Feb. 3, 2003 – The V.I. government has taken the second public step in complying with terms it consented to last year in a signed agreement with the U.S. Education Department to ensure that more than $30 million a year in school funds will continue to flow into the territory despite federal authorities having branded the local Education Department a "high-risk grantee."
The step just taken is the posting of information on the Internet concerning the agreement itself and the Virgin Islands' actions to date in compliance with it. The information can be found on the V.I. government Web site under Department of Education Compliance, where the full agreement also can be accessed.
The first public step was taken in December, when the V.I. Education Department publicized toll-free telephone numbers for people to call if they suspect fraudulent use of federal education funds in the territory. (See "Hotlines for suspected education funding fraud".) One number, (800) 647-8733, is in the federal Education Department's Office of Inspector General. The other, (800) 424-5081, is in the U.S. Interior Department.
The 36-page agreement is separate from the territory's efforts to gain reaccreditation or new accreditation for its public high schools. It also is distinct from, although interrelated with, the territory's compliance with the federal No Child Left Behind Act signed into law by President Bush in January 2002. The agreement's action steps and timelines were developed by local officials in December 2001 but are subject to updating on the basis of ongoing assessment by the territory.
The introductory "overview" of the agreement states that the approaches to compliance "should include effective planning and evaluation of resource and management decisions that are designed to produce better educational results." And whatever solutions the territory chooses to implement "must address communication and cooperation among V.I. departments, and developing a culture of 'getting the work done right.'"
At the end of three years, it states, the territory must be in full compliance with the requirements of all programs funded by the federal Education Department. The local department should have as a goal that by that time 95 percent of federal school funds will be spent on instructional activities and directly related costs.
Meantime, failure to meet any of the agreement's terms could result in federal sanctions including possible withholding of funds, payment on a reimbursement basis and/or requiring the territory to obtain technical or management assistance including the designation of a third party to administer federal education grants. Further, the federal department could seek a judicial order to compel or stop specific actions and enforce such an order by withholding of funds.
The V.I. government agreed to submit quarterly progress reports to the federal Education Department, and the first deadline for doing so was Dec. 31. The agreement specified that the information "should be transmitted to the [federal] department by updating (at least quarterly) an Internet Web site developed and maintained by the Virgin Islands government," with the Office of Management and Budget "responsible for tracking, monitoring and reporting progress on all requirements and milestones in this agreement in a manner that is fully accessible to the department and the public."
The posted information is to be "updated continuously, but in any event, no later than 30 days from the last day of each quarter." Thirty days past Dec. 31 was Friday. This weekend, OMB director Ira Mills announced the posting of the information online.
According to federal education officials, it is critical "that the V.I. use the first year of the next three-year period to develop long-term goals, assess the current status of each program receiving federal assistance, and design coherent programs to bridge the gap between the current status of education in the V.I. and its educational goals and applicable requirements." In the first year, the territory should develop a "comprehensive plan for reforming the total instructional program."
The planning process, the federal officials state, "should include citizen and/or customer input and feedback." In addition to bringing the territory into compliance with requirements for federal programs, expected outcomes of planning should be:
– Greater site-based authority for schools to determine needs and apply funding thereto.
– Enhanced site-based management through greater school community involvement and awareness of accountability.
– Implementation of programs to fit the needs of individual schools, rather than one district approach for all.
The Virgin Islands is required to come up with performance-based ways to measure progress, both territorywide and for individual schools.
Also within the three years, the territory must "develop a credible central financial management system" that can "provide the correct amount of funds, in the correct accounts, in a timely manner, all the time." The agreement notes that the V.I. Education Department and the Finance Department now use separate accounting systems. In the short term, it states, the two sets of figures "will be reconciled concurrently." According to the Web site, forms are being developed to standardize the reconciliation process.
District autonomy is an issue. The agreement notes that the territory, which from Washington's perspective falls under "state" regulations, has two "local educational agencies," the St. Thomas-St. John and St. Croix districts. Certain federal funding programs require that local school districts have "complete discretion in deciding how to allocate funds" among allowable program areas.
Some short-term deadlines
By Oct. 6, appropriate V.I. fiscal staff were to be provided access to the federal department's GAPS system to monitor funding draw-downs. According to the Web site, this was done.
By Dec. 31, the Finance Department was to complete a "vision document" for the implementation of a credible central financial management system. According to the Web site, the document has been submitted the territory's Compliance Agreement Re-accreditation Team. By March 31, the Finance Department is to complete a plan for developing and implementing such a system.
By Jan. 21, the territory was to submit "an action plan that can demonstrate steady progress toward developing a comprehensive statewide plan" and a Fiscal Year 2003 consolidated grant application. According to the Web site, the application was submitted; a draft request for proposals to secure a contractor to develop the plan was developed and has been revised by the federal department.
By March 30, all local payroll registers are to reflect the percentage of split time for staff funded by federal programs.
By March 31, the territory must develop a plan to re-engineer its grants application, planning and disbursement. By that date, it is to create a common template and timetable for all program plans to structure planning and activity-based disbursement plans and decisions. And by then it must develop five-year hiring goals and priorities and set goals for employing qualified teachers in specific classrooms for the next five years.
Effective April 1, unused leave for employees leaving the education system will not be charged directly to federal programs but will be allocated as indirect costs.
By April 30, the territory is to develop an action plan to revise as necessary the steps outlined in December 2001 to improve the hiring process, including the use of new legislative authority for the Education Department "to bypass the personnel offi
ce and expedite the hiring process."
By June 30, the territory is to provide federal authorities an inventory policy and plan for implementation of an inventory management system. Also by that date, the V.I. must complete steps to secure property from theft or inappropriate or unauthorized use and revise steps and timelines from the December 2001 plan in this area as deemed necessary.
By Sept. 30, the V.I. will revise the system of requiring three bids for every item cited in a requisition and will develop a short-term emergency bypass authority/option for items costing less than $10,000.
As far as classroom staffing, from the 2002-03 academic year forward, "there will be no instances of classes or students without adult supervision," the agreement states By last Oct. 31, the territory was to have developed policies and procedures for class coverage in the absence of a teacher. The Web site is unclear as to the status of this action step.
By Dec. 31, it was to have determined the percentage of classes conducted by "highly qualified teachers" as defined by the No Child Left Behind Act; again, the status is unclear. And it was to have established a plan to increase recruitment of specialized personnel; the Web site states that a memorandum of agreement was executed on Dec. 20. Also, it was to have determined how many "highly qualified" teachers are needed per program to achieve the goal of a qualified teacher in every classroom within five years (on the Web site, the status is unclear), and to have assigned priorities to the types of teachers needed (status not addressed on the Web site).
In the area of property management and procurement, the agreement notes that because of a time-consuming procurement process and failure to pay invoices in a timely manner, "vendors have been unwilling to do business with the V.I., resulting in an inability to obtain needed supplies and equipment for students and teachers." Further, "purchased items do not get to classrooms in a timely manner, if at all. Property cannot be effectively tracked and may remain in warehouses, be delivered to incorrect locations or be stolen…"
The agreement requires the territory to develop and implement policies and systems that ensure delivery of inventory within specified time frames and payment to vendors within 30 days of invoice receipt.
How the agreement came about
The seeds for the compliance agreement were sown years ago. In March of 2001, then-Education commissioner Ruby Simmonds told the Senate Education Committee that the department had been warned by federal education officials in 1998, when Liston Davis was Education commissioner, that conditions could be imposed if steps weren't taken to improve accountability, particularly in the area of special education. Simmonds said the department was given three years to come into compliance.
Federal education officials cited audits dating back to 1994, as well as recent audit work by the U.S. Education Department's Inspector General and on-site visits as evidence of large-scale program-management and accountability problems.
In March 2000, the U.S. department imposed special conditions because of concerns over fiscal accountability and other problems, Simmonds testified, mainly focusing on the proper tracking of federal grant expenses. They included:
– That the V.I. Finance Department create a separate account for federal money coming into the Education Department (which she said had been done).
– That the department prepare certified expense reports with copies of requisitions and invoices that involve federal grant money (which also had been done, she said).
– That the department comply with the requirements of the Single Audit Act. (Simmonds said a firm had been hired to undertake the review.)
In January 2002, the federal Education Department gave notice of public hearings to be held on St. Croix and St. Thomas on the pending compliance agreement. In the notice, it stated: "The findings in various audits made clear that large-scale fiscal and programmatic problems that have existed for a number of years continue to exist."
Areas of concern, it said, included "procurement, program planning and implementation, human resource management, and financial and property management" that "affect the ability of the V.I. to spend the [federal] department's program funds properly and effectively."
At the St. Croix hearing, last Feb. 5, Simmonds said the compliance agreement represented an opportunity for her department to "clean up our act." Two days later, on St. Thomas, she said she was "not worried that we won't be able to meet the terms of the agreement," noting that local officials had helped draft the document so that conditions could realistically be met.
Noreen Michael, who was named acting Education commission last April 30 after Gov. Charles W. Turnbull filed Simmonds upon learning that the territory's appeal of the loss of schools accreditation had been denied, went to Washington last July to complete the compliance agreement that would then be submitted to federal and V.I. authorities for approval.
On July 31, Michael said at a press conference that the V.I. government would enter into the agreement and that it was expected to go into effect within two weeks. At that time, a spokesman for the federal Education Department described the agreement as "a last resort," saying it is rare that a state or territory must come under such a pact. "The territory has quite a bit of ground to cover to meet the requirements of the law," he said.
The agreement took effect on Sept. 23. Signing it for the Virgin Islands were the governor; Michael; Finance Commissioner Bernice Turnbull; Ira Mills, Office of Management and Budget director; Jorge Galiber, Board of Education chair; Joanne U. Berry, Personnel Division director; Property and Procurement Commissioner Marc Biggs; Health Commissioner Mavis Matthew; and Eddie Williams, Board of Vocational Education chair.
In October, Michael told the Senate Education Committee that the agreement would buy the Education Department an additional three years to fulfill the mandates of the No Child Left Behind Act. The act seeks to hinge the federal education funding going into states and territories on results, linking those dollars to specific goals and rewarding success and imposing sanctions for failure.
Michael noted at that time that preparing, training and recruiting high-quality teachers and principals is a major component of the act, adding that it would have a significant impact on the territory. She said more than 40 percent of V.I. public school teachers then were teaching outside their areas of specialization, and more than half did not meet Board of Education certification requirements. And of the department's 160 paraprofessionals, only 16 were registered as having college credits, she said. The new law requires that such employees have at least two years of college, hold an associate of arts degree or pass an assessment test.
Michael also said that all of the $32 million in federal education grants received for Fiscal Year 2001 had been expended or obligated.
On Dec. 23, the Legislature approved Michael's nomination to become the permanent Education commissioner.
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