May 15, 2008
State Audit Finds Extensive Problems with Pyramids Child Development Center
DiNapoli: $240,000 in Taxpayer Money Used for Unsupported or Improper Expenses
The Pyramids Child Development Center, with facilities in Clinton and Essex counties, improperly claimed reimbursement for nearly $240,000 in taxpayer money for unexplained, undocumented or improper expenses, such as the preparation of the executive director’s personal income taxes, according to an audit released today by State Comptroller Thomas P. DiNapoli.
The audit, which examined the financial records of Pyramids’ four largest pre-school special education programs from July 2005 to June 2006, identified a number of improper claims for staff salaries and bonuses, depreciation of equipment and professional services from those related to staff. Auditors recommended that the State Education Department (SED), which oversees special education programs, recover the entire $171,000 salary paid to the executive director who lives out-of-state because there was little evidence of the work she provided to justify her salary. SED worked cooperatively with auditors during the course of this audit.
“Making sure that our kids with special needs get the care and attention they need early on is critical,” DiNapoli said. “But taxpayers have the right to expect that their money is being used for its intended purpose and for reasonable expenses. This organization engaged in improper practices that ultimately shortchanged taxpayers.”
Pyramids is approved by the State to provide pre-school special education to children from birth through age three and received $2.7 million in State and county funds in fiscal year ended June 30, 2006. It also provides in-home services and operates seven pre-school special education facilities in Morrisonville, Elizabethtown, Keeseville and Ticonderoga, as well as day care centers. In December, Pyramids filed for Chapter 11 bankruptcy but continues to operate its facilities.
Among the audit’s major findings:
Auditors made eight recommendations to SED and Pyramids to improve operations and recover improperly paid money. SED agreed with all of the audit findings, while Pyramids did not agree with the audit findings. A full response from both entities is included in the audit.
Click here for a copy of the audit.