Louisiana Legislative Auditor
Daryl G. Purpera, CPA, CFE

November 2, 2015

Miller-McCoy Academy May Have Violated Its Charter and Recovery School District Policy When It Sold Computers Bought with State Funds

A New Orleans-based charter school may have violated both its own charter and Recovery School District (RSD) policy when the school sold 86 pieces of computer equipment to former teachers and parents for $15,760 this past summer, according to an investigative audit made public by Legislative Auditor Daryl Purpera on Monday.

RSD policy prohibits the sale of assets purchased with state or federal funds. Allegations that school administrators at Miller-McCoy Academy for Mathematics and Business (Miller-McCoy) were violating this policy initially prompted this investigation.

Miller-McCoy began operating as a Type 5 Board of Elementary and Secondary Education-chartered school on April 15, 2008. In December 2014, Miller McCoy’s board of directors decided to close the school at the end of the 2014-2015 academic year. The school’s charter was officially surrendered effective June 30, 2015.

The school’s business manager and operations manager told auditors they decided to sell off any of the school’s computer equipment having an original purchase price of less than $500 in order to pay off the school’s debts. The school’s receipt books show that, between May 20, 2015 and June 24, 2015, Miller-McCoy sold computers, projectors and phones to former faculty members and parents of students for a total of $15,760. Available school records show that all of the proceeds from the sales were deposited into the school’s operating bank account.

However, the RSD told auditors that, as part of its oversight role, between May 7, 2015 and June 17, 2015, it sent four different letters to Miller-McCoy particularly stating that any assets purchased with public funds cannot be sold. One of those RSD letters states: “Ensuring that all property purchased with public money continues to serve the students of New Orleans is critical and a responsibility of all charter board members.”

Miller-McCoy’s court-appointed liquidator says the school respectfully disagrees with the RSD’s policy interpretation. School employees said they believed the RSD inventory policy provided that purchases of items under $500 are not included in the school’s inventory of assets. The school says all funds generated in the equipment sales will ultimately be turned over to RSD as part of the dissolution process.

For more information contact:

Legislative Auditor
225.339.3800



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