Adult Education Program Criticized : Schools: Two audits find problems with administration and finance. Some practices could leave the district with a $5.6-million deficit.

LA PUENTE —  Two independent reports have sharply criticized management of adult education in the Hacienda La Puente Unified School District, including practices that could leave the district with as much as a $5.6-million deficit, officials said this week.

A June state Controller’s audit found that, among other things, the district inflated attendance hours, kept poor records, misspent funds, offered classes not approved by the state Department of Education, employed non-credentialed teachers and advertised classes it did not offer to the general public.

That report prompted the school board to commission Sacramento education consultant Paul M. Goldfinger to do a second study this summer. His Oct. 9 report corroborated many of the state findings.

Goldfinger concluded that district policies “raise serious questions of accountability.” The report also recommended that the district develop an accounting system “that clearly shows income and expenditure for each program.”

District administrators said they are examining the conclusions and will discuss adult education at the Nov. 17 board meeting.

“I’m very concerned,” said John Kramar, assistant superintendent for business services. “I agree with some of the (state findings) and I disagree with some of them. We’ll go through the process of reconciling this with the state Department of Education . . . It is not an intentional defrauding.”

The district serves 21,727 students in kindergarten through 12th grade in La Puente and Hacienda Heights. It also runs what Goldfinger called an “inordinately large” adult education program that serves 100,000 students, most of whom live outside district boundaries.

Kramar said the district started the adult education program in 1955 and the program has grown steadily. In the early 1970s, the district began providing adult education to all Los Angeles County jails, he said. That program alone accounts for 20,000 students, or 20% of the program, he said. Classes range from parenting to AIDS education, vocational training to literacy.

In many instances, the district contracts with outside agencies to teach such classes as English as a second language, brick-laying, firefighting and some vocational instruction for those in jail.

Much as it does for regular students, the state provides funding for each adult student based on verified daily attendance. The district is expected to conform to a variety of requirements and maintain paperwork showing it is in compliance.

Both reports found problems in finance and administration.

Goldfinger’s report raised alarms that the district spent more than it received yearly in state funds. In 1990-91 for instance, the district funded more than 800,000 hours of adult education, even though the Department of Education capped reimbursement at 296,782 hours that year.

“For the district to continue to pay (contractors) for hours that were not funded for year after year, without seeking reimbursement of the underfunded hours from prior years seems incredible, yet this has occurred,” Goldfinger wrote.

Kramar defended the practice, saying that the state usually passed legislation that retroactively approved the additional expenses. However, the state stopped funding such excesses last year, leaving Hacienda La Puente with outlays of at least $1.6 million for which it probably will not be reimbursed, he said.

“We became very concerned” at that point, Kramar said. “We shut off all payments when it became obvious we weren’t going to get that extra money. It’s not the way a business should be run, but that’s the way the state runs.”

Kramar said the district has an agreement with its contractors guaranteeing that they will return to the district any monies paid them that were not reimbursed to the district by the state. He said the district is attempting to collect that money.

The district also may have to repay as much as $4 million in state funds contested by the Controller. The potential reimbursement, the state says, includes money issued for classes for which attendance cannot be verified, for teachers who were not certified, for classes not offered to the general public and for classes for which the district could not provide the instructors’ names.

Board President Yvonne A. Garcia said she believes top district administrators are not moving quickly enough to deal with the problem. Garcia and Board Member Lyla Eddington have called for the district to explain what remedies are planned.

In a letter to acting district Supt. K. Jessie Kobayashi, Garcia wrote: “It appears that the school district is purposely avoiding some very unpalatable questions precipitated by the incredible findings of these two audit reports. We must take immediate action and make an honest good faith effort to solve rather than blithely cover-up the serious operational problems outlined in both audit reports.”