Errors led to Baltimore County Schools overpaying $823,000 to former employees

An audit by the Baltimore County Public Schools Office of Internal Audits found that the school system erroneously paid over $823,000 to former employees who were no longer working for the district.

The audit examined payments made between January 2020 and March 2023. It found that 174 “separated employees” were overpaid a total of $726,568.34. An earlier investigation had also identified an additional $87,053.84 in overpayments, bringing the total overpayments to $823,622.18.

The audit blamed these improper payments on a “lack of internal controls” that allowed separated employees to remain on the payroll after leaving their jobs. It stated that without corrective action, these control deficiencies could lead to financial liability, reputational damage, and potential fraud for the school district.

In response to the audit findings, Baltimore County Public Schools said it has developed a corrective action plan and is working to implement stronger internal controls to prevent similar errors going forward. To date, the district has recovered $103,764 of the erroneous payments. However, some overpayments cannot be collected due to statutes of limitation under Maryland law.

The audit recommended that the district identify any additional losses beyond salary payments, such as pension contributions and health insurance costs. It is unclear if Baltimore County Public Schools has fully quantified these additional costs. In a statement, the district said it is confident that the new internal controls will prevent future payroll errors.

Some government accountability advocates have called for broader reforms and tighter oversight of Baltimore County Schools’ finances in light of these audit findings. However, the district maintains that the improper payments were an anomaly that will be addressed through improved processes and controls around payroll and employee separation procedures.