Millbury Public School District's Use of Certain American Recovery and Reinvestment Act Funds

This is a Massachusetts State Auditor report about Millbury Public School District's use of certain federal ARRA education grants, specifically Race to the Top and Education Jobs funds, during part of 2010 and 2011.

“The objectives of our audit were to determine whether ARRA funds awarded to MPSD for its RTT and Education Jobs programs were used for their intended purposes and in compliance with program requirements, and to evaluate whether MPSD was complying with ARRA accounting and reporting requirements.”

The auditor reviewed whether the district spent the ARRA money for the right purposes, followed program rules, and met accounting and reporting requirements.

“The objectives of our audit were to determine whether American Recovery and Reinvestment Act of 2009 (ARRA) funds awarded to MPSD for Race to the Top (RTT) and Education Jobs programs were used for their intended purposes and in compliance with program requirements, and to evaluate whether MPSD was complying with ARRA accounting and reporting requirements.”

The issue matters because federal stimulus funds need safeguards so public money is not lost, stolen, misused, or spent outside the rules.

“Without ARRA-specific internal controls that identify risks and ways to mitigate them, MPSD cannot ensure compliance with applicable laws, rules, and regulations or that ARRA funds are adequately protected from loss, theft, or misuse.”

The only reported problem was not about a specific improper expense; it was that the district lacked ARRA-specific written controls and risk assessments.

“MPSD had not designed a system of internal controls that would provide reasonable assurance of compliance with applicable laws and regulations affecting its RTT and Education Jobs awards funded by ARRA or ensure that federal stimulus funds received for these two ARRA programs were safeguarded from possible loss, theft, or misuse.”

The auditor recommended that the district create ARRA-specific controls and risk assessments, and the district said it would formally document them.

“As recommended, the Millbury Public Schools will formally document a system of internal controls and risk assessments to provide reasonable assurance of compliance with applicable laws and regulations specific to ARRA related funds.”

The report is significant because it says the district had to improve how it documented safeguards for federal stimulus money, even though the audit otherwise found adequate controls and compliance in the areas tested.

“MPSD should develop ARRA-specific internal controls and risk assessments to address the objectives and risks that affect compliance with ARRA regulations, performance and reporting requirements, fraud detection and prevention, and safeguarding of assets.”

ARRA means the 2009 federal stimulus law; Race to the Top was a federal education reform grant, and Education Jobs was money meant to save or create education jobs.

“The Education Jobs program is a one-time appropriation, which may be used through September 30, 2012, that USDOE awarded to save or create education jobs that provide educational and related services for early childhood, elementary, and secondary education.”