We're appalled by news that the now-former parent organization of Mountain Lake Academy - the Lake Placid school and home for troubled boys that has roots going back to 1965 - stands accused by the state comptroller of soaking taxpayers to the tune of $7.7 million. We don't want to presume guilt, but it's not looking good for the officials of Windwood Meadow. The responses enclosed with the audit don't included any outright denials. Rather, Mountain Lake has severed all ties with Windwood Meadow, and Mountain Lake's executive director told state auditors she had expressed fiscal concerns internally back in 2007.
The agencies responsible for these millions of missing tax dollars are the State Education Department and the Office of Children and Family Services, and the comptroller says they were asleep at the switch.
Check out these numbers, cited in the audit: Windwood Meadow paid its CEO more than $480,000, plus a $14,000 vehicle allowance, plus $30,000 for charitable donations, plus a $250,000 loan that they excused payments on. And that's just him. Windwood Meadow reportedly paid a board president $180,000 over three years and 12 other board members $127,334 over a two years, paid $278,963 to three board members for serving as consultants (although auditors found no evidence they did any consulting) and almost $1 million in other inappropriate or unsupported expenses.
That puts the term "nonprofit corporation" in a whole new light.
These two state agencies should be raked over the coals for writing checks of that magnitude to a non-government school group without scrutinizing what the money was being used for.
Meanwhile, it's good the Lake Placid school has managed to separate itself from Windwood Meadow, but it'll take a while to shake all the clinging dust of that organization from its feet.
This case also illustrates a pitfall to the state farming out social services instead of running them itself. While there are times when the state can save money doing so, it must be extra-attentive and accountable. Many non-government groups are highly responsible, but some will try to milk a little bonus comfort out of the taxpayers. And some - like Windwood Meadow, apparently - go in whole hog on the fleecing and get away with it for years.