Assemblyman Joe Pennacchio

PENNACCHIO: BETTER OVERSIGHT OF PRESCHOOL FUNDS COULD SAVE STATE MILLIONS

INVESTIGATIVE REPORT DETAILS TENS OF MILLIONS OF DOLLARS IN WASTED STATE PRESCHOOL FUNDING
April 10, 2006
Assemblyman Joe Pennacchio/973-984-0922
Assembly Republican Office/609-292-5339

PENNACCHIO: BETTER OVERSIGHT OF PRESCHOOL FUNDS COULD SAVE STATE MILLIONS

INVESTIGATIVE REPORT DETAILS TENS OF MILLIONS OF DOLLARS IN WASTED STATE PRESCHOOL FUNDING

Assemblyman Joe Pennacchio today said that until the state gets a grip on how its money is being spent by non-profit preschool programs around the state and exercise better oversight of those funds, no extra funds should be provided for these programs in the proposed state budget.

Governor Corzine's proposed Fiscal Year 2007 budget would add $50.8 million in Department of Education preschool funding over what was proposed in the Fiscal Year 2006 budget, but a published report has determined that tens of millions of dollars have been wasted.

"Clearly much of the taxpayer money allocated to these programs is being wasted or inappropriately spent," said Pennacchio, R-Morris and Passaic. "When taxpayer dollars are being used to fund Caribbean time-shares for preschool directors, luxury car rentals and Godiva chocolates, the time is long overdue for a crack down."

Pennacchio was responding to a story in this weekend’s Record of Hackensack detailing numerous examples of waste and abuse of taxpayer dollars in New Jersey’s preschool program for low-income, disadvantaged children.

The story cites a Jersey City preschool owner who charged state taxpayers for a Caribbean time share two years in a row, a Hoboken center that collected hundreds of thousands of dollars in state funds without telling New Jersey that the federal government had already paid for the same preschoolers, and an Irvington preschool being run by a director who had her same program in Newark shut down for mismanagement.

"Not only are the taxpayers being hurt by this abuse of state funds, but the children who this program is designed to help are getting lost in the shuffle," said Pennacchio. "If we have a preschool program that is providing more personal benefit for the administrators than it is an educational benefit for the kids, it is time to clean-house with the oversight of that program."

The Record analyzed audits of more than 100 state-funded preschools in New Jersey’s poorest communities, reviewed tax returns, financial documents and contracts and interviewed dozens of state and local officials, owners and teachers in an effort to detail the fiscal workings of the program.

The results of that audit revealed payments for luxury car leases, Omaha steaks, shrimp, Godiva chocolates, wedding gifts, motorcycle insurance, even cat food were buried in the books. Inflated rents, six-figure salaries and $900,000 in personal loans, while some schools shortchanged teachers' wages and benefits, were also uncovered.

"When Governor Corzine said he had made all the cuts he can in his budget, I don't think he accounted for the waste buried within many of these programs," Pennacchio said. “I think it is a fair standard that before we raise taxes on New Jersey families we need to make sure the state has stopped paying for fancy chocolates and resort island time-shares."

Pennacchio said the actions reported by The Record should have resulted in legal action by the state. He faulted the Department of Education and the Attorney General's Office for allowing these deeds to go unpunished.

Preschool funding provided through the Department of Human Services budget has been reduced by $17 million in the Corzine budget proposal -- not by cutting wastes, but as a result of forcing some parents to pay a portion of the costs for their children.

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