oversight

OIG's Independent Report on the Department's Detailed Accounting of Fiscal Year 2010 Drug Control Funds

Published by the Department of Education, Office of Inspector General on 2011-01-31.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                       UNITED STATES DEPARTMENT OF EDUCATION 

                    OFfICE OF PLANNING, EVALUATION AND POLICY DEVl':LOPMENT 





                                         FEB - 1 2011


Gil Kerlikowske
Director
Office of National Drug Control Policy
Executive Office of the President
Washington, D.C. 20500

Dear Mr. Kerlikowske :

In accordance with section 705(d) of the Office of National Drug Control Policy (ONDCP)
Reauthorization Act of 1998 (21 U,S,C, 1704(d)), enclosed please find a detailed accou nting of
all fiscal year 2010 Department of Education drug control funds , along with the Department of
Education Assistant Inspector General's authentication of this accounting, consistent with the
instructions in ONDCP Circular Drug Control Accounting, dated May 1, 2007,

Please do not hesitate to contact me if you have any questions about this information,

                                      Sincerely,               _AI
                                     -17~Vv-h I /\j/LL~
                                      Thomas P. Skelly                       ()
                                      Director, Budget Service


Enclosure # 1: Department of Education Detailed Accounting of Fiscal Year 2010 Drug Control
Funds, dated January 19, 2011

Enclosure # 2: Authentication letter from Ke ith West , Assistant Inspector General for Audit,
dated January 31 , 20 11

cc: Keith W est




                          400 MARYLAND AVE. S.W.• WASIIINGTON, DC 20202
                                           """'''''.NLgov
 DEPARTMENT OF EDUCATION 





            DETAILED ACCOUNTING OF 

   FISCAL YEAR 2010 DRUG CONTROL FUNDS 



                   IN SUPPORT OF THE
          NATIONAL DRUG CONTROL STRATEGY
AS REQUIRED BY SECTION 705(d) OF THE OFFICE OF NATIONAL 

  DRUG CONTROL POLICY REAUTHORIZATION ACT OF 1998 

                    (21 U.S.C. 1704(d)) 




                 JANUARY 19, 2011
                                                  DEPARTMENT OF EDUCATION 


             DETAILED ACCOUNTING OF FISCAL YEAR 2010 DRUG CONTROL FUNDS 


                                                          TABLE OF CONTENTS 



Transmittal Letter .................................................................................. .............. ........................ 1 


Table of Prior Year Drug Control Obligations ............... ............................................................... 2 


Program Descriptions ...... .............. ... .. ... ............. .... ....... .... .......... ...... ... .. ... ................ ..... ........... . 2 


      State Grants ... ................. .. ............... ..... ...... ........ ................... .......... .... ............ ........... .......... 2 


      National Programs .................... .. ...................... ....................... __ ...... ..................................... 3 


Disclosures .. .......... ... ................ .... ......................... ......... ................ ...... .... ................ ....... ........... 3 


      Drug Methodology ................... .... .... ................... ...... ........................... ... ............. .... .. ............ 3 


           Obligations by Drug Control Function ................... .................................................. ......... 3 


           Obligations by Budget Decision Unit ................... ..................................... .......... ............. 4 


     Methodology Modifications ........................ ... ....... ..... .......... ........ ...... .. ... ........ ......... .... ... ....... 4 


     Material Weaknesses or Other Findings .................................................. ............. .... ............. 4 


     Reprogrammings or Transfers ...................... .... ..... .................. ............................................. 4 


     Other Disclosures ................ ................................................ ... ..... .... .... ......... .. .. ... ......... ...... 4 


Assertions ........... ....... ............................................................... .... ........ ........ ..... .. .. .... .............. 5 


     Obligations by Decision Unit ............................................................................. .................... 5 


     Drug Methodology ....................... ...... ................. ...... .. .. ......... ............. .. ......... ................... ..... 5 


           Data .. ... .................... ...................................................................... ...... ........ ........... ....... 5 


           Other Estimation Methods ........... ................... ........... .......................... ............................ 5 


           Financial Systems ...... .......................... ......................................... ........... ............. ........ 5 


     Application of Drug Methodology.... ... ....... .. ............ ........ .......... .... ....................................... 5 


     Reprogrammings or Transfers ....................................................................... ........ ............... 5 


     Fund Control Notices ...... ............ .............. ............................................................ ..... .... ....... 6 

                          UNITED SfATES DEPARTMENT OF EDUCATION
                          OFf-'lCE Of" PI.4.NNiNG, EVALU ATION AND POLICY DEVELOPMEI'n'



                                                         JAN 1 9 2011


Ms. Kathleen Tighe
Inspector General
U.S. Depaltment of Education
400 Maryland Avenue , S.W
Washington, DC 20202-1510

Dear Ms. Tighe :

As required by section 705(d) of the Office of National Drug Control Policy (ONDCP)
Reauthorization Act of 1998 (21 U.S.C. 1704(d», enclosed please find a detailed accounting of
all fiscal year 2010 Department of Education drug control funds for your authentication, in
accordance with the guidelines in ONDCP Circular Drug Control Accounting, dated
May 1, 2007.

Consistent with the instructions in the ONOC P Circular, please provide your authentication to
me in writing, and I will transmit it to ONDCP along with the enclosed accounting of funds. As
you know, ONDCP requests these documents by February 1, 2011, if possible. Please do not
hesitate to contact me if you have any questions about the enclosed information.

                                                   Sincerely,

                                                   /,/~? 1'r?[u1~
                                                   Thomas P. Skelly
                                                   Director, Budget Service
                                                                                                            I




                                      400 MARYU.ND AVE .. SW. WASHINGTON . DC 20202
                                                            www.ed.gov
        0 ..., mission i.~ to t"I'1SUI"t.' equal <lIn$.~ to eduoo.Hort and to promote ed... catforulI ~ ttvoughoul the nation.

                                                                   1
TABLE OF PRIOR-YEAR DRUG CONTROLOBUGATIONS
                                                                      Fiscal Year 2010 Obligations
                                                                              (in $ millions)

Drug Resources by Function
Prevention                                                                      $179.632
   Total                                                                         179.632

Drug Resources by Decision Unit
Safe and Drug-Free Schools and Communities Program

SDFSC State Grants                                                                 3.791
SOFSC National Programs                                                          175.841
  Total                                                                          179.632



PROGRAM DESCRIPTIONS

The programs funded under the Safe and Drug-Free Schools and Communities (SDFSC) Act
comprise the only Department of Education programs included in the national drug control
budget in fiscal year 2010. The SDFSC program provides funding for drug prevention programs
and activities that support the National Drug Control Strategy, in addition to efforts designed to
prevent school violence. Under the SDFSC Act, funds are appropriated for State Grants and for
National Programs.

                                       SDFSC State Grants

Under the program statute SDFSC State Grant funds are allocated by formula to States and
Territories, half on the basis of school-aged population and half on the basis of each State's
share , for the prior year, of Federal funds for Mconcentration grants to local educational agencies
(LEAs) for improving the academic achievement of disadvantaged students~ under section
1124A of Title I of the Elementary and Secondary Education Act (ESEA) . Governors receive
20 percent, and State educational agencies (SEAs) 80 percent, of each State's allocation
(unless a Governor elects to delegate admin istrative responsibility to the SEA for some or all of
the 20 percent). SEAs are required to subgrant at least 93 percent of their allocations to LEAs ;
these subgrants are based 60 percent on LEA shares of prior-year funding under Part A of title I
of the ESEA and 40 percent on enrollment. LEAs may use their SDFSC State Grant funds for a
wide variety of activities to prevent or reduce violence and delinquency and the use,
possession, and distribution of illegal drugs, and thereby foster a safe and drug-free learning
environment that supports academic achievement. Governors may use their funds to award
competitive grants and contracts to LEAs, community-based organizations, and other public and
private organizations for activities to provide safe, orderly, and drug-free schools and
communities through programs and activities that complement and support activities of LEAs.

Note: Funding for SDFSC State Grants was last appropriated in fiscal year 2009. The
Department's 2009 appropriations act provided that the 2009 funds may remain available for
obligation at the Federal level through September 30, 2010. All but $3.8 million of the 2009
appropriation for SDFSC State Grants was obligated by the Department in 2009 and reported in
the Department's 2009 detailed accounting of drug control funds . The $3.8 million included in




                                                 2

the resource summary table of this report reflects the obligations incurred in fiscal year 2010 of
the remaining 2009 appropriation of funds.

                                    SDFSC National Programs

SDFSC National Programs authorizes funding for several programs and activities to help
promote safe and drug-free learning environments for students and address the needs of
troubled or at-risk youth, including Federa l Activities (a broad discretionary authority that permits
the Secretary to carry out a wide variety of activities designed to prevent the illegal use of drugs
and violence among, and promote safety and discipline for, students); and an Alcohol Abuse
Reduction Program to assist school districts in implementing innovative and effective programs
to reduce alcohol abuse in secondary schools. Within Federal Activities SDFSC National
Programs also authorizes: (1) Project SERV (School Emergency Response to Violence, which
is a crisis response program that provides education-related services to LEAs in which the
learning environment has been disrupted due to a violent or traumatic crisis), and (2) School
Emergency Preparedness initiatives. Although the Department obligated funds for both of these
activities in fiscal year 2010, as explained in the discussion of drug budget methodology below,
funds for these two components of SDFSC National Programs are not included in the ONDCP
drug budget and, therefore, they are not included in this obligations report.

DISCLOSURES

                                        Drug Methodology

Th is accounting submission includes 100 percent of all fiscal year 2010 obligations of funds
under the Safe and Drug-Free Schools and Communities (SDFSC) Act, with the exception of
those SDFSC National Programs that have no clear drug control nexus. Accordingly, the
amounts in the enclosed table of prior-year drug control obligations include 100 percent of
funding for the SDFSC State Grants program, the SDFSC Alcohol Abuse Reduction program,
and all other SDFSC National Progra ms, with the exclusion of obligations of funds for (1) Project
SERV (School Emergency Response to Violence) , (2) School Emergency Preparedness
Initiatives, and (3) Character Education.

The explanation for excluding (3) Character Education is as follows . The Department's fiscal
year 2010 appropriations act included language requiring the Department to use $8.2 million of
the 2010 appropriation for SDFSC National Programs to support Character Education activities.
The Department used those funds to award continuation grants to Character Education
grantees that were funded originally under the Character Education program. The Character
Education program is separate from SDFSC National Programs and is not included among the
Department's drug control programs.

Obligations by Drug Control Function

All obligations of funds for the SDFSC program shown in the table on page 2 of this report fall
under the ONDCP drug control function category of prevention - the same functional category
under which the budgetary resources for the SDFSC program are displayed for the Department
of Education in the annual National Drug Control Budget Summary issued by ONDCP that
accompanies the President's budget and in the National Drug Control Strategy.




                                                  3

Obligations by Budget Decision Unit

All obligations of drug control funds in the table on page 2 of this report are displayed using the
SDFSC program as the budget decision unit - the same decision unit under which the 2010
budgetary resources for the Department of Education are displayed by ONDCP in the F Y 2011
Budget Summary that accompanied the 201 1 President's budget in support of the National Drug
Control Strategy.

                                  Methodology Modifications

The Department does not have any drug control budget methodological modifications to
disclose.

                            Material Weaknesses or Other Findings

The Department does not have any material weaknesses to disclose that affect the presentation
of fiscal year 2010 drug-related obligations in this report . All other known weaknesses that
affect the presentation of drug-related obligations in this report are explained in the disclosures
below.

                                 Reprogramm ings or Transfers

On three occasions in 2010 the Department reprogrammed small amounts of funds within
SDFSC National Programs. However, these reprogrammings had no impact on (i.e., neither
increased nor decreased) the amount of Education's 2010 drug-related obligations. There were
no transfers that changed the amount of drug-related budgetary resources in the Department in
fiscal year 2010.

                                       Other Disclosures

The Department acknowledges the following limitations in the methodology described above for
deriving the obligations of fiscal year 2010 drug control funds attributable to the SDFSC
program:

  • 	 Although the budgetary resources in this report include 100 percent of obligations for
      SDFSC State Grants and Federa l Activities (exclusive of Project SERV, School
      Emergency Preparedness Initiatives , and continuation awards to Character Education
      program grantees), not all obligations of funds included in the resource summary of this
      report support drug prevention activities - some of these funds support violence
      prevention and school safety activities that have no drug control-related nexus.

  • 	 Approximately $7.8 million of the SDFSC National Programs funds included in the
      resource summary of this report (4.4 percent of total fiscal year 201 0 SDFSC reported
      drug control obligations) supported prevention projects for students enrolled in institutions
      of higher education; for college students served by such programs who are 21 years of
      age or older, alcohol is a legal drug and the alcohol prevention component of the program
      falls outside the scope of the National Drug Control Strategy.




                                                4

ASSERTIONS 


                                 Obligations by Decision Unit

The fiscal year 2010 obligations of drug control funds shown in this report for the SDFSC drug
budget decision unit are the actual 2010 obligations of funds from the Department's accounting
system of record for the SDFSC program.

                                       Drug Methodology

The methodology used to calculate the fiscal year 2010 obligations of drug prevention funds
presented in this report is reasonable and accurate, because: (1) the methodology captures all
of the obligations of funds under the SDFSC program that reasonably have a drug control­
related nexus, and (2) these obligations of funds correspond directly to the display of resources
for the SDFSC program in the Department's budget justifications to Congress that accompany
the President's budget.



No workload or other statistical information was applied in the methodology used to generate
the fiscal year 2010 obligations of drug control funds presented in the table on page 2 of this
report.

Other Estimation Methods

Where assumptions based on professional judgment were used as part of the drug
methodology, the association between these assumptions and the drug control obligations
being estimated is thorough ly explained and documented in the drug methodology disclosure on
page 3 and in the other disclosures on page 4 of this accounting report.

Financial Systems

Financial systems supporting the drug methodology yield data that fairly present, in all material
respects , aggregate obligations from which the drug·related obligation estimates are derived.

                               Application of Drug Methodology

The methodology disclosed in the narrative of this report was the actual methodology used to
generate the fiscal year 2010 obligations of drug control funds presented in the table on page 2.

                                Reprogrammings or Transfers

The data presented in this report properly reflect changes in drug control budget resources
resulting from reprogrammings of fiscal year 2010 SDFSC funds. On three occasions in 2010
(April 16, September 14, and September 29) the Department reprogrammed a small amount of
funds within the SDFSC National Programs: the April 16 and September 14 reprogrammings
exceeded $1 million and were approved in advance by ONDCP, as required by law. The other
reprogramming was less than $1 million and was not subject to ONDCP approval.




                                                5

                                     Fund Control Notices

The Director of ONDCP has never issued to the Department of Education any Fund Control
Notices under 21 U.S.C. 1703(f) or the applicable ONDCP Circular, Budget Execution.
Therefore , the required assertion that the data presented in this report accurately reflect
obligations of drug control funds that comply with all such Fund Control Notices is not
applicable.




                                               6

                                    UNITED STATES DEPARTMENT OF EDUCATION
                                                           OFFICE OF INSPECTOR GENERAL

                                                                                                                          AUDIT SERVICES

                                                       JAN 31 2011

Office oflnsQCctor General's Independent Report on the U.S. Department of Education's
Detailed Accounting ofFiscal Year 2010 Drug Control Funds. dated January 19,20 11

We have reviewed management's assertions contained in the accompanying Detailed Accounting
ojFiscal Year 2010 Drug Conlrol Funds, dated January 19,20 11 (Accounting). The U.S.
Department of Education'5 management is responsible f(Jr the Accounting and the assertions
contained therein.

OUf review was conducted in accordance with altcstation standards established by the American
Institute of Certified Public Accountants. A review is substantially less in scope than an
examination, the objective of which is the expression of an opinion on management's assertions.
Accordingly, we do not express such an opinion.

We perfonned review procedures on the "Table of Prior Year Drug Control Obligations,"
" Di sclosures," and "Assertions" contained in the accompanying Accounting. We did not review
the " Progrmn Descriptions" contained in the accompanying Accounting. In general, o ur review
procedures were li mited to inquiries and analytical procedures appropriate for o ur review
engagement.

Based on our review, nothing came to our attention that caused us to believe that management's
assertions, contained in the accompanying Accounting, are not fairly stated in all material
respects, ba'ied upon the Office of National Drug Control Policy Circular: Drug Control
Accounting, dated May I, 2007.



                                                        Keith West
                                                        Assistant Inspector General for Audit




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