Federal review cites 33 EOB violations

By Timothy Pratt

Tuesday, June 29, 2004 | 11:09 a.m.

A federal agency told the embattled Economic Opportunity Board last week that the organization has committed 33 violations of federal rules tied to $12.2 million in federal funds.

It's the third time in two months that a review of Southern Nevada's largest publicly funded nonprofit organization has cited financial mismanagement in the organization.

According to the federal Head Start bureau's June 25 report, the problems range from mismanagement of millions of dollars to insufficient health care provided to poor children in the Las Vegas Valley's 18 Head Start centers.

The centers serve about 1,800 children between ages 3 and 5.

The EOB has 45 days to correct financial problems and 90 to fix other areas of the program or risk losing those funds.

The report was based on an early April review of the Head Start program in the valley.

Sen. Joe Neal, D-North Las Vegas, spokesman and a member of the board -- recently reduced from 15 to 6 members because of the nonprofit organization's ongoing problems -- said Monday that he had not seen the report and would not comment on it until the board's meeting on Wednesday.

Steve Barbour, spokesman for Windy Hill, associate commissioner for the Head Start bureau and leader of the team that did the review, said the bureau would not comment on the report until it is released to the public sometime this week.

The Sun obtained a copy of the report Monday.

The report notes that the EOB was not able to prove that nearly $500,000 in Head Start dollars were actually spent on the early education program, and that a third of the children reviewed had not received required dental exams.

The Head Start review is one of three reviews of the EOB in recent months and the last to release its findings. The Head Start program is the second-largest program run by EOB, after the $20 million-plus child care program. All three reviews were brought on by financial, management and program problems.

The financial problems listed in the Head Start review are given top priority, according to the report because they are seen as "threatening the integrity of federal funds."

In one part of the report, it claims that the EOB withdrew $87,000 in Head Start funds on Jan. 2 and $407,000 on Jan. 16 and could not "document that the funds ... had been used for the Head Start or Early Head Start program."

In another, it says $250 was charged to a credit card for a meal at the Seven Seas soul-food restaurant for a meeting of the "EOB of Las Vegas," with no documentation on who was at the meeting, what was discussed or why the federal grant should have paid for the meal.

Of 35 financial transactions reviewed, the report said, "more than 90 percent did not include appropriate documentation to ensure that the costs met the conditions of reasonableness ... and allowability.

"As a result, (the EOB) was unable to provide assurance that grant funds were not used for unauthorized purposes," it said.

As for the program's health care problems, the report said that 47 of 49 files reviewed were missing blood test results, 12 of 49 were missing eye test results, and 16 of 49 were missing dental exam results.

Finally, the report addresses the way the different parts of the nonprofit organization worked together -- or didn't.

"The (EOB's) Policy Council, Policy Committees and governing body did not work in partnership with key management staff," the report said.

It went on to say that board members "were unclear as to their duties and responsibilities" and that the policy council -- a group of parents and other members of the community that is supposed to share control over the program with the board -- felt "'unappreciated and inferior."'

This resulted in the council not receiving financial reports on the program in a timely fashion and having trouble following the budget of the program they were charged with overseeing, the report said.

The council and the board must sign off on all the corrections sought by the bureau and noted in the report.

If the problems are not fixed within the time limit set out, the Head Start bureau will send out "a letter stating our intent to terminate (the) Head and Early Head Start grants," the report said.