West Virginia School Districts Misspent Millions in COVID Relief Money, Audit Shows

More problems are likely to surface as spending and financial reviews continue.

By Amelia Ferrell Knisely

This story first appeared at The 74, a nonprofit news site covering education. Sign up for free newsletters from The 74 to get more like this in your inbox.

The state department of education failed to adequately monitor school districts’ use of millions of dollars in federal pandemic relief funds, and more misuse of the money is likely to emerge as spending reviews continue.  

A state audit, which reviewed only a sample of purchases made since 2020, found that the West Virginia Department of Education lacked “adequate capacity” to monitor how local school districts used the federal funds.

Of the 54 school districts reviewed, 37 school districts were deemed “noncompliant” in their use of federal funds, including improper purchasing procedures or using funds for unallowable activities.

In Upshur County, the school district spent $60,000 of federal funds on pool passes.

Other funds were spent on private school expenses, food and a student choir trip out of state.

“It seems like there’s a massive problem and we should be looking at everything — but that’s not ever going to happen,” said Del. Kayla Young, D-Kanawha.

State lawmakers were notified of the audit’s results on Monday during a Legislative interim meeting in Wheeling.

West Virginia has already seized control of two school districts — Upshur and Logan — due to issues that included misspending of the funds. As the state has until September 2024 to spend more than $400 million remaining in federal funds, the audit recommended that the WVDE increase its oversight of school districts’ spending by adding staff. But that’s unlikely to happen, the audit said.

“The WVDE indicated that it has no intention of increasing capacity since the deadline to spend [federal] funds is 10 months away,” said Brandon Burton, research manager for Performance Evaluation Research Division, who presented the audit.

The COVID-19 relief funds, passed down from the federal government, were supposed to be used to help schools safely reopen and help students recover from pandemic-incurred academic and emotional needs. Federal and state auditors found that states across the country spent millions in COVID-relief funds on questionable purchases since 2020.

Beginning in March 2020, the WVDE has received nearly $1.2 billion in money from the federal Elementary and Secondary Emergency Relief funds.

Burton told lawmakers that, although state and federal monitors signed off on the school districts’ spending plans, the lack of a fiscal monitoring system within the WVDE failed to detect problems with the spending.

“Consequently, there are violations that the system did not detect,” he said.

‘I think the school systems were in a panic’

According to the audit, there were a number of reasons as to why the WVDE failed to detect the misuse of funds and improper purchasing procedures, including a lack of staff who could monitor spending.

“It’s a large amount of information that you’re having to go through,” said Burton, who added that in some counties only one person was reviewing financial transactions.

Additionally, there were issues with school districts not following proper bidding procedures and buying from vendors who weren’t registered with the state.

Schools have been permitted to purchase items from unregistered vendors, which Burton said increased the likelihood of school boards interacting with fraudulent vendors.

“ … The vast majority of [Local Education Authorities] made federal grant purchases with unregistered vendors totaling over $2.1 million,” the audit said. Most of the vendors were located out of state.

Melanie Purkey, WVDE senior officer for federal programs, told lawmakers that during the height of the pandemic, school districts were using the funds to quickly buy items like hand sanitizer, masks and laptops for remote learners. The procurement wasn’t “proper,” she said.

“I think school systems were in a panic, and thought, ‘We found a vendor who’s going to provide this, so we’re going to buy it,’” she said.

The WVDE is working on updating internal policies to emergency purchasing procedures, according to Purkey.

Reviews are ongoing of how school boards spent pandemic relief funds, and the state still has more than $476 million of those funds to spend by deadline. Unspent money will be returned to the U.S. Department of Education.

Del. Kathie Hess Crouse, R-Putnam, emphasized that the missteps would ultimately fall back on tax payers in counties where school boards must pay back misspent funds.

“There’s no consequences to them when we have to pay for that,” she said.

West Virginia Watch is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. West Virginia Watch maintains editorial independence. Contact Editor Leann Ray for questions: info@westvirginiawatch.com. Follow West Virginia Watch on Facebook and Twitter.