With students quarantined at home, is this really the right time for a movie about public school fraud? You bet.
After getting an extra $13.5 billion in March’s “Phase 3” stimulus bill, the education lobby is now asking Congress for another $175 billion as it ponders a Phase 4 bill. With that kind of money on the line—about three times Washington’s annual K-12 funding—a film on school fraud should be considered essential viewing.
HBO’s “Bad Education,” released April 25, dramatizes a real-life incident of school funds embezzlement in Roslyn, Long Island. In telling the tale, the film indicts an entire education system, one plagued with a morass of forms to fill out and weak oversight that makes it easy for school bureaucrats to fudge the numbers and pay for a beach house, a sports car, and more.
As the plot unfolds, the school district auditor tells Hugh Jackman’s character that the state comptroller could “barge in this office at any given moment” to review their finances.
“Has he ever done that in your 30 years of experience?” Jackman’s character, district superintendent Frank Tassone, asks. The auditor shakes his head.
“Exactly,” Tassone says.
So Tassone embezzled more than $11 million in district school funds over a six-year period. The sordid tale includes a Corvette-driving assistant superintendent; Tassone’s expensive taste in suits and penchant for first-class travel; and a hapless school board.
When The New York Times covered the story in 2005, the paper wrote, “The authorities consider the Roslyn embezzlement scandal extraordinary in several respects, not only for the size of the theft, but for its having eluded the attention of prosecutors for as long as it did.”
Unfortunately, it’s no longer that extraordinary. The size of the Rosalyn, New York case was exceptional at the time, but in 2015, former Chicago public school chief Barbara Byrd-Bennett was convicted of illegally steering $23 million in contracts in exchange for bribes and kickbacks. Three years later, investigators were still uncovering the extent of Byrd-Bennett’s misdeeds.
One of the distinguishing features of school fraud is how long these activities go undetected in districts both large and small. In Arizona’s Tolleson Union High School District (enrollment: 12,000), a bookstore manager used school funds to finance 76 visits to casinos between 2009 and 2011.
Baltimore County, Md., is one of the largest school districts in the United States, but former superintendent Dallas Dance defrauded the district for at least three years (2012-2015) before investigators caught on. Examples abound from Plano, Texas (nine years, $2.5 million stolen), to Shakopee, Minn. (six years, $74,000).
Such crimes aren’t occurring in every district, although federal and state investigators are scrambling to keep up. In 2019, Chicago schools’ inspector general received 2,175 complaints but could investigate only 817 cases, slightly more than one-third.
“As previously reported by this office,” the auditor’s report said, “the inability to investigate more complaints creates a substantial risk that instances of fraud and employee misconduct go undetected.” The U.S. Department of Education’s inspector general has made similar comments over the years. Not reassuring.
Teachers should be furious over these examples. In the Tolleson episode, the amount stolen could have given each of the district’s 507 teachers an extra $237. When a Charleston, S.C. administrator embezzled $1.2 million from the district, his salary was already three times the average teacher salary in his district. The total amount he stole would have paid the annual salaries of 22 educators.
The financial crisis ahead gives state lawmakers the chance to reconsider notoriously complicated school spending formulas to get the most out of available resources. States such as Arizona and Florida allow some families of children with special needs to use education savings accounts to buy education products and services for their children. Families must account for every dollar before parents can make additional purchases. A recent audit of Arizona’s accounts found that parents had misspent 0.001 percent of account funds.
Utah lawmakers just created similar opportunities for state families. More than half of U.S. states have options such as these, but teacher unions and other vested interest groups work hard to limit student eligibility and relegate streamlined learning alternatives to the fringes of the education landscape.
Education savings accounts and other out-of-the-bureaucratic-box ideas can help students and taxpayers weather this crisis while giving students the chance to customize their learning experience. For Washington to send trillions to states without commitments to protect taxpayers and students is not just imprudent. It’s the perfect scenario for a fiscal disaster movie.