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Shredded documents may cost Hernando schools as much as $3.7 million in state funding

“It’s a very serious concern. We’re waiting to see how the process plays out,” Hernando School Board member Matt Foreman said.
“It’s a very serious concern. We’re waiting to see how the process plays out,” Hernando School Board member Matt Foreman said.
Published May 28, 2015

BROOKSVILLE — A recent audit of state money paid to Hernando County schools last school year found several small problems — and a very big one that could cost the already cash-strapped district as much as $3.7 million.

The shredding of attendance records at Suncoast Elementary School left the district without documentation for the funding it collected for nearly 900 students. Though the district is confident that it can produce other records to save most of the funding, the risk of significant losses is real, School Board member Matt Foreman said.

"It's a very serious concern," he said. "We're waiting to see how the process plays out."

That process includes an appeal with the state Department of Education, which will set up a hearing committee of independent experts, said George Gall, the district's outgoing chief financial officer.

This committee can consider other proof of student attendance, including meal and transportation records that the district has already compiled.

The process, which could take several years to complete, should result in the department eliminating some of the district's debt to the state, he said, "but the question is how much."

Both Gall, and superintendent Lori Romano — in a letter written to the state in April — referred to a recent precedent for restoring funds.

About two years ago, a Lake County district charter school also failed to provide attendance documents, Gall said. The state restored all or most of its funding, he said, but its shortfall was much smaller because it involved a smaller number of students.

The state Auditor General's Office analyzes each district's state funding every year. The audit for the 2013-14 school year, completed April 28, found that the district was not able to provide documents for 897 students who had attended Suncoast.

Including the much smaller issues with documentation at other schools, and factoring in more expensive programs needed by some of the students, the auditor found that the district had claimed payment for the equivalent of 991 students that it couldn't justify.

Because the state paid the district $3,752 for each of these "full-time equivalent" students, "the estimated gross dollar effect of our proposed adjustments … is a negative $3,719,828," the audit said.

Though all the attendance statistics had been entered into a computer file, said David Hughes, a manager for the Auditor General, his office requires original records.

"It's like when you claim a deduction with the (Internal Revenue Service). You have to have the documentation," Hughes said.

"It may not seem reasonable to people who were at the school, who say, 'I can see the students, what's the problem?' But you have to be able to show it."

Gall said that if the district is required to compensate the state for some or all of the shortfall, it will be taken out of the following year's payment from the state.

The district, which is facing cuts in a wide range of programs to make up an estimated $12 million budget shortfall for the next fiscal year, found out about the destroyed documents long before the audit was released.

According to a district investigation initiated last year, the clerk mistakenly believed the records could be destroyed after the information had been compiled electronically.

Though she told the investigator that she did not know that law required her to keep the paperwork for three years, she had followed that procedure with other documents.

"While there may not have been an intent to destroy records and violate statute, the employee acted inappropriately in her assigned duties," the investigative report said.

The clerk was asked to resign and Suncoast principal Lisa Braithwaite was also cited in the report for allowing the destruction on her watch.

"There is the potential for the district to lose a significant amount of funding as a result," the report said.

Contact Dan DeWitt at Follow @ddewitttimes.