Garden State Times

In a letter sent last week to Attorney General Platkin and State Auditor Kaschak, Senator Declan O’Scanlon (R-13) requested an official investigation into the Salem City School District to address the district’s potential misuse of taxpayer funds.

As of today, Sen. O’Scanlon has not heard back from the Attorney General or State Auditor.

The full letter text is below or you can click here to view a copy.

Dear Attorney General and State Auditor:

I was sickened to recently read a State audit with shocking findings concerning the Salem City School District, which has received a 50% increase in State taxpayer funding over the past seven years, with a 20% increase this year alone. For the reasons listed below, I believe the findings warrant an investigation by the Division of Criminal Justice, and respectfully request that you support one. Furthermore, I believe the State should dedicate more resources towards State audits of school districts so that we can avoid this kind of grotesque waste in the future.

The audit’s findings show financial abuses that go far beyond ordinary waste and inefficiencies and appear worthy of a criminal investigation for two reasons. First, the audit suggests that taxpayer funds may have been used for self-enrichment or enrichment of certain well-connected family members of students and officers of the district. This extravagant—and potentially unlawful—spending includes:

$37,000 for overnight football trips;

$45,300 for championship rings and jackets for individuals including board members;

$75,000 for five all-expenses-paid international trips, which covered the airfare of several adults who were not needed as chaperones and did not participate in daily activities;

$103,000 paid to students to sit for an exam prep course; and

$115,650 for former students’ college tuition, fees, room, and board.

Second, there is a significant pattern of procurement abuses where competition seems to have been deliberately and willfully limited to the point where something other than mere incompetence was fueling the lawlessness and waste. The audit report notes that the district did not properly bid for 57 percent of purchases above the threshold, including an annual contract with a college admissions counselor for $187,000, construction projects totaling $450,000, and goods such as laptops and sports apparel totaling more than $650,000.

Sadly, the State Auditor’s review of school districts is limited, with only a few school audits conducted each year. For many years, as State aid was relatively flat or grew modestly for all districts, this was perhaps appropriate. However, times have changed, and now there are select districts that have received enormous State aid increases in the past seven years—sometimes exceeding 50% in a single year—as was the case with the Salem City School District. Other districts’ increases have been even more staggering. Certain school districts received up to a 500% increase over seven years; Newark received a $500 million increase—with Newark’s increase alone including more State tax dollars than many departments of State government. Massive “free” aid increases over time pose temptations and test internal controls. More auditing resources need to be redirected accordingly because Salem City is almost certainly not alone in wasting their largesse.

In fact, another recent State audit report highlights some gross inefficiencies in spending by the Plainfield Public School District which has enjoyed a 130% increase in State taxpayer funding over several years. The report highlights a slew of wasteful spending such as:

$34,356 spent on laptops that were not properly safeguarded by the district;

$199,625 in overpayments to certain employees resulting from a miscalculation of their overtime;

$884,969 in payments to private providers of preschool education for services that could have been provided as part of their original contracts; and

$6.4 million in health benefits in FY 2023 that the school district could have saved by participating in the School Employees’ Health Benefits Program.

Notably, the report also mentions that Plainfield Public School District potentially engaged in its own procurement abuses by (1) failing to consistently comply with applicable purchasing policies and regulations; (2) circumventing procurement regulations for landscaping services averaging $271​ ,435 annually; (3) conducting business with multiple companies owned by one individual.

It is difficult to express my level of outrage and frustration. As Senate Republican Budget Officer I am disturbed by wasteful reckless spending by certain districts that have seen significant increases in state aid over several years while aid for many other districts has been unreasonably irrationally slashed during same period I believe this wasteful spending can be avoided with more frequent audits criminal investigations

I offer my unqualified support if needed additional funds auditor's office expand its school district audit capacity This funding will pay itself will hopefully result shifting resources away from places waste largesse they received towards other districts starved In addition I sincerely hope Division Criminal Justice work closely follow-up when obvious red flags suggest worse than incompetence driving disgusting level

Sincerely,

Declan J O'Scanlon Jr

c Kevin Dehmer Commissioner Education