Summary

California’s Charter Schools Some Are Providing Meals to Students, but a Lack of Reliable Data Prevents the California Department of Education From Determining the Number of Students Eligible for or Participating in Certain Federal Meal Programs October 2010 Report 2010-104 Independent NONPARTISAN Accountability TRANSPARENT The first five copies of each California State Auditor report are free. Additional copies are $3 each, payable by check or money order. You can obtain reports by contacting the Bureau of State Audits at the following address: California State Auditor Bureau of State Audits 555 Capitol Mall, Suite 300 Sacramento, California 95814 916.445.0255 or TTY 916.445.0033 OR This report is also available on the World Wide Web http://www.bsa.ca.gov The California State Auditor is pleased to announce the availability of an on-line subscription service. For information on how to subscribe, please contact the Information Technology Unit at 916.445.0255, ext. 456, or visit our Web site at www.bsa.ca.gov. Alternate format reports available upon request. Permission is granted to reproduce reports. For questions regarding the contents of this report, please contact Margarita Fernández, Chief of Public Affairs, at 916.445.0255. CALIFORNIA STATE AUDITOR Elaine M. Howle State Auditor Doug Cordiner B u r e a u o f S t a t e A u d i t s Chief Deputy 555 Capitol Mall, Suite 300 Sacramento, CA 95814 916.445.0255 916.327.0019 fax www.bsa.ca.gov October 21, 2010 2010-104 The Governor of California President pro Tempore of the Senate Speaker of the Assembly State Capitol Sacramento, California 95814 Dear Governor and Legislative Leaders: As requested by the Joint Legislative Audit Committee, the California State Auditor presents its audit report on how the nutritional needs of charter schools students are met, so the Legislature can make future decisions regarding the health and education of California’s children. This report concludes that the California Department of Education (Education) databases are not reliable enough for it to accurately identify all California charter schools that participate in the federal School Breakfast program (breakfast program) or the National School Lunch Program (lunch program). Moreover, Education cannot determine the number of students at either traditional or charter schools who qualify for or who participate in these programs. Despite the limitations of Educations’ data, we were able to identify 815 charter schools active in California as of April 2010. Charter schools are exempt from many of the laws that apply to school districts. In particular, they are exempt from California law that requires schools to provide each needy student with one nutritionally adequate free or reduced-price meal during each school day. Further, as is true for school districts, participation by charter schools in both the breakfast and lunch programs is voluntary. According to Education’s data, 451 charter schools were participating in the breakfast or lunch program and an additional 151 were providing instruction to their students outside the classroom either online or independently, and thus do not provide meals. We surveyed the remaining 213 charter schools to identify those that provide an alternative meal program and those that do not provide meals to their students. Of the 133 responses we received, 46 charter schools stated that they offer their students an alternative meal program, 39 stated that they do not provide meals to their students, and 41 stated that they were in fact participating in the programs. The remaining seven do not provide meals either because their students receive instruction outside the classroom or their students are age 18 or older and are not eligible to participate in the programs. The 46 charter schools that reported they provide an alternative meal program cited varying methods of providing meals, ranges of costs for those meals, and reasons for offering such meals. For example, most of these schools either have staff prepare and deliver the meals or hire contractors to do so. Some of these charter schools stated that they provide meals that meet or exceed the U.S. Department of Agriculture’s nutritional standards. Generally, the charter schools that reported they provide meals to their students believe that the nutritional needs of their students, including their low-income students, are being met. The 39 charter schools that did not provide meals to their students cited various reasons including lack of a kitchen, cafeteria, or other facility to prepare and deliver meals to their students. Another reason commonly cited was a lack of funding and staffing to operate an alternative meal program or participate in the breakfast and lunch programs. Respectfully submitted, ELAINE M. HOWLE, CPA State Auditor California State Auditor Report 2010-104 vii October 2010 Contents Summary 1 Introduction 7 Audit Results The California Department of Education Lacks Reliable Data to Identify the Number of Charter Schools and Their Students Eligible for and Participating in the Federal Breakfast and Lunch Programs 17 Charter Schools Not Participating in the Federal Breakfast or Lunch Program Use Various Methods to Provide Meals to Their Students 24 Charter Schools Cited Various Reasons for Not Providing Meals to Their Students 28 Provisions Exist That Are Intended to Reduce the Administrative Requirements of the Federal Breakfast and Lunch Programs 30 Recommendations 32 Appendix A Charter Schools’ Survey Responses 35 Appendix B Stakeholder Comments and Opinions on Whether California’s Charter Schools Meet the Nutritional Needs of Their Low‑Income Students 51 Response to the Audit California Department of Education 53 California State Auditor’s Comments on the Response From the California Department of Education 57 California State Auditor Report 2010-104 1 October 2010 Summary Results in Brief Audit Highlights . . . In investigating how the nutritional needs of charter school Our review of the California Charter students are being met, so that the Legislature can make future Schools and how the nutritional needs decisions regarding the health and education of California’s of their students are being met, revealed children, we were hampered by a lack of data. Specifically, we found the following: that data from California Department of Education (Education) databases are not sufficiently reliable to determine the exact » The California Department of number of California charter schools participating in the federal Education’s (Education) databases School Breakfast Program (breakfast program) or the National are not sufficiently reliable to identify School Lunch Program (lunch program). Moreover, the data are the number of charter schools and their not sufficiently reliable to identify the number of students at either students participating in the federal traditional or charter schools who qualify for or participate in School Breakfast Program (breakfast these programs. program) or the National School Lunch Program (lunch program). Under the Charter Schools Act of 1992, teachers, parents, students, and community members are encouraged to establish and maintain • It lacks an internal control process charter schools that operate independently from the existing school to ensure the accuracy of certain district structure. Although charter schools operate independently, data in its paperless consolidated they are part of the public school system and can serve students in application database. kindergarten through grade 12. Charter schools are exempt from many of the laws that apply to school districts. In particular, they • It does not verify certain codes and are exempt from the law that requires schools to provide each the site type on the schools’ site needy student with one nutritionally adequate free or reduced-price applications and we found errors. meal during each school day. Further, as is true for school districts, participation by charter schools in both the breakfast and lunch • It allows school food authorities programs is voluntary. to combine information for their sites before entering it into the child The breakfast and lunch programs are federally assisted meal nutrition database and thus, it programs operating in public and nonprofit private schools. cannot differentiate between charter School districts and independent schools that choose to take part school students and students from in the breakfast and lunch programs get a cash subsidy from the traditional schools who participate in U.S. Department of Agriculture (USDA) for each meal they serve. the programs. In return, they must serve meals that meet federal requirements and offer free or reduced-price meals to eligible children. » Despite Education’s data limitations, we identified 815 charter schools The data from Education are not sufficiently reliable to determine active in California. Of these, 451 were the exact number of charter schools and their students participating participating in the breakfast or lunch in the breakfast and lunch programs. For example, Education’s program and 151 do not provide Consolidated Application Data System (ConApp database), a meals because instruction is provided paperless system, has three data fields that are relevant to our outside the classroom—either online audit. These fields are designed to capture the number of students or independently. enrolled at a given school, the number of those enrolled students who are eligible to receive free meals, and the number of those continued on next page . . . enrolled students who are eligible to receive reduced-price meals. However, Education lacks an internal control process, such as a systematic review of the local educational agencies’ and 2 California State Auditor Report 2010-104 October 2010 » We surveyed the remaining 213 charter direct-funded charter schools’ supporting documentation, to ensure schools, and of the 133 that responded, the accuracy of these three data fields. In addition, Education 46 stated they offer their students an does not require all direct-funded charter schools to submit their alternative meal program and have information using the ConApp database. varying methods of providing meals and a range of meal costs; 39 stated they Education’s Nutrition Services Division uses its Child Nutrition do not provide meals to their students Information and Payment System (CNIPS) database for school mainly because they lack resources such food authorities to submit and track the status of their applications as funding, staff, and a kitchen, cafeteria, and reimbursement claims for the meals the schools under their or other facility to prepare and deliver jurisdiction serve to students under the breakfast and lunch meals; and 41 stated that they do in fact programs. A school food authority is defined as an entity that is participate in the programs. responsible for the administration of one or more schools and has the legal authority to operate a breakfast or lunch program or is approved by the USDA’s Food Nutrition Service to operate a breakfast or lunch program. For example, a school district or a county office of education may operate as a school food authority. In addition, certain entities, such as residential care facilities, may be approved by the USDA to operate a program. The school food authority must submit to Education an application for any school in which it desires to operate a breakfast or lunch program and a policy statement regarding free and reduced-price meals. The school food authority must include in its application information related to its food safety inspections, verification reports, and annual audits, as well as a site application for each school it sponsors. Education performs reviews of a sample of the schools under the jurisdiction of the school food authorities each year, in accordance with federal regulations, to ensure that the requirements of the lunch program are being met. However, its reviews do not include a procedure for verifying the accuracy of the county-district-school (CDS) code or the site type reflected on the schools’ site applications. Therefore, Education is unable to accurately identify all charter schools participating in the breakfast and lunch programs. We found errors related to the CDS codes and the site type. Specifically, three charter schools with CDS codes in the CNIPS database did not match the CDS codes in Education’s Charter Schools Database, and eight charter schools had no CDS codes in the CNIPS database. Also, two charter schools participating in the breakfast and lunch programs were misidentified on the school food authorities’ applications—one as a private school and one as a county office of education. In addition, the CNIPS database has data fields for the school food authorities to enter the number of students approved for free and reduced-price meals at each site under their jurisdiction. However, Education allows the school food authorities to combine the information for their sites before entering it into the CNIPS database. Therefore, although Education can report the total number of students for each school food authority, it cannot California State Auditor Report 2010-104 3 October 2010 differentiate between charter school students and students from traditional schools who are participating in the breakfast or lunch program. Despite the limitations of Education’s data, we were able to identify 815 charter schools active in California as of April 2010.1 According to the data, 451 were participating in the breakfast or lunch program and an additional 151 were providing instruction to their students outside the classroom, either online or independently, and thus do not provide meals. We surveyed the remaining 213 charter schools to identify those that provide an alternative meal program and those that do not provide meals to their students. Of the 133 responses we received, 46 charter schools stated that they offer their students an alternative meal program, 39 stated that they do not provide meals to their students, 41 stated that they were in fact participating in the programs, and four stated that they provide instruction based outside the classroom. In addition, three charter schools stated that they do not provide meals to students or participate in the breakfast and lunch programs because their students are age 18 or older and are not eligible to participate in the programs. The 46 charter schools responding to the survey that provide an alternative meal program have varying methods of providing meals, ranges of meal costs, and reasons for offering an alternative meal program. Most of these schools either have their staff prepare and deliver the meals or hire contractors to do so. The students at these charter schools paid between 50 cents and $5 for their meals. In addition, the primary reason cited by 15, or 33 percent, of these schools for having an alternative meal program is to allow them to provide what they described as fresher, healthier food choices to their students than the breakfast or lunch program provides. Some of these charter schools stated that they provide meals that meet or exceed the USDA’s nutritional standards. Generally, these charter schools believe that the nutritional needs of their students, including low-income students, are being met. As mentioned previously, state law does not require charter schools to provide each needy student with one nutritionally adequate free or reduced-price meal during each school day. The 39 charter schools that do not provide meals to their students gave various reasons for not participating in the breakfast and lunch programs 1 The number of active charter schools was obtained from Education’s Charter Schools Database. However, we could not test the information in the database against source documents. Further, we found that the Charter Schools Division does not conduct audits or perform reviews of the information stored in the database. Therefore, we concluded that the information from the database was of undetermined reliability to reach an audit conclusion related to the number of active charter schools in California. We present this information because there was no better source from which to obtain this information. 4 California State Auditor Report 2010-104 October 2010 and not providing an alternative meal. The primary reason was lack of a kitchen, cafeteria, or other facility to prepare and deliver meals to their students. Another reason commonly cited was a lack of funding and staffing to operate an alternative meal program or participate in the breakfast and lunch programs. Generally, however, these charter schools believe that the nutritional needs of their students, including their low-income students, are being met. Many of the schools stated that their students bring lunch from home. We also found that some of these charter schools inform parents via handbooks that can be found on their Web sites that they do not provide meals. Thus, when parents choose to pack their children’s lunch and schools make parents aware of the fact that they do not provide meals, it becomes the parents’ responsibility to ensure that their children’s nutritional needs are met. Recommendations To ensure the reliability of the ConApp database fields related to the number of students enrolled at the school level, the number of those enrolled students who are eligible to receive free meals, and the number of those enrolled students who are eligible to receive reduced-price meals, Education should establish an internal control process such as a systematic review of a sample of the local educational agencies’ and direct-funded charter schools’ supporting documentation. To ensure the accuracy of the CNIPS database, Education should: • Direct the school food authorities to establish procedures to ensure the accuracy of the application information they enter into the CNIPS database. • Modify the tool it uses to review a sample of the school food authorities’ schools to include a procedure for verifying the accuracy of the CDS code and site type reflected on the schools’ applications. • Discontinue allowing the school food authorities to combine each site under their jurisdiction before they enter information on the number of students approved for free and reduced-price meals into the CNIPS database. California State Auditor Report 2010-104 5 October 2010 Agency Comments Education generally agreed with our recommendations. However, Education did not address fully one recommendation aimed at ensuring the accuracy of its CNIPS database and it is considering the actions it will take regarding two other recommendations. 6 California State Auditor Report 2010-104 October 2010 Blank page inserted for reproduction purposes only. California State Auditor Report 2010-104 7 October 2010 Introduction Background Under the Charter Schools Act of 1992 (Act), teachers, parents, students, and community members are encouraged to establish and maintain charter schools that operate independently from the existing school district structure. The intent of the Act is to improve student learning, increase learning opportunities for all students, encourage the use of different or innovative teaching methods, create professional opportunities for teachers, provide parents and students with expanded choices for educational opportunity, hold schools accountable for meeting measurable student outcomes, and provide vigorous competition within the public school system. Although charter schools operate independently from the existing school district structure, they are part of the public school system and can serve students in kindergarten through grade 12. They are publicly funded, serve diverse populations, and employ a variety of educational philosophies. Typically, a group of parents, teachers, and community members develops a charter petition, which they then submit to a chartering entity for approval. Under the Act, a chartering entity can be a school district, a county board of education, or the State Board of Education (state board). Once approved, the petition becomes the governing document for the school and the school must comply with the Act. As of April 2010, according to data from the California Department of Education (Education), there were 815 active charter schools throughout California.2 California law requires each school district or county superintendent of schools that offers instruction in kindergarten through grade 12 to provide each needy student one nutritionally adequate free or reduced-price meal during each school day. To comply with this requirement, school districts and county offices of education may use funds made available through any federal or state program that provides meals to students, including the federal School Breakfast Program (breakfast program) and the National School Lunch Program (lunch program). The Act exempts charter schools from many of the laws that apply to school districts, 2 The number of active charter schools was obtained from Education’s Charter Schools Database. However, we could not test the information in the database against source documents. Further, we found that the Charter Schools Division does not conduct audits or perform reviews of the information stored in the database. Therefore, we concluded that the information from the database was of undetermined reliability to reach an audit conclusion related to the number of active charter schools in California. We present this information because there was no better source from which to obtain this information. 8 California State Auditor Report 2010-104 October 2010 including the law requiring free or reduced-price meals for needy students. Further, similar to school districts, participation by charter schools in the breakfast or lunch program is voluntary. The breakfast and lunch programs are federally assisted meal programs operating in public and nonprofit private schools. School districts and independent schools that choose to take part in the breakfast and lunch programs get a cash subsidy from the U.S. Department of Agriculture (USDA) for each meal they serve. In return, they must serve meals that meet federal requirements and must offer free or reduced-price meals to eligible children. Both programs require that the meals meet the applicable recommendations established in Dietary Guidelines for Americans, a joint publication of the U.S. Department of Health and Human Services and the USDA. For example, the guidelines recommend that for the lunch program no more than 35 percent of an individual’s calories come from total fat and less than 10 percent from saturated fat. Federal regulations also establish the minimum nutrient standards for school breakfasts and lunches related to recommended dietary allowances for protein, vitamin A, vitamin C, iron, and calcium, as well as the minimum calorie levels. The breakfasts and lunches served by schools must meet federal nutrition requirements, but decisions about the specific foods to serve and how to prepare them are made by their school food authorities, which are the entities federal regulations designate to administer the programs. Specifically, a school food authority is defined as an entity that is responsible for the administration of one or more schools and has the legal authority to operate a breakfast or lunch program or is approved by the USDA’s Food Nutrition Service to operate a breakfast or lunch program. For example, a school district or a county office of education may operate as a school food authority. In addition, certain entities, such as residential care facilities, may be approved by the USDA to operate a program. Participation in the breakfast or lunch program requires the school food authority and the schools that participate in its programs to perform various administrative tasks. The school food authority must submit to Education an application for any school in which it desires to operate a breakfast or lunch program and a policy statement regarding free and reduced-price meals. The school food authority enters its initial or renewal application to participate in the breakfast or lunch program, and any annual updates to its application, into the Child Nutrition Information and Payment System (CNIPS) database of Education’s Nutrition Services Division (nutrition services). The school food authority must include in its application information related to its food safety inspections, verification reports, and annual audits, as well as a site application California State Auditor Report 2010-104 9 October 2010 for each school it sponsors. The site application includes the name of the school, the requested meal program or programs, the site type, prior-year participation information, site enrollment, kitchen type, and meal pricing. Once Education approves the school food authority’s initial or renewal application, the local educational agencies must establish their eligibility criteria for free and reduced-price meals, based on Education’s family-size income standards, for those schools under their jurisdiction that wish to submit site applications to participate in the breakfast and/or lunch programs. The local educational agencies must then seek Education’s approval of their eligibility criteria. Local educational agencies include entities such as school districts and county offices of education. The local educational agencies must publicly announce their eligibility criteria for free and reduced-price meals at the beginning of each school year. In addition, each local educational agency must provide meal benefit forms to families so that they can apply to the agency for free or reduced-price meals for all children in their household. Further, the local educational agencies must select a sample of their approved household applications for free and reduced-price meals on file as of October 1 and verify the eligibility of the children listed. The school food authority is required to ensure the local educational agencies’ compliance with the nutritional program standards and the accuracy of their information. For example, prior to its submission of a monthly Claim for Reimbursement to Education, each school food authority must review the meal count data, which include the number of meals served by type (free, reduced price, or paid) for each school under its jurisdiction to ensure the accuracy of the claim. Each school submits this information to the school food authority, and the school food authority aggregates the data for its sites and enters it into the CNIPS database monthly. Education’s Role in Charter Schools Although Education does not have the authority to approve a charter petition and act as a chartering entity, it has established a Charter Schools Division to serve as the focal point for the development and oversight of state regulations, policies, and procedures related to charter schools and to provide staff support to the state board in its role as a charter school authorizer. The Charter Schools Division had, as of June 30, 2010, 14 employees who, among other tasks, assist charter schools with fiscal and administrative issues. For example, the Charter Schools Division administers the Public Charter Schools Program, the 10 California State Auditor Report 2010-104 October 2010 Charter School Facility Grant Program, and the Charter School Revolving Loan Program. The Public Charter Schools Program provides financial assistance for the planning, program design, and initial implementation of charter schools. The Charter School Facility Grant Program assists charter schools that meet specific eligibility criteria with their facilities rent and lease expenditures. The Charter School Revolving Loan Program provides start-up and initial capital in the form of low-interest loans of up to $250,000 to new charter schools. In addition, Education’s nutrition services, with 183 employees as of June 30, 2010, administers the USDA’s child nutrition programs, including the breakfast and lunch programs and food distribution programs in California. Nutrition services also performs administrative reviews of schools participating in the breakfast and lunch programs, in accordance with federal regulations. In August 2008 nutrition services began using the Web-based CNIPS database to collect data from the school food authorities regarding their initial and renewal applications and any annual updates. In November 2008 the school food authorities began entering their monthly Claim for Reimbursement into the CNIPS database to obtain federal reimbursement for the number of meals served by each school under their jurisdiction. Education’s Use of the Consolidated Application Data System to Obtain Various Funding Information From Schools According to the director of Education’s Data Management Division (data division), since the 1980s, Education has been using its Consolidated Application for Funding Categorical Aid Programs, referred to as ConApp, to consolidate the multiple applications that local educational agencies submit to receive state and federal funding. Education funds that serve students in kindergarten through grade 12 are usually one of two types: general purpose or categorical. General-purpose funds can be spent on everything from teacher salaries to utility bills, while categorical funds are typically designated for a specific purpose,3 such as the Title 1 Grants to Local Educational Agencies that benefit children who are failing, or are most at risk of failing, to meet the State’s academic standards. The ConApp is a two-part application that local educational agencies complete electronically using Education’s Consolidated Application Data System (ConApp database). In June of each year, 3 Assembly Bill 2 of the Fourth Extraordinary session of 2009 provides for what is commonly known as flexibility in the expenditure of most, but not all, categorical funds, if the school district meets certain conditions. California State Auditor Report 2010-104 11 October 2010 the local educational agencies submit Part I of the ConApp, which documents their participation in state and federal categorical programs and provides assurances that they will comply with the legal requirements of each program. In January of each year, the local educational agencies submit Part II of the ConApp, which contains their allocations and the number of participants in specified programs. The allocation amounts they receive for each program are determined by the laws creating the programs. Part II of the ConApp also has a page that is used to report the number of students ages five through 17 enrolled in the schools and the number of those students who are eligible for free or reduced-price meals based on the income criteria used in the breakfast and lunch programs. Charter schools, like other public schools, can apply to receive state and federal funding, using the ConApp database. Direct-funded charter schools apply for and receive funding on their own behalf. In contrast, locally funded charter schools apply for and receive funding through their chartering entity, which can be a school district, a county board of education, or the state board. Education’s data division is responsible for managing the information local educational agencies and direct-funded charter schools submit through the ConApp database. The data division, which had 44 employees as of June 30, 2010, is also responsible for providing technical support to the local educational agencies, among other data collection and education projects. Education’s Collection of Data on Student Enrollment Each year in October, Education collects data on student and staff demographics from the local educational agencies using its California Basic Educational Data System (CBEDS), which was first implemented in the 1980s. Specifically, Education uses two forms to collect data. The County/District Information Form collects data specific to school districts and county offices of education, including the number of classified staff, estimated number of teacher hires, and high school graduation requirements. The School Information Form collects data specific to schools, including the number of classified staff, enrollment in select educational options, education calendars, parental exception waivers, and bilingual paraprofessionals. Student aggregate counts related to the number of graduates and dropouts, and various enrollment counts previously collected on the School Information Form, have been transitioned to the California Longitudinal Pupil Achievement Data System (CALPADS), beginning with the 2009–10 school year. Education began implementing 12 California State Auditor Report 2010-104 October 2010 CALPADS in 2008 primarily to meet the reporting requirements of the federal No Child Left Behind Act of 2001. When fully implemented, CALPADS will be the new longitudinal data system Education will use to maintain data at the individual level, including student demographics, program participation, grade level, enrollment, course enrollment and completion, discipline, statewide assessments, and other data needed for state and federal reporting. In CALPADS, each student receives a Statewide Student Identifier, which is a unique number that is not personally identifiable, to track these data. Scope and Methodology The Joint Legislative Audit Committee (audit committee) requested that the Bureau of State Audits (bureau) conduct an audit of how the nutritional needs of charter school students are met, so that the Legislature can make future decisions regarding the health and education of California’s children. Specifically, the audit committee asked us to determine, to the extent that data are available, the number of traditional public school students eligible for free and reduced-price meals compared to the number of charter school students eligible for such meals. Further, the bureau was asked to determine, to the extent possible, the number of charter school students currently participating in federal school nutrition programs, such as the breakfast and lunch programs. The audit committee also requested that the bureau identify the charter schools that provide meals but do not participate in the federal nutrition programs and, for a sample of those schools, determine the types of alternative nutrition programs they offer and how they deliver the meals; the cost of meals to low-income students; whether the program meets or exceeds the nutritional standards that apply to traditional schools and, if not, what nutritional standards the program follows; and why the charter school selected the alternative nutrition program. Further, the audit committee asked the bureau to identify those charter schools that do not provide meals to their students and, for a sample of those schools, to determine how the schools accommodate the nutritional needs of low-income students and the reasons the schools cite for not providing meals, including any barriers that exist. Finally, the bureau was asked to survey key stakeholders regarding whether they believe charter schools are adequately providing nutrition to low-income students eligible for free or reduced-price meals. To understand charter school governance, we reviewed the Act and other state laws. In addition, to understand the breakfast and lunch programs, we reviewed federal laws and regulations governing the programs. Finally, to understand Education’s various California State Auditor Report 2010-104 13 October 2010 electronic databases, we interviewed its staff and reviewed relevant documentation such as procedure manuals and instructions given to the local educational agencies. We attempted to rely on the various electronic databases when performing this audit. The U.S. Government Accountability Office (GAO), whose standards we follow, requires us to assess the sufficiency and appropriateness of the computer-processed data. To determine the number of traditional and charter schools and their students eligible for free and reduced-price meals, we obtained data from Education’s ConApp database, which is a paperless system. Typically, we assess the reliability of paperless databases by reviewing the adequacy of system controls in place. However, Education lacks internal controls over the ConApp database. In addition, Education does not require all direct-funded charter schools to submit their information using the ConApp database. Thus, based on our testing and analysis, we determined that the data obtained from the ConApp database is not sufficiently reliable to reach an audit conclusion related to the number of traditional and charter schools and their students eligible for free and reduced-price meals. A further discussion of the issues identified with the ConApp database is provided in the Audit Results section of this report. To identify the number of charter schools and their students currently participating in the breakfast or lunch program, we attempted to identify charter schools participating in these programs by obtaining information from Education’s CNIPS database. We assessed the reliability of the CNIPS database by conducting data set verification procedures, performing electronic testing of key data elements, and performing completeness testing on the data. We could not conduct accuracy testing because nutrition services no longer updates their hard-copy documents. Therefore, we could not verify data in the system against source documents. Nutrition services performs administrative reviews to meet federal regulations related to the lunch program. However, its review does not include the data elements the bureau considers key to this analysis. We identified no issues when performing data set verification procedures. However, we identified omissions in a key data field during our electronic logic testing. Specifically, we found that the county-district-school code data field was blank in 12.5 percent of the instances. Further, to test the completeness of the data, we haphazardly selected a sample of 29 charter schools identified as participating in the breakfast and lunch programs by obtaining their applications on file at nutrition services to ensure that they were included in the data we received. In all but one instance we were able to find the unique identifier associated 14 California State Auditor Report 2010-104 October 2010 with a charter school. In that instance the school did not appear in the data because its application was pending the school food authority’s verification for fiscal year 2009–10, which had not been completed by the date of the data we received. However, we were not able to verify the charter school name in three of 29 instances due to the lack of updated source documents. We also attempted to identify charter school students participating in the breakfast and lunch programs by obtaining information from Education’s CNIPS database. However, Education does not require the school food authorities to report monthly claims for each of their sites separately. Therefore, although Education can report the total number of students, it cannot differentiate between charter school students and traditional students who are participating in these programs. Based on our testing and analysis, we determined that the CNIPS database is not sufficiently reliable to reach an audit conclusion related to the exact number of charter schools and their students currently participating in the breakfast and lunch programs. Further discussion of issues identified with the CNIPS database is provided in the Audit Results. To identify the number of active charter schools in California, we obtained the Charter Schools Database from Education. We assessed the reliability of the Charter Schools Database by conducting data set verification procedures, performing electronic testing of key data elements, and performing completeness testing. We could not conduct accuracy testing. Although the Charter Schools Division retains the original source documentation in hard copy, any subsequent changes to the database are submitted by the schools through an annual information survey. The Charter Schools Division does not retain the hard-copy survey documents, with the exception of those for the years 2001 to 2003. Therefore, we could not test data in the system against source documents. Further, we ascertained that the Charter Schools Division does not conduct audits or perform reviews of the information stored in its database. We identified no issues when performing data set verification procedures or electronic testing of key data elements. To further test the completeness of the data, we haphazardly selected a sample of 29 charter school applications obtained from the files at the Charter Schools Division to ensure that they were in the data we received. In all instances we were able to find the unique identifier associated with a charter school. However, we were not able to verify the charter school name in six of 29 instances due to the lack of updated source documents. Based on our testing and analysis, we determined the data obtained from the Charter Schools Database to be of undetermined reliability to reach an audit conclusion related to the number of active charter schools in California. California State Auditor Report 2010-104 15 October 2010 To identify charter schools that provide alternative nutrition programs to their students and those schools that do not provide meals to their students, we first had to determine the number of traditional and charter schools that were participating in the breakfast and lunch programs. Despite concerns regarding their data reliability, we used the Charter Schools Database and the CNIPS database that is designed to capture information on the number of schools and their students’ participation in the breakfast and lunch programs to identify the number of active charter schools participating in the breakfast or lunch program. Using these data sources, we were able to reasonably determine that 213 charter schools were not participating in the breakfast or lunch program as of October 31, 2009. We then surveyed these 213 charter schools to identify those that provide alternative meals to their students and those that do not provide meals to their students. Appendix A presents the responses to this survey. Finally, we visited five schools that stated in their response to our survey that they provide an alternative meal program to their students to obtain a better understanding of their programs. The five schools we visited were the Children’s Community Charter School in Paradise, Discovery Charter School in Tracy, Explorer Elementary Charter School in San Diego, International School of Monterey in Seaside, and Port of Los Angeles High School in San Pedro. To survey key stakeholders, we first identified four key stakeholders through a discussion with Education’s staff. We then conducted phone interviews with these stakeholders. Appendix B summarizes the mission of each stakeholder and the comments and opinions of their representatives. 16 California State Auditor Report 2010-104 October 2010 Blank page inserted for reproduction purposes only. California State Auditor Report 2010-104 17 October 2010 Audit Results The California Department of Education Lacks Reliable Data to Identify the Number of Charter Schools and Their Students Eligible for and Participating in the Federal Breakfast and Lunch Programs Several factors prevented us from using the data collected by the California Department of Education (Education) to determine the number of traditional and charter schools and their students eligible for free and reduced-price meals offered under the federal School Breakfast Program (breakfast program) and National School Lunch Program (lunch program). Specifically, Education lacks an internal control process, such as a systematic audit or review of supporting documentation, for the three data fields in its Consolidated Application Data System (ConApp database) that are relevant to our audit. These fields record the number of students enrolled in a school, the number of those students eligible to receive free meals, and the number of those students eligible to receive reduced-price meals. Furthermore, although Education requires local educational agencies receiving certain federal and state funding to complete its Consolidated Application for Funding Categorical Aid Programs (ConApp) by entering data into its ConApp database, it stated that it has no authority to require charter schools to do so. Therefore, the data in the ConApp database on the number of charter school students eligible for free and reduced-price meals may not reflect all of the charter schools in California. We were also unable to use Education’s data to determine the actual number of charter schools and their students participating in the breakfast and lunch programs. Specifically, the Child Nutrition Information and Payment System (CNIPS) database does not separately identify charter schools in its data. Instead, these data are combined with data for traditional schools under the same administrative jurisdiction. This practice makes it impossible to identify both the number of charter schools participating in the breakfast and lunch programs and the number of charter school students eligible for and participating in the programs. Education’s Data on the Number of Schools and Their Students’ Eligibility for Free and Reduced‑Price Meals Are Not Sufficiently Reliable As we discussed in the Introduction, Part II of Education’s ConApp obtains information from local educational agencies and direct-funded charter schools regarding the number of students eligible for free and reduced-price meals. Specifically, the page titled October 20XX School-Level Free and Reduced Price Meals Eligibility Data Collection has three data fields designed to capture the number of students enrolled at the school level, the 18 California State Auditor Report 2010-104 October 2010 number of enrolled students who are eligible to receive free meals, and the number of enrolled students who are eligible to receive reduced-price meals. Education instructs the local educational agencies and direct-funded charter schools to include students between the ages of five and 17, to define eligibility as pertaining to students with a household income that meets the income eligibility criteria for receiving free or reduced-price meals in the breakfast or lunch program, and to capture the data on a preselected information day in October of each year. Education uses the information in these three data fields to determine eligibility and funding allocations for a variety of categorical programs, such as the Title I Grants to Local Educational Agencies that benefit children who are failing, or are most at risk of failing, to meet the State’s academic standards. Because the ConApp database is a paperless system, meaning the local educational agencies and direct-funded charter schools enter the data directly into the database, we expected Education to have an internal control process, such as a systematic audit or review of their supporting documentation, for the three data Education’s consolidated fields that are relevant to our audit. However, Education has not application database is a paperless established an internal control process to ensure the accuracy system—certain charter schools of these three data fields. The director of the Data Management enter the data directly into the Division (data division) stated that it is not the responsibility database—yet, Education has not of the data division to perform audits or reviews of the local established controls to ensure the educational agencies’ and direct-funded charter schools’ supporting accuracy of the data. documentation for the data they enter into the ConApp database. The director also stated that the users of the data are in a better position to determine if an audit or review is needed. Because the data fields are used to determine eligibility and funding allocations for a variety of categorical programs, we contacted staff in Education’s School Fiscal Services Division, Categorical Allocation and Audit Resolution Office (fiscal services division), which is responsible for, among other things, allocating funds to local educational agencies. An administrator in the fiscal services division stated that the ConApp database is currently the only database Education uses to collect information on the number of students eligible for free and reduced-price meals. The administrator also stated that the fiscal services division does not review the local educational agencies’ and direct-funded charter schools’ supporting documentation for the three data fields they enter into the ConApp database. The administrator further stated that Education requires the local educational agencies and direct-funded charter schools to certify that the data they submit are accurate and that it must place some confidence in their certifications. Finally, the administrator stated that local educational agencies and direct-funded charter schools are supposed to have documentation to support the information they enter into the California State Auditor Report 2010-104 19 October 2010 ConApp database. Nevertheless, although Education’s ConApp database instructions require the local educational agencies and direct-funded charter schools to electronically certify that they have fulfilled the requirements listed on the page, the instructions do not state that they should retain the documentation. Fiscal services division staff also stated that the page has built-in electronic error checks that do not allow the total number of students eligible for free and reduced-price meals to exceed the total enrollment. Although this is a reasonable edit check, this An edit check Education uses, feature does not ensure that the numbers entered into the ConApp although reasonable, does database by the local educational agencies and direct-funded not ensure that the numbers charter schools are correct. In addition, fiscal services division entered into the database by the staff stated that they compare the ConApp database enrollment local educational agencies and figures for new and significantly expanding charter schools with direct‑funded charter schools Education’s California Basic Educational Data System (CBEDS) are correct. enrollment figures to identify any large discrepancies. However, we found that a reconciliation between the total enrollment numbers in the ConApp database and the total enrollment numbers in CBEDS, for the purpose of obtaining some assurance of the accuracy of the total enrollment numbers reported by the local educational agencies and direct-funded charter schools in the ConApp database, was not possible for the 2009–10 school year because some of the local educational agencies had not certified their enrollment data by August 12, 2010, as Education requested. In 2008 Education began implementing its California Longitudinal Pupil Achievement Data System (CALPADS), primarily to fulfill the reporting requirements of the federal No Child Left Behind Act of 2001. The first phase of the CALPADS implementation included, among other things, the collection of 2009–10 school year enrollment numbers previously collected on the CBEDS School Information Form. However, a report on Education’s implementation of CALPADS issued by its consultant in January 2010 found anomalies, errors, and defects throughout the system that were causing it to experience slowness, outages, and other performance issues. The May revision to the Governor’s Budget for fiscal year 2010–11 instructed Education to ensure at the minimum that by the end of the 2010 calendar year, CALPADS is able to receive and reliably transfer data. In a letter it sent to local educational agencies and charter schools on August 6, 2010, Education stated that, as of June 26, 2010, it was able to stabilize CALPADS. The letter also instructed the local educational agencies and charter schools to submit and certify their 2009–10 school year enrollment counts and 2008–09 graduate and dropout counts by August 12, 2010. According to the director of Education’s data division, 1,290 out of 1,522 local educational agencies had certified their data as of September 13, 2010. 20 California State Auditor Report 2010-104 October 2010 In addition to the concerns we have with the accuracy of the three data fields that are relevant to our audit, we question the completeness of the data for the purpose of our audit. Education requires local educational agencies applying for categorical aid program funds to submit their information into the ConApp database. However, according to an administrator in its data division, there is no state or federal law that gives Education the authority to require charter schools to submit the ConApp. Therefore, complete data on the number of charter schools and their students eligible for free and reduced-price meals may not be available. Our concerns with both the accuracy and completeness of the data in the three data fields prevent us from concluding that the data are sufficiently reliable to reach an audit conclusion related to the number of traditional and charter schools and their students eligible for free and reduced-price meals. Education’s Nutrition Services Division Is Unable to Accurately Identify Charter Schools Participating in the Breakfast and Lunch Programs The Child Nutrition Information and Payment System (CNIPS) database administered by Education’s Nutrition Services Division (nutrition services) did not identify all charter schools participating in the breakfast and lunch programs as of October 31, 2009. Consequently, the CNIPS database cannot be used to accurately identify all charter school students participating in the programs. When applying to participate in the breakfast and lunch programs, a school food authority must complete an application for each of its school sites, and in doing so must indicate the type of site—such as a public school district, direct-funded charter school, or locally funded charter school. A direct-funded charter school may apply to participate in the breakfast and lunch programs as its own school In comparing two of Education’s food authority. In contrast, a locally funded charter school must databases, we identified 115 direct apply to participate in the programs through its chartering entity and and locally funded charter schools must be listed as a site on the application of an approved school food that were participating in the authority. In our comparison of Education’s Charter Schools breakfast or lunch program, but Database and its CNIPS database, we identified 115 direct and locally were not identified as charter funded charter schools that were participating in the breakfast or schools participating in these lunch program, but were not identified as participating in these programs in the CNIPS database. programs because the school food authorities had not identified them as charter schools in the CNIPS database. Nutrition services does not review the applications the school food authorities enter into CNIPS to ensure the accuracy of the information. Further, federal law allows sites to be combined for the purposes of participating in the breakfast and lunch programs if the programs are under the same administrative jurisdiction and are on the same campus. Consequently, it is impossible to determine whether California State Auditor Report 2010-104 21 October 2010 a particular charter school is participating in the breakfast and lunch programs, because it is part of a combined site. For example, Gompers Preparatory Academy in San Diego is participating in the lunch program as a combined site under Gompers Charter Middle School. Both of these charter schools are under the administrative jurisdiction of the San Diego Unified School District, and their programs are conducted on the same campus. Similarly, Marysville Charter Academy for the Arts, a charter school, and Marysville High School, a traditional high school, are both located on the same campus and are under the jurisdiction of Marysville Joint Unified School District. The school food authorities in these examples do not need to list these charter schools as separate school sites on their applications. Because federal law allows these sites to submit a single application to participate in the breakfast and lunch programs, it is impossible to identify how many charter schools are participating in the programs. Due to the school food authorities’ reporting errors and their ability to combine sites on the same campus, we found that the CNIPS database is not sufficiently reliable to determine the exact number of charter schools or their students participating in the breakfast and lunch programs. However, the database was the only source available to us to use to identify schools that provide alternative meal programs to their students as well as schools that do not provide any meals to their students. Therefore, using the Charter Schools Database and the CNIPS database, we determined that 213 charter schools did not appear to be participating in the breakfast or lunch program. To identify any additional reporting errors, we added a question on our survey asking the 213 charter schools to verify Education’s information indicating that they were not participating in the breakfast or lunch program. Figure 1 on the following page presents the results for the 133 charter schools responding to our survey. As the figure shows, four schools stated that they provide instruction based outside the classroom Federal School Breakfast Program and and therefore do not provide meals. In addition, National School Lunch Program Criteria for three schools stated that they do not provide Students Up to Age 21 meals to students or participate in the breakfast and lunch programs because their students are • Child can be enrolled in any public or nonprofit private age 18 or older. In fact, two of these schools stated residential child care institution including juvenile detention centers. that they provide services to students in jail. The third school stated that its students are between • Child can be enrolled in Job Corps centers funded by the ages of 18 and 25 and that the majority of the U.S. Department of Labor. its students are above the age to participate in • Child can be enrolled in private foster homes. the breakfast or lunch program. However, if the school’s students meet the criteria shown in Source: Federal Regulations 7CFR 210.2 and 7CFR 220.2. the text box, they may be able to participate in the breakfast and lunch programs. 22 California State Auditor Report 2010-104 October 2010 Figure 1 Surveyed Charter Schools’ Responses About Their Participation in Alternative Meal Programs Schools with students, age 18 or older, who they believe do not qualify for the federal breakfast or lunch programs—3 (2%) Schools that provide instruction based outside the classroom—4 (3%) Schools that provide alternative meal Schools that do not programs—46 (35%) provide meals— 39 (29%) Schools that participate in the federal breakfast or lunch program—41 (31%) Sources: Charter Schools’ responses to the Bureau of State Audits’ Nutritional Needs of Charter School Students survey. Further, Figure 1 shows that although identified as not participating in the breakfast or lunch program in the CNIPS database, 41 of the 133 charter schools responding to our survey stated that they are in fact participating in the programs. Various reasons exist for this discrepancy. We found that 10 of the schools enrolled in the programs after October 2009 and thus were appropriately excluded from the October 31, 2009, list we generated using the CNIPS database. Eighteen of the schools shared a campus with another school and were reported as combined sites, which is allowable under federal law, as described previously. Nutrition services requires the school food authorities to enter the county-district-school (CDS) codes for their public school district sites but not for other site types, such as the charter schools. The remaining discrepancies were related to errors in the CDS codes and the site type. Specifically, three charter schools had CDS codes in the CNIPS database that did not match the CDS codes in the Charter Schools Database, and eight charter schools had no CDS codes in the CNIPS database. Also, two charter schools participating in the breakfast and lunch programs were misidentified on the school food authorities’ applications, one as a private school and one as a county office of education. California State Auditor Report 2010-104 23 October 2010 Nutrition services performs reviews of a sample of the schools under the jurisdiction of the school food authorities each year, in accordance with federal regulations, to ensure that the requirements of the lunch program are being met. However, nutrition services’ review tool does not include a procedure for verifying the accuracy of the CDS code or the site type reflected on the schools’ site applications. Nutrition services stated that it is the charter schools’ responsibility to enter the CDS code into the CNIPS database but that there is no requirement for them to do Education’s CNIPS database is not so. The additional errors we identified through the survey further sufficiently reliable to determine illustrate that the CNIPS database is not sufficiently reliable to the exact number of charter schools determine the exact number of charter schools participating in the participating in the breakfast and breakfast and lunch programs. lunch programs. Education’s Nutrition Services Cannot Differentiate Between Charter School Students and Traditional School Students Participating in the Breakfast and Lunch Programs The CNIPS database has data fields for school food authorities to enter information such as the number of students approved for free and reduced-price meals at each site under their jurisdiction. However, Education allows the school food authorities to combine the information for their sites before entering it into the CNIPS database. Thus, the CNIPS database cannot be used to identify the number of charter school students participating in the breakfast and lunch programs. Each month the school food authorities must submit a Claim for Reimbursement to nutrition services using the CNIPS database. Education’s claim reimbursement procedures require the school food authorities to enter a claim for each site under their jurisdiction as well as a consolidated claim. Both claim types are required to include information such as the number of students approved to receive free and reduced-price meals, total enrollment, and the number of free and reduced-price meals served during the month. In addition, prior to submitting the Claim for Reimbursement, school food authorities are required by federal regulations to review the meal count data for each site to ensure that the site claim accurately reports the number of free and reduced-price meals served to eligible students. However, nutrition services does not require the school food authorities to report monthly claims for each of their sites separately. For example, the Natomas Pacific Pathways Preparatory Schools, which has a charter middle school and high school, participates in the breakfast and lunch programs through the Natomas Unified School District, which acts as a school food authority for both traditional schools and charter schools. 24 California State Auditor Report 2010-104 October 2010 The Natomas Unified School District enters into the CNIPS database the combined number of charter school and traditional school students at all of its sites who are approved to receive free and reduced-price meals. Therefore, although Education can report the total number of students, it cannot differentiate between charter school students and traditional school students who are participating in the breakfast or lunch program. Nutrition services stated that it does not require the school food authorities to report the monthly claims for each of their sites because some of the larger school food authorities had expressed concern about the amount of manual data entry this reporting would require. Nutrition services also stated that the school food authorities may choose to report the monthly claims for each of their sites. Finally, nutrition services stated that, once it fully implements the CNIPS database in December 2010 and all of the school food authorities have the capability to upload site-level data into the CNIPS database, it will revisit requiring site-level reporting for all school food authorities. Charter Schools Not Participating in the Federal Breakfast or Lunch Program Use Various Methods to Provide Meals to Their Students The Joint Legislative Audit Committee (audit committee) asked us to identify charter schools that provide meals but do not participate in the breakfast or lunch program and to gather data such as how they deliver the meals, why they chose that method, the cost of the Forty‑six of the 133 charter meals to low-income students, and whether the program meets or schools that responded to our exceeds the nutritional standards that apply to traditional schools. survey provide meals but do not Forty-six of the 133 charter schools responding to our survey fall participate in the breakfast or into this category. Charter schools establish their own procedures lunch program. and guidelines when providing meals to students outside of the breakfast and lunch programs. The 46 charter schools have varying methods of providing meals, ranges of meal costs, and reasons for offering their alternative meal programs. In addition, the nutritional guidelines they follow vary. Table A.1 in Appendix A presents a summary of these charter schools’ responses to our survey. The 46 charter schools had various reasons for electing to provide meals without participating in the breakfast or lunch program. The primary reason cited by 15, or 33 percent, of the charter schools for having an alternative meal program is to allow them to provide what they described as fresher, healthier food choices to their students than the breakfast or lunch program provides. For example, All Tribes Charter School, located in Valley Center, partners with the local Indian Health Clinic to develop a diet plan that it believes is more appropriate for its students. Larchmont Charter School–West Hollywood, located in Los Angeles, stated that it is affiliated with the Chez Panisse Foundation’s Edible Schoolyard program, which focuses on a comprehensive hot lunch California State Auditor Report 2010-104 25 October 2010 program that includes offering gardening and cooking classes to the students. The Golden Oak Montessori of Hayward Charter School, located in Hayward, wanted to offer its students organic foods without trans fats and sugar. Eight charter schools stated that they do not have enough staff and resources to fulfill the administrative requirements of the breakfast and lunch programs. Eight charter schools also indicated that they do not have a kitchen, a cafeteria, equipment, or other resources with which to prepare and deliver meals to their students. The remaining charter schools cited reasons such as having too few students eligible for free or reduced-price meals, having applications for the breakfast and lunch programs that were either pending approval or denied, or choosing to partner with another entity. The five charter schools we visited cited reasons that were consistent with those of the other schools. The The Five Charter Schools With an Alternative text box lists these five charter schools. Specifically, Meal Program That We Visited three of the five charter schools we visited wanted • Children’s Community Charter School, located in Paradise to provide fresher, healthier food choices to their students than the breakfast or lunch program • Discovery Charter School, located in Tracy provides. In addition, the International School of • Explorer Elementary Charter School, located in San Diego Monterey in Seaside and the Explorer Elementary Charter School (Explorer) in San Diego expressed • International School of Monterey, located in Seaside concerns regarding the administrative requirements • Port of Los Angeles High School, located in San Pedro of the breakfast and lunch programs. The 46 charter schools also cited various methods of providing meals to their students, including using school staff to prepare and serve meals on site; obtaining meals from local restaurants, delicatessens, or vendors; and contracting with food service management companies or local caterers. Figure 2 on the following page provides a breakdown of the delivery methods used by the 46 charter schools. The five charter schools we visited had similar methods for delivering meals to their students. For example, Explorer contracts with a caterer to provide a hot lunch to its students each day of the week except Tuesday. The caterer prepares the food off site and then brings it to the school. The caterer and Explorer’s parent volunteers serve the meal. On Tuesday, Explorer brings in pizza from a local restaurant. In contrast, Discovery Charter School (Discovery) in Tracy, prepares its food daily and puts it on a steam line in its kitchen so that its students can walk through the line to select their lunch. The students who paid full price for their meals at the charter schools paid between 50 cents and $5. The students who paid for reduced-price meals paid between 40 cents and $1.88. Twenty-four of the 46 charter schools offered free meals either to all of their students or to those who qualify for free or reduced-price meals 26 California State Auditor Report 2010-104 October 2010 under the breakfast or lunch program. Some charter schools stated that the free meals they provide to their students are paid for by either a Parents’ Fund, a parent organization, or the school. For example, Northcoast Preparatory and Performing Arts and Academy, located in Arcata, stated that its low-income students pay either whatever they can afford or nothing, with its Parents’ Fund paying the remaining cost for their meals. In addition, Discovery stated that its general fund pays the difference between the money it collects from students and its costs to operate the program. Figure 2 Surveyed Charter Schools’ Various Methods of Providing Meals to Students Meals provided through partnerships with the California National Guard or the Federal Job Corps—2 (4%) Meals prepared on site by the charter Meals provided by the schools’ staff— charter schools’ 11 (24%) contractors*— 20 (44%) Meals provided by local restaurants, delicatessens, or vendors—13 (28%) Sources: Charter Schools’ responses to the Bureau of State Audits’ Nutritional Needs of Charter School Students survey. * The schools contracted with food service management companies, caterers, a school, and school districts. The students at the five charter schools we visited paid between $3 and $4.25 for their meals. For example, Port of Los Angeles High School, in San Pedro, has an agreement with its primary vendor to provide lunch for its students at a price of $3. Port of Los Angeles High School does not offer free or reduced-price meals to its students. Explorer charged its students $4.25 for lunch. However, students who qualify for reduced-price meals paid $1, and there is no cost for those students who qualify for free lunch. Figure 3 shows the cost of the meals at the five schools we visited. The figure also indicates which schools offered free or reduced-price meals. California State Auditor Report 2010-104 27 October 2010 Figure 3 Amounts Students Paid for Meals at the Five Charter Schools We Visited $4.5 Standard meal price Reduced meal price 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0 Children’s Discovery Explorer International Port of Community Charter School† Elementary School of Los Angeles Charter School* Charter School† Monterey High School* Charter School hcnuL ro tsafkaerB fo tsoC Sources: Charter Schools’ responses to the Bureau of State Audits’ Nutritional Needs of Charter School Students survey. * The school does not offer free or reduced-price meals. † The school also offers free meals to its eligible students. As discussed in the Introduction, charter schools are exempt from the State’s requirement of providing each needy student with one nutritionally adequate free or reduced-price meal during each school day. Thus, unless a charter school is participating in the breakfast or lunch program, it is not required to follow the nutritional guidelines of the U.S. Department of Agriculture (USDA). However, 13 of the 46 charter schools stated that they provide meals that meet or exceed the USDA’s nutritional standards. In addition, 18 of the charter schools stated that their contractors provide nutritious meals. Another nine charter schools stated that they follow their own nutritional standards, work with a nutrition expert or health clinic, or allow the parents or vendor to select the meals. Finally, four charter schools did not address how they ensure that their students receive nutritious and well-balanced meals and two charter schools stated that their students bring lunch from home. Three of the five charter schools we visited stated that either they or their vendor follow the USDA’s nutritional guidelines or Interactive Food Guide Pyramid (food pyramid). The USDA’s food pyramid 28 California State Auditor Report 2010-104 October 2010 outlines five basic food groups: grains, vegetables, fruits, milk, and meat and beans. It also suggests the amount of food a person should eat from each group each day to stay healthy. However, we found variations in how closely the schools followed the USDA’s guidance. For example, Discovery’s director of food services (director) creates monthly menus and tries to ensure that each lunch has three or more of the daily food recommendations provided by the food pyramid. Although the menus include a daily salad bar, the director does not take into consideration the calories or fat content of the meals. However, when creating menus, the director does consider the likes and dislikes of the students. Discovery offers lunches that include hamburgers, grilled cheese sandwiches, and lasagna. In contrast, Explorer’s lunch menu states that the caterer offers fresh, home-style meals, using organic products when possible, and that every lunch includes fresh fruits and vegetables, healthy carbohydrates, and lean protein. For example, the menu for the month of March 2010 offered students a chicken Caesar salad wrap, apples, and dessert on one day and home-style beef stew, garden salad, whole wheat bread, and fruit on another day. Finally, Children’s Community Charter School, in Paradise, did not address how it ensures that its students receive nutritious well-balanced meals but stated that it selects the lunches it provides to its students based on the meals offered by its local vendors. Generally, the charter schools responding to our survey believe the nutritional needs of their students, including their low-income students, are being met. Charter Schools Cited Various Reasons for Not Providing Meals to Their Students The audit committee also asked us to identify charter schools that do not provide meals to their students and to gather data on how they accommodate the nutritional needs of low-income students and Of the 133 charter schools that why they choose not to provide meals. Of the 133 charter schools responded to our survey, 39 do not responding to our survey, 39 indicated that they do not provide meals provide meals to their students and to their students. These charter schools gave a variety of reasons for are not required to do so. not supplying meals to their students; however, many of the schools feel that the nutritional needs of their students are being met because most of their students bring lunch from home. Further, the charter schools stated that they make parents aware of the fact that they do not provide meals. Table A.2 in Appendix A presents a summary of the 39 charter schools’ responses to our survey. As we mentioned previously, charter schools are exempt from the State’s requirement of providing each needy student with one nutritionally adequate free or reduced-price meal during each school day. The 39 charter schools that do not participate in the breakfast or lunch program or provide an alternative meal program cited a variety of reasons for not doing so. The most common California State Auditor Report 2010-104 29 October 2010 reason, cited by 22 of the 39 charter schools, was the lack of a kitchen, cafeteria, or other facility to prepare and deliver meals to their students. The next most common reason, cited by 12 of the 39 charter schools, was a lack of funding and staffing to operate an alternative meal program or participate in the breakfast or lunch program. Figure 4 shows the reasons charter schools cited for not providing meals to their students. Figure 4 Reasons Given by Surveyed Charter Schools for Not Providing Meals to Their Students Application process for participation in the federal School Breakfast Program (breakfast program) or “It seems the school can run more National School Lunch Program efficiently without providing meals (lunch program) requires bids “from to its students”—1 (2%) three vendors, but the [school] was only able to identify one that provides organic food”—1 (2%) Lack of parental interest in a school food program—4 (9%) Lack of student participation or students who qualify to participate in the breakfast or lunch program—6 (13%) Lack of kitchen, cafeteria, or other facility to prepare and deliver meals—22 (48%) Lack of funding and staffing to operate an alternative meal program or participate in the breakfast or lunch program—12 (26%) Sources: Charter Schools’ responses to the Bureau of State Audits’ Nutritional Needs of Charter School Students survey. Note: The total number of reasons the charter schools do not provide meals to their students does not agree with the total number of 39 schools responding to the survey because some schools did not provide a reason while others provided multiple reasons. Of the 39 charter schools responding to our survey, 29 believe that, in general, the nutritional needs of their students, including their low-income students, are being met. Many of the 29 schools stated that their students bring lunch from home. Our review of the information some of these charter schools make available to parents found that they inform parents that they do not provide meals, using handbooks that can be found on their Web sites. For example, one school’s handbook informs parents that students must bring a snack and lunch to school on the days they attend classes and that they should provide healthy, nutritious food and bottled water, as no 30 California State Auditor Report 2010-104 October 2010 drinking fountains are available. In addition, the handbook states that there is no cafeteria on the school campus. Thus, when parents choose to pack their children’s lunch and schools make parents aware of the fact that they do not provide meals, it ultimately becomes the parents’ responsibility to ensure that their children’s nutritional needs are met. Provisions Exist That Are Intended to Reduce the Administrative Requirements of the Federal Breakfast and Lunch Programs One reason charter schools responding to the survey cited for choosing not to participate in the breakfast or lunch program was that they do not have enough funding, staffing, or other resources to fulfill the administrative requirements of these programs. However, federal regulations include three provisions aimed at reducing administrative requirements such as meal counting and claim reimbursement associated with the programs. As discussed in the Introduction, participating in the breakfast or lunch program requires the school food authorities and local educational agencies to perform various administrative tasks. For example, federal regulations require each local educational agency to provide meal benefit forms to families so that they can apply to the agency for free or reduced-price meals for all children in their household. In addition, local educational agencies must select a sample of their approved household applications for free and reduced-price meals on file as of October 1 and verify the eligibility of the children listed. Finally, before submitting a monthly Claim for Reimbursement to Education, each school food authority must review the lunch count data, which includes the number of meals served by type (free, reduced price, and paid) for each school under its jurisdiction to ensure the accuracy of the claim. Some charter schools that do not Eight charter schools providing alternative meal programs stated participate in the breakfast or that they do not participate in the breakfast or lunch program lunch program stated they do not because they do not have enough staff and resources to fulfill have enough resources to fulfill the administrative requirements of these programs. Specifically, the administrative requirements of one charter school stated that it has a small number of students who these programs. qualify for the lunch program and the amount of “man” hours needed to fulfill the requirements and paperwork makes its participation in the program economically unfeasible. The charter school also stated that it would be less expensive for it to absorb the expense of providing free and reduced-price lunches than to pay its personnel to oversee the program. Another charter school stated that the bureaucracy and staffing levels of the breakfast and lunch programs do not allow for a small school to participate. The charter school also stated that the programs do not cover all of the students who really need to participate and do not provide enough food to realistically meet the needs of its students. In addition, one of the 39 charter California State Auditor Report 2010-104 31 October 2010 schools that does not provide meals to its students stated that Education requires schools to submit three bids for food vendors with the applications for the programs, and it has been able to identify only one vendor that provides organic food. Federal regulations outline three alternatives to the notification, certification, and claim reimbursement procedures that school food authorities and their schools must follow to receive federal reimbursement for the meals they serve. These alternatives are commonly referred to as Provision 1, Provision 2, and Provision 3. The Table presents these three provisions. Table Alternative Provisions to Reduce the Administrative Requirements of the Federal School Breakfast Program and the National School Lunch Program PROVISION DESCRIPTION 1 A school food authority of a school having at least 80 percent of its enrolled children determined eligible for free or reduced-price meals may, at its option, authorize the school to: • Publicly notify parents of enrolled children who receive free meals once every two consecutive school years instead of annually. • Reduce annual certification of children eligible for free meals to once every two consecutive school years. • Count the number of free, reduced-price, and paid meals served to children in their schools as the basis for monthly claim reimbursements. 2 A school food authority may certify children for free and reduced-price meals for up to four consecutive school years in schools that serve meals at no charge to all enrolled children. This provision establishes a base year, which is generally the last school year that public notifications to parents and eligibility determinations were made and meal counts by type were taken. The base year is the first year and is included in the four-year cycle. This provision requires that: • Schools serve reimbursable meals to all children at no charge. • School food authorities pay, with funds from nonfederal sources, the difference between the cost of serving breakfast and lunch at no charge to all children and the federal reimbursement. • Schools take daily meal counts of reimbursable student meals by type during the base year and convert the counts to percentages. The schools then use the percentages to calculate reimbursement claims in non-base school years. • School food authorities, during the base year, review the meal count data for each school under their jurisdiction to ensure the accuracy of the reimbursement claim. During non-base school years, they compare each school’s total daily meal counts to the school’s total enrollment, adjusted by an attendance factor. • School food authorities exclude the schools participating under this provision from their sample selection and verification of eligibility during non-base school years. 3 A school food authority of a school that serves all enrolled children reimbursable meals at no charge during any period for up to four school years may elect to receive federal cash reimbursement and commodity assistance at the same level as the total amounts it received during the last year that the eligibility determinations for free and reduced-price meals were made and meals were counted by type (generally referred to as the base year). The base year immediately precedes but is not included in the four-year cycle. This provision requires that: • Schools serve reimbursable meals to all children at no charge during non-base school years. • School food authorities pay, with funds from nonfederal sources, the difference between the cost of serving breakfast and lunch at no charge to all children and the federal reimbursement. • Schools take and retain daily meal counts of reimbursable meals they serve to children during the non-base school years. The school food authority establishes an oversight system using the daily meal counts to ensure that participation has not declined significantly from the base year. • The California Department of Education or the school food authorities make annual adjustments for enrollment and inflation to the total federal cash and commodity assistance received by the school in its base year. • School food authorities, during the base year, review the meal count data for each school under their jurisdiction to ensure the accuracy of the reimbursement claim. During non-base school years, school food authorities develop their own oversight system or compare each school’s total daily meal counts to the school’s total enrollment, adjusted by an attendance factor. • School food authorities exclude the schools participating under this provision from their sample selection and verification of eligibility during non-base school years. Source: Federal Regulation 7CFR245.9. 32 California State Auditor Report 2010-104 October 2010 These provisions have been in place for at least 15 years. Education informs school food authorities about the provisions through its management bulletins and information manuals on its Web site. In addition, Education stated that it provides information on the provisions to school food authorities during its annual training. Thus, opportunities may exist for charter schools to participate in the breakfast and lunch programs while reducing the administrative burdens of these programs. Recommendations To ensure the reliability of the ConApp database fields related to the number of students enrolled at the school level, the number of those enrolled students who are eligible to receive free meals, and the number of those students who are eligible to receive reduced-price meals, Education should do the following: • Modify its ConApp database instructions to require local educational agencies and direct-funded charter schools to retain their documentation supporting the three data fields for a specified period of time. • Establish an internal control process such as a systematic review of a sample of the local educational agencies’ and direct-funded charter schools’ supporting documentation. To ensure the accuracy of the CNIPS database, Education should do the following: • Direct the school food authorities to establish internal control procedures to ensure the accuracy of the application information they enter into the CNIPS database. • Direct nutrition services to modify the tool used to review a sample of the school food authorities’ schools to include a procedure for verifying the accuracy of the CDS code and site type reflected on the schools’ applications. To ensure that it maximizes the benefits from the State’s investment in the CNIPS database, Education should do the following: • Require the school food authorities to submit a monthly Claim for Reimbursement for each site under their jurisdiction in addition to their consolidated claims. • Establish a timeline for the school food authorities to comply with the requirement. California State Auditor Report 2010-104 33 October 2010 We conducted this audit under the authority vested in the California State Auditor by Section 8543 et seq. of the California Government Code and according to generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives specified in the scope section of the report. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. Respectfully submitted, ELAINE M. HOWLE, CPA State Auditor Date: October 21, 2010 Staff: Joanne Quarles, CPA, Audit Principal Rosa Reyes Michelle J. Baur, CISA Ryan P. Coe, MBA Mike Henson Tina Kobler Legal Counsel: Donna Neville, Associate Chief Counsel For questions regarding the contents of this report, please contact Margarita Fernández, Chief of Public Affairs, at 916.445.0255. 34 California State Auditor Report 2010-104 October 2010 Blank page inserted for reproduction purposes only. California State Auditor Report 2010-104 35 October 2010 Appendix A CHARTER SCHOOLS’ SURVEY RESPONSES The Joint Legislative Audit Committee (audit committee) directed the Bureau of State Audits (bureau) to identify charter schools that provide meals but do not participate in the federal nutrition programs and, for a sample of those schools, determine the types of alternative nutrition programs they offer and how they deliver the meals; the cost of meals to low-income students; whether the program meets or exceeds the nutritional standards that apply to traditional schools and, if not, what nutritional standards the program follows; and why the charter school selected the alternative nutrition program. Further, the audit committee requested the bureau to identify those charter schools that do not provide meals to their students and, for a sample of those schools, determine how the schools accommodate the nutritional needs of low-income students and the reasons the schools cite for not providing meals, including any barriers that exist. The Child Nutrition Information and Payment System (CNIPS) database used by the Nutrition Services Division of the California Department of Education (Education) did not include all charter schools, directly and locally funded, participating in the federal School Breakfast Program (breakfast program) or the National School Lunch Program (lunch program). We also found that the school food authorities do not always correctly identify on their applications the type of school sites, such as public school district, direct-funded charter school, or locally funded charter school, participating in the breakfast and lunch programs. In addition, we identified various data entry reporting errors by the school food authorities. As a result, we found that the CNIPS database is not sufficiently reliable to determine the exact number of charter schools and their students participating in the breakfast and lunch programs. Although the Charter Schools Division retains the original source documentation it uses for the Charter Schools Database in hard copy, any subsequent changes to the database are submitted by the schools through an annual information survey. The Charter Schools Division does not retain the hard-copy survey documents, with the exception of those for the years 2001 to 2003. Therefore, we could not test data in the system against source documents. Further, we ascertained that the Charter Schools Division does not conduct audits or perform reviews of the information stored in its database. We haphazardly selected a sample of 29 charter school applications obtained from the files at the Charter Schools Division to ensure that they were in the data we received. In all instances we were able to find the unique identifier associated with a charter school. 36 California State Auditor Report 2010-104 California State Auditor Report 2010-104 37 October 2010 October 2010 However, we were not able to verify the charter school name in six of 29 instances due to the lack of updated source documents. Based on our testing and analysis, we determined the data obtained from the Charter Schools Database to be of undetermined reliability to reach an audit conclusion related to the number of active charter schools in California. Nevertheless, because they were the only databases available for the purpose of our audit, we used the CNIPS database and the Charter Schools Database for our review. Using these sources, we were able to determine that of the 815 active charter schools identified as of April 2010, 451 were participating in the breakfast or lunch program and 151 provide instruction based outside the classroom to their students, either online or independently. We surveyed the remaining 213 charter schools to identify schools that provide an alternative meal program and schools that do not provide meals to their students, and we received responses from 133 charter schools. Forty-six of the charter schools responding stated that they offer their students an alternative meal program. Table A.1 provides a summary of their responses, including a description of the meal program, the prices for meals, how the charter schools ensure that nutritional standards are met, the reason for choosing an alternative nutrition program, and whether they believe the nutritional needs of low-income students are being met. In addition, 39 of the 133 charter schools responding stated that they do not provide meals to their students. Table A.2 beginning on page 46 provides a summary of their responses, including how the charter school accommodates the nutritional needs of low-income students, the reason why the charter school does not provide meals, and whether they believe the nutritional needs of low-income students are being met. 36 California State Auditor Report 2010-104 California State Auditor Report 2010-104 37 October 2010 October 2010 1.A elbaT smargorP laeM evitanretlA evaH tahT sloohcS retrahC morF sesnopseR yevruS OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC eht esahcrup sdik wef yreV .oN hcnuL tnedutS lanoitaN ehT serusne .cnI ,sdooF noituloveR eht edivorp ton did loohcs ehT ,01–9002 raey loohcs nI ytinummoC aeN ademalA loohcs eht yhw si hcihw ,hcnul s’loohcs )margorp hcnul( margorP fo tnemtrapeD .S.U eht taht .cnI ,sdooF noituloveR ecirp htiw detcartnoc loohcs eht retneC gninraeL .smargorp hcnul gnignahc si ”.eramthgin“ a si ssecorp noitacilppa lanoitirtun )ADSU( s’erutlucirgA .slaem sti rof segrahc ot .cnI ,sdooF noituloveR .tem era sdradnats raey loohcs nI .hcnul reviled lliw loohcs eht ,11–0102 .retsamhcnuL htiw tcartnoc nevig si deen ni tneduts ynA .seY ,nairategev sevres loohcs ehT cinagro ,lacol sevres loohcs ehT eht fi yad rep 4$ si hcnuL dna deraperp si hcnuL tsaochtroN atacrA revetahw ro egrahc on rof hcnul osla loohcs ehT .doof cinagro s’loohcs eht dna ecudorp ni htnom a syap tnerap yb etis no dereviled dna yrotaraperP .yap nac yeht eerf-netulg dna nagev sedivorp eht ”deecxe“ sdradnats lanoitirtun .yliad diap fi 5$ ro ecnavda .ffats loohcs strA gnimrofreP deen ohw stneduts rof sehcnul .sdradnats s’ADSU yap stneduts emocni-woL ymedacA .sevitanretla eseht revetahw ro gnihton rehtie s’loohcs ehT .droffa nac yeht .tser eht syap dnuF ’stneraP wef yrev sah loohcs ehT .seY laem evitanretla s‘ loohcs ehT eht swollof rotcartnoc s’loohcs ehT ehT .yad rep 05.3$ si hcnuL eht ,01–9002 raey loohcs nI yellaV atiralC atnaS ciatsaC eht fo tsoM .stneduts emocni-wol .tnemelpmi ot reisae si margorp dna senilediug lanoitirtun s’ADSU eerf reffo ton seod loohcs layoR htiw detcartnoc loohcs lanoitanretnI a gnirb ot referp stneduts s’loohcs wef yrev sah osla loohcs ehT dna sdoof cinagro no yltsom sesucof .slaem ecirp-decuder ro reviled ot .cnI ,gniretaC gniniD sreffo loohcs ehT .emoh morf hcnul .stneduts emocni-wol .eciohc nairategev a sah netfo ton seod tneduts a fi ,revewoH ,11–0102 raey loohcs nI .hcnul tegrof ohw stneduts lla ot doof lliw loohcs eht ,hcnul evah htiw tcartnoc lliw loohcs eht ylimaf a fi ,rehtruF .hcnul gnirb ot .kcans a edivorp .cnI ,sdooF noituloveR ytinummoc loohcs eht ,pleh sdeen .pleh ot pu spets lla ot elbaliava era sehcnuL .seY erew stneduts rof snoitpo ehT serehda“ .cnI ,sdooF noituloveR ehT .yad rep 57.4$ si hcnuL htiw stcartnoc loohcs ehT retrahC ytrebiL nojaC lE eht ,11–0102 raey loohcs nI .stneduts a thguos loohcs ehT .”lufitip“ dna margorp hcnul ”lla ot ro eerf reffo ton seod loohcs ot .cnI ,sdooF noituloveR loohcS ecirp-decuder gnireffo eb lliw loohcs rof ”doof laer“ sedivorp taht margorp .senilediug noitirtun .slaem ecirp-decuder .hcnul reviled .snoitpo laem eerf dna .stneduts sti lla ot elbaliava era sehcnuL .seY stneduts rof snoitpo ehT serehda“ .cnI ,sdooF noituloveR ehT .yad rep 05.3$ si hcnuL htiw stcartnoc loohcs ehT tsriF ycaretiL nojaC lE eht ,11–0102 raey loohcs nI .stneduts a thguos loohcs ehT .”lufitip”erew dna margorp hcnul ”lla ot ro eerf reffo ton seod loohcs ot .cnI ,sdooF noituloveR loohcS retrahC ecirp-decuder gnireffo eb lliw loohcs rof ”doof laer“ sedivorp taht margorp .senilediug noitirtun .slaem ecirp-decuder .hcnul reviled .snoitpo laem eerf dna .stneduts sti . . . egap txen no deunitnoc 38 California State Auditor Report 2010-104 California State Auditor Report 2010-104 39 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC ton si rotcerid evitucexe ehT .seY yltneicffie erom detubirtsid si dooF“ ti woh sserdda ton did loohcs ehT secirp hcnul dna tsafkaerB era hcnul dna tsafkaerB retrahC odidnocsE odidnocsE evah ohw stneduts yna fo erawa si eh esuaceb rodnev eht hguorht eviecer stneduts sti taht serusne dna 1$ neewteb egnar a yb dereviled dna deraperp loohcS hgiH nehw doof tuohtiw ro yrgnuh enog doof detsaw dna ,ssenisub a gninnur decnalab-llew dna suoitirtun fo ytirojam eht htiw ,05.3$ morf ecaps sesael taht rodnev segaruocne loohcs ehT .dedeen lla gnitageled yB .tfiorp detsaw si eht ni ton si loohcs ehT“ .slaem dnuora decirp sehcnul eht .loohcs eht rof ytilibisnopser ekat ot stnerap rodnev eht ot ytilibisnopser eht fo noitacude eht tub ssenisub hcnul ton seod loohcs ehT .05.1$ .sdeen lanoitirtun s’nerdlihc rieht gnffiats artxe on ,etsaw ssel si ereht taht seveileb loohcs ehT ”.ssenisub rof ecalp ni noisivorp a evah gnilaed on ,loohcs eht rof sdeen .ytilibisnopser s’tnerap eht si siht eerf rof yfilauq ohw stneduts eht dna ,snoitcepsni htlaeh htiw .slaem ecirp-decuder ro eht fo egatnecrep a steg loohcs hcihw ,rodnev eht morf yenom fo noitacude eht ot kcab seog ”.stneduts eht ton si rotcerid evitucexe ehT .seY yltneicffie erom detubirtsid si dooF“ ti woh sserdda ton did loohcs ehT secirp hcnul dna tsafkaerB era hcnul dna tsafkaerB 8–K egatireH odidnocsE evah ohw stneduts yna fo erawa eh esuaceb rodnev eht hguorht eviecer stneduts sti taht serusne dna 00.1$ neewteb egnar a yb dereviled dna deraperp loohcS retrahC nehw doof tuohtiw ro yrgnuh enog detsaw dna ,ssenisub a gninnur si decnalab-llew dna suoitirtun fo ytirojam eht htiw ,05.3$ morf ecaps sesael taht rodnev segaruocne loohcs ehT .dedeen gnitageled yB .tfiorp detsaw si doof eht ni ton si loohcs ehT“ .slaem dnuora decirp sehcnul eht .loohcs eht rof ytilibisnopser ekat ot stnerap eht ot ytilibisnopser eht fo lla noitacude eht tub ssenisub hcnul ton seod loohcs ehT .05.1$ .sdeen lanoitirtun s’nerdlihc rieht artxe on ,etsaw ssel si ereht rodnev taht seveileb loohcs ehT ”.ssenisub rof ecalp ni noisivorp a evah on ,loohcs eht rof sdeen gnffiats .ytilibisnopser s’tnerap eht si siht eerf rof yfilauq ohw stneduts ,snoitcepsni htlaeh htiw gnilaed .slaem ecirp-decuder ro egatnecrep a steg loohcs eht dna ,rodnev eht morf yenom eht fo fo noitacude eht ot kcab seog hcihw ”.stneduts eht lla taht serusne loohcs ehT .seY retrahc wen a si loohcs ehT ,gnireffo laminim eht ot euD ehT .05.3$ si hcnuL rehcaeT-tneraP s’loohcs ehT hcnaR tseroF hcnaR tseroF na sedivorp dna doof evah stneduts lennosrep detimil sah dna loohcs dezilamrof ton sah loohcs eht eerf reffo ton seod loohcs sti sedivorp pihsrentraP loohcS retrahC loohcs ehT .ton od yeht fi evitanretla krowrepap ehT .gnidnuf dna ehT .sdradnats lanoitirtun sti ot slaem ecirp-decuder ro morf hcnul toh a htiw stneduts si ti os ,stneduts 001 naht ssel sah laem etats dna laredef eht rof ,hserf reffo ot yrt seod loohcs .stneduts sti yad eno tnaruatser lacol a .rotinom ot ysae ”.emosnedrub“ oot si smargorp .seciohc yhtlaeh .keew a snoitpo sti gnirolpxe si loohcs ehT ot mraF eht ni gnitapicitrap sa hcus .margorp loohcS dedivorp era slaem eht esuaceb ,seY dettimbus sah loohcs ehT gniniD layoR htiw gnikrow yB ton yltnerruc era stnedutS htiw stcartnoc loohcs ehT hgiH erutciP giB onserF ecivres doof dezingocer-llew a yb eht ni etapicitrap ot snoitacilppa serusne loohcs eht .cnI ,gniretaC dna ,slaem rof degrahc gnieb ot .cnI ,gniretaC gniniD layoR onserF—loohcS .ynapmoc tnemeganam margorP tsafkaerB loohcS laredef eviecer stneduts sti fo lla taht s’loohcs eht fo tnecrep 5.87 .hcnul dna tsafkaerb reviled hcnul dna )margorp tsafkaerb( .slaem decnalab-llew ,suoitirtun dna eerf rof yfilauq stneduts ton sah tub ,semit lareves margorp .slaem ecirp-decuder ,emitnaem eht nI .devorppa neeb sti ta slaem eht sreffo loohcs eht .esnepxe nwo 38 California State Auditor Report 2010-104 California State Auditor Report 2010-104 39 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC yltnerruc rotcartnoc s’loohcs ehT .seY rof noitacilppa s’loohcs ehT swollof .cnI ,gniretaC gniniD layoR ehT .yad rep 3$ si hcnuL htiw stcartnoc loohcs ehT ymedacA onserF onserF s’margorp hcnul eht swollof margorp hcnul eht ni noitapicitrap .senilediug s’margorp hcnul a ta hcnul sreffo loohcs ot .cnI ,gniretaC gniniD layoR dna civiC rof .sdradnats noitirtun .gnidnep si rep stnec 04 fo ecirp decuder .hcnul reviled lairuenerpertnE stneduts esoht ot eerf ro yad pihsredaeL .yfilauq ohw etapicitrap dluoc loohcs eht fI .oN ni tup ot droffa tonnac loohcs ehT s’ADSU eht swollof loohcs ehT .yad rep 05.2$ si hcnuL eertne eht sniatbo loohcs ehT irossetnoM arreiS yellaV ssarG stneduts sti ,margorp hcnul eht ni rof tnempiuqe egarots deriuqer eht loohcs ehT .sdradnats lanoitirtun esahcrup stneduts ,revewoH seraperp dna arreiS éfaC morf ymedacA .yad yreve def eb dluow .yreviled muminim dedivorp slaem eht taht serusne na rof retaw ro eciuj eht pu ekam ot smeti rehto lanoitirtun eht teem arreiS éfaC yb stnedutS .stnec 05 lanoitidda eht rof stnenopmoc yrassecen .ADSU eht yb dehsilbup sdradnats ytiliba fo sseldrager def era desaB-dooF lanoitidarT s’ADSU loohcs ot emoc yeht fi yap ot —hcaorppA gninnalP uneM .hcnul tuohtiw .sehcnuL rof nrettaP laeM noitarepo fo raey tsrfi eht si sihT .oN tuohtiw sdoof cinagro reffo oT eht sah .cnI ,sdooF noituloveR ehT .yad rep 52.3$ si hcnuL htiw stcartnoc loohcs ehT kaO nedloG drawyaH emit ekat lliw ti dna loohcs eht rof .stneduts sti ot ragus dna staf snart .sdradnats lanoitirtun ”tsehgih“ a evah ton seod loohcs ot .cnI ,sdooF noituloveR fo irossetnoM eht fo stibah gnitae eht egnahc ot ton seod loohcs eht ,noitidda nI detnalp loohcs eht ,noitidda nI stneduts rof ecalp ni noisivorp .hcnul reviled retrahC drawyaH gnirentrap si loohcs ehT .seilimaf dna nehctik lanoitarepo na evah dna stiurf elbide fo nedrag a ro eerf rof yfilauq ohw loohcS ot etnenamreP resiaK htiw .airetefac a sa meht sedivorp dna selbategev .slaem ecirp-decuder yhtlaeh no seilimaf eht etacude .stneduts eht ot skcans .stibah gnitae sti fo sdeen lanoitirtun ehT .oN rof doof gnikam saw loohcs ehT morf hcnul gnirb stneduts ehT fo ecils a rof 1$ si hcnuL slaem sevres loohcs ehT hgiH klawssorC airepseH ehT .tem gnieb ton era stneduts htlaeh eht tub ,yad yreve stneduts sti segaruocne loohcs ehT .emoh ton seod loohcs ehT .azzip azzip sevres tI .keew a ecno loohcS etapicitrap ot deilppa sah loohcs ni pots ot meht ”decrof“ tnemtraped gnirb dna tiurf kcap ot stneduts rof ecalp ni noisivorp a evah loohcs ehT .syadsruhT no lacsfi rof margorp hcnul eht ni a evah ton did ti esuaceb 9002 yaM seod osla loohcs ehT .skcans yhtlaeh eerf rof yfilauq ohw stneduts morf doof eht lla pu skcip .11–0102 raey sah loohcs ehT .nehctik laicremmoc sados gnirb ot stneduts sti wolla ton .slaem ecirp-decuder ro erofeb thgir stnaruatser lacol hcnul eht ni etapicitrap ot deilppa .supmac no ni ti serots ,yad hcae hcnul .11–0102 raey lacsfi rof margorp dna ,reniatnoc maoforytS a .yletaidemmi ti sevres sti fo sdeen lanoitirtun ehT .oN rof doof gnikam saw loohcs ehT morf hcnul gnirb stneduts tsoM ocat a rof stnec 95 si hcnuL slaem sevres loohcs ehT ot syawhtaP airepseH ehT .tem gnieb ton era stneduts htlaeh eht tub ,yad yreve stneduts ,hcnul rieht tegrof stneduts fI .emoh .azzip fo ecils a rof 1$ dna socat sevres tI .keew a eciwt egelloC etapicitrap ot deilppa sah loohcs ni pots ot meht ”decrof“ tnemtraped .loohcs eht morf spihc yub nac yeht egnar secirp kcahS kcanS ehT no azzip dna syadseuT no lacsfi rof margorp hcnul eht ni a evah ton did ti esuaceb 9002 yaM ,yenom evah ton seod tneduts eht fI .1$ dna stnec 05 neewteb skcip loohcs ehT .syadsruhT .11–0102 raey sah loohcs ehT .nehctik laicremmoc eht reh ro mih evig lliw loohcs eht a evah ton seod loohcs ehT lacol morf doof eht lla pu hcnul eht ni etapicitrap ot deilppa .eerf rof spihc stneduts rof ecalp ni noisivorp erofeb thgir stnaruatser .11–0102 raey lacsfi rof margorp ro eerf rof yfilauq ohw ti serots ,yad hcae hcnul .slaem ecirp-decuder ,reniatnoc maoforytS a ni .yletaidemmi ti sevres dna nac stneduts ,noitidda nI eht morf doof esahcrup .kcahS kcanS . . . egap txen no deunitnoc 40 California State Auditor Report 2010-104 California State Auditor Report 2010-104 41 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC a gnirb rehtie stnedutS .seY na evah ton seod loohcs ehT sunem hcnul s’eciohC s’nerdlihC 4$ yletamixorppa si hcnuL ,01–9002 raey loohcs nI yellaV eromreviL eromreviL stnerap rieht ro emoh morf hcnul .nehctik etis-no eht rednu depoleved erew nac stnerap ,revewoh ;yad rep htiw detcartnoc loohcs eht loohcS retrahC morf enilno hcnul rieht esahcrup deretsiger ffats-no sti fo ecnadiug rof snoitrop laem regral redro reviled ot eciohC s’nerdlihC .rotcartnoc eht eht yb ”devorppa“ era dna naititeid seod loohcs ehT .yad rep 5$ ,11–0102 raey loohcs nI .hcnul .margorp hcnul hcnul ecirp-decuder reffo ton tcartnoc lliw loohcs eht ot slaem eerf reffo seod tub .retsamhcnuL htiw .yfilauq ohw stneduts esoht sehcnul eerf sedivorp loohcs ehT .seY ot hcnul sedivorp loohcs ehT swollof loohcS elddiM nobuduA ehT .slaem rof yap ton od stnedutS htiw tcartnoc a sah loohcs ehT /strA wahsnerC selegnA soL .stneduts dellorne sti fo 032 lla ot nobuduA hguorht stneduts sti dehsilbup sdradnats lanoitirtun lla ot loohcS elddiM nobuduA hgiH retrahC hceT .loohcS elddiM .ADSU eht yb stneduts rieht rof slaem eviecer loohcS selegnA soL eht hguorht .tcirtsiD loohcS defiinU yreve sevres loohcs ehT .seY eht htiw detailffia si loohcs ehT rotanidrooc hcnul s’loohcs ehT ehT .yad rep 5$ si hcnuL htiw stcartnoc loohcs ehT retrahC tnomhcraL selegnA soL decirp era slaem sti dna tneduts elbidE s’noitadnuoF essinaP zehC erusne nehctiK s’remraF ehT dna a ta hcnul sreffo loohcs ot nehctiK s’remraF ehT tseW—loohcS ot seilimaf lla rof yletairporppa sesucof hcihw ,margorp drayloohcS ”sdeecxe ro steem“ unem yreve taht ot eerf ro 1$ fo ecirp decuder .hcnul reviled doowylloH era slaem ,noitidda nI .etapicitrap hcnul toh evisneherpmoc a no .sdradnats lanoitirtun s’ADSU eht .yfilauq ohw stneduts esoht ,lanosaes ,cinagro ,nworg yllacol gnireffo sedulcni taht margorp ycaretiloce eht htiw tnetsisnoc dna ot sessalc gnikooc dna gninedrag gnihcaet si loohcs eht taht stpecnoc .stneduts eht .stneduts eht sdeen lanoitirtun ’stnedutS .seY emaceb nalp deretsinimda-fles ehT did loohcs eht ,0102 hcraM ot roirP stneduts ,0102 hcraM ot roirP hcnul ,0102 hcraM ot roirP retrahC ycageL selegnA soL stae tneduts yrevE .tem gnieb era nur ot loohcs eht rof evisnepxe oot lanoitirtun yna wollof yltcerid ton ehT .slaem rof yap ton did dereviled dna deraperp saw loohcS hgiH sehcnul eht fo tnecrep 58 dna ,hcnul sti esuaceb dnuf lareneg sti gnisu derorrim ti ,revewoh ;senilediug edivorp ton did loohcs retfA .ffats loohcs yb etis no ehT .sdeen lanoitirtun gniteem era neht loohcs ehT .werg noitalupop fo nalp laem devorppa-etats eht gniniD layoR ecirp eht loohcs eht ,0102 hcraM yhtlaeh ssel era sehcnul gniniamer .cnI ,gniniD layoR htiw detcartnoc ton did loohcs ehT .loohcs rehtona rof segrahc .cnI ,gniretaC gniniD layoR htiw detcartnoc a rof sohcan ro azzip ekil snoitpo loohcs ehT .slaem edivorp ot fo eulav lanoitirtun eht no tnemmoc .slaem sti reviled ot .cnI ,gniretaC .tneve laiceps eht ni etapicitrap ot deilppa sah .0102 hcraM retfa devres slaem .hcnul dna tsafkaerb .margorp hcnul gniyap era stneduts rehtehW .seY loohcs eht ”,sdnamed tnerap“ ot euD ,sdooF noituloveR htiw gnikrow yB .yad rep 05.3$ si hcnuL htiw stcartnoc loohcs ehT ehteoG yeR led aniraM rof laem eht gniviecer ro ecirp lluf margorp evitanretla na esu ot esohc lla taht serusne loohcs eht .cnI rof yfilauq ohw stnedutS ot .cnI ,dooF snoituloveR lanoitanretnI loohcs eht ,ecirp decuder a ta ro eerf erom“ a htiw stneduts edivorp ot ,suoitirtun eviecer stneduts sti fo ylno yap hcnul ecirp-decuder .hcnul reviled loohcS retrahC a seviecer dlihc hcae taht serusne ”.laem hserf ,cinagro ,elohw .slaem decnalab-llew .stnec 04 .yliad laem decnalab-llew ,suoitirtun rof yfilauq ohw stneduts llA .seY rebmun llams a sah loohcs ehT sedivorp .cnI ,sdooF noituloveR yad rep 06.3$ si hcnuL htiw stcartnoc loohcs ehT fo loohcS retrahC lliH nagroM evah hcnul ecirp-decuder dna eerf eerf rof yfilauq ohw stneduts fo ecnadrocca ni era taht slaem hguorht netragrednik rof ot .cnI ,sdooF noituloveR lliH nagroM etapicitrap ot ytinutroppo eht ehT .slaem ecirp-decuder dna lanoitirtun s’ADSU eht htiw 58.3$ dna stneduts edarg ht6 .hcnul reviled .margorp hcnul toh s’loohcs eht ni dna stnemeriuqer margorp hcnul eht ,noitidda nI .sdradnats edarg ht8 dna ht7 rof yad rep margorp eht ekam krowrepap taht ycilop noitirtun a sah loohcs sreffo loohcs ehT .stneduts evisnepxe ssel si tI ”.elbisaefnu“ s’ADSU eht ”sdeecxe ro steem“ fo ecirp decuder a ta hcnul tsoc eht brosba ot loohcs eht rof .sdradnats lanoitirtun ot eerf ro yad rep stnec 04 eesrevo ot lennosrep yap ot naht .yfilauq ohw stneduts esoht .margorp eht 40 California State Auditor Report 2010-104 California State Auditor Report 2010-104 41 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC stiurf htiw sehciwdnas hserF .seY eht rof ”yfilauq ton seod“ loohcs ehT cisab sti swollof loohcs ehT .slaem rof yap ton od stnedutS ,tiurf sedivorp loohcs ehT sprociviC dnalkaO erom ylbaborp“ era selbategev dna stneduts sti esuaceb margorp hcnul fo ytnelp gnidivorp fo enilediug ot hciwdnas a dna ,selbategev rebmemsproC degakcaperp eht naht suoitirtun .42 dna 81 fo sega eht neewteb era a no selbategev dna stiurf hserf .stneduts sti ymedacA ”.erehwesle esahcrup stneduts slaem .sisab yliad ton si loohcs eht hguohtlA .seY hsilbatse ot elba ton saw loohcs ehT eht swollof .cnI ,sdooF noituloveR ehT .yad rep 05.3$ si hcnuL htiw stcartnoc loohcs ehT ygolonhceT cfiicaP elavegnarO eht ,margorp hcnul eht fo trap margorp hcnul eht htiw flesti sdradnats lanoitirtun lanoitidart a ta hcnul sreffo loohcs ot .cnI ,sdooF noituloveR loohcS margorp hcnul sesu loohcs .emit ni .margorp hcnul eht ni deniltuo eerf ro 02.1$ fo ecirp decuder .hcnul reviled ot hcnul gnidivorp ni senilediug .yfilauq ohw stneduts esoht ot dna eerf rof yfilauq ohw stneduts .sehcnul ecirp-decuder ot“ evol“ dluow loohcs ehT .oN trap yltnerruc ton si loohcs ehT slaem deraperp syub loohcs ehT .yad rep 57.2$ si hcnuL sti htiw stcartnoc loohcs ehT retrahC eveihcA esidaraP ecirp-decuder dna eerf edivorp .margorp hcnul eht fo .tcirtsid loohcs lacol sti morf evah ton seod loohcs ehT esidaraP ,tcirtsid loohcs lacol fo loohcS ,ti deen taht seilimaf esoht ot slaem rof ecalp ni noisivorp a ot ,tcirtsiD loohcS defiinU .cnI ,esidaraP loohcs sti fo ”ycrem eht ta“ si ti tub eerf rof yfilauq ohw stneduts .hcnul reviled a stneduts sti segrahc taht tcirtsid .slaem ecirp-decuder ro ni sloohcs rehto naht ecirp rehgih od stneduts fi ,revewoH .tcirtsid eht loohcs eht ,hcnul evah ton fo tsoc lluf eht revoc lliw .hcnul eht yrav sgnireffo doof s’loohcs ehT .seY na evah ton seod loohcs ehT ti woh sserdda ton did loohcs ehT kcanS ehT .yad rep 3$ si hcnuL htiw stcartnoc loohcs ehT s’nerdlihC esidaraP era stneduts lla taht tsoc ni hguone .airetefac etis-no eviecer stneduts sti taht serusne neewteb egnar secirp kcahS reviled ot srodnev lacol ytinummoC .laem decnalab a tae ot elba .slaem decnalab-llew dna suoitirtun loohcs ehT .05.1$ dna stnec 52 stneduts ,noitidda nI .hcnul loohcS retrahC no desab era slaem s’loohcs ehT ni noisivorp a evah ton seod eht morf doof esahcrup nac ehT .srodnev lacol fo ytilibaliava eht yfilauq ohw stneduts rof ecalp .kcahS kcanS snoitpo reihtlaeh gnirolpxe si loohcs ecirp-decuder ro eerf rof .kcahS kcanS sti rof .slaem eveileb ton seod lapicnirp ehT .oN wol a htiw ,llams si loohcs ehT ti woh sserdda ton did loohcs ehT kcanS ehT .52.3$ si hcnuL lacol htiw stcartnoc loohcs ehT retrahC esidaraP esidaraP emocni-wol fo sdeen lanoitirtun eht .stneduts fo rebmun eviecer stneduts sti taht serusne neewteb egnar secirp dehS ecno hcnul reviled ot srodnev loohcS elddiM ehT .tem gnieb era stneduts .slaem decnalab-llew dna suoitirtun loohcs ehT .2$ dna stnec 05 stneduts ,noitidda nI .keew a eveileb ton seod osla lapicnirp a taht seciton rebmem ffats a fI noisivorp a evah ton seod eht morf doof esahcrup nac sdik loohcs elddim fo ytirojam eht eht ,hcnul a gnirb ton did tneduts stneduts rof ecalp ni .dehS kcanS yllausu ,noitirtun yhtlaeh eviecer tneduts eht edivorp lliw loohcs ro eerf rof yfilauq ohw tahw fo seciohc nwo rieht no desab eerf dehS kcanS eht morf doof htiw .slaem ecirp-decuder .tae ton od dna od yeht .egrahc fo yhtlaeh sedivorp loohcs ehT .seY sti ot ”snoitpo reihtlaeh“ reffo oT ni sezilaiceps reretac s’loohcs ehT lacol A .yad rep 52.4$ si hcnuL htiw stcartnoc loohcs ehT rerolpxE ogeiD naS .nerdlihc lla rof snoitpo hcnul sah loohcs eht ,noitidda nI .stneduts ehT .seciohc yhtlaeh ylno gnivres azzip sedivorp tnaruatser reviled ot gniretaC naynaB yratnemelE etapicitrap ot snalp loohcs ehT rof yfilauq ohw stneduts wef oot ”sdeecxe ro steem“ reretac s’loohcs no gnisserd htiw storrac dna loohcs eht ,noitidda nI .hcnul loohcS retrahC loohcs ni margorp hcnul eht ni yfitsuj ot slaem ecirp-decuder ro eerf .sdradnats lanoitirtun s’ADSU eht tsoc egareva ehT .syadseuT keew a yad eno hcnul sedivorp .11–0102 raey stnemeriuqer evitartsinimda eht .78.1$ si ecils rep azzip fo .tnaruatser lacol a morf ehT .smargorp laredef eht fo a ta hcnul sreffo loohcs ehT rebmun wol a htiw llams si loohcs ot eerf ro 1$ fo ecirp decuder .stneduts fo .yfilauq ohw stneduts esoht . . . egap txen no deunitnoc 42 California State Auditor Report 2010-104 California State Auditor Report 2010-104 43 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC gnisahcrup ton era stneduts fI .seY ”yhtlaehnu“ si margorp s’tcirtsid ehT s’ADSU eht swollof loohcs ehT 05.3$ neewteb segnar hcnuL htiw stcartnoc loohcs ehT snoitavonnI ogeiD naS setacude ti ,sehcnul s’loohcs eht dessecorp fo tol a sesu ti esuaceb loohcs ehT .sdradnats lanoitirtun eht htiw ,yad rep 05.4$ dna ot nessetaciled lacol a retrahC ymedacA na ekam ot woh no seilimaf .sevitidda larutannu dna sdoof ro elbategev a stneduts sedivorp decirp sehcnul eht fo ytirojam .hcnul edivorp loohcS ta hcnul yhtlaeh dna elbadroffa niam rieht htiw gnola eciohc tiurf ton seod loohcs ehT .57.3$ ta ,taht detats loohcs ehT .emoh morf esoohc osla nac yeht dna laem ecirp-decuder ro eerf reffo .llew tae stneduts sti ,yllareneg .eciuj ro ,klim ,retaw .stneduts sti ot slaem doof etis-no s’loohcs ehT .seY gnffiats dna ”ycarcuaerub ”ehT ”deecxe ro teem“ slaem llA ta dedivorp era slaem llA na setarepo loohcs ehT gninraeL efiL ocsicnarF naS sdeecxe ro steem margorp ecivres eht ni etapicitrap ot deriuqer slevel yb dehsilbup sdradnats lanoitirtun dna ,stneduts ot tsoc on margorp ecivres doof etis-no ymedacA rof stnemeriuqer lanoitirtun lla a rof ”wolla ton od“ smargorp laredef fo senilediug eht wollof dna ADSU s’loohcs eht fo tnecrep 08 slaem elpitlum sedivorp taht laredef eht htob ni noitapicitrap eht dna ,etapicitrap ot loohcs llams .dimaryP ediuG dooF evitcaretnI sti dna eerf rof yfilauq stneduts dna tsafkaerb gnidulcni ,yliad .smargorp hcnul dna tsafkaerb hguone edivorp ton od“ smargorp .slaem ecirp-decuder sa deraperp era slaeM .hcnul sdeen eht teem yllacitsilaer ot ”doof s’loohcs eht fo tnenopmoc a .stneduts s’loohcs eht fo .margorp gniniart stra yraniluc yhtlaeh sedivorp loohcs ehT .seY hguone evah ton seod loohcs ehT eht swollof retrahc s’loohcs ehT ehT .yad rep 52.4$ si hcnuL htiw stcartnoc loohcs ehT retrahC yrevocsiD esoJ naS esoht nevE .stneduts lla ot slaem ni etapicitrap ot stneduts gniyfilauq .sdradnats lanoitirtun s’ADSU ot hcnul eerf sedivorp loohcs lacol a ,tekraM atsaP eht loohcS ecirp-decuder a ylno rof yfilauq ohw .margorp etats a rof yfilauq ohw stneduts esoht .hcnul reviled ot ,tnaruatser .yliad hcnul eerf eviecer hcnul .slaem ecirp-decuder ro eerf .seY ni elbaliava si margorp hcnul ehT si margorp hcnul eht rof unem ehT neewteb egnar secirp hcnuL margorp hcnul s’loohcs ehT eF atnaS–euvelleB siuL naS suoitirtun ,yhtlaeh edivorp ot redro .reetnulov tnerap a yb dehsilbatse ehT .05.4$ dna 57.1$ yb yleritne deganam si loohcS retrahC opsibO .stneduts rof sehcnul sah ti taht detats loohcs si hcnuL .sreetnulov tnerap rof elbaliava spihsralohcs gnitapicitrap morf deredro .stneduts emocni-wol yb dereviled dna stnaruatser .sreetnulov tnerap ssecca lauqe evah stneduts llA .seY siht rof deriuqer era slaeM drauG lanoitaN ainrofilaC ehT .slaem rof yap ton od stnedutS ni setarepo loohcs ehT egnellahC ylzzirG siuL naS .slaem lla ot .margorp laitnediser doof lanoisseforp a htiw stcartnoc ainrofilaC eht htiw pihsrentrap loohcS retrahC opsibO lacol a morf rotcartnoc ecivres sedivorp hcihw ,drauG lanoitaN .egelloc ytinummoc .stneduts eht ot slaem gniviecer ton era stneduts emoS .oN evitanretla sti esohc loohcs ehT yna evah ton seod loohcs ehT nehw yad rep 3$ si hcnuL dna dedivorp si hcnuL fo troP ordeP naS snalp loohcs ehT .noitirtun tseb eht skcal ti esuaceb margorp laem taht erusne ot ecalp ni snoisivorp yramirp eht morf desahcrup .srodnev lacol owt yb dereviled selegnA soL yltnerruc ti gnidliub eht esahcrup ot ot secruoser dna ecaps ytilicaf eht eviecer stneduts emocni-wol sti rodnev dnoces ehT .rodnev loohcS hgiH hcihw ,xenna na dliub dna sesael slaem reviled dna ,eraperp ,erots .slaem decnalab-llew dna suoitirtun syadseuT no azzip sedivorp .airetefac dna nehctik a edulcni lliw .stneduts sti ot taht detats loohcs eht ,revewoH ,yltnerruC .ecils rep 05.2$ ta etapicitrap ot snalp loohcs eht nehT eht swollof rodnev yramirp sti a evah ton seod loohcs eht .margorp hcnul dna tsafkaerb eht ni nehw sdradnats lanoitirtun s’ADSU stneduts rof ecalp ni noisivorp .slaem gniraperp ro eerf rof yfilauq ohw .slaem ecirp-decuder 42 California State Auditor Report 2010-104 California State Auditor Report 2010-104 43 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC gnieb era sdeen lanoitirtun ehT .seY rebmun llams a sah loohcs ehT morf slaem sedivorp loohcs ehT neewteb egnar secirp hcnuL stcartnoc loohcs ehT ytnuoC egnarO anA atnaS esoht gnidulcni ,stneduts lla rof tem eht rof elbigile stneduts fo a si laem hcaE .cnI ,sdooF ergelA loohcs ehT .2$ dna stnec 05 ot .cnI ,sdooF ergelA htiw fo loohcS hgiH dna eerf rof yfilauq ohw stneduts ot emit eht dna ,margorp hcnul smeti ”etairporppa“ fo noitanibmoc esoht ot hcnul eerf sedivorp .hcnul reviled strA eht .hcnul ecirp-decuder rof krowrepap yrassecen etelpmoc dna ,selbategev ,stiurf gnidulcni eerf rof yfilauq ohw stneduts esuoh-ni na ekam tnemesrubmier .egareveb a .slaem ecirp-decuder ro .elbaeganam erom metsys .seY ton si loohcs eht ”,yllacinhceT“ seicilop eht swollof loohcs ehT erew ohw stneduts roF erew ohw stneduts roF retrahC sserpyC zurC atnaS laem evitanretla na gnireffo sti yb dehsilbatse serudecorp dna eht ni gnitapicitrap ylsuoiverp eht ni gnitapicitrap ylsuoiverp loohcS hgiH gniretrahc sti swollof ti ;margorp kaO eviL si hcihw ,tcirtsid gniretrahc loohcs eht ,margorp hcnul syap loohcs eht ,margorp hcnul .senilediug tcirtsid setapicitrap tcirtsid ehT .yratnemelE hcnul rieht rof 52.2$ syap eviecer ot eunitnoc ot meht rof .smargorp hcnul dna tsafkaerb eht ni ehT .tegdub loohcs sti gnisu gniretrahc sti morf slaem ot hcnul reffo ton seod loohcs stneduts rehto llA .tcirtsid .stneduts rehto sti ffo og ,hcnul rieht gnirb kcans a esahcrup ro ,supmac .loohcs eht morf meti s’loohcs eht fo ytirojam egral A .seY dna sdoof ”rehserf“ edivorp oT s’ADSU eht swollof loohcs ehT .slaem rof yap ton od stnedutS era hcnul dna tsafkaerB teertS diK asoR atnaS hcihw ,seussi htlaeh evah stneduts eht sserdda ot dna selbategev .sdradnats lanoitirtun etis no dereviled dna deraperp retneC gninraeL .steid detcirtser eriuqer .seussi htlaeh ’stneduts .ffats loohcs yb loohcS retrahC sesahcrup OSTP s’loohcs ehT .seY eht gniwollof eb lliw loohcs ehT lanosaes hserf sreffo loohcs ehT .yad rep 05.3$ si hcnuL dna deraperp si hcnuL yellaV zenY atnaS zenY atnaS yfilauq ohw stneduts rof hcnul eht txen senilediug s’margorp hcnul dna ,nietorp ,selbategev dna tiurf nac stneduts ,revewoH loohcs yb etis no dereviled loohcS retrahC llA .sehcnul ecirp-decuder ro eerf rof .raey loohcs eciwt yriad sreffo osla tI .yliad niarg eértne artxe na esahcrup nwo sti sah loohcs ehT .ffats .gniht emas eht def era stneduts .keew a .05.1$ rof azzip fo ecils a ro .fehc dna nehctik rehcaeT tneraP ’sloohcs ehT )OSTP( noitazinagrO tnedutS rof hcnul eht sesahcrup eerf rof yfilauq ohw stneduts .sehcnul ecirp-decuder ro sdeen lanoitirtun eht ,lareneg nI .seY evorpmi ot detnaw loohcs ehT erew snoitpo unem s’loohcs ehT ehT .yad rep 05.3$ si hcnuL dna deraperp si hcnuL lanoitanretnI edisaeS gnieb era stneduts emocni-wol fo ot sevres ti doof fo ytilauq eht lacol a htiw deweiver yllaitini a ta hcnul sreffo loohcs yb etis no dereviled fo loohcS ni etapicitrap ohw stnedutS .tem krowrepap eht ,noitidda nI .stneduts .trepxe noitirtun ot 57.1$ fo ecirp decuder .ffats loohcs yeretnoM ,yhtlaeh a nevig era margorp eht laredef eht htiw detaicossa .yfilauq ohw stneduts esoht era dna yad yreve hcnul decnalab dna evisnetni robal saw smargorp eef decuder a ta slaem rieht nevig kcal s’loohcs eht ot eud gnignellahc etapicitrap ot ytiliba rieht erusne ot .gnffiats fo loohcs ehT .detseretni era yeht fi kcap ot seilimaf segaruocne osla .sehcnul yhtlaeh .seY ot ”droffa tonnac“ loohcs ehT s’ADSU swollof loohcs ehT 05.2$ era hcnul dna tsafkaerB era hcnul dna tsafkaerB omreT-eladnevaR omreT deriuqer eht od ot elpoep erih sa ylesolc sa sdradnats lanoitirtun sreffo loohcs ehT .yad rep no dereviled dna deraperp loohcS retrahC smargorp laredef eht rof krowrepap .nac ti fo ecirp decuder a ta hcnul doof s’loohcs eht yb etis .snoitaluger dna selur lla wollof dna stneduts esoht ot eerf ro 52.1$ .seeyolpme ecivres .yfilauq ohw . . . egap txen no deunitnoc 44 California State Auditor Report 2010-104 California State Auditor Report 2010-104 45 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC sti sevres loohcs ehT .seY eciohc ”retteb dna rehserf“ a reffo oT fo erom ro 3 sreffo loohcs ehT egnar secirp tsafkaerB era hcnul dna tsafkaerB yrevocsiD ycarT emas eht stneduts emocni-wol .stneduts ot snoitadnemmocer doof yliad eht .yad rep 3$ dna 1$ neewteb etis no dereviled dna deraperp loohcS retrahC ,ecirp lluf yap ohw stneduts sa hcnul devorppa s’ADSU eht ni dedulcni ehT .yad rep 57.3$ si hcnuL retneC gninraeL ycarT eht yb fo erom ro 3 sreffo loohcs eht dna .dimaryP ediuG dooF evitcaretnI a ta hcnul sreffo loohcs .ffats éfaC snoitadnemmocer doof yliad eht eht ffo flah fo ecirp decuder devorppa s’ADSU eht ni dedulcni esoht ot eerf ro ecirp unem .dimaryP ediuG dooF evitcaretnI ehT .yfilauq ohw stneduts slaem eerf eht rof syap loohcs .dnuf lareneg sti gnisu sti sevres loohcs ehT .seY eciohc ”retteb dna rehserf“ a reffo oT fo erom ro 3 sreffo loohcs ehT egnar secirp tsafkaerB era hcnul dna tsafkaerB muinnelliM ycarT emas eht stneduts emocni-wol .stneduts ot snoitadnemmocer doof yliad eht .yad rep 3$ dna 1$ neewteb etis no dereviled dna deraperp loohcS retrahC ,ecirp lluf yap ohw stneduts sa hcnul devorppa s’ADSU eht ni dedulcni neewteb egnar secirp hcnuL retneC gninraeL ycarT eht yb fo erom ro 3 sreffo loohcs eht dna .dimaryP ediuG dooF evitcaretnI stnedutS .05.3$ dna stnec 05 .ffats éfaC snoitadnemmocer doof yliad eht dna eerf rof yfilauq ohw devorppa s’ADSU eht ni dedulcni eviecer slaem ecirp-decuder .dimaryP ediuG dooF evitcaretnI ot devres hcnul emas eht loohcS retrahC yrevocsiD eht .stneduts sti sevres loohcs ehT .seY eciohc ”retteb dna rehserf“ a reffo oT fo erom ro 3 sreffo loohcs ehT egnar secirp tsafkaerB era hcnul dna tsafkaerB yramirP ycarT emas eht stneduts emocni-wol .stneduts ot snoitadnemmocer doof yliad eht .yad rep 3$ dna 1$ neewteb etis no dereviled dna deraperp loohcS retrahC ,ecirp lluf yap ohw stneduts sa hcnul devorppa s’ADSU eht ni dedulcni rof yad rep 05.2$ si hcnuL retneC gninraeL ycarT eht yb fo erom ro 3 sreffo loohcs eht dna .dimaryP ediuG dooF evitcaretnI dr3 hguorht netragrednik .ffats éfaC snoitadnemmocer doof yliad eht rep 3$ dna stneduts edarg devorppa s’ADSU eht ni dedulcni .stneduts edarg ht4 rof yad .dimaryP ediuG dooF evitcaretnI a ta hcnul sreffo loohcs ehT eht ffo flah fo ecirp decuder esoht ot eerf ro ecirp unem .yfilauq ohw stneduts eht fo seussi laiceps ehT .seY fo seussi htlaeh eht ot dnopser oT lacol eht htiw srentrap loohcs ehT dna yad rep 2$ si tsafkaerB era hcnul dna tsafkaerB sebirT llA retneC yellaV rieht gnidrager ,stneduts s’loohcs .stneduts s’loohcs eht poleved ot cinilC htlaeH naidnI ehT .yad rep 3$ si hcnul etis no dereviled dna deraperp loohcS retrahC ”retteb hcum“ tem gnieb era ,htlaeh rof nalp teid etairporppa erom a ot hcnul eerf sedivorp loohcs .ffats loohcs yb .erofeb naht .stneduts sti .stneduts sti fo tnecrep 07 slaem sedivorp loohcs ehT .seY ainrofilaC[ EDC dna ADSU ehT eht seraperp .cnI ,oxedoS ti taht detats loohcs ehT htiw stcartnoc loohcs ehT mahgnimriB syuN naV s’ADSU eht htiw ecnadrocca ni ot esufer“ ]noitacudE fo tnemtrapeD s’ADSU eht swollof ti dna ,slaem gnicirp emas eht swollof dna eraperp ot .cnI ,oxedoS ytinummoC .senilediug lanoitirtun rof noitacilppa s’loohcs eht ”tpecca .sdradnats lanoitirtun ,loohcs ybraen a sa erutcurts hcnul dna tsafkaerb reviled hgiH retrahC .tnemesrubmier eht edivorp ton did ti tub .etis no tsafkaerb rof segrahc ti ecirp loohcs ehT .hcnul dna sreffo ti taht detats osla ot slaem eerf ro ecirp-decuder .yfilauq ohw stneduts sti 44 California State Auditor Report 2010-104 California State Auditor Report 2010-104 45 October 2010 October 2010 OT ESNOPSER S’LOOHCS RETRAHC SERUDECORP FO NOITPIRCSED EHT EVEILEB UOY OD :NOITSEUQ EHT ROF NOSAER S’LOOHCS RETRAHC LOOHCS RETRAHC YB DEHSILBATSE EMOCNI-WOL FO SDEEN LANOITIRTUN EVITANRETLA NA EDIVORP OT GNISOOHC EVIECER STNEDUTS TAHT ERUSNE OT MARGORP LAEM FO NOITPIRCSED ?TEM GNIEB ERA STNEDUTS MARGORP LAEM SLAEM DECNALAB-LLEW DNA SUOITIRTUN SLAEM FO ECIRP DOHTEM YREVILED DNA EMAN LOOHCS YTIC a ot ssecca evah stnedutS .seY boJ laredef eht htiw pihsrentraP margorp sproC boJ laredef ehT .slaem rof yap ton od stnedutS eviecer stneduts hceTAIS rof loohcS atsiV yeht dna airetefac ecivres-lluf .margorp sproC lanoitirtun s’ADSU eht swollof laredef eht hguorht slaem detargetnI .yliad slaem suoitirtun ,toh eviecer .slaem sti gninnalp nehw sdradnats .margorp sproC boJ dna scimedacA seigolonhceT )hceTAIS( s’loohcs eht fo tnecrep 10. ylnO .seY gnirb stneduts s’loohcs eht fo tsoM sesu rotanidrooc hcnul s’loohcs ehT ,yltnerruC .yad rep 4$ si hcnuL deraperp si hcnuL alucemeT retsehcniW ti dna ,emocni wol era stneduts tuoba ylno ;emoh morf hcnul rieht suoitirtun gnitceles ni tnemgduj reh a evah ton seod loohcs eht lacol yb dereviled dna yrotaraperP sksa tneduts a fi hcnul sedivorp ehT .hcnul esahcrup tnecrep 8 noitpo nairategev a gnidulcni ,sdoof stneduts rof ecalp ni noisivorp eht yb detceles stnaruatser loohcS .eno rof margorp a troppus ton dluoc loohcs .yad hcae ro eerf rof yfilauq ohw .rotanidrooc hcnul desab ynapmoc edistuo na morf .slaem ecirp-decuder siht esohc ti os ,srebmun eseht no .dohtem yreviled .cnI ,gniretaC gniniD layoR .seY nehctik detimil sah loohcs ehT si .cnI ,gniretaC gniniD layoR .yad rep 3$ si hcnuL htiw stcartnoc loohcs ehT aimedacA yvI slliH dnaldooW dna decnalab-llew sedivorp .supmac sti no elbaliava secruoser ainrofilaC eht yb ”devorppa“ eviecer stneduts emocni-woL ot .cnI ,gniretaC gniniD layoR ,stneduts lla ot slaem lanoitirtun s’noitacudE fo tnemtrapeD .slaem eerf .hcnul reviled era yeht rehtehw fo sseldrager layoR .noisiviD secivreS noitirtuN eht evah stneduts llA .emocni wol deretsiger sah .cnI ,gniretaC gniniD .hcnul rof snoitpo emas eht taht erusne ot snaiciteid s’ADSU eht htiw ylpmoc sunem .sdradnats lanoitirtun .yevrus stnedutS loohcS retrahC fo sdeeN lanoitirtuN )uaerub( stiduA etatS fo uaeruB ot sesnopser ’sloohcs retrahC :secruoS eht ot segnahc lairotide edam uaerub eht ,secnatsni emos nI .setis beW rieht gniweiver ro sloohcs eht gnitcatnoc sa hcus serudecorp pu-wollof demrofrep uaerub eht ,sesnopser ’sloohcs retrahc eht yfiralc oT :etoN .sesnopser lanigiro ’sloohcs retrahc 46 California State Auditor Report 2010-104 California State Auditor Report 2010-104 47 October 2010 October 2010 2.A elbaT stnedutS riehT ot slaeM edivorP toN oD tahT sloohcS retrahC morF sesnopseR yevruS EMOCNI-WOL FO SDEEN LANOITIRTUN EHT EVEILEB UOY OD LANOITIRTUN EHT ETADOMMOCCA LOOHCS RUOY SEOD WOH ?TEM GNIEB ERA STNEDUTS SLAEM EDIVORP TON SEOD LOOHCS EHT YHW ?STNEDUTS EMOCNI-WOL FO SDEEN EMAN LOOHCS YTIC .m.p 03:9 dna .m.p 3 neewteb era sruoh s’loohcs ehT .seY s’tcirtsid loohcs eht ni detapicitrap loohcs ehT ehT .m.p 9 dna .m.p 3 neewteb era sruoh s’loohcs ehT 0002 ecrofkroW nreK dlefisrekaB ot roirp tem gnieb era sdeen lanoitirtun ’stneduts ehT ni )margorp hcnul( margorP hcnuL loohcS lanoitaN ot roirp tem gnieb era sdeen lanoitirtun ’stneduts ymedacA kcans esahcrup nac stneduts ,dedeen fI .sruoh loohcs sti deunitnocsid loohcs eht ,revewoH .sraey ylrae sti kcans esahcrup nac stneduts ,dedeen fI .sruoh loohcs rieht gnirud erots tneduts s’loohcs eht morf smeti oot saw noitapicitrap tneduts esuaceb noitapicitrap rieht gnirud erots tneduts s’loohcs eht morf smeti .kaerb etunim-03 .margorp hcnul eht niatsus ot wol .kaerb etunim-03 ni stneduts emocni-wol evah ton seod loohcs ehT .seY rof slaem esahcrup ot droffa tonnac loohcs ehT ro eerf rof yfilauq ton od margorp eht ni stneduts ehT yellaV ozneroL naS dnomoL neB .margorp eht ecirp-decuder ro eerf rof yfilauq ton od ohw stneduts .slaem ecirp-decuder tcirtsiD loohcS defiinU eht ni etapicitrap ot tnaw ton od ohw dna slaem loohcS retrahC s’tcirtsid gnirosnops eht morf doof ”ni-dekcap“ .nehctik lartnec rof seitinutroppo dna noitacude sreffo loohcs ehT .seY ni detseretni ton erew seilimaf ’stneduts ehT stneduts eht dna ,doof detanod seviecer loohcs ehT fo ymedacA olliramaC olliramaC sdeen lanoitirtun s’dlihc rieht tahw nrael ot seilimaf margorP tsafkaerB loohcS laredef eht ni gnitapicitrap .elbaliava si tahw evah nac noitacudE evissergorP a dna ,spohskrow stcudnoc loohcs ehT .eb dluohs .margorp hcnul ro )margorp tsafkaerb( nI .seilimaf eht ot noitamrofni sedivorp tsinoitirtun doof ”suoreneg“ yrev seviecer loohcs eht ,noitidda a wolla ”reven“ lliw dna seilimaf eht morf snoitanod .yrgnuh og ot tneduts ,suoicsnoc htlaeh yllacipyt era stnerap ehT .seY a poleved ot yenom sdeen loohcs ehT ot semocni lla fo nerdlihc seriuqer ycilop s’loohcs ehT loohcS retrahC kaO eulB ocihC gnitae ni eveileb ton od dna ,steid nairategev tae .nehctik defiitrec .loohcs ot doof suoitirtun ,yhtlaeh gnirb .sdoof dessecorp .esnopser oN .nehctik a evah ton seod loohcs ehT yeht taht tnemllorne gnirud demrofni era stnerap ehT yratnemelE enreVaL airepseH loohcs ehT .dlihc rieht rof hcnul kcas a eraperp tsum ymedacA yrotaraperP .hcnul rieht tegrof stneduts fi tiurf dna puos sedivorp yrev dna llams a ni detacol si loohcs ehT .seY emoh emoc ot nerdlihc rieht tnaw stnerap ehT sti dna .m.p 1 ot .m.p 21 morf sesolc loohcs ehT loohcS retrahC ekaL emuH emuH fo sdeen eht taht sees hcihw ,ytinummoc detcennoc .hcnul rof .hcnul rof emoh og stneduts .tem gnieb era ytinummoc eht ni evil ohw lla fi ,dna nerdlihc rieht fo erac gnikat era stneraP .seY eht neewteb ecnereffid eht brosba tonnac loohcs ehT fI .skcans dna hcnul edivorp stnerap ’stneduts ehT ytinummoC yrutneC doowelgnI .stnemelppus loohcs eht ,dedeen eht dna setar tnemesrubmier ’smargorp laem laredef sknird dna ,skcans ,sehciwdnas sah loohcs eht ,dedeen loohcS retrahC .slaem eht fo tsoc lautca .stneduts yrgnuh rof elbaliava .emoh morf hcnul gnirb stneduts ehT .seY naht rewef sah dna llams yrev si loohcs ehT .emoh morf hcnul gnirb stneduts ehT retrahC reteviR eht eisoR hcaeB gnoL .stneduts 54 loohcS hgiH emocni-wol sti taht ecnedive sees loohcs ehT .seY slaem fo erac ekat ot erised eht desserpxe stnerap ehT erusne ot seilimaf laudividni htiw skrow loohcs ehT loohcS retrahC naecO selegnA soL .tem gnieb era sdeen lanoitirtun ’stneduts .nerdlihc rieht rof stneduts emocni-wol sti fo sdeen lanoitirtun eht taht .tem gnieb era sdeen lanoitirtun eht taht seveileb loohcs ehT .seY fo kcal eht ot eud slaem edivorp ton seod loohcs ehT ton seod ti taht seilimaf eht smrofni loohcs ehT strA ecnassianeR selegnA soL sah loohcs ehT .tem gnieb era stneduts eht fo .doof evres dna ,eraperp ,erots ot elbaliava seitilicaf lanoitirtun sah loohcs ehT .stneduts ot sehcnul edivorp ymedacA sti fo erawa era stneduts lla dna ,stneduts 023 ot tegrof ohw stneduts yna ot elbaliava era taht skcans hcnul tae ffats dna stneduts s’loohcs ehT .ycilop hcnul .hcnul rieht gnirb dluow ti dna ,ytilicaf moorssalc nepo eht ni rehtegot .doof tuohtiw erew stneduts fi ffats ot tnerappa eb 46 California State Auditor Report 2010-104 California State Auditor Report 2010-104 47 October 2010 October 2010 EMOCNI-WOL FO SDEEN LANOITIRTUN EHT EVEILEB UOY OD LANOITIRTUN EHT ETADOMMOCCA LOOHCS RUOY SEOD WOH ?TEM GNIEB ERA STNEDUTS SLAEM EDIVORP TON SEOD LOOHCS EHT YHW ?STNEDUTS EMOCNI-WOL FO SDEEN EMAN LOOHCS YTIC dna ,nerdlihc rieht rof slaem edivorp stnerap ehT .seY .ecaps ytilicaf evah ton seod loohcs ehT .emoh morf hcnul dna skcans rieht gnirb stneduts ehT lanoitanretnI ytnuoC ekaL nwotelddiM .doof ycnegreme sedivorp loohcs eht loohcS retrahC ot gnirb nerdlihc doof eht srotinom loohcs ehT .seY .ytilicaf a fo kcal eht dna tsoc ”evissecxe“ ehT sehcnul dna skcans yhtlaeh dnes stnerap ’stneduts ehT ymedacA yellaV taerG otsedoM sedivorp loohcs ehT .yhtlaeh si ti erus ekam ot loohcs .loohcs ot llits era ro hcnul tegrof stneduts fi yrtnap sti morf doof .gnitae retfa yrgnuh kcap ot seilimaf egaruocne srehcaet s’loohcs ehT .seY eht dna smargorp hcnul dna tsafkaerb eht fo tsoc ehT ehT .emoh morf hcnul dna skcans gnirb stneduts ehT loohcS egdirB enotS apaN skcans yragus gnignirb diova ot dna doof suoitirtun .slaem gnidivorp morf loohcs eht tneverp seciohc laem kcans yhtlaeh a eraperp sessalc netragrednik s’loohcs .sados ro .stneduts rieht lla rof yad hcae .doof on ro elttil htiw pu wohs netfo stneduts ehT .oN .nehctik a evah ton seod loohcs ehT lanoitirtun eht etadommocca ton seod loohcs ehT fo loohcS ytiC adaveN ytiC adaveN .stneduts emocni-wol sti fo sdeen strA eht noitirtun tuoba stneduts setacude loohcs ehT .seY tuohtiw yltneicffie erom nur nac loohcs eht smees tI“ era dna hcnul nwo rieht edivorp stneduts s’loohcs ehT cilbuP naidnI naciremA dnalkaO seod loohcs ehT .mulucirruc loohcs elddim sti hguorht ”.stneduts sti ot slaem gnidivorp .doof tsaf gnirb ot dettimrep ton II loohcS retrahC .sados knird ro doof tsaf tae ot stneduts wolla ton htiw doof erahs stneduts s’loohcs eht ,noitidda nI .rehto hcae a sedivorp loohcs eht dna ,hcnul tae stneduts llA .seY .esnopser oN .emoh morf hcnul rieht gnirb stneduts ehT dnalkaO tsaE dnalkaO .kaerb gnirud kcans yhtlaeh ymedacA pihsredaeL tae stneduts eht taht erus sekam loohcs ehT .seY .esnopser oN .emoh morf hcnul rieht gnirb stneduts ehT pihsredaeL dnalkaO tsaE dnalkaO .gninrom eht ni tiurf sedivorp ti dna ,hcnul loohcS hgiH ymedacA era stneduts s’loohcs eht fo ,lla ton fi ,tsoM .erus toN osla loohcs ehT .airetefac a evah ton seod loohcs ehT .margorp hcnul lamrof a edivorp ton seod loohcs ehT ymedacA retrahC dnalkaO dnalkaO segaruocne loohcs ehT .emoh ta dekooc slaem gnitae .margorp hcnul a hsilbatse ot gnidnuf eht skcal ohw stneduts esoht ot tiurf hserf sedivorp ti ,revewoH dna slaem dekooc-emoh yhtlaeh ekam ot stnerap .emoh morf hcnul thguorb evah ton yam ehT .seirtnap doof lacol ot slarrefer htiw meht sedivorp taht scinilc lacidem lacol htiw pihsrentrap a sah loohcs na no seilimaf dna stneduts sti ot snoitatneserp ekam sados on fo ycilop a sah osla loohcs ehT .sisab gniogno .supmac no doof tsaf ro era stneduts s’loohcs eht fo ,lla ton fi ,tsoM .erus toN osla loohcs ehT .airetefac a evah ton seod loohcs ehT .margorp hcnul lamrof a edivorp ton seod loohcs ehT retrahC dnalkaO dnalkaO segaruocne loohcs ehT .emoh ta dekooc slaem gnitae .margorp hcnul a hsilbatse ot gnidnuf eht skcal ohw stneduts esoht ot tiurf hserf sedivorp ti ,revewoH loohcS hgiH dna slaem dekooc-emoh yhtlaeh ekam ot stnerap .emoh morf hcnul thguorb evah ton yam ehT .seirtnap doof lacol ot slarrefer htiw neht sedivorp scinilc lacidem lacol htiw pihsrentrap a sah loohcs .seilimaf dna stneduts sti ot snoitatneserp ekam taht doof tsaf ro sados on fo ycilop a sah osla loohcs ehT .supmac no . . . egap txen no deunitnoc 48 California State Auditor Report 2010-104 California State Auditor Report 2010-104 49 October 2010 October 2010 EMOCNI-WOL FO SDEEN LANOITIRTUN EHT EVEILEB UOY OD LANOITIRTUN EHT ETADOMMOCCA LOOHCS RUOY SEOD WOH ?TEM GNIEB ERA STNEDUTS SLAEM EDIVORP TON SEOD LOOHCS EHT YHW ?STNEDUTS EMOCNI-WOL FO SDEEN EMAN LOOHCS YTIC ,tnemevlovni tnerap fo level hgih a sah loohcs ehT .seY ot elbaliava seitilicaf eht evah ton seod loohcs ehT .emoh morf hcnul dna kcans a gnirb stneduts ehT yaB yeretnoM evorG cfiicaP ,margorp loohcS ot mraF a ,nedrag elbategev loohcs a .stneduts sti ot slaem evres ro eraperp tunaep ,puos gnidulcni ,doof hcnul skcots loohcs ehT loohcS retrahC taht sknird dna doof gnidrager seicilop evitcaorp dna tae stneduts ehT .eciuj dna ,tiurf ,daerb ,maj dna rettub sdeen eht seveileb loohcs ehT .supmac no thguorb era seciton rehcaet eht fi ,dna moorssalc eht ni hcnul rieht stnerap eht yb tem gnieb era stneduts emocni-wol fo eht ,hcnul etauqeda na evah ton seod tneduts a taht .loohcs eht yb detroppus dna swollasid ycilop s’loohcs ehT .hcnul edivorp lliw loohcs rehto ro ,doof degakcaperp ,sados ro sknird yragus .sdoof tneicfied yllanoitirtun no atad etelpmoc evah ton seod loohcs ehT .erus toN sah loohcs ehT .airetefac a evah ton seod loohcs ehT eht etadommocca ot elbanu yltnerruc si loohcs ehT loohcS retrahC kaO eviL amulateP .stneduts emocni-wol sti tuoba tcirtsid gnirosnops sti htiw eugolaid a nugeb .stneduts emocni-wol sti fo sdeen lanoitirtun .ecivres doof rof gnitcartnoc gnieb era stneduts eht fo sdeen lanoitirtun ehT .seY edivorp ot seitilicaf eht evah ton seod loohcs ehT ,sehcnul rieht kcap stnerap ’stneduts ehT niatnuoM eniP niatnuoM eniP secruoser nwo rieht hguorht stnerap rieht yb tem .stneduts sti ot slaem .segareveb gnidulcni retneC gninraeL bulC ehT .secruoser rehto dna sknab doof ytinummoc ro htlaeh no stneduts sti ot noitcurtsni sedivorp loohcs htiw stnerap sedivorp osla loohcs ehT .noitirtun dna .slairetam noitacude lanoitirtun eht llet ton od ohw stneduts ylbaborp era erehT .oN .nehctik a evah ton seod loohcs ehT lanoitirtun eht etadommocca ton seod loohcs ehT reviR otnemarcaS ffulB deR .yrgnuh era yeht taht ffats ,sisab reetnulov a no ,ffats stI .stneduts sti fo sdeen loohcS retrahC yrevocsiD ot evig ot dnah no srab alonarg ro xim liart ,puos peek .stneduts yrgnuh .esnopser oN ro eraperp ot seitilicaf eht evah ton seod loohcs ehT .emoh morf hcnul rieht gnirb stneduts ehT ytinummoC ytnuoC tseW dnomhciR ton seod loohcs eht dna stneduts sti ot slaem evres loohcS hgiH .margorp hcnul a edivorp ot gnidnuf yna eviecer tae stneduts sti tahw srotinom loohcs ehT .seY yfilauq ohw stneduts fo rebmun wol a sah loohcs ehT kcans yhtlaeh a stneduts sti sedivorp loohcs ehT loohcS nedraG araX ogeiD naS .hcnul rof .margorp hcnul eht rof .yad yreve eht ssorca era sdeen lanoitirtun ehT .erus toN doof a tnemelpmi ot ffats detimil sah loohcs ehT ekam ot gnirb stneduts hcnul eht srotinom loohcs ehT yellaV otnicaJ naS otnicaJ naS lla ot elbacilppa era dna egnar cimonoce-oicos .noisivrepus lanoitidda dna margorp ecivres eht ,dedeen fI .laem suoitirtun a sah enoyreve erus ymedacA stnerap gnidivorp taht detats loohcs ehT .stneduts edivorp lliw ffats sti ro stnerap eht tcatnoc lliw loohcs na si noitamrofni hcnul suoitirtun htiw stneduts dna .tneduts eht rof hcnul .ytiroirp gniogno .seY sa ,noitapicitrap wol dna tsoc taht detats loohcs ehT .stneduts emocni-wol evah ton seod loohcs ehT yrotaraperP yaB htuoS esoJ naS .slaem gnidivorp morf ti tneverp ,deyevrus loohcS retrahC ro eerf rof stseuqer on dah sah loohcs ehT .seY tsrfi ti nehw margorp hcnul a dereffo loohcs ehT nI .emoh morf hcnul rieht gnirb stneduts ehT yrotaraperP ytisrevinU esoJ naS neeb evah ffats eht ,noitidda nI .slaem ecirp-decuder ti stneduts dna stnerap fo tseuqer eht ta tub ,detrats eht ,margorp yawa evig doof a htiw noitarepooc ymedacA nerdlihc eciton yeht fi erawa pihsredael ekam ot deksa stneduts wef yrev sah loohcs ehT .deunitnocsid saw .seilimaf ydeen rof srehcuov doof seussi loohcs sah loohcs ehT .doof fo kcal a morf ”gnireffus“ era ohw ,hcnul ecirp-decuder dna eerf rof yfilauq ohw .ffats sti morf strela on deviecer a ezidisbus ot sdnuf hguone evah ton seod ti dna .margorp hcnul tcatnoc ni era ffats dna srehcaet s’loohcs ehT .seY na evah ton seod taht ytilicaf a gnisael si loohcs ehT eht rof edivorp ,defiitnedi nehw ,lliw loohcs ehT loohcS etaigelloC cfiicaP zurC atnaS lanoitirtun eht eveileb dna stneduts lla htiw .slaem edivorp ot nehctik etauqeda .stneduts sti fo sdeen lanoitirtun gnidulcni ,stneduts lla rof tem gnieb era sdeen .stneduts emocni-wol 48 California State Auditor Report 2010-104 California State Auditor Report 2010-104 49 October 2010 October 2010 EMOCNI-WOL FO SDEEN LANOITIRTUN EHT EVEILEB UOY OD LANOITIRTUN EHT ETADOMMOCCA LOOHCS RUOY SEOD WOH ?TEM GNIEB ERA STNEDUTS SLAEM EDIVORP TON SEOD LOOHCS EHT YHW ?STNEDUTS EMOCNI-WOL FO SDEEN EMAN LOOHCS YTIC rof stnemeriuqer eht teem ylurt ohw stneduts ehT .seY rof elbigile stneduts fo rebmun wol a sah loohcs ehT .secivres yna edivorp ton seod loohcs ehT loohcS retrahC egalliV asoR atnaS eht aiv doof eviecer nac slaem ecirp-decuder ro eerf skcal osla loohcs ehT .slaem ecirp-decuder ro eerf .seicnega lacol ot gnidnuf dna seitilicaf noitaraperp doof reporp eht .slaem edivorp ot dnet ffats sti taht hguone llams si loohcs ehT .seY seitilicaf gnivres etauqeda evah ton seod loohcs ehT srenetragrednik sti fo lla ot laem a sedivorp loohcs ehT tnednepednI lopotsabeS lopotsabeS doof suoitirtun artxe deen ohw stneduts esoht wonk sti rof gnildnah dna egarots doof efas erusne ot ,revewoH .stnerap eht ot tsoc on ta sisab yliad a no loohcS retrahC .doof htiw meht edivorp lliw dna .stneduts rehto ni stneduts sti rof slaem edivorp ton seod loohcs eht .8 hguorht 1 sedarg dlihc hcae wonk ffats sti dna ,llams si loohcs ehT .seY ,detimil yrev ni detacol si dna llams si loohcs ehT sti ot slaem edivorp yltnerruc tonnac loohcs ehT loohcS retrahC egdiRnuS lopotsabeS yb seilimaf stsissa loohcs eht ,dedeen fI .ylimaf dna a evah ton seod loohcs ehT .seitilicaf detner .loohcs ta stneduts .secruoser ytinummoc ot meht gnirrefer ro ,erots ,eraperp ot snaem eht ro nehctik laicremmoc .slaem evres .esnopser oN .esnopser oN .esnopser oN ratS dnaldooW amonoS *loohcS retrahC lla erussa ot troffe yreve sekam loohcs ehT .seY .nehctik gnikrow a evah ton seod loohcs ehT stneduts fI .sehcnul nwo rieht gnirb stneduts ehT dna strA swodaeM skaO dnasuohT .kcans ro laem yhtlaeh a tae stneduts hcnul evah ot emoh llac yam yeht ,hcnul rieht tegrof yratnemelE ygolonhceT a edivorp lliw loohcs eht ,revewoH .loohcs ot thguorb .hcnul eviecer ton seod tneduts eht fi kcans lanoitirtun .yas ot drah si ti taht detats loohcs ehT .erus toN .nehctik ro airetefac a evah ton seod loohcs ehT ehT .emoh morf hcnul dna skcans gnirb stneduts ehT loohcS retrahC kaO reviR haikU fo tnetnoc lanoitirtun eht rotinom srehcaet s’loohcs artxe sedivorp loohcs ehT .gnitae era stneduts doof eht ”suoreneg“ eht morf ti deen ohw stneduts ot doof .stnerap dna ffats fo snoitanod sti esac ni doof ”pukcab“ sedivorp loohcs ehT .seY noitacilppa s’noitacudE fo tnemtrapeD ainrofilaC ehT stiurf cinagro sa hcus doof ”pukcab“ speek loohcs ehT loohcS retrahC efiL fo eerT haikU .hcnul a evah ton od stneduts hcnul dna tsafkaerb eht ni noitapicitrap rof ssecorp sti ni rettub tunaep dna ,srekcarc ,selbategev dna morf sdib niatbo ot loohcs eht eriuqer smargorp .doof evah ton od stneduts sti esac ni nehctik etacol ot elba neeb sah loohcs ehT .srodnev eerht ,suoitirtun edivorp ot gnilliw rodnev lacol eno ylno .sehcnul cinagro ton od ohw stneduts evah ton seod loohcs ehT .seY ro airetefac a evah ton seod loohcs ehT seod ti taht stneduts gnimocni lla smrofni loohcs ehT kaeP elgaE keerC tunlaW .yad hcae kcans a dna hcnul gnirb .elbaliava nehctik .margorp hcnul a reffo ton loohcS irossetnoM stneduts s’loohcs eht fo ytirojam ehT .seY evah ton seod taht ytilicaf a gnisael si loohcs ehT ro kcans a gnirb ot stneduts sti seriuqer loohcs ehT ymedacA asoR atnaS ramodliW kcans a gnirb )meht fo tnecrep 99 yletamixorppa( .nehctik a tsafkaerb ro srab alonarg sedivorp loohcs ehT .hcnul .hcnul ro .hcnul ro kcans a gnirb ton od ohw stneduts rof srab .nerdlihc rieht rof hcnul edivorp stneraP .seY seitilicaf evah ti seod ron ,droffa tonnac loohcs ehT .nerdlihc rieht rof hcnul edivorp stnerap ehT fo ymedacA eromacyS ramodliW .slaem edivorp ot ,elbaliava strA larutluC dna ecneicS .yevrus stnedutS loohcS retrahC fo sdeeN lanoitirtuN )uaerub( stiduA etatS fo uaeruB ot sesnopser ’sloohcs retrahC :secruoS eht ot segnahc lairotide edam uaerub eht ,secnatsni emos nI .setis beW rieht gniweiver ro sloohcs eht gnitcatnoc sa hcus serudecorp pu-wollof demrofrep uaerub eht ,sesnopser ’sloohcs retrahc eht yfiralc oT :etoN .sesnopser lanigiro ’sloohcs retrahc loohcs eht ,revewoH .stneduts sti rof margorp laem evitanretla na edivorp ton did dna margorp hcnul ro tsafkaerb eht ni etapicitrap ton did ti taht detacidni esnopser yevrus s’loohcS retrahC ratS dnaldooW ehT * .snoitseuq yevrus gniniamer eht rewsna ot ton esohc 50 California State Auditor Report 2010-104 October 2010 Blank page inserted for reproduction purposes only. California State Auditor Report 2010-104 51 October 2010 Appendix B STAKEHOLDER COMMENTS AND OPINIONS ON WHETHER CALIFORNIA’S CHARTER SCHOOLS MEET THE NUTRITIONAL NEEDS OF THEIR LOW‑INCOME STUDENTS The Joint Legislative Audit Committee (audit committee) directed the Bureau of State Audits (bureau) to survey key stakeholders on whether they believe charter schools are adequately providing nutrition to low-income students eligible for free or reduced-price meals. The bureau identified the following key stakeholders through its discussion with staff from the California Department of Education (Education): California Food Policy Advocates, the California School Nutrition Association, the California Association of School Business Officials, and the California Charter Schools Association. Table B summarizes the mission of each stakeholder and provides the bureau’s summary of the comments and opinions of their representatives. Table B Bureau of State Audits’ Summary of Stakeholder Comments and Opinions STAKEHOLDER MISSION COMMENTS AND OPINIONS California Food Policy CFPA is a statewide public policy and The CFPA representative stated that some charter schools are meeting the Advocates (CFPA) advocacy organization dedicated to nutritional needs of their low-income students, while others are improving the health and well-being of not. Specifically, the representative stated that charter schools in the low-income Californians by increasing Los Angeles area are doing a better job of meeting the nutritional needs of their access to nutritious and affordable their students and a significant number of charter schools in the Bay Area food. CFPA employs a variety of are not meeting the nutritional needs of their students. The federal School strategies to develop and implement Breakfast Program (breakfast program) and National School Lunch Program public policies that recognize the (lunch program) have certain guidelines and standards that must be met value of adequate nutrition and its in order for schools to participate in them, while alternative nutrition fundamental contribution to good programs have no guidelines and standards for schools to meet. In some health and development, education, cases, the students may receive incomplete meals or meals with lower and productivity. nutritional value. Furthermore, some charter schools are contracting with outside vendors to provide meals to their students, while other charter schools do not provide any type of meal to their students. Finally, the representative stated that although the nutritional needs of charter school students compete with the charter schools’ other priorities, the charter schools should take advantage of federal and state resources available to them. California School Nutrition The CSNA provides its members resources The CSNA representative stated that a charter school in her district Association (CSNA) for quality school nutrition programs participates in the lunch program and that the nutritional needs of and services as partners in academic students are being met. However, outside of her district, she is unaware of achievement. Two of the CSNA’s goals whether the nutritional needs of students are being met, which may be a are to promote professionalism of school concern. The representative stated that charter schools should establish nutrition and to increase public and food service agreements with their districts to receive meals through legislative awareness that child nutrition the breakfast and lunch programs. The districts can oversee the meals and academic achievement go hand and claim reimbursement for the meals the charter schools provide to in hand. their students. continued on next page . . . 52 California State Auditor Report 2010-104 October 2010 STAKEHOLDER MISSION COMMENTS AND OPINIONS California Association CASBO is a statewide professional The CASBO representative stated that charter schools are not meeting the of School Business organization serving California. nutritional needs of their students. Specifically, the representative Officials (CASBO) CASBO provides its individual, district, believes that charter schools do not participate in the breakfast and lunch and county office members with programs because the administrative requirements for the programs professional development, influential are excessive, they do not have eligible students or the facilities to serve advocacy, vital information, and meals, and the cost to provide meals is more than the reimbursement they crucial networking opportunities. receive. The representative stated that those charter schools providing The mission of CASBO is to set the alternative nutrition programs do not measure up to schools participating standard for best business practices and in the breakfast and lunch programs because they are providing their policies that support public education students with the bare minimum, if any meals at all. Some schools may hire through high-quality professional an outside source to provide meals to their students. However, to ensure development and effective advocacy, that charter schools are meeting the nutritional needs of their low-income communication, and collaboration. students, they could sign up to participate in the breakfast and lunch programs with either their own school district or a neighboring district. California Charter Schools The association is the membership and The association representative stated that although charter schools are Association (association) professional organization serving charter not required to provide any meals for students, they still have a wide schools in California. The mission of the range of participation. For example, some schools participate in the association is to lead the charter public breakfast and lunch programs, some have their own alternative nutrition school movement in California in order programs, and others play an active role in educating parents and the to increase the number of students community on health and nutrition. The representative provided some attending high-quality charter schools. main examples of why charter schools do not participate in the breakfast and lunch programs such as scale, cost, and facility issues. The benefit is too small for many schools with low student enrollment and schools often do not have the staff, equipment, or facilities to offer food. In addition, the association representative provided two potential suggestions for getting more charter schools to serve meals: offering school districts incentives to include charter schools in their breakfast and lunch programs and providing charter schools start-up funding to construct necessary food service facilities or to purchase and install equipment. Finally, the representative stated his belief that if school districts met their legal obligation under Proposition 39, many charter schools would be able to participate in the breakfast and lunch programs.* Sources: Interviews conducted by the Bureau of State Audits. * Proposition 39 states that each school district shall make available, to each charter school operating in the school district, facilities sufficient for the charter school to accommodate all of the charter schools in-district students in conditions reasonably equivalent to those in which the students would be accommodated if they were attending other public schools of the district. Facilities provided shall be contiguous, furnished, and equipped, and shall remain the property of the school district. The school district shall make reasonable efforts to provide the charter school with facilities near to where the charter school wishes to locate, and shall not move the charter school unnecessarily. California State Auditor Report 2010-104 53 October 2010 (Agency comments provided as text only.) California Department of Education 1430 N Street Sacramento, CA 95814-5901 October 6, 2010 Elaine M. Howle, State Auditor* Bureau of State Audits 555 Capitol Mall, Suite 300 Sacramento, CA 95814 Dear Ms. Howle: Subject: Response to Bureau of State Audits Draft Audit Report No. 2010–104 This is the California Department of Education’s (Education) response to the Bureau of State Audits’ (BSA) draft audit report titled, California’s Charter Schools: Some Are Providing Meals to Students, but a Lack of Reliable Data Prevents the Department of Education From Determining the Number of Students Eligible for or Participating in Certain Federal Meal Programs. Recommendations for Education’s Consolidated Application Data System: To ensure the reliability of the Consolidated Application (ConApp) database fields related to the number of students enrolled at the school level, the number of those enrolled students who are eligible to receive free meals, and the number of those students who are eligible to receive reduced-price meals, Education should do the following: 1. Modify its ConApp database instructions to require local educational agencies (LEAs) and direct-funded charter schools to retain their documentation supporting the three data fields for a specified period of time. 2. Establish an internal control process such as a systematic review of a sample of the LEAs’ and direct-funded charter schools’ supporting documentation. Education’s Comments and Corrective Actions: 1. Education will modify its ConApp instructions to require LEAs and direct-funded charter schools to retain documentation supporting the three data fields in accordance with state and federal records retention requirements. 2. Education will consider establishing an internal control process to review a sample of the LEAs’ 1 and direct-funded charter schools’ supporting documentation. * California State Auditor’s comments begin on page 57. 54 California State Auditor Report 2010-104 October 2010 Elaine M. Howle, State Auditor October 6, 2019 Page 2 Recommendations for Education’s Child Nutrition Information and Payment System: To ensure the accuracy of the Child Nutrition Information and Payment System (CNIPS) database, Education should do the following: 1. Direct the school food authorities (SFA) to establish internal control procedures to ensure the accuracy of the application information they enter in the CNIPS database. 2. Direct its Nutrition Services Division (NSD) to modify the tool used to review a sample of the school food authorities’ schools to include a procedure for verifying the accuracy of the county-district-school (CDS) code and site type reflected on the schools’ applications. 3. Discontinue allowing the school food authorities to combine each site under their jurisdiction before they enter information on the number of students approved for free and reduced-price meals into the CNIPS database. Education’s Comments and Corrective Actions: 1. To ensure the accuracy of the CNIPS application information, each CNIPS application includes a “certification” check box which SFAs must check in order to submit the application. The certification reads in part: “I certify under penalty of perjury that the information on this application form is true and correct to the best of my knowledge.” In addition to this certification, Education will post a notice on the first screen of the CNIPS advising sponsors of their responsibility to ensure the information they provide is accurate. To further ensure the accuracy of application information, Education will include a clause in the annual instructions reminding SFAs of their responsibility to ensure the CNIPS information they provide is accurate. The annual instructions will recommend a second person review the information before submittal. Education will also clarify that charter schools should be identified as such and not as public schools. 2. Full implementation of CNIPS is targeted for December 2010; thereafter, NSD plans to run weekly data matches against the public school directory at both the SFA and site level, and identify 2 anomalies. The CDS code matches data within the public school directory, which includes charter schools. When a CDS code is entered in CNIPS, the CNIPS provides the name of the matching charter school from the public school directory. When new SFAs and sites are entered into CNIPS, the NSD obtains information from the public school directory for each site and enters the CDS code into CNIPS. For new applicants, if the site name/address provided by the SFA does not match the name/address provided by the directory, the NSD informs the SFA to contact Education’s Data Management Division and the Charter School Division to update their information in the public school directory in order to be considered for approval. California State Auditor Report 2010-104 55 October 2010 Elaine M. Howle, State Auditor October 6, 2019 Page 3 3. Education will work with the SFAs to transition to site level reporting by the beginning of next 1 school year. For new SFAs, Education will consider requiring site level reporting immediately. To ensure that it maximizes the benefits from the State’s investment in the CNIPS database, Education should do the following: 1. Require the school food authorities to submit a monthly Claim for Reimbursement for each site under their jurisdiction in addition to their consolidated claims. 2. Establish a timeline for the school food authorities to comply with the requirement. Education’s Comments and Corrective Actions: 1. To maximize the schools districts’ acceptance with the automated system, Education initially required sponsors to report at the sponsor level, but the school districts could still elect to report at the site level. When CNIPS is fully implemented in December 2010, Education will begin working to require site level reporting for all school districts. However, currently, some school districts do not have the capability of uploading large amounts of site level data without manually keying in the data for each school site. 2. Education will work with the SFAs to transition to site level reporting by the beginning of next 1 school year. For new SFAs, Education will consider requiring site level reporting immediately. Education’s Comments Addressing Potential National School Lunch Program Barriers Meal Quality The report indicates that for three out of five charter schools visited, meals were provided outside of the federal meal programs because they “wanted to provide fresher, healthier food choices to their students than the breakfast and lunch programs provide.” However, Education believes that this statement 3 infers a significant misunderstanding of the meal programs among charter schools. Specifically, the U. S. Department of Agriculture (USDA) sets minimum nutrition standards for the meals served, and provides federal reimbursement for each meal meeting these minimum standards. The USDA standards allow SFAs significant flexibility in the meals they choose to serve, and many SFAs provide healthy and appealing meals that are popular with students while complying with USDA standards. Program Administration The federal meal programs are complicated to administer, and many small school districts and charter schools have difficulty administering them. An option exists in state statute (California Education Code Section 41980) that allows school districts to form Joint Power Authorities (JPAs) for the specific purpose to jointly administer the meal programs. However, charter schools are not specified as being included in this state statute; therefore, Education has worked with charter schools to find other options. 56 California State Auditor Report 2010-104 October 2010 Elaine M. Howle, State Auditor October 6, 2019 Page 4 For example, charter schools are allowed to be “sites” under the umbrella of one charter school that serves as the actual SFA. Education piloted this approach with Aspire Charter Schools, which had about 22 other Bay Area charter schools under their administrative umbrella. To help educate charter schools on the state and federal meal programs, Education has submitted a budget change proposal requesting additional resources, including a “charter school liaison,” to provide the technical assistance needed to increase meal program participation among charter schools. If you have any questions regarding this subject, please contact Kevin W. Chan, Director, Audits and Investigations Division, by phone at 916-323-1547 or by e-mail at kchan@cde.ca.gov. Sincerely, (Signed by: Geno Flores) GENO FLORES Chief Deputy Superintendent of Public Instruction California State Auditor Report 2010-104 57 October 2010 Comments CALIFORNIA STATE AUDITOR’S COMMENTS ON THE RESPONSE FROM THE CALIFORNIA DEPARTMENT OF EDUCATION To provide clarity and perspective, we are commenting on the response to our audit report from the California Department of Education (Education). The numbers below correspond to the numbers we placed in the margin of Education’s response. In response to our recommendations, Education states that it 1 will “consider” establishing an internal control process to review a sample of local educational agencies’ and direct-funded charter schools’ supporting documentation and will “consider” requiring site-level reporting immediately. We look forward to Education’s 60-day response for a more definitive decision regarding its intent to implement our recommendations. Education’s alternative approach to implementing our 2 recommendation raises concerns for us. Specifically, our recommendation on page 32 of the report is aimed at ensuring that the county-district-school (CDS) code and the site type entered into the Child Nutrition Information and Payment System (CNIPS) database by the school food authorities are accurate. In its response Education stated that, once it implements fully the CNIPS database, it will run weekly data matches against the public school directory at both the school food authority and site level. However, during the audit Education did not present its plan of performing weekly data matches against the public school directory to us. In fact, as reflected on page 23 of the report, Education’s Nutrition Services Division (nutrition services) stated that it is the charter schools’ responsibility to enter the CDS code into the CNIPS database. In addition, as reflected on page 20, when applying to participate in the federal School Breakfast Program (breakfast program) and National School Lunch Program (lunch program), a school food authority must complete an application for each of its school sites, and in doing so must indicate the site type. Our primary concern with Education’s alternative approach to addressing our recommendation is that Education did not include in its response the internal controls it has in place to ensure the information in the public school directory is accurate. For example, Education stated that, when new school food authorities and sites are entered into the CNIPS database, nutrition services obtains information from the public school directory for each site and enters the CDS code into the CNIPS database. However, as stated on page 22, we found errors in the CDS code. Thus, we look forward to Education’s 60-day response for an explanation of its internal controls over the 58 California State Auditor Report 2010-104 October 2010 process it uses to generate the public school directory and ensure the accuracy of the data included in the directory, particularly the CDS code and site type that are found in the CNIPS database. 3 Education stated that it believes a statement in our report infers “a significant misunderstanding of the meal programs among charter schools.” However, we disagree and believe that, in fact, Education does not understand the facts presented in our report. Specifically, on page 24, we state that 46 charter schools had various reasons for electing to provide meals without participating in the breakfast or lunch program. The primary reason cited by 15, or 33 percent, of the charter schools for having an alternative meal program is to allow them to provide what they described as fresher, healthier food choices to their students than the breakfast or lunch program provides. Further, on page 25, we state that the five charter schools we visited cited reasons that were consistent with those of the other charter schools. Specifically, three of the five charter schools we visited wanted to provide what they described as fresher, healthier food choices to their students than the breakfast or lunch program provides. It appears as though Education is taking exception with the statement regarding the schools we visited. However, it does not appear as though Education took into consideration that the statements made by the three schools we visited are consistent with those of 12 other charter schools that provide an alternative meal program. Further, the statements represent the charter schools’ perspective and opinion regarding the quality of the breakfast and lunch programs, not ours. Finally, we did not assess whether charter schools alternative meals meet minimum standards. California State Auditor Report 2010-104 59 October 2010 cc: Members of the Legislature Office of the Lieutenant Governor Milton Marks Commission on California State Government Organization and Economy Department of Finance Attorney General State Controller State Treasurer Legislative Analyst Senate Office of Research California Research Bureau Capitol Press