St. Louis College Prep Under Investigation For Fraud | St. Louis Public Radio

St. Louis College Prep Under Investigation For Fraud

Jan 22, 2019

Updated 5:25 p.m. with additional information on the school's financial situation —

St. Louis College Prep has lost tens of thousands of dollars in state funding amidst an investigation into whether the charter school's founder over-reported attendance records.

The Missouri State Auditor’s office accepted a request Jan. 11 from Education Commissioner Margie Vandeven to review St. Louis College Prep’s finances. Charter schools are public schools that receive state and federal funding but operate independently from traditional school districts.

The charter school’s sponsor, University of Missouri-St. Louis, in October “identified possible issues with attendance data and remedial enrollment numbers that would have resulted in overpayments to the school in previous years,” Bill Mendelsohn, the executive director of UMSL’s charter school office, said in a statement.

Mendelsohn brought the findings to the school’s board of directors. When questioned about the potential irregularities, the school’s founder and executive director, Mike Malone, resigned Nov. 1. The board alerted the state Department of Elementary and Secondary Education — or DESE — the following day.

School leaders are adjusting to a new fiscal reality but pledge high-quality education is continuing.

Board President Steve Singer told St. Louis Public Radio “nothing has changed with students and teachers,” and education is still going on. A letter was sent home to parents explaining the situation.

Behind the scenes, St. Louis College Prep officials are trying to close what Singer told the board is “a whopping hole” in its books amid a sizable decrease in state funding.

St. Louis College Prep — also called SCP — received $390,000 in funding in October before the problem was reported. Now DESE is clawing back the overpayments; it gave SCP just $251,000 this month, a reduction of $139,000 over just four months. Its debt in December was $74,000, according to Singer.

The school shortened its extended academic year by six days and eliminated three part-time staff positions. It is considering eliminating some sports programs and relocating prom to a cheaper venue.

The board has also hired a new outside accounting firm.

Per-student state funding is based on average daily attendance — or how often students are reported to be in the school — rather than enrollment. The exact discrepancy in attendance and funding is not known yet, a spokeswoman for the state education department said.

Singer said it was “pretty significant” but could not provide an exact figure. St. Louis Public Radio submitted an open-records request to the school seeking more information.

Malone founded St. Louis College Prep eight years ago as South City Prep after being a classroom teacher and then working for the Missouri Charter Public School Association, an advocacy group.

He declined to comment when contacted by St. Louis Public Radio. In a Facebook post about his resignation shared Jan. 4 he said, “I loved my time as part of that amazing school and I’ll never forget the hundreds of relationships with staff, students and parents.” He added he’s seeking a job outside of education.

The school serves 306 students in sixth through 12th grade and will graduate its first senior class this summer. SCP’s state annual performance report card score rose more than 20 points to 87.5 percent last year, according to preliminary numbers shared at the school’s January board meeting.

DESE spokeswoman Nancy Bowles said investigations into falsified attendance reports are rare.

The former Hope Academy Charter School in Kansas City, Missouri, collected $4.3 million over two years by overstating its attendance, according to a state audit. It closed in 2014.

Two former Riverview Gardens principals sued the school district in October 2017, alleging they lost their jobs because they refused to comply with pressure to pad their school’s attendance numbers. A district investigation says it found no evidence of tampering.

State audits typically take several months to complete. Lauren Chaney, SCP’s principal, is serving as interim executive director.

Editor’s Note: St. Louis Public Radio is an editorially independent community service of the University of Missouri-St. Louis.

Follow Ryan on Twitter: @rpatrickdelaney