Editorial: Board has fallen down on the job

Friday, July 2, 2004 | 3:57 a.m.

WEEKEND EDITION

July 3 - 4, 2004

Another highly critical review of the Economic Opportunity Board's management and finances is further evidence that this nonprofit group, entrusted with a $60 million budget and charged with fighting poverty, has been dysfunctional for some time. The alarms began sounding publicly in January, when the Sun disclosed that the EOB could not account for $2.1 million in state and federal money intended for child-care programs. Reports of other large amounts of missing money and gross mismanagement quickly followed.

The latest report came last week, from the national bureau that administers the Head Start program for preschoolers. The EOB receives $12.2 million a year in federal funds to run this program. The national Head Start bureau report says that in January, the EOB withdrew nearly $500,000 in Head Start funds but cannot account for a penny of it. On Jan. 2, $87,000 was withdrawn from the EOB's Head Start account, and on Jan. 16, $407,000 was pulled out. The audit says the EOB cannot "document that the funds ... had been used for the Head Start or Early Head Start program."

Altogether the national bureau looked at 35 financial transactions by the EOB and found that, "... more than 90 percent did not include appropriate documentation ..." An example was a $250 lunch tab "with no documentation on who was at the meeting, what was discussed or why the federal grant should have paid for the meal."

Even more troubling in the audit was the finding that children in the Head Start program were not receiving the full health care benefits for which the federal funds are provided. A third of the children had not received required dental exams. The audit also found gaping holes in the children's medical files -- 47 of 49 files reviewed, for example, were missing blood test results.

The EOB began the year with a board of 15 members, which has since shrunk to six because of all the disclosures. The Head Start bureau gave the board 45 days to explain its financial lapses and 90 days to correct its management problems. At a board meeting Wednesday, the five board members who attended decided -- wisely in our view -- that the job of bringing competence back to the EOB was beyond their capability. They decided to spend up to $224,000 in federal funds to bring in a management team provided by Mid-Iowa Community Action, which functions in mid-Iowa as the EOB is supposed to function in Southern Nevada. This team is scheduled to take charge of the EOB from July 7 through Nov. 26.

We expect this team, which found numerous problems when it reviewed the EOB in April at the request of the state, will implement sound financial and management policies. After that, if the current board still acts as if the job is beyond its capability, it should be dismantled and a new board assembled -- one that will take its oversight responsibility seriously.