A new report issued Monday by the Washington State Auditor’s Office says the Steilacoom Historical School District was overpaid nearly $1 million over two years because it overcounted enrollment in its online program.
That’s a bit less than what the state first reported in January, but auditors stuck to their overall findings with regard to the Washington Virtual Academy, or WAVA.
Steilacoom, which had been one of the state’s pioneers in online learning, ended its participation in WAVA last year.
Auditors said Monday that the school district’s miscalculations resulted in a total of $990,138 in overpayments from the 2009-10 and 2010-11 school years.
On Jan. 7, the auditor’s report had initially claimed more than $1.3 million in mistaken overpayments. Auditors said the district lacked adequate controls over enrollment reporting on WAVA students.
At Steilacoom’s request, auditors pulled their January report and revised it. Auditor’s spokesman Matt Miller said the district provided documentation that showed some of the previously questioned costs were for students who were genuinely enrolled in WAVA.
Steilacoom Superintendent Bill Fritz said Monday that he still disagrees with the audit findings. He said auditors “found what they believed were deficiencies in a small number of the files they examined.” He said they then extrapolated their findings and calculated an error rate of 3.5 percent in the 2010-11 school year and nearly 6 percent the previous year.
The district enrolled the equivalent of 1,618 full-time WAVA students in 2010-11 and 2,488 the year before.
Last year, Steilacoom and Virginia-based online education company K12 ended their relationship. The for-profit firm first partnered with Steilacoom in 2006 to offer WAVA statewide for students in elementary and middle school.
Fritz said he will meet with state education officials to determine how much money needs to be repaid, if any. But he said K12 has promised to cover any payback.
“They have assured us they are going to take care of it,” he said Monday, noting that the agreement between the district and K12 includes language protecting the school district’s financial interests in case of audits that arise.
Fritz said Steilacoom is not the only district that has run into difficulties counting online students. Last year, the state auditor criticized other Washington school districts, including Evergreen in Clark County, Omak in Okanogan County and Valley in Stevens County, for similar problems. Their error rates ranged from an estimated 33 percent to more than 46 percent, according to state audit reports.
Fritz, who became Steilacoom superintendent in fall 2010, said laws governing the way online students are counted are “complex and burdensome for school districts to administer.”
Districts receive funding for traditional students based on whether they show up in classrooms.
“If you see them, you count them,” he said.
But he said that for online students, districts must not only track their online time but also document whether students are making progress in their plan of study.
Auditors said Steilacoom did not adjust enrollment figures for students who failed to make progress, nor did it identify what criteria had to be met. Auditors blamed staff turnover and failure to seek guidance from the state for some of the problems.
This was not the first time the state had questioned Steilacoom over online program enrollments and per-student funding. In 2008, the state questioned an estimated $1.3 million in funding to Steilacoom for WAVA.
Debbie Cafazzo: 253-597-8635 debbie.cafazzo@ thenewstribune.com
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