The governing board for Epic Charter Schools unanimously approved on Wednesday corrective actions after reviewing the state auditor’s review of their operations.
Those actions include clarifying payroll processes and more specifically outlining how management fees for the for-profit Epic Youth Services are calculated, areas the auditor’s report indicated were mishandled.
But the actions do not mean members have acquiesced to the auditor’s findings.
A law firm presented to the board a nearly 200-page response to the state audit. The document largely seeks to rebut the auditor’s findings, including that Epic failed to properly classify and report nearly $9 million dollars in payroll, accounting for the largest portion of the State Department of Education’s demand for Epic to repay $11.2 million in state funds.
Most board members indicated they were willing to sit down with the education department after they receive the state auditor’s work papers and try to resolve outstanding issues. Epic’s attorney, Bill Hickman, thinks the employee classifications can be addressed to reduce the state penalty.
"We can find out the details, whether it’s individual by individual, year by year, or groupings of individuals by groupings of individuals and do our best to address as many of these issues and these dollars that we can so that … we don’t hurt our current students with having to pay back an administrative penalty that is a Monday morning quarterbacking look back on this situation," Hickman said.
Board member Mike Cantrell was less enthusiastic about meeting with the State Department of Education, claiming the education department’s penalty was meant to support the auditor’s findings.
"They seem to be interested in backing up the state auditor. Just say it like it is. That’s what it is. It’s one state agency, backing up another state agency, covering their ass," Cantrell said.
The Epic board will meet again next month and may consider additional corrective actions.