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Oversight Scarce for Billions in COVID Aid for Schools

In this excerpt from a deep dive into COVID-19 relief funding, CalMatters examines where oversight and accountability could be improved.

When the pandemic closed schools in March 2020 – abruptly ending classes and stranding children and working parents – leaders in Washington and Sacramento scrambled to provide relief.

The result was a series of stimulus measures that allocated $33.5 billion in state and federal funds to California’s K-12 schools to address the devastation of the pandemic. It was a staggering amount of one-time funding for the state’s cash-strapped schools, equal to a third of all the money they got the year before the pandemic.

For schools, this was money for things like laptops, air filters and mental health counselors – money to help kids.

But much of the funding has come with limited oversight and little transparency, according to a CalMatters investigation. No centralized state or federal database exists to show how schools have spent this money. And data from the districts’ quarterly spending reports provided to the state are so broad as to be virtually useless in tracking this COVID-19 relief money.

Of the $5.9 billion local education agencies have spent so far from the largest of the stimulus funds, more than a quarter went to a category for “other” expenses, according to the state.

“I’m just not sure anyone has a good handle on how this money was spent,” said John Affeldt, managing attorney at Public Advocates, who works on educational equity issues. “There’s a lot of money that went into the system this year, and we continue to have a concern knowing how … effective it was.”

CalMatters spent three months examining school COVID-19 relief spending across the state, reviewing thousands of pages of records obtained through more than 45 public records requests. That includes state spending reviews as well as accounting ledgers from two dozen school districts, including many of California’s biggest.

The records offer a unique glimpse at how school leaders grappled with the generational challenge of COVID-19 in dollars and cents. Capistrano Unified, for instance, spent nearly $10 million on Chromebooks to make sure students could go virtual. Castro Valley Unified spent most of its stimulus money on payroll. El Centro Elementary School District spent $3.8 million to install shade structures for outdoor eating, school assemblies and teaching space.

The records reveal pandemic winners – companies that reaped millions as overwhelmed districts, suddenly flush with cash, started writing checks. Some are established firms well-positioned to fill massive orders for goods.

And some are new ventures launched by savvy entrepreneurs to capture some of the windfall. That includes a limited liability company formed in April 2020 and headquartered out of a UPS drop box in Los Alamitos that got a $52 million no-bid COVID-19 testing contract in San Diego. And it includes a company – whose founder is described on its website as a former CIA counterterrorism officer – that morphed into a COVID-related school consultant and got a $12.7 million gig in San Bernardino, helping with COVID-19 testing and contact tracing.

One chain of virtual charter schools gave $11 million – nearly two-thirds of its stimulus spending last year – to the publicly traded, for-profit company affiliated with the schools. A Southern California public school district spent $440,000 to hire an evangelical group for a program to help at-risk kids.

Other records reveal clear mistakes or misspending. The state told West Contra Costa Unified School District to shift nearly $800,000 in unrestricted funds to reimburse its stimulus money because the district failed to prove certain payroll costs were tied to the pandemic. Oakland Unified had to reimburse nearly $1 million in stimulus money for expenditures the state flagged as questionable.

Some districts refused to provide CalMatters records showing where their money is going. That includes San Francisco Unified, which got more than $186 million in federal stimulus funds.

Taken together, the reporting shows the differing decisions local leaders made trying to keep teachers, kids and their communities safe from a deadly disease while also addressing the learning loss and mental health impacts of prolonged social isolation. Some of those spending decisions were made behind closed doors and with little scrutiny, making it difficult for the public to determine whether districts used the money as effectively as possible or as lawmakers intended.

Local educational agencies still have billions of dollars of COVID-19 relief left to spend. If they don’t spend it by various deadlines, they may have to return it.

The entire report from which this article was excerpted is available online through CalMatters.
CalMatters is a nonpartisan, nonprofit journalism venture committed to explaining how California’s state Capitol works and why it matters.