Audit rips Michigan Youth Challenge Academy

LANSING – A state-run program for high school dropouts couldn't account for thousands of dollars received from cadets' families and through fund-raising events and failed to provide cadets in the residential program with meals that satisfied requirements for daily calories, according to a state audit released today.

Michigan Auditor General Doug Ringler said the Michigan Youth Challenge Academy, run by the Michigan Department of Military and Veterans Affairs under an agreement with the National Guard Bureau, "had not safeguarded or properly accounted for cash received from cadets' families and various fund-raising activities, increasing the risk for fraud, waste, and abuse."

The academy for troubled adolescents near Battle Creek, which spent $3.6 million in 2013 and $3.9 million in 2014, couldn't document how it spent $86,250 received from cadets' families and fund-raising events between January 2012 and June 2014, the audit said.

"MYCA collected $100 from each incoming cadet's family to assist with the cadet's incidental expenses, such as medical bills and co-payments, testing fees, transportation costs, and postage," the report said. "Throughout our audit, we received conflicting information from MYCA management regarding the nature and disposition of the funds collected."

Some officials said unused funds were returned to cadets upon dismissal or graduation; others said they were non-refundable; the audit said. The funds weren't deposited in a bank but kept in a safe that many at the academy had access to, the audit said.

MYCA, which has the equivalent of 32 full-time employees, has stopped collecting cash from cadets' families as of Jan. 5, the department said in a response included with the audit.

"All remaining funds from the previous cadet class were accounted for and refunds issued to families," the department said in the response.

The department said it also agrees with other recommendations in the audit report and has taken steps to address the problems.

Maj. Gen. Gregory Vadnais, adjutant general of the Michigan National Guard and director of the department, said the audit "ignited a chain reaction of improvements at the Michigan Youth Challenge Academy," including replacement of the academy's director.

"Constructive feedback of the program helped me identify opportunities for program improvement," Vadnais said. "As a self-correcting organization we are always looking for ways to improve, and in this case we made some immediate changes to get the program back on track."

Located on the campus of the Battle Creek Veterans Affairs Medical Center. MYCA provides military-based training, education, and supervised working experience through community service. Male and female high school dropouts between 16 and 18 are eligible for the program, provided they are drug-free, unemployed and not involved in crime. The 17-month program, has a five-month residential phase followed by a 12-month mentoring phase and is 75% funded by the U.S. Department of Defense.

Among other findings the audit said MYCA:

■ Didn't measure its own performance and failed to document that cadet graduates had completed 1,091, or 64%, of 1,700 tasks considered core components in the program. "As a result, MYCA could not ensure that cadets met all graduation requirements or that program results reported to (the National Guard Bureau) were accurate."

■ Did not provide male cadets with their recommended calorie intake and failed to provide male or female cadets with consistent levels of calories throughout the day. The USDA recommends adolescent males get 3,200 calories per day but they only received an average of 2,740 per day at the academy, the audit said.

■ Failed to monitor its education services provider, Marshall Public Schools, didn't keep a copy of the contract, and didn't recover a $119,000 surplus the contractor was left with in 2014, despite the fact it was required to by the contract.

■ Didn't meet staffing or training requirements for its National Youth Challenge Agreement with the federal government and had a staff turnover of more than 60%, partly due to low morale.

Contact Paul Egan: 517-372-8660 or pegan@freepress.com. Follow him on Twitter @paulegan4.