Press-Republican

Local News

April 27, 2013

Comptroller finds $7.7 million state funds unaccounted for by special-ed schools

(Continued)

“Auditors found that Bahrenburg did not maintain such records or any other documents to show how his actual time was allocated. 

“His salary also significantly exceeded executive compensation for other not-for-profits of comparable size.”

‘STUDENTS SHORTCHANGED’

The audit found that Windwood’s CEO also received “a $14,000 vehicle allowance for three years and $30,000 for charitable donations for two years.”

DiNapoli said those two expenses are not legally reimbursable under State Education Department guidelines, and no documentation indicated the costs were program-related.

In a statement released with the audit report, DiNapoli said special-education students were being shortchanged.

“The State Education Department and the Office of Children and Family Services need to step up and do a better job policing providers and making sure they only charge for appropriate costs they incur for their services, not exorbitant salaries and perks,” he said.

The comptroller reported that State Ed had “not conducted any on-site provider audits since 2007.”

LOAN TO BAHRENBURG

Other management fees paid by Windwood were also unsupported in school business records, according to the audit report.

These included “$55,395 in interest (Windwood) paid on a $250,000 loan obtained for the CEO over the three years ended June 30, 2009. Bahrenburg was supposed to repay $50,000 per year, but Windwood excused the annual repayment for two years. 

“That resulted in both the interest and annual payments being charged to the company’s affiliates as part of the management fees.”

DiNapoli said New York’s Not-For-Profit Corporations Law prohibits facilities from making loans to corporate officers. 

‘NO CRIMINAL ASPECT’

Mark Johnson, a spokesman for the Comptroller’s Office, told the Press-Republican that it is the State Education Department’s responsibility to recoup the funds and “to rectify the situation.”

The audit found no criminal aspect, he said.

“We have not referred this to any law enforcement organization.”

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