By Nuria Martinez-Keel, Oklahoma Voice
OKLAHOMA CITY — A long-awaited special audit of the Oklahoma State Department of Education found no misuse of taxpayer funds under former state Superintendent Joy Hofmeister.
State Auditor and Inspector Cindy Byrd released the findings during a news conference Wednesday. Gov. Kevin Stitt requested the audit in 2021 while at odds with Hofmeister, who was term-limited in 2023.
The former state superintendent said she is pleased the probe found no evidence of wrongdoing by her administration.
“That result reflects the integrity, diligence, and transparency our team brought to its work every day,” Hofmeister said in a statement. “I appreciate the thorough review by Auditor Byrd, and we’re glad the final report confirms our commitment to responsible stewardship and open government.”
The governor’s audit request included no specific allegations of financial mismanagement at the agency.
Rather, Stitt asked for an investigation into the Education Department’s revenue sources and spending, especially during an influx of federal pandemic aid funds at the time. A scathing audit of Epic Charter School the year before attracted significant attention to education spending.
Attorney General Gentner Drummond requested a separate audit to investigate the Education Department’s finances during state Superintendent Ryan Walters’ tenure from 2022-2025. Drummond has chosen to put that audit on hold, a spokesperson for the state auditor said.
The Education Department acts as a pass-through entity for billions of state and federal dollars that continue down to local school districts. The agency keeps only 0.21% of those funds for its own operations and legislatively required programs.
Byrd said her audit focused primarily on that 0.21%, or $16 million, from the 2021 fiscal year and found no misspending.
The likelihood of waste, fraud or abuse of funds is greater at the local level, Byrd said, “because that’s where all of the money is spent.”
She said the state doesn’t have a strong enough accounting system to detect fraud within local schools. The Oklahoma Cost Accounting System, which the Education Department manages, relies on each district to report its finances honestly, though it has some risk assessment tools.
“The good news here is that most school districts are working hard to report expenditures honestly,” Byrd said. “However, there are some bad actors out there, and the bad news is that we do not have a system that can catch bad actors at the local level. The consequences of that can be catastrophic.”
In a statement through his communications staff, the governor said it’s time to modernize Oklahoma’s school accounting system. Stitt said the existing system “is not giving parents and taxpayers the transparency they deserve.”
Byrd didn’t lay the blame for the accounting system’s weaknesses on the Education Department. Rather, she said the state should design a new financial reporting mechanism, one that doesn’t rely on the honor system.
Auditors also homed in on a $1 million allocation for a math vendor that the Oklahoma Legislature included in the state budget in 2021. Budget records from the 2021 fiscal year indicate the vendor is Imagine Math, though Byrd didn’t name the company during her news conference.
Imagine Math is the only math vendor singled out for a $1 million appropriation in the Education Department’s budget that year. It was hired to provide “supplemental math programs (to) help PreK-9 students solve problems and justify reasoning inside the classroom and in day-to-day life, moving students beyond computation to real comprehension,” according to the agency’s budget.
While finding no issues with the vendor’s services, Byrd questioned why lawmakers dedicated funds to a single company and allowed it to avoid the competitive bidding process. A lawmaker who led an education appropriations committee at that time was unable to provide any documents to auditors showing how that vendor was evaluated, she said.
“I want to be clear: I’m not questioning the quality or effectiveness of this vendor’s product, but taxpayers deserve to know that when money is set aside for an education vendor that the vendor’s services have been fully vetted and that the vendor has a documented history of success working in Oklahoma with Oklahoma’s specific learning standards,” Byrd said.
The audit also raised questions about the state’s funding of the Strong Readers Act, which in 2021 was an $11 million program known as the Reading Sufficiency Act. The program dedicates money for literacy instruction in schools.
Although larger districts understandably received more funding, others received too little for it to be effective, she said. One district, for example, got only $12.
Auditors also found no correlation between larger appropriations and better reading outcomes, she said.
“Did taxpayers get any return on investment on that $11 million?” she said. “Did more kids learn how to read? No one knows, and that’s the problem.”
Editor’s note: This story has been updated to include a statement from Gov. Kevin Stitt, which was provided after publication.
