Bill would require audits of private schools that receive public tuition
Mar. 6—Legislators are weighing deeply divided testimony about a proposal to require annual financial audits of Maine private schools approved to receive tuition funds from taxpayers.
"To request clarity to spending public funds by any branch of government is a reasonable and responsible request," Sen. Joe Rafferty, a Kennebunk Democrat, said.
Rafferty said he co-sponsored a bill to require the audits after learning that private schools at the secondary level in Maine receive more than $53 million for tuition from public school systems but don't have to provide annual audits that scrutinize their finances.
It's an issue with potentially serious ramifications for those who live in rural towns with limited public schools that cover students' tuition to attend private schools instead. Private high schools who participate in the program this year receive $12,559 per student from taxpayers.
Some worry that audits will nick away at time-honored educational options at places like Kents Hill School or Hebron Academy. Others, though, citing the U.S. Supreme Court decision last year which required the inclusion of religious schools in the program, expressed concern that more schools participating might open the door to abuse without greater scrutiny.
"Audits provide objective assessments of how effectively and responsibly resources are managed, provide accountability and confidence among stakeholders, and, in this instance, help ensure the protection and appropriate use of state resources," Rep. Rebecca Millet, a South Portland Democrat, said.
Michael McQuarrie, the longtime head of school at Erskine Academy in South China, told lawmakers on behalf of the Maine Association of Independent Schools that nearly all schools already engage in annual audits.
He questioned, though, the need for a bill requiring them, because the proposal "seeks to remedy a problem that is not there but is instead a solution in search of a problem."
After McQuarrie pointed out that legislators removed a requirement for annual audits in 2011, he told the Education and Cultural Affairs Committee that the new proposal "chips at the independence of our schools" by seeking to make public everything about how private schools spend their money.
Paula Gravelle, director of school finance for the state Department of Education, told the panel that "in order to ensure accountability of the proper use of public taxpayer funds, it is necessary for the state to review a private school's audits annually."
"This measure will help to inspire trust and ensure equitable student and school safety, health and well-being within all schools that serve Maine's publicly funded student population," Gravelle said.
She said the measure honors the independence of private schools "and allows them to continue to use the audit process they always have; it merely asks them to share that audit with the state."
But Nick Murray, policy director at the Maine Policy Institute, said the state education commissioner can already require audits if officials think they're warranted.
"One would think that if the DOE saw a problem with the accountability of these schools, many more audits would have been ordered," Murray testified. "Is this bill just a solution in search of a problem?"
State Rep. Chad Perkins, a Republican from Dover-Foxcroft, said, "There is no need to create further legislation or expand bureaucracy to gain information that is already available when appropriate or to gain access to private financial records when it is not."
Eileen King, deputy executive director of Maine School Management Association, said private schools that accept tuition money for public school students "should be held to the same financial accountability and transparency as public schools."
"Taxpayers should have access to the same financial data from the private schools" where they pay tuition for students as they do for public schools because "it is their money the private schools are spending," King said.
"Public schools are overseen by local school boards which are elected to be representative of the communities providing those funds," Daryne Rockett of Orono testified.
"But these private academies do not have elected community representation and are notably opaque," Rockett said. "There is no way of knowing if these schools are spending their public funding in a manner that is commensurate with the laws and education policies of our state and community."
Playing into the issue are the potential consequences of last summer's Carson v. Makin decision by the U.S. Supreme Court that ruled Maine had to fund religious education at private religious schools in towns that don't have a public high school and instead pay for students to attend private schools.
The government relations director of the Maine Education Association, John Kosinski, said the union representing more than 24,000 educators in the state expects "more private schools to compete for funding from the towns that provide choice programs" in the wake of the court's decision.
"Given the likelihood of greater interest from private schools in accessing public funding, the minimum the state should require is annual audits of their finances," Kosinski said.
The committee has not scheduled a work session to discuss the bill.