Shifts in Chapter 1 Policy Worry State Directors

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Correspondent Greg Garland in Baton Rouge contributed to this report.

Washington--State directors of education programs for the disadvantaged are concerned that lax new rules governing Chapter 1, combined with new federal auditing procedures, might set them up for a multi-million-dollar knockout punch in a few years.

That fear, and other apprehensions regarding shifts in federal policies and priorities surrounding the Chapter 1 program, emerged during a meeting sponsored here last week by the Education Department (ed). The gathering brought together all state officials responsible for the implementation of the $2.9-billion federal program, which provides services to educationally and economically disadvantaged students.

According to several state directors, the proposed rules for the Chapter 1 program give states sub-stantially more leeway in determining how program funds should be spent than did regulations governing the program when it was known as Title I.

At the same time, however, they say that they are both confused and concerned by moves within the federal government's General Accounting Office and Office of Management and Budget to revise federal audit procedures.

Approve Local Programs

"The idea here is that we will approve local Chapter 1 programs soon under the new regulations in good faith, but a few years down the road an auditor will come in and tell us that the local officials violated the regulations, and then he'll demand that they repay the federal government for misspent funds," said Clarence Wills, director of compensatory-education programs in the Michigan department of education.

"I don't want to see a school district punished down the road for an audit exception that could ruin the district's entire budget that year," Mr. Wills said. "To do that would be criminal."

Several state Chapter 1 directors also expressed concerns over two additional changes in federal audit procedures. Both stem from a new policy that will require states to use the services of their own auditing agencies or those of private certified public accountants to conduct audits of federally financed programs.

First, the state directors said that they want to know who will pick up the tab for future audits. In the past, they pointed out, the cost of auditing local and state Chapter 1 activities was underwritten in large part by the federal government.

John H. Oliphant, an official in ed's office of the inspector general, told the directors that the audits would have to be financed from the states' Chapter 1 allocations. That raised the ire of several state directors, who complained that too much of their allocation is already diverted from Chapter 1's main purpose, namely, the education of disadvantaged children.

Second, state officials added, the new auditors, particularly the privately contracted accountants, will probably have little or no experience with the Chapter 1 program and could conceivably fault state and local education officials for misspending funds that were actually spent in a proper fashion.

Mr. Oliphant said that the states could always contest the auditors' rulings in such cases, but one state director quickly responded that doing so "would probably take 15 years, and all you could hope to gain in the end is 15 cents on the dollar."

Others wondered aloud whether "there are enough C.P.A.'s out there now" to handle all of the Chapter 1 audits.

The state directors also expressed concern about ed's decision to relax state and local program-evaluation requirements. Some of them questioned how ed officials could justify devoting one full day of the three-day meeting to sessions on the identification of exemplary Chapter 1 programs when, at the same time, the regulations that they propose would no longer require locally developed project officers to conduct self-evaluations.

"We feel that in North Carolina we had a good system of evaluation,'' Robert Marley, that state's Chapter 1 director, said in an interview during a break in the meeting. "It's evaluations of that sort that helped prove Title I's effectiveness and helped us win support for the program in Congress. This new move seems to take away from those gains."

"Many people here think that elimination of the evaluation re-quirement is one of the ways the Administration is setting up Chapter 1 for the kill," asserted Mr. Wills of Michigan. "There is a general feeling that this is part of the game plan."

In related developments:

Wilbert Cheatham announced his resignation as ed's director of compensatory-education programs in late September, according to a spokesman for the department. Mr. Cheatham, who is said to have resigned for personal reasons, has been temporarily replaced by John F. Staehle, who was director of the Chapter 1 office's division of grants, policy, and administration.

Delegates to the annual meeting of the National Coalition of Title I Parents, which was held this month in Baton Rouge, La., were upset by the fact that no ed officials chose to attend their gathering despite the fact that three of them were invited.

Robert Witherspoon, a member of the organization's board of directors, told the group that the federal officials' absence indicated "a lack of support on the federal level" for Chapter 1. Traditionally, he added, seven to nine ed officials have attended the group's conventions.

"They're just hoping we'll curl up, fall away, and be quiet," he told the delegates.

Mr. Staehle said in an interview during the state directors' meeting that federal officials did not attend the parent's gathering because ''it is the intent of both the Congress and this Administration to shift more responsibility for Chapter 1 to the states."

"We feel that the best approach is for the parents to speak more often with state officials now because the states will have more responsibility for plotting the direction in which Chapter 1 will move," he said.

Vol. 02, Issue 08

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