taxpayers were getting the best services for their money. New York now has the most expensive pre-K special education program in the country, and without strict oversight the instances of waste could multiply.

In addition to forcing in audit on all firms contracted with the state, the legislation also asks the State Education Department to put in a better system of contractor reimbursement and regulation.

Nearly all the department’s budget and personnel for oversight are devoted to calculating some 1,400 reimbursement rates for each of the prekindergarten contractors in the state. Little is left to verify that the money is spent properly or to ensure the quality of the services.

A result, officials say, has been rising costs for the state and local governments, which split the bill roughly 60-40. In New York City, annual costs now total $1.2 billion, about 6 percent of the $19.8 billion education budget. Statewide, costs have doubled in just six years.

A number of groups representing the interests of the contractors have protested the broad characterization of the whole industry as crooks, saying that except for a few “bad apples,” everyone involved in the program is chiefly dedicated to helping children.