Audit Finds Historic $2.6B Investment In Education Might Be A ‘Waste of Money’

Republican Governor Joe Lombardo and the Executive Branch Audit Committee received an audit report (see below) on Nevada’s 17 public school districts on Wednesday that revealed “major shortfalls and questioned the state’s historic investment.”

“It’s a little disturbing that as part of the presentation with the $2.6 billion into the education program for the state of Nevada, but yet this audit says that, I don’t know for a lack of a better term, a waste of money,” Lombardo said.

“The accountability matrix was produced and was provided to the districts in agreement with the districts. Now we have to pass legislation to have the hammer per se,” the governor said.

In a press release this afternoon, Lombardo stated:

“In one of my first Executive Orders last year, I mandated an audit of Nevada’s 17 Public School Districts and the State Public Charter School Authority. I firmly believe that our unprecedented investment into K-12 education warrants unprecedented accountability and fiscal responsibility. The audit highlighted existing shortcomings within our education system, and my administration will use the audit’s findings to shape our Acing Accountability initiative and education reform in our state.”

The Office of the Governor identified several key findings from the audit, including:

• Importance of Eliminating Fragmented Oversight: Currently, there are numerous boards and commissions with various duties and oversight responsibilities related to K-12 education. The audit found that these efforts need to be unified and uniform.
• Importance of Maximizing New K-12 Dollars: The audit reported that investments in Nevada’s K-12 education system must be hyper-targeted to achieve better academic outcomes.
• Importance of Reinstituting Critical Literacy Benchmarks via Read by Grade 3: The audit reiterated the importance of students achieving reading proficiency by third grade, as reading skills are critical to all aspects of students’ educational success.

The audit also found that:

• Three quarters of school districts did not comply with quarterly expenditure reporting requirements. Failure to comply with this statute limits transparency for the public and inhibits accountability for tax dollars designated to support public education in the state.
• The Read By Grade 3 (RBG3) program is underperforming statewide. School district RBG3 scores are lower than the state goal (43.3 percent) and have declined since the 2018-2019 school year. The COVID-19 Pandemic continues to impact student learning. Underperforming school districts have not made major improvement. Statute needs updating to allow NDE to hire literacy specialists to coordinate RBG3 efforts and train licensed teachers performing literacy specialist roles in individual schools.

During the last legislative session, Lombardo signed a historic K-12 education budget, investing $12 billion over the next biennium, adding an additional $2.6 billon to the budget.

Prior to the budget’s passage, Lombardo signed Executive Order 2023-005 which directed the Division of Internal Audits in the Governor’s Finance Office to review Nevada’s 17 public school districts and the Nevada State Public Charter School Authority.

The Executive Order cites, “Nevada taxpayers invest over $5 billion annually in the operations of the State’s public schools; and, K-12 education accounted for $3.2 billion in general fund appropriations approved by the Nevada State Legislature for the 2021-23 biennium, more than any other function of state government.”

Last September, Lombardo and State Superintendent John Ebert announced an “Acing Accountability” intiative. The initiative established accountability metrics related to the $2.6 billion investment in K-12 education. The metrics were designed to ensure that “resources are tied to performance.”

Superintendent Ebert established the metrics of performance for schools based upon the following criteria: the growth and proficiency in literacy and mathematics; the engagement and proficiency of pupils in courses for college and career readiness; and, the retention and recruitment of teachers and education support professionals. Additional metrics would be established by each school district and approved by Superintendent Ebert.

According to a 2022 report by Scholaroo, Nevada ranked 49th in education.

Based on the above proficiency data, only 19.6 percent of high school students are proficient in math but school districts are reporting, on average, over 80 percent graduation rates.

Now that the audit has come home to roost, the Governor told the committee on Wednesday he plans to propose new legislation to make it easier to remove a school superintendent and put a school district under state control.

In a related report from Channel 8 news, “The administrator for the Division of Internal Audits Craig Stevenson defended his report’s finding, saying that taxpayer dollars need to be targeted.”

“That is not to say that more invested does not necessarily lead to better outcomes, it really has to do with how you invest that money,” Stevenson said.