LEGISLATIVE JOINT AUDITING - EDUCATIONAL INSTITUTIONS

The Legislative Joint Auditing-Educational Institutions Subcommittee convened for a meeting where members began with a prayer led by one of the committee members, expressing gratitude for the opportunity to serve the people of Arkansas and asking for wisdom in their stewardship over educational institutions. Following the opening remarks, the chair called for the adoption of the minutes from the September 10th, 2026 meeting. A motion was made and seconded, with all members voting in favor, thus adopting the minutes. The committee then proceeded to review six education audit reports. The first report discussed was on the Texarkana School District, which had two findings deferred from a previous September meeting. The first finding related to a delay between drawing down Magnet Schools Assistance Program funds and spending them, leading to an improper drawdown of federal aid. Superintendent Boy Jackson and President Jesse Buchanan were present to address these issues. Superintendent Jackson explained that the district has implemented additional safeguards to ensure proper protocol is followed in future fund draws. The second finding involved fraudulent ACH payments totaling $286,000 made between April and June 2025 due to unverified changes in vendor bank information. Of this amount, only $58,000 was recovered after the district notified their financial institution. Jackson stated that the individual responsible for not following protocol was placed on leave and eventually terminated. The district has since added additional layers of verification processes involving verbal confirmation from a verified individual to prevent such incidents in the future. The committee members confirmed that while the procedures were correct, they were not followed properly in this case, leading to the fraudulent payments. Superintendent Jackson assured the committee that these issues have been addressed with new safeguards and protocols in place.