Tax Watch

Following the release of a state audit this week that  criticized oversight of the more than preschool special-education contractors in New York, the state Association of Counties renewed its call for changes to the current system.

New York is the only state in the country that requires counties to fund a share of the Preschool Special Education Program, according to the Association of Counties. But counties have no real role in the program other than to pay for it—roughly 41 percent of the total. The program serves 75,000 children 3 to 5 years old who have special needs. An average of $22,000 is spent per child annually, although the cost for some exceeds $200,000 a year, the group said.

“Unfortunately, it is mostly unknown how or if that taxpayer money is being used to serve the children, as revealed in the latest report from the state comptroller,” the Association of Counties said.

State Comptroller Thomas DiNapoli’s audit found widespread fraud and abuse among contractors who serve children with disabilities, and he called on the state Education Department to strengthen its oversight of special-education contractors, who are paid $1.3 billion a year. That agency has not conducted on-site audits of the contractors since 2007. Auditors uncovered numerous cases in contractors used taxpayer money to hire relatives for high salaries and pay for things like vacation homes and landscaping.

“The more we learn about the mishandling of funds and the failures of the State Education Department to make certain the money is going to serve our children, the more urgently counties call for reforms to the current system,” Stephen Acquario, the association’s executive director, said in a statement. 

Orange County Executive Edward Diana, president of the association, said county leaders are “deeply disappointed” about the audit findings.

“County taxpayers are required to fund these important programs and in doing so we trust that the money is going to help the children who need the services,” he said in a statement. “As we learn about further mishandling of funds and the failures of the State Education Department to oversee private contractors, counties again renew our call for reform of the system.”

The Association of Counties has made a number of recommendations for improving the system, which cost about $96 million when it was established in 1989 and now costs an estimated $2 billion a year. Proposals include streamlining transportation; allowing greater county involvement in determining placements and  transportation; setting up a fiscal incentive program and having a state-determined target or cap each year; and creating a special audit unit within the state Education Department.
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