BIRMINGHAM, Ala. (WIAT) – When President Barack Obama came to speak at Birmingham’s Lawson State Community College in 2015, headlines suggested his visit could be a “potential game-changer” for the school and its surrounding neighborhood.
Obama played down that notion in his remarks at the historically Black community college, saying that while he may be able to help “a little bit,” the real “game-changers” were already on the ground in Birmingham, making a difference every single day.
In the seven years since the president’s visit, change at Lawson State has come slowly.
A decade of state audits shows that the community college has struggled to maintain proper internal control of its finances. For some students, the reports suggest, the issues have meant financial aid refunds that have come late or been in the wrong amount. And while those students struggled with delayed and miscalculated payments, the college was violating state law on the disposal of property, according to the audits, selling surplus vehicles to former and current employees for as little as $55.
At each turn over the last 10 years, Lawson State Community College has chosen not to dispute the financial issues outlined by state auditors. Universally, college officials have agreed with auditors’ findings and promised to take “corrective action,” although some of the same issues have recurred year after year.
‘Lack of internal control’
Reports filed annually from 2012 until 2022 show that auditors with the Alabama Department of Examiners of Public Accounts cited Lawson State Community College nearly two dozen times for issues involving its finances.
As early as 2012, college officials “misstated” Lawson State’s revenues because of “a lack of properly designed and implemented internal control over financial reporting,” auditors wrote. The same issue would surface again in the state financial watchdog’s 2017 and 2018 audits of the college.
Nearly a third of the issues cited by auditors involved federal financial aid funds handled by the school.
A 2016 audit was the first to note problems with the handling of financial aid at Lawson State. That year, auditors chose 25 students that appeared to meet the criteria for a return of financial aid fund for testing. Eleven of the returns were not calculated correctly. The school had completely neglected to complete one return.
“The established review process did not detect these errors,” the report said.
The next year, auditors selected another 25 students for testing. Fourteen returns were not calculated correctly – three more mistakes than the year before.
In 2018, of 40 returns, half were incorrectly completed.
In the state’s latest audit, released earlier this month, the school’s refund “error rate” had fallen to 25%.
Lawson State has also repeatedly been cited for failing to return excess or leftover financial aid funds to the government. A 2021 audit report said that the college had failed to return more than $130,000 of financial aid money to federal education officials as required by law. Financial aid checks dating back to 1998 were found at the college, auditors said.
The state’s latest report shows that in the majority of sampled cases (63%), college officials also failed to return financial aid funds within the time period required by law.
The most recent audit of the college also reveals that while students dealt with financial aid fiascos, Lawson State employees – former and current – were benefitting from violations of state law regarding the disposal of state property.
In Alabama, state law requires that surplus state property be disposed of through auction or a sealed bid. At Lawson State, however, auditors determined that officials were selling surplus vehicles to former and current college employees at heavily discounted prices.
“During the review of capital asset deletions, it was determined seventeen vehicles were not disposed of properly,” the report said. At least nine of the vehicles were sold to employees, the report concluded, for prices as low as $55.
Other old equipment valued at over $540,000 had also been deleted from college records without any documented reason the report said.
As was the case with previous audits, Lawson State Community College Officials agreed with the state’s findings in its 2022 report.
The college also outlined plans to build on “significant progress,” particularly related to “identifying and correcting issues causing discrepancies in the bank reconciliations and fraud detection,” according to its response.
In the end, though, Lawson State did not dispute the state audit. As it has before, it promised to do better.
“Management agrees with this finding and will take corrective actions,” the university wrote.
Attempts to reach representatives at Lawson State for comment were unsuccessful Thursday.