At school for disabled kids on Long Island, high pay for staff, teachers leads to state pressure, layoffs

From The NY Times:

ALBERTSON, N.Y. — Kathleen Cervasio’s daughter, Gina, (pictured) who is 12, has cerebral palsy, cannot speak and is quadriplegic. Without a doubt, Ms. Cervasio said, the best thing that ever happened to Gina was getting into the Henry Viscardi School, one of 11 state-supported public schools for the severely disabled in New York.

Ms. Cervasio, a professor of nursing, said the education and rehabilitation programs were exceptional, offering services her family could never otherwise afford. Indeed, per-pupil cost at Henry Viscardi is $74,331 — about five times the cost of educating a typical child — and is covered almost entirely by taxpayers.

”I am so grateful,” Ms. Cervasio said. “Gina has a great social worker who understands her and can calm her like no one else.” The orthotic center, run by physical therapists, fixes Gina’s wheelchair when it breaks down or needs adjustment as she grows. “The swimming pool is her favorite,” Ms. Cervasio added. “It’s the only time she can relax her muscles, float — she can even stand up with help.”

But the school’s image went from outstanding to disreputable last month. An audit from the state comptroller’s office revealed that $835,074 was misused in 2008 and 2009, much of it going toward the $1.25 million in salary and benefits paid to Edmund L. Cortez, the chief executive officer, during that time. It gets worse: The state demanded the money be returned.

A few weeks later, on May 1, facing a budget shortfall — partly because of the disallowed salary expenditures — the school announced that nine staff members would be laid off or have their hours cut. The social worker Gina loves, along with a physical therapist and a lifeguard, are to be let go. The orthotic center and the pool at the school will be closed.

Parents are angry. “I can’t believe anyone would sign off on that kind of salary,” Ms. Cervasio said. “They were using our children to get rich.”

Six parents and two former employees interviewed said that when they tried to complain, as recently as last week, they were blocked from attending school board meetings. Wanda O’Brien, a social worker who made $58,000 a year and lost her job during an earlier series of layoffs in 2009, said people feared Mr. Cortez. “If someone wrote the board a letter of complaint about him, the board would turn it over to him,” she said. “These children are the most vulnerable of the vulnerable, and they’re paying for what this man took.”

Mr. Cortez is long gone — he retired in January, two months after a draft of the audit was sent to the school. Several efforts to contact him were unsuccessful.

A spokeswoman for the school, Katherine Heaviside, said, “He’s retired and doesn’t want to be in the limelight.” She and other school officials said they were in the process of changing school policies and intended to pay back the $835,074.

Patrice M. Kuntzler, the executive director, said the expected budget shortfall was caused mainly by a change in the state reimbursement process. But she acknowledged that if the repayment had not been demanded by the state and if Mr. Cortez had been paid less, fewer people would need to be laid off.

In addition to the $1.25 million Mr. Cortez received, he accumulated $1.36 million in deferred compensation over 12 years, according to the most recent tax data available.

He was also provided a house on the school grounds and a leased Lexus, both free.

Even while Mr. Cortez was laying off people and freezing teachers’ salaries, the chief financial officer, Sheryl P. Buchel, had her salary and benefits raised to $258,169 in 2009, from $255,345 in 2008.

To put this in perspective, Dennis M. Walcott, chancellor of the New York City schools, makes $213,000 for overseeing a district of 1.1 million students, including 24,000 who are severely disabled. The Henry Viscardi School serves 187 students.

The biggest example of malfeasance, according to the audit, involved Mr. Cortez’s being paid twice for doing the same job.

Mr. Cortez was president of a nonprofit parent organization that paid him hundreds of thousands of dollars to oversee the school as well as an adjoining rehabilitation center. But he and his secretary also received a combined $280,000 a year from the school budget. In short, Mr. Cortez was being paid by the parent organization to oversee the school, and he was being paid by the school to oversee the school. (The audit also noted that four other people, with an average annual salary of $132,000, were also paid to oversee the school.)

“We could not determine what services were provided,” the audit said, calling the additional $280,000 a year, “unnecessary and unreasonable.” All $560,000 ($280,000 for each of the two years) was disallowed.

Mr. Cortez kept no records to substantiate whether the Lexus was used for business purposes, according to the audit. (He didn’t need it for commuting; his free house was a five-minute walk from the school.)

A total of $18,276 was disallowed for the use of the Lexus and a second leased car.

A draft of the audit was sent to the school on Nov. 12, 2010. The State Education Department, which finances the school, agreed with all the findings.

On Dec. 23, the school filed a response to the audit, listing 17 objections, and within a few weeks, Mr. Cortez retired.

The state’s response to the school’s response was to reject the objections.

In April, the final version of the audit was made public.

Mark Johnson, a spokesman for Thomas P. DiNapoli, the comptroller, said the findings had been referred to Eric T. Schneiderman, the attorney general. If the state takes action, one option would be to file a civil suit against Mr. Cortez seeking to recoup the disallowed money.

The attorney general declined to comment.

Several people were in a position to find the problems long before the comptroller, a former state assemblyman from Nassau County. They include Ms. Buchel, the financial officer; the examiners at KPMG, a global auditing firm, which is paid by the school to review its finances yearly; the school’s executive director, Ms. Kuntzler, who receives $192,520 a year; a senior vice president, Fran P. Prezant ($184,756); a vice president of administration, Michael Giampetruzzi ($159,189); an assistant vice president of administration, Jennifer Neft-Spalletta ($136,604); the school comptroller, Michael Gambeski ($111,512).

The new chief executive of the school, John D. Kemp, said in an interview, “I hope you understand we’re changing things. Things are very, very different.”

Mr. Kemp, a lawyer who uses a wheelchair, would not discuss his salary but said it was “a lot less” than Mr. Cortez’s. And he is paying for his own car. It is also a Lexus, although it is 12 years old and he bought it secondhand.