Dena Levitz, The Examiner
2008-04-11 07:00:00.0
Current rank: Not ranked

WASHINGTON -

Four of the nine D.C. public charter schools that have borrowed millions of dollars from the city’s State Superintendent’s Office have failed to pay back the loans as required, according to an audit of internal control failures across the D.C. government.

The so-called “Yellow Book,” an attachment to an annual city financial report, identifies the District’s long-troubled school system as one of three “material weaknesses” in financial controls. Such weaknesses have the potential to damage the District’s reputation on Wall Street.

Among the problem areas cited by auditors is a direct loan system that provides public charter schools with funds to build and upgrade facilities.

State Superintendent Deborah Gist’s office has given loans totaling $13 million to nine charters.

Of this amount, a total of more than $5 million has not been paid back by four different charter schools, which auditors say could be difficult to collect now.

“We noted no reports or repayment history being sent from the OCFO [Office of the Chief Financial Officer] to the OSSE program office,” BDO Seidman said in the report. “Closer coordination between the agencies is needed to adequately manage and oversee the program.”

John Stokes, spokesman for the State Superintendent’s Office, said he could not immediately name the schools that have been tardy in repayment, and the spokesman for BDO declined to provide the charter groups’ names. But Stokes said his agency is on track to fix the situation.

“The OSSE is working with the CFO to ensure that we are provided with regular financial reports that will allow us to provide robust tracking of payments made on the loans we provide,” he said in an e-mail.

Calls to Thomas Nida, chairman of the D.C. Public Charter School Board, which oversees the city’s growing charter school segment, were not returned Thursday.

dlevitz@dcexaminer.com