Report 98113 Summary - July 1999

Department of Education: Lax Monitoring Led to Payment of Unsubstantiated Adult Education Claims and Changes in the Program May Seriously Impact Its Effectiveness

RESULTS IN BRIEF

The California Department of Education (department) has mismanaged oversight of the federal adult education program in the State. As a result of its ineffective monitoring practices, the department has paid community-based organizations (CBOs) for services these organizations cannot substantiate. Although the department claims it monitors its service providers, 8 of 10 CBOs we reviewed could not document the number of class hours for which they received federal funds in at least one of the last five years, and none could consistently demonstrate gains in skill for the students they claimed to have educated. In addition, the department's grant award process yielded inconsistent decisions that leave the department open to charges of favoritism.

The department is making significant changes to the adult education program for fiscal year 1999-2000; however, these changes may not resolve past problems and could even create new ones. The new award grading process, though an improvement on the old method, must still be implemented. Additionally, drafted monitoring procedures do not include steps to determine whether claimed services are documented. Meanwhile, new eligibility requirements and payment rates, intended to improve the accountability of service providers, could result in a drop in the number of students served-especially students with the least skills who most need these educational services. Finally, the department will need to reassess its new rate structure and award process because earmarking of federal adult education funds in the State's fiscal year 1999-2000 budget is much more restrictive than the department expected.

RECOMMENDATIONS

To ensure that service providers maintain appropriate evidence to support their claims for payment, the department should do the following:

• Establish strict guidelines for service providers to document student testing and hours of instruction to deter easily falsified evidence.
  
  
• Place a high priority on developing a battery of interchangeable tests for measuring gains in skill to avoid falsification of evidence or teaching to the test questions.
  
  
• Design monitoring procedures to test support for claimed services, including review of attendance records, summary documents, and tests showing attainment of benchmarks.

To ensure that its award decisions are consistent and fair, the department should do the following:

• Hold all applicants accountable for submitting required information, including audit reports, to qualify for funding.
  
  
• Evaluate funding requests in light of prior-year performance and the size of the service provider before authorizing grant awards.
  
  
• Review a sample of fiscal year 1999-2000 awards to ensure that decisions to award or deny funds are consistent and defensible.

To ensure that it reaches the greatest number of students and maximizes the use of federal adult education funds, the department should evaluate the impact that changes in the program will have on students and service providers. If, as we anticipate, this evaluation shows that fewer students will be served, the department needs to develop strategies to encourage program expansion.

AGENCY COMMENTS

The California Department of Education expresses concern with the perspective presented in our report and believes it should be given more credit for changes it has undertaken since March 1998. It also takes exception with the accuracy of some of our findings. It does not, however, disagree with any of our recommendations.

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