When your government-funded program is on the chopping block, a rather damning Inspector General audit will do little to bolster your case for continued funding.
Such is the case for the Center for Civic Education and its two grant programs, We the People and the Cooperative Civic Education and Economic Education Exchange Program. Both seek to foster civic education in K-12 schools. Both programs are also part of a laundry list of cuts the Obama administration has proposed. The savings, according to the Obama folks, would be $33.5 million.
The center is a California-based nonprofit corporation that gets about 82 percent of its revenue from the U.S. Department of Education.
Auditors from the Education Department’s Office of Inspector General reviewed about $7.4 million of $23 million in grants that the Center for Civic Education charged in a one-year period to the federal grant programs, including We the People. Of that $7.4 million, auditors found $1.2 million of the spending was not allowed under federal regulations, and another $4.7 million couldn’t be supported by proper documentation. That’s a whopping 80 percent of charges that were either unallowable, or unsupported.
The problems are extensive; in fact, the audit (including the center’s responses), is 120 pages.
Among the things auditors flagged: the center used grant funds to pay settlements to former employees to avoid lawsuits alleging some type of harassment of discrimination; the center spent $3,566 on an airline ticket to India for the executive director’s spouse, who did not work for the center; and center employees spent hundreds of additional dollars on hotel rooms and meals above the standard government allowance. The auditors also found that the center didn’t have basic controls in place to make sure money was spent, and accounted for, appropriately.
The audit also reveals the challenges auditors faced as they sought answers. For example, the center required its legal counsel to be present during all interviews that auditors had with employees. Moreover, the center’s chief fiscal officer sent an email (a copy is in the audit report, on page 72 of the document) to employees instructing them on how to explain how they filled out their time sheets, in anticipation of auditors’ questions. Employees’ time sheets were another source of concern for auditors.
In a detailed letter of response, Center for Civic Education Executive Director Charles N. Quigley stressed that although the OIG found “some minor, unallowable costs”, the center “performed precisely the work it promised to do, performed that work very well, and effectively and conscientiously served the purpose of each of ED’s grants.” In fact, the center found the audit “unduly harsh, unfair, and at times misleading.”