State auditors fault Seattle schools over federal grants

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Seattle Public Schools may have to repay as much as $490,000 to the federal government because state auditors say the district did not spend some of its federal grant money appropriately in the 2011-12 school year.

The auditors, in one of their regular audits of the school district, questioned how the district spent funds from two of its grants -- one for Native American students, and one aimed at preventing students from dropping out of high school.

The auditors said the district spent $483,862 of the dropout-prevention grant on expenses that weren't part of the original grant application or budget. They also said the district, for the fourth year in a row, claimed more students than it could justify for its federal Indian Education grant, and received $6,530 more than it should have as a result.

District officials largely agreed with the state auditors' findings, saying they take their responsibilities for grant management seriously. But Superintendent José Banda said he didn't want the problems to overshadow all the good work going on under the grants.

The auditors acknowledged that they look solely at financial compliance, not grant effectiveness.

District officials also said they are taking a second look at the questioned costs for the dropout-prevention grant, which is a five-year, $12.5 million grant that the district received in September 2010. Many of the questioned expenses in the 2011-12 school year went to activities that met the intent of that grant even if they weren't part of the original application, said Duggan Harman, the district's assistant superintendent of business and finance.

The federal government has agreed to look at the new information in deciding how much, if anything, the district must repay, Harman said.

He said the district also may seek revisions to that grant so it will cover expenses that the state auditor questioned.