May 28, 2014

EXCLUSIVE: Churchill School, a private East Side special education school, shelled out more than $3 million in improper costs over a three-year period

By Juan Gonzalez
New York Daily News

It’s a private school abusing millions in public money.

A private East Side special education school where many wealthy New Yorkers send their children — and then get their tuition reimbursed by taxpayers — shelled out more than $3 million in improper costs over a three-year period, an audit by state Controller Thomas DiNapoli has found.

Among the impermissible expenditures DiNapoli’s auditors uncovered at the Churchill School from the 2008 to 2010 school years were: hundreds of thousands of dollars for staff parties, liquor and flowers, excess pay for the chief executive, a student surfing trip to Puerto Rico and scores of new computers purchased by the school that disappeared or were discarded.

You can also toss in an apartment for the director of the school and a travel allowance on the taxpayers’ dime, according to the audit obtained exclusively by the Daily News.

“It is sad and disheartening to discover that those who run the Churchill School are wasting and misusing taxpayers’ dollars at the expense of the special education children they’re supposed to serve.” DiNapoli said Tuesday. “This kind of abuse needs to stop immediately.”

Tuition at Churchill, a K-12 school on E. 29th St., is a whopping $37,000 this year. The place, reputedly harder to get into than Harvard, has drawn the children of celebrities for years. Actors Kevin Bacon and Kyra Sedgwick sent their son there. So did artist and filmmaker Julian Schnabel. Designer Dana Buchman’s daughter attended, as did political consultant Hank Sheinkopf’s daughter.

Now, there’s nothing wrong with a private school catering to those who can afford to pay. But in Churchill’s case, most of those parents then turn around, with guidance from the school, and hire lawyers to get the Department of Education to reimburse them, by claiming regular city schools can’t provide adequate programs for their learning-disabled children.

This kind of private tuition for special ed schools like Churchill will cost the city $210 million next year alone.

As a result, a “private” school like Churchill receives close to 90% of its funding from the public. During the three years of DiNapoli’s audit, for instance, an average of nearly 350 of the school’s 398 students had their tuition paid by the city’s Department of Education or nearby school districts.

Last year, the state’s approved tuition reimbursement for Churchill was $31,430 per child.

But DiNapoli’s audit reveals that Churchill officials think the money is theirs to spend as they wish.

Among the $3 million in improper expenditures the controller disallowed were:

-$126,382 for food, parties and flowers for staff, including more than $9,709 for liquor.

-$64,080 for an apartment, utilities and travel allowance for the school’s executive director, Robert Siebert.

-$429,729 for employee bonuses not justified by performance reviews.

-$66,039 for student activities already paid for by parents.

-$376 ,597 in compensation for Siebert and the school’s chief financial officer “that were in excess of the state’s allowed compensation levels.”

In 2010 , for example, Siebert received $412,850 in compensation when the state regional median for his position was $254,385.

DiNapoli’s auditors even nixed $220,501 the school spent for private school buses.

Why buses? Because the city Department of Education was already supplying 34 buses per day to Churchill — free of charge — for both transportation to and from school and daytime field trips.

State education officials concurred with DiNapoli’s findings and vowed to recover the money by lowering future reimbursements to the school.

As for the Churchill School, it accepted that DiNapoli found about $800,000 worth of waste, but objected to the rest.

“Our other sources of funding — private tuition and fund-raising — enable us to spend more on each student than the state currently allocates,” Churchill’s spokeswoman Sydney Ann Neuhaus said. “Churchill does not expect, nor do we attempt to take advantage of, state reimbursement for this measure of expenses.”

But maybe the most astonishing expense DiNapoli flagged was the $1,750 in stipends the school provided to two staff members, on top of their regular pay, to accompany a group of students on a one-week surfing trip in Puerto Rico.

There’s a whole lot of public school teachers and students who will be tempted to ask, how about us?