Minster schools may owe more than $300,000 based on audit

Minster Local Schools may have to pay more than $300,000 back to the federal government due to illegal operation of the district's former community school during the 2004-2005 school year.

The school underwent a federal audit earlier this week and the official results won't be available for up to two months, according to school Superintendent Gayl Ray, who spoke to The Daily Standard this morning about the issue.

"They (auditors) found no misspending. All the money was spent for the good of the kids," she said. "However, there was no school."

Ray said the auditors told school officials the community school was only a "school on paper" and not created as a separate division as it was intended.

The funds in question - approximately $329,000 according to Ray - were federal grant monies used to operate the Minster Community School, which was shut down during the first part of the 2005-2006 school year.

The federal auditors told school officials they might have to pay back that money - with interest - or the report could show the government is satisfied that the money was spent on the students, and the issue could be dropped.

Spokespersons for the state and federal Department of Education, the state auditor's office and the attorney general's office were contacted by The Daily Standard and refused to comment on the incomplete audit.

Ray said the school received a letter from the U.S. Attorney General's office in the fall, stating its intention to audit the school. Any district receiving federal funds can be audited, she added.

The Daily Standard asked for a copy of that letter, but school Treasurer Laura Klosterman said she hasn't been able to find it.

"I won't spend my time looking (for it), I don't have the time," she told the newspaper.

In 2003, the Minster Local School board approved setting up a community school as a way to get more funding. Hal Belcher, the current principal at Holy Angels School, Sidney, was superintendent of the Minster district at the time.

A total of 112 students in grades 1-5 registered for the community school the first year; the number increased to 132 the second year as sixth-graders were included.

A separate board of education was formed for the community school, but there were no visible changes made at the school. Students enrolled in the community school attended the same classes and were offered the same curriculum as the rest of the student body, Ray said.

According to the Ohio Department of Education Web site, "community schools (often called charter schools in other states) are public nonprofit, nonsectarian schools that operate independently of any school district ... community schools are public schools of choice and are state and federally funded."

The Web site also says, "new community schools are generally created to provide a unique educational program or meet the needs of an underserved subgroup of students."

Ray said she was concerned about the operations of the community school when she began the position of superintendent in August 2005. The community school was about to begin its second year of operation at that time.

"I said we need to shut it down," she said. "I met with the boards and told them what I thought and they agreed."

Ray said no more federal grant money for the community school was spent after she took over as superintendent, even though it took several months before the school was closed officially. All remaining money was sent back to the federal government, she said.

Ray emphasized that "every penny given to the school was accounted for" and there was no criminal activity found by the auditors.

Ray said if the school is ordered to pay the money back, they will find a way. Meanwhile, there isn't much they can do until they receive the auditors' report, she said.

"Now we just wait," she said.