Audit Finds a Quarter of Wisconsin Schools Missed Financial Deadlines
Legislative Audit Bureau report recommends changes to DPI to improve procedures.
State Superintendent Jill Underly speaks Thursday, Sept. 21, 2023, at the Wisconsin State Capitol in Madison, Wis. Angela Major/WPR
An independent audit of the the Department of Public Instruction found about a quarter of Wisconsin’s school districts missed the deadline to file financial statements in the 2022-23 school year.
About 20 percent of independent charter schools and 10 percent of schools in the Parental Choice Program also missed the statutory deadline for submitting financial paperwork, according to the Legislative Audit Bureau’s report.
The financial reports from schools and school districts are necessary for DPI to calculate state aid payments, to ensure educational entities are financially viable and certify all districts and schools are complying with legal requirements.
Auditors also found DPI did not begin to review reports for more than two months after the Dec. 15 deadline to submit and failed to track how the reviewing team spent its time.
Auditors issued at least one financial reporting deficiency, or weakness in control over financial reporting, for 370 of the 421 school districts. DPI policies require schools to submit plans describing actions they will take to address each deficiency.
But 281 districts had at least one repeat deficiency from the previous year’s reporting, while 262 of those districts’ repeat deficiencies were identified in at least four consecutive years of reporting, according to LAB findings.
The LAB made 22 recommendations to DPI to improve its procedures including establishing written policies that require the agency to contact school districts within one month of the filing deadline.
State Superintendent Jill Underly responded to State Auditor Joe Chrisman with a five-page letter of clarifying information.
Underly wrote that DPI will focus on “documenting communication and review practices that will aid DPI in its monitoring and enforcement responsibilities.”
“Also, while the report recommends the establishment of new policies, some of which already exist in practice, DPI notes that there must be some level of accommodation and flexibility that allows DPI to prioritize what is best for kids and be responsive to the unique circumstances of districts and schools as well as DPI’s resources,” Underly wrote.
The bureau was asked in August 2024 by legislative Republicans to analyze DPI’s monitoring of school district finances for the 2022-23 school year following revelations earlier that year that Milwaukee Public Schools did not submit annual audits, causing the school district to lose $81 million in state funding.
Gov. Tony Evers and Republicans were critical of DPI for not revealing MPS was behind in its reporting until after Milwaukee voters approved a $252 million referendum.
MPS has since submitted those audits and received the state money.
But the audit found MPS wasn’t the only district to have financial issues.
Expenditures at 15 school districts exceeded budgeted amounts by an average of $746,200, including one school district that exceeded its budget by $3.8 million.
Following the release of the audit, Joint Legislative Audit Committee co-chairs Sen. Eric Wimberger, R-Oconto and Robert Wittke, R-Caledonia, released statements condemning DPI.
“Instead of serving Wisconsin’s students, DPI has allowed deficiencies in hundreds of school districts to remain unaddressed for years,” Wittke said. “These problems only grow when DPI lacks the policies to help districts resolve them, and doesn’t even look at many of its reports until more than two months after it receives them.”
Wimberger said DPI distributes more than $14 billion to Wisconsin schools but does not have “real oversight.”
“Deficiencies are chronic and perennial, and I’m not confident the Legislature has anywhere near a clear idea how tax dollars are spent on K-12 in Wisconsin,” Wimberger said. “I suspect neither does DPI.”
In her letter to the state auditor, Underly said DPI takes its constitutional responsibility to effectively administer Wisconsin’s education system seriously.
“Finance is a critical aspect of that work, and we strive to hold our districts and schools to their legal obligations while balancing their focus on teaching and learning,” she wrote.
Audit finds nearly a quarter of Wisconsin schools missed financial deadlines was originally published by Wisconsin Public Radio.
What a MESS!!!!