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GAO Report Finds Major Flaws in Implementation of D.C. Voucher Program

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The U.S. Government Accountability Office has issued a report detailing a myriad of weaknesses in the management and implementation of the District of Columbia's voucher program.

"The [DC Children and Youth Investment Trust Corporation, which oversees the voucher program,] needs to improve program management and operations to assure efficiency and effectiveness. Currently, it does not effectively oversee participating schools, has not implemented effective polices and procedures, and is unable to efficiently manage day-to-day program operations," the report found.

The report is the result of an audit performed by the GAO from May 2012 until September 2013 and is based on the analysis of key documents, extensive interviews, site visits to 10 of the participating schools, and talks with parents (in both English and Spanish) about their experiences with the program.

The Opportunity Scholarship Program is the only federally funded school choice program. It serves families in the nation's capital whose incomes are at or below 185 percent of the federal poverty level or are eligible for food stamps. The program, which has doled out $152 million in vouchers since its creation in 2003, provides up to $8,000 for students in grades K-8 and $12,000 for high school students to be applied to private schools that meet certain requirements. Any leftover funds may be used for school-related fees such as uniforms or field trips or for transportation costs.

In the audit, the GAO found many flaws in the implementation of the program by the DC Children and Youth Investment Trust Corporation—or the Trust—a nonprofit organization that took control of the program in 2010.

• The Trust is required to put out a directory containing key information about the schools in the program, such as how to apply to the schools and information about tuition, accreditation, admissions, and facilities for each school, but the audit found that this directory lacked key information about the schools and some of the information presented in the directory was not accurate.

For example, only one tuition amount was published for each school even though some of the schools participating offered different tuition levels for various grades or religious affiliations. It also did not include comprehensive information about the fees associated with each school or the accreditation of the schools, the audit found.

The directory was also published too late to be used to inform school choices, says the GAO report. The directory for the 2012-13 school year was published in May 2013—nine months after the start of the school year. Officials at the Trust contend that the directory is intended to inform decisions for the next year, although they did say it was published later than normal and that in the future, the directory will be published by December of that school year.

• The report also found that the Trust did not award scholarships in time for many families to make choices about the schools. For both 2012-13 and 2013-14, the scholarships were awarded months after the application deadlines for many of the participating schools had passed, the report found. That makes it hard for parents to make informed choices about the participating schools and also makes it difficult for the schools to plan classes and predict how many teachers they will need because of how late the voucher students enroll.

Trust officials said that the delay in awarding the scholarships is partly because of how long it takes to verify families' income information. They said they were exploring new ways to use prior year's information to determine eligibility.

• The report also found that the Trust has weak policies and procedures related to school compliance and financial accounting, creating a weak accountability environment for the funds to be distributed.

For instance, the Trust relies on self-reported data from schools to make sure they are operating within the confines of the laws governing the program with no process to externally verify that the schools are in compliance. The Trust also does not have strong policies and procedures in place when it comes to addressing noncompliance in participating schools.

• The GAO report also found that the database used by the Trust does not provide the structure needed for effective program management and implementation, leaving the door open to database errors that slow the program's progress and make it difficult to communicate accurate data to parents.

• In addition, the Trust has also not filed its mandatory financial reports on time, the GAO report found. Under the Single Audit Act, the Trust must file financial reports about the program no later than nine months after the end of the fiscal year. The Trust filed its report for the year ending in 2010 in January 2013—two years after the deadline—and has not filed any financial reports since then. As a result, "there was no opportunity for formal oversight of federal dollars spent on OSP [the Opportunity Scholarship Program] for almost two years under the Trust's administration," says the GAO audit.

• The District of Columbia's mayor and the Secretary of Education entered into a memorandum of understanding about how the scholarship program would be implemented in June 2012, but those agreements have not been met, the GAO report found. For example, the District is required to conduct inspections in the participating schools to make sure they are in compliance with the laws governing the program, but these are not being conducted.

In response to the report and its recommendations, representatives of the U.S. Department of Education said that the report does not fully take into consideration the "significant staff turnover in leadership at the Trust, which affected several aspects of the Trust's implementation of the program in the school year 2012-2013."

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