District responds to secretary of state's audit

Sisters School District does not think it should have to repay the Oregon Department of Education (ODE) $1.2 million. The district's lawyers contend the amount should be reduced by about half.

The controversy centers on a homeschool program the district operated at Sonrise Christian School (now Sisters Christian Academy) between 1999 and 2004. An audit of the program released last September concluded that the district was overpaid $1,208,286.15 in State School Funds (SFFs). The audit conducted by the Oregon Secretary of State's office found that the district inappropriately counted private students attending the Christian school as participants in its homeschool program.

In a seven-page letter to Oregon Superintendent of Public Instruction Susan Castillo, attorney Neil Bryant, on behalf of the Sisters school board, challenges the audit's findings that the district's homeschool program at Sonrise was not a legitimate program for which SSFs could be claimed and that the program unlawfully used public money to benefit a religious institution.

In putting forth the district's arguments, Bryant first concludes that Oregon statutes, administrative rules and guidelines about homeschool programs are both incomplete and unclear. He points out that the audit itself drew a like conclusion.

"We believe the district inappropriately received SSF in part because the department (ODE) provides very little oversight of district homeschool programs to determine whether they are entitled SSF," the investigative results of the audit state.

Bryant next relies on the audit's finding that approximately 24 percent of the students who participated in the homeschool program were registered, as the law requires, with the High Desert Educational Services District (HDESD).

"The ODE should not direct a withholding of SSF for the SSF dollars that were received for instruction provided to registered home school students," Bryant writes.

Bryant's final point centers around the district's findings that it spent approximately $454,206 on tutor salaries and benefits, administrator salaries and administrative expenses to educate district students.

"The district should not be required to repay this amount to the ODE," Bryant says.

In his letter, Bryant does not provide a dollar figure for exactly how much less than $1.2 million the ODE should withhold from the district. Instead, he requests a meeting among representatives of the district and the ODE to discuss the reduction that he contends the district is entitled.

"We are hopeful that the ODE and the district can find a solution to the outstanding issues," he states.

Randy Harnisch, Adviser to the State Superintendent of Public Instruction, told The Nugget that the ODE anticipates sitting down with Sisters School District representatives to discuss the issues raised in the district's response. However, "we're assuming reimbursement of some amount will be the outcome," Harnisch said.

Although Bryant's letter to Castillo is dated Friday, January 26, Sisters School Board members and superintendent Ted Thonstad did not receive copies of it until Tuesday, January 30. They saw a draft of the letter at their executive session on Thursday evening, January 25.

Board chairman Mike Gould said that the letter was e-mailed to the board around 8:45 a.m. Tuesday morning. By 5 p.m., Gould and Thonstad had decided they wanted to release the letter to the public. However, because board members Glen Lasken, Steve Rudinsky and Jeff Smith were all traveling, it took until Wednesday, January 31 to receive their approvals and release the letter.

"That's sort of the evolution of how we got to where we got," Gould said.

Originally, Bryant advised the letter be kept confidential as it deals with what Bryant termed "an offer of compromise and settlement."

Sisters resident Mike Morgan, who has been vocal about the board's transparency and usage of public funds to pay for private attorneys, told The Nugget that he feels the district is making a big mistake arguing it did "absolutely nothing wrong, (but) if we did it's ODE's fault because they approved it, and nobody can understand ODE rules. I don't think ODE, the public or the press is going to be very happy with this," Morgan said.

Bryant's letter is available to the public online at: www1.outlawnet.com/outlaw/ssd/discover/districtinfo/audit/01-26-07.pdf The audit can be accessed at: www1.outlawnet.com/outlaw/ssd/discover/districtinfo/audit/01-26-07.pdf.