The Arizona State Schools for the Deaf and the Blind failed to properly collect or recover more than $4.5 million in revenue, according to a three-year forensic audit released by the Arizona Auditor General’s Office.
The forensic audit, conducted by independent firm Forensic Strategic Solutions LLC, examined ASDB’s finances, student documentation and educational management from 2022 to 2024. Investigators found no evidence of fraud or intentional wrongdoing, but identified inconsistent transactions, records and documentation. Among the findings:
- $2.1 million in vouchers and service-fee revenue that ASDB failed to properly collect.
- $2.5 million in Medicaid claims that could have been recovered but were not resubmitted in a timely manner.
$456,000 in payments from the Arizona Department of Education that ASDB may eventually have to repay.
- More than $30,000 in stipend and incentive payments and purchases that were not properly approved.
The findings come as ASDB faces ongoing financial and legal challenges amid its relocation to Oro Valley.
The audit mentions the school closure and relocation, but says the move occurred after fiscal year 2024 and was therefore outside the review's scope. ASDB had said it faced a nearly $3 million budget deficit, prompting the move to a more economical campus.
#Questions surrounding the campus closure#
Diana Newmark, director of the Education Advocacy Clinic at the University of Arizona, said the audit raises concerns about how ASDB handled its campus closure plan.
In the performance audit, Newmark states that the ASDB announced its campus closure plan before it ever obtained board approval and without seeking input from the community.
“This is a big deal,” Newmark said.
Newmark and the Education Advocacy Clinic filed a complaint against ASDB in May. The Arizona Department of Education later found that ASDB violated state law by predetermining student placements rather than working through each student's Individualized Education Program.
Newmark said the campus relocation has also eliminated 24/7 residential opportunities for students who relied on them.
#Audit follows ASDB's own review#
The forensic audit began while ASDB was conducting its own self-audit, according to the auditor general’s report.
ASDB spokesperson Tricia Beckham has not responded to questions about the money identified in the audit or the agency's self-audit.
In a statement, superintendent Annette Reichman emphasized that the audits found no evidence of fraud or intentional wrongdoing.
“ASDB will continue to do what is statutorily required for a state agency and will make appropriate changes to our current policies to ensure all audit findings are addressed,” Reichman said.
The report includes recommendations for ASDB to improve enrollment data, reconciliation procedures and transactions involving board members who serve as vendors.
The Auditor General's Office plans to follow up with Forensic Strategic Solutions LLC within six months to review ASDB's compliance with the recommendations.
Newmark said the consequences extend beyond the agency's finances to students and families who relied on ASDB's services.
“They had community and access to specialized teachers and all of the related services that they needed to be able to thrive in school,” Newmark said. “I hope that there will be some opportunities for those students to have what they're entitled to get under the law.”
