NY comptroller: State oversight of special ed lax

BUFFALO, N.Y. (AP) -- The state Education Department has no process in place to routinely review the private contractors who charge hundreds of millions of dollars to provide special education services to disabled students and has not done any onsite audits of individual providers in five years, New York Comptroller Thomas DiNapoli said Tuesday.

A review found that other fiscal oversight is limited to desk reviews of self-reported information, which is often filed late and rife with error, said DiNapoli, who undertook the review after a series of audits of preschool special education providers found cases in which contractors cheated the system out of millions of dollars.

He recommended the state develop and implement a plan for onsite fiscal and program monitoring of special education providers, something state education officials said is already in the works.

"Children with disabilities and taxpayers are being ripped off and it has to stop," DiNapoli said. "The state Education Department has much work to do to straighten out the special education program."

In 15 recent reviews of private providers, state auditors found $13.2 million in disallowed billings out of $139.8 million paid. Six cases were referred to law enforcement after auditors found funds being used to hire relatives at excessive salaries and pay for things like vacation homes and home entertainment.

Education Commissioner John King said Tuesday his department already has adopted reforms to improve accountability but doesn't have the staff or resources to fiscally audit every special education provider. He pressed for more audits by the comptroller.

"We're moving forward with our reforms," King said in a statement. "We urge the comptroller to put his army of auditors to work protecting funding for these special needs children."

The New York State Association of Counties, used Tuesday's report to renew its call for reform of special education mandates.

"With yet another report revealing problems with the system, we continue to press for changes that will help the children being served and relieve the taxpayers funding these vital services," NYSAC Executive Director Stephen Acquario said.

Gov. Andrew Cuomo said Tuesday he had not read DiNapoli's report but spoke of a need for balance in providing services while preventing fraud.

"There will always be some level of fraud in almost any program — government program, private sector program — some level of fraud," he said in Albany. "People pay their taxes, people don't pay their taxes. But what you are trying to do is everything you can to catch it, eliminate it."

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Associated Press Writer Michael Gormley contributed to this report from Albany.