Indiana report blames Daleville Community Schools district in online enrollment fraud

The state audit of the online schools found that Daleville Community Schools inappropriately paid nearly $86 million to companies linked to the schools’ founder or his associates.

Posted: Aug 10, 2020 2:47 PM

DALEVILLE, Ind. (AP) — State auditors have determined a central Indiana school district should repay $2.2 million for failing to properly supervise two online charter schools accused of padding their enrollments by about 14,000 students over eight years.

The Daleville Community Schools received the money from the online schools in an agreement that paid the district up to 3% of their annual state funding for oversight responsibilities as their authorizer under state law, according to the State Board of Accounts report filed Friday.

According to a state audit released in February, Indiana Virtual School and Indiana Virtual Pathways Academy wrongly received $68.7 million in state payments by improperly claiming students as enrolled between 2011 and 2019 even though they had no online course activity.

State auditors cited “Daleville’s lack of meaningful oversight and monitoring may have contributed to ineligible students being included” on enrollment reports, resulting in the overpayment of per-student funding to the online schools.

The state audit of the online schools found they inappropriately paid nearly $86 million to companies linked to the schools’ founder or his associates.

“Had Daleville implemented proper oversight procedures in accordance with (state law), Daleville may have discovered that education service providers were used, conflicts of interest existed, and there was a lack of structural independence,” the state report said.

Leaders of the Daleville schools, a district of about 1,000 students near Muncie, disputed the report’s findings, maintaining that the district played no role in the erroneous enrollment reports and didn’t have access to data about the online schools’ students until August 2018 because of concerns about federal student privacy laws.

Indiana Virtual School and Indiana Virtual Pathways Academy had complete responsibility for the state funds they received and Daleville officials were the first to raise questions about the enrollment figures, Daleville Superintendent Paul Garrison said in a statement to The (Muncie) Star Press.

“Whatever misdeeds IVS and IVPA leadership may have perpetrated was done alone and in the dark, hidden from view until DCS uncovered their alleged scheme and blew the whistle to the proper government agencies,” Garrison said.

The state audit of the online schools released in February was given to federal and state authorities for possible criminal violations.

A federal grand jury subpoena to the schools in August 2019 was included in documents released last year, but the U.S. attorney’s office in Indianapolis has declined to comment.

Both schools, which had a shared administration and last year reported about 7,200 students, shut down last summer after state education officials cut off funding.

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 111505

Reported Deaths: 3506
CountyConfirmedDeaths
Marion20699758
Lake10217318
Elkhart6368109
St. Joseph604597
Allen5965200
Hamilton4676109
Vanderburgh334129
Hendricks2650122
Monroe240836
Johnson2257122
Tippecanoe221013
Clark211756
Porter205244
Cass19319
Delaware187061
Vigo176622
Madison157775
LaPorte136737
Floyd130361
Howard127563
Kosciusko119017
Bartholomew114957
Warrick114135
Marshall98524
Dubois94918
Boone94446
Hancock90542
Grant88233
Noble88132
Henry76324
Wayne73914
Jackson7349
Morgan69638
Shelby66529
Daviess64127
LaGrange63011
Dearborn62628
Clinton59112
Harrison56024
Putnam5329
Montgomery50521
Lawrence50328
Knox4869
White47914
Gibson4744
Decatur45339
DeKalb45011
Miami4243
Fayette41813
Greene41835
Jasper3822
Steuben3677
Scott35310
Sullivan32912
Jennings30912
Posey3020
Franklin29725
Clay2925
Orange28224
Ripley2788
Carroll27013
Wabash2638
Washington2581
Whitley2526
Starke2517
Wells2472
Adams2443
Jefferson2433
Fulton2352
Huntington2213
Spencer2194
Tipton21722
Perry20913
Randolph2067
Jay1700
Newton17011
Owen1641
Martin1620
Rush1514
Pike1411
Vermillion1260
Fountain1152
Pulaski1141
Blackford1132
Crawford1030
Brown1013
Parke932
Benton880
Union770
Ohio767
Switzerland680
Warren401
Unassigned0225

Ohio Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 144309

Reported Deaths: 4615
CountyConfirmedDeaths
Franklin25977603
Cuyahoga17092642
Hamilton12756308
Montgomery7501152
Lucas7119357
Butler563299
Summit5096249
Marion306347
Mahoning2991279
Warren291048
Stark2739168
Pickaway263344
Lorain226386
Delaware213520
Fairfield202050
Columbiana191980
Licking185762
Trumbull1848131
Clark172338
Wood170671
Clermont162620
Lake157649
Medina143038
Allen136767
Greene135228
Miami135049
Portage107466
Mercer105317
Tuscarawas91220
Wayne90166
Erie89944
Ross85622
Richland78419
Madison78012
Darke76039
Belmont70727
Geauga70347
Hancock6579
Ashtabula64348
Athens5972
Lawrence59418
Shelby5819
Auglaize5659
Sandusky55420
Putnam54123
Huron5237
Union4932
Ottawa46530
Scioto4646
Seneca43914
Preble42013
Holmes3717
Muskingum3712
Jefferson3184
Henry29712
Champaign2933
Logan2933
Perry2859
Defiance28110
Clinton27813
Knox27815
Brown2752
Hardin25013
Morrow2492
Washington24823
Fulton2341
Jackson2314
Coshocton23011
Fayette2256
Ashland2234
Highland2203
Crawford2186
Wyandot20112
Williams1983
Gallia18012
Meigs1729
Hocking1619
Pike1580
Guernsey1567
Carroll1507
Adams1214
Van Wert1113
Monroe10618
Paulding1010
Harrison611
Morgan470
Vinton453
Noble270
Unassigned00
Fort Wayne
Clear
54° wxIcon
Hi: 74° Lo: 43°
Feels Like: 54°
Angola
Clear
54° wxIcon
Hi: 73° Lo: 45°
Feels Like: 54°
Huntington
Clear
52° wxIcon
Hi: 74° Lo: 44°
Feels Like: 52°
Decatur
Clear
52° wxIcon
Hi: 73° Lo: 43°
Feels Like: 52°
Van Wert
Clear
52° wxIcon
Hi: 73° Lo: 41°
Feels Like: 52°
Warming up for Monday
WFFT Radar
WFFT Temperatures
WFFT National

Community Events