EXCLUSIVE: Watchdog Group Calls Out Spending in Buffalo Schools

8:09 PM, Nov 6, 2013   |    comments
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BUFFALO, N.Y. -- A national education watchdog group says unnecessary spending in the Buffalo School District is among the worst in the entire country.

The Education Action Group, a conservative organization often critical of public school districts, does similar studies of schools across America. Its founder called out Buffalo for its spending on cosmetic coverage for teachers, employees staying at lavish hotels, and excessive travel expenses, among others.

"What you have here is a school district that is out of control," EAG Founder Kyle Olson told 2 On Your Side.

We poured through the district's financial books for the last fiscal year, including more than 23,000 individual receipts and transactions from its check register and credit card statements.

The biggest expenses are what you'd expect: health insurance payments to Blue Cross Blue Shield totaling $117,198,986, charter school payments of $105,037,256, $80600,158 in payments to the IRS, and $27,561,426 to First Student, a private company that provides bus service to the district.

Those costs aside, Olson says what troubles him most are the smaller receipts on what he calls "unnecessary" expenses -- on travel, restaurants and hotels.

March 6th of this year, the district paid out $1,554.90 to the Peabody Hotel in Memphis, one of the nicest, most historic hotels in the Blues City.

The district paid $1,854.80 at the Gaylord Opryland Hotel in Nashville. Outside of Vegas, it's the largest non-casino hotel in the entire country.

Someone spent $1,176.24 at the Loews, a luxury hotel in Atlanta.

In September of last year, there was a $9,994.60 charge for the Hyatt Regency in Buffalo.

Much of the lodging costs were in Albany, where the district often has meetings. Sometimes the employees stayed at the Holiday Inn, while others stayed at the much more expensive Marriott and other pricier hotels.

Add it all up, and last fiscal year the district spent at least $140,963.53 on hotels.

2 On Your Side compared that to the public school district in Newark, New Jersey, which turned over its books to EAG last year. Buffalo, despite having a smaller budget and fewer students, spent four times more on hotels than did Newark.

Travel was also a concern for Olson. BPS spent $48,198.38 on travel last fiscal year. Most of that money was spent on flights, including many to Albany. Obviously driving would have been much cheaper.

The district paid $17,396.50 to JetBlue, $11,234.60 to Delta, and several thousand each to US Airways, Southwest, and United.

"It surprises me," Olson said, "because again, you've got a school district that has a $51 million deficit."

The district also spent more than $1,500 on "agent fees" to book all of that travel, another expense called out as unnecessary.

Olson also questioned restaurant expenses within the district. The total there came out to $14,632.87, including two receipts for the high-end Buffalo Chophouse. Most of the cost here was paid to pizza restaurants, sandwich shops, and other reasonably-prices establishments. There were some exceptions.

Finally, the data from the district also show us the latest amount spent on the controversial cosmetic coverage for teachers. It's part of the union contract, so there's nothing the superintendent can do about it because come to an agreement on a new deal with the union.

Still, Olson considers it unacceptable to spend taxpayer money in that way. Last year's total was $2.9 million, up slightly from the year before.

2 On Your Side wanted to sit down with district representatives to go over the numbers and get answers to our questions. We first reached out by email over the weekend and followed up with phone calls Monday. After discussions with the district, we held off doing the story until Wednesday evening to give the district time to respond.

Due to meetings and other obligations, the district did not get back with us before airtime.

After our story aired at 5 p.m., the Superintendent's office sent a short explanation of the expenses to 2 On Your Side's Michael Wooten:

Accommodations: Some of the hotel fees were for professional development opportunities through conferences (school turnaround leaders, educating people with disabilities, International Baccalaureate Conference) and required training in Albany (Focus and Priority School Training with outside educational experts). In the case of development, staff stays at the hotel the conference is being held and there are discounted rates for attendees, and costs are within allowed per diem rates as designated by gsa.gov.

The Hyatt fee was for the 2012 "Results Now" conference that was a three-day conference held in the last week of August of 2012, with over 200 people in attendance.

Holiday Inn vs. Marriott: The difference between where the conference is held. Again, special rates apply that are adjusted for conference guests.

Chop House: On two occasions since becoming superintendent, Dr. Brown took two out-of-town consultants to dinner (1 guest per visit)

Agent fees: Through a New York State contract, an agent is used to find the cheapest flights when staff travels.

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