Delayed action by state Superintendent creates big hurdles for legislature’s mandated audit

Delayed action by state Superintendent creates big hurdles for legislature’s mandated audit

- in Education, Top Story
N.C. Department of Public Instruction (Photo by Clayton Henkel)

When Joni Robbins, a section chief in the N.C. Department of Public Instruction, closes bidding next week for an upcoming audit of the state’s top K-12 agency, state leaders will have a little more than four months to find a vendor and begin work on a weighty review of the department’s operations.

But past and present leaders in the state’s public schools say they worry about the speed and depth of the deep-dive, organizational review led by Superintendent Mark Johnson’s office, which comes with a report due to the legislature by May 1.

“To award, prepare a team, bring in the team, do the research and produce a report by April is going to be difficult, if not impossible,” said Philip Price, DPI’s longtime finance chief until his 2017 retirement.

Price was one of multiple K-12 leaders who tell Policy Watch they’re concerned that the audit may be weakened by its slow rollout. The review was one of many public school mandates etched into the General Assembly’s 2017-2018 budget plan when it earned final approval in late June, but bidding for the state contract didn’t begin until Dec. 1.

And, with bidding set to wrap Monday, experts say that inking a contract with an “objective, third-party organization” mandated by state lawmakers this year could take weeks to complete.

“I view it as extremely ambitious to think you could do a thorough audit and report out by May 1,” said State Board of Education Chairman Bill Cobey.

Bill Cobey

“I’d rather have a solid, meaningful audit rather than something that is rushed to a conclusion and doesn’t necessarily represent the kind of work that I believe the General Assembly would want and that I certainly would want,” Cobey added.

And while the state board chair stopped short of criticizing Johnson’s office, Cobey said it would have been “helpful” if the superintendent completed the RFP months ago, given this year’s state budget earned final approval in late June.

For comparison, a 2008 DPI performance audit with a far more narrow scope than this year’s legislative mandate took more than a year to complete, state K-12 experts say, with consultants from Massachusetts-based Boston Consulting Group embedded in the department at least eight to nine months before they began work on any report.

June Atkinson

Former DPI Superintendent June Atkinson, a Democrat who lost to Johnson in last year’s election, complained that the timeframe could pave the way for a “surface job” by the state consultant.

The audit comes amid mounting pressure from North Carolina legislators to root out alleged inefficiencies in the  agency, which oversees the state’s roughly $9 billion K-12 budget and serves 115 local school systems across the state as well as the growing charter school sector.

Lawmakers want an independent auditor to review the agency’s services, branches, staffing, funding allocations and technology before making recommendations for legislative action next year.

In the General Assembly-approved budget bill, top Republicans called for the auditor to find unnecessary or “ineffective” programs and services, evaluate jobs within the department that are “duplicative” and lay out measurable goals, roles and responsibilities for the central office administration.

And legislators took the somewhat unusual step of budgeting in $1 million in DPI cuts next year based on anticipated savings from the pending audit. Atkinson says that suggests Republican legislators have already made up their mind about the report’s findings before an independent consultant can begin work.

“That means the General Assembly has already determined ‘efficiency,’” said Atkinson.

This year’s fiscal scrutiny of the K-12 department is no outlier. GOP lawmakers, particularly powerful budget writers in the state Senate, have offered withering criticism of the K-12 department for years, slamming an agency they’ve often derided as “bloated” or “wasteful” of tax dollars.

Along the way, they’ve chopped more than $22 million from DPI since 2009 and axed dozens of jobs from a department charged with offering support and professional development to local school districts.

State and local K-12 leaders say DPI is most essential to North Carolina’s poorest districts, which often don’t have the funds or staff to deploy more resources to struggling, low-performing schools.

Superintendent Mark Johnson

Johnson, a Republican who did not respond to interview requests this week, told members of the State Board of Education last week that legislators and the public want more urgency and efficiency from the K-12 bureaucracy and the state board.

“I think what the General Assembly is looking for is accountability, accountability for the money that is sent to this department,” he said. “Through the audit, we will show that we are working to be accountable.”

The superintendent—who was relatively quiet when lawmakers dished out another round of cuts to his department this year—added that he believes DPI hasn’t always administered its funding wisely, again citing about $15 million in unspent elementary literacy funds over two years under Atkinson’s leadership.

Atkinson and former DPI leaders slammed Johnson’s claims as “misleading” in a Policy Watch report last week, arguing that the funding was allotted for North Carolina’s 115 local school districts to spend, and not state administrators.

Furthermore, one of Johnson’s own budget advisors played a role in blocking DPI’s use of a portion of that cash in 2015, Policy Watch’s investigation found.

Despite the criticism from Johnson and some lawmakers, state board members such as Cobey and Eric Davis, both appointees of former Gov. Pat McCrory, seemed skeptical of Johnson’s work on the audit in recent days.

Cobey said he’s not opposed to the agency’s performance review, but he argues state board members and DPI leaders have been paring down operations for years due to General Assembly orders.

“I’m open to eliminating wasteful or redundant spending,” said Cobey. “I just don’t know where it is, if there is any. I think it’s going to take a lot of work on the part of a consultant, no matter how qualified.”

Rebecca Garland, a longtime DPI administrator who, like Price, retired this year, said the timeline for the upcoming DPI audit isn’t too far removed from a legislatively-ordered structural review of the department and state board in 2009 by Florida-based Evergreen Solutions LLC, but she emphasized that the job will be a tall order nonetheless.

“I wouldn’t say that it’s not doable,” Garland said. “But I would think that if you were going to do it in a reduced time frame that you’re going to have a pretty good number of people who are going to take a deep dive. You would certainly have to have people who know what they are looking at to get a view of everything the department has to do, which is extensive. I don’t think people truly understand the scope of commitments, responsibilities and requirements the department has.”

Meanwhile, Davis, who’s also a sitting school board member in Charlotte, questioned why state board members were not involved in Johnson’s development of a request for proposals from potential audit consultants.

In an interview with Policy Watch this week, Davis said he didn’t want to “prejudge” the results of the audit, but he bristled over a seemingly growing divide between DPI staff and the state superintendent, who is tasked under the state Constitution with serving as the chief administrator for the K-12 agency.

“What I have great concern with is the continued reduction in funding for not just DPI but for public schools in general,” said Davis. “And the cumulative effects of budget cuts, particularly since the recession. We’ve got 115 school districts and over 180 charter schools in the state. Our most challenged school districts from the poorest parts of our state are the ones that are most reliant on our (DPI). Years and years of funding reductions really impact, in the most direct way, those students in those districts.”

Davis added that he’d like for Johnson’s office to present its own proposals for DPI’s funding.

“If that means further budget cuts, I would like the recommendation to come from him, the single person in the state most responsible for the performance of that department,” said Davis.

Members of the state board aren’t expected to meet again in 2017, but the panel and Johnson are currently prepping for a pending state Supreme Court appeal of a 2016 law that dispatched more budgetary powers to Johnson’s office.