Audit of the Division of Administrative Law Appeals Objectives, Scope, and Methodology

An overview of the purpose and process of auditing the Division of Administrative Law Appeals.

Overview

In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor (OSA) has conducted a performance audit of certain activities of the Division of Administrative Law Appeals (DALA) for the period July 1, 2017 through December 31, 2019.

We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Below is a list of our audit objectives, indicating each question we intended our audit to answer; the conclusion we reached regarding each objective; and, if applicable, where each objective is discussed in the audit findings.

Objective	Conclusion
Did DALA’s General Jurisdiction Unit (GJU) take the necessary measures to address the issues identified in our previous audit report (No. 2014-0345-7S)?	No; see Findings 1, 2, 3, and 4
2.     Did DALA’s Bureau of Special Education Appeals (BSEA) take the necessary measures to address the issues identified in the audit report dated February 2, 2018 from the US Department of Education’s Office of Special Education Programs (OSEP)?	Yes
Does BSEA administer its hearings in compliance with all applicable federal and state requirements for timelines of hearings: Section 615(c)(2) of the Individuals with Disabilities Education Act (IDEA); Section 300.515 of Title 34 of the Code of Federal Regulations (CFR); Section 28 of Title 603 of the Code of Massachusetts Regulations; and Rules III, IX.E, and XVI of the BSEA Hearing Rules for Special Education Appeals?	No; see Findings 4 and 5

 

We gained an understanding of the internal control environment we deemed significant to our audit objective through interviews; observations; and review of applicable policies and procedures, the internal control plan (ICP), and actual case files. We conducted inquires with the chief administrative magistrate and the BSEA director.

Our first objective, related to the findings in OSA Report No. 2014-0345-7S, included the following issues:

• DALA does not have written policies and procedures for case-management activities.
• DALA had not developed an ICP or conducted periodic risk assessments.
• DALA had not complied with statutory reporting requirements.
• DALA had not adopted internal controls to address its case-management problems, which included the following:
• The number of open cases was overstated.
• DALA did not send acknowledgment letters promptly.
• The backlog of open cases was increasing.
• The average case duration was increasing.
• DALA did not maintain copies of draft decisions.

For this objective, we performed the following procedures:

• We requested case-management policies and procedures from DALA officials to determine whether DALA had developed policies and procedures.
• We obtained and reviewed all annual reports filed and submitted by GJU to the Legislature since the previous audits (for the years 2014 through 2019) to determine whether DALA had filed the reports and included all the required elements.
• We reviewed and evaluated the 2019 ICP based on the criteria established by the Office of the Comptroller of the Commonwealth’s 2015 Internal Control Guide, which includes the following eight elements: internal environment, objective setting, event identification, risk assessment, risk response, control activities, information and communication, and monitoring.
• To test whether the open-case list remained overstated as the previous audit had found, we tested a statistical random sample of 60 of the 3,161 open cases from the audit period and examined whether they were closed but remained on the list. The sample comprised 19 Contributory Retirement Appeal Board (CR) cases, 1 Office of the Attorney General—Fair Labor Division (LB) case, 2 Department of Early Education and Care (OC) cases, and 38 Executive Office of Health and Human Services—Rate Setting (RS) cases.
• To determine whether DALA sent letters of acknowledgment to the parties involved in each case within five days of receiving appeals, we selected a statistical random sample of 60 of the 1,720 cases opened during the audit period and reviewed the case files for the sample. The sample comprised 43 CR cases, 5 LB cases, 1 miscellaneous (MS) case, 1 OC case, 2 Department of Public Health (PH)—Emergency Technicians (PHET) cases, 4 Board of Registration in Medicine (RM) cases, 3 RS cases, and 1 Department of Veterans’ Services (VS) case.
• We analyzed the open-case list from DALA’s 2019 annual report to determine whether open cases were increasing or decreasing.
• To determine whether the average duration of cases had increased or decreased since the previous audit, we selected a nonstatistical sample of 60 of the 722 cases opened and closed during the audit period and calculated the length of time between appeal receipt and disposition. The sample comprised 34 CR cases, 10 LB cases, 2 MS cases, 4 OC cases, 1 PH case, 2 PHET cases, 2 PH—Nursing Aides (PHNA) cases, 2 RM cases, and 3 VS cases.
• To determine whether DALA documented decisions, we selected a nonstatistical random sample of 40 of the 357 cases for which DALA issued a final decision during the audit period, and we examined the case files for evidence that decisions had been issued with management approval. The sample comprised 37 CR cases, 1 LB case, 1 MS case, and 1 VS case.

Our second objective concerned the seven findings from OSEP’s 2017 report. These included four findings regarding BSEA’s Hearing Rules:

• BSEA did not have procedures in place to ensure that hearing officers granted extensions of the 45-day timeline for issuing final decisions in due process hearings.
• BSEA’s Hearing Rule IV, which allows parties to a hearing to move the hearing off calendar (i.e., remove it from the hearing schedule calendar and work offline), permitted parties to delay scheduling of a hearing for up to six months in the absence of a specific extension of the 45-day timeline.
• BSEA did not ensure that due process complaints filed pursuant to Section 615(k)(3) of IDEA and 34 CFR 300.532(a) were expedited.
• BSEA’s Hearing Rule III.C operated as an automatic 30-day postponement of any previously scheduled date. Specifically, it allowed hearing officers to grant 30-day postponements of some previously scheduled dates in the absence of a party’s request for a specific extension of the 45-day timeline for issuing a final decision in the hearing.

The findings also included three findings regarding the policies and procedures of the Department of Elementary and Secondary Education (DESE):

• DESE did not ensure that the public agencies involved in due process hearings implemented hearing officers’ decisions in a timely manner.
• Once the state set aside issues in state complaints that were also the subjects of due process complaints, DESE did not have a mechanism for resolving those issues when the hearing officer dismissed, or did not rule on the substance of, the due process complaints.
• The state had procedures that set aside state complaints when the parties were engaged in mediation under 34 CFR 300.506, regardless of whether the parties had agreed to extend the 60-day complaint resolution timeline to engage in mediation. Further, once DESE had set aside state complaints to allow the parties to engage in mediation, the state did not have a process to ensure that if mediation was not successful in resolving the disputes, the complaints were resolved within 60 days after they were filed.

To achieve our objective, we performed the following procedures:

• For the four BSEA findings in the OSEP report, we reviewed the BSEA Revised Hearing Rules issued in March 2019 to determine the following:
• Had BSEA modified Hearing Rule III to ensure that extensions complied with 34 CFR 300.515?
• Had BSEA removed the off-calendar hearing rule?
• Had BSEA modified its Hearing Rules regarding expedited hearings to comply with 34 CFR 300.532?
• Had BSEA removed Hearing Rule III.C regarding unilateral postponements?
• For the three DESE findings in the OSEP report, we reviewed DESE’s policies and procedures to determine the following:
• Did DESE have procedures to ensure that it implemented hearing officers’ decisions in a timely manner?
• Had DESE developed a mechanism for resolving state complaint issues that were also the subjects of due-process complaints?
• Did DESE have procedures addressing the resolution of state complaints to ensure that they were resolved within the 60-day period when mediation was not successful?

We also obtained and reviewed the letter from DESE’s commissioner to OSEP responding to the audit findings in the OSEP report, and we contacted the director of DESE’s Problem Resolution Department to determine whether BSEA and DESE jointly shared information to avoid duplication of caseloads.

To achieve our objective related to BSEA administering its hearings in compliance with all applicable federal and state requirements for hearing timelines (Section 615[c][2] of IDEA; 34 CFR 300.515; and Rules III, IX.E, and XVI of the BSEA Hearing Rules for Special Education Appeals), we performed the following procedures:

• We selected a nonstatistical judgmental sample of 40 of the 293 cases opened during the period March 1, 2019 through December 31, 2019¹ and reviewed the case files to determine the following:

• Did the files contain response filings by the opposing parties before the 10-day deadline required by Sections 615(c)(2)(B)(i)(I) and (ii) of IDEA and Rule I.D of the revised BSEA Hearing Rules for Special Education Appeals?

• Did the files contain case postponements issued in compliance with 34 CFR 300.515 and Rule III of the revised BSEA Hearing Rules for Special Education Appeals (i.e., requested and granted in writing with specific lengths of extensions)?

We used a combination of nonstatistical and statistical sampling methods for our audit objectives and did not project the results from the samples to the populations.

Data Reliability

We assessed the reliability of the case data from Time Matters by the following means:

• We performed basic reasonableness checks on the data by checking for duplicate and missing entries and data entry errors in the following populations: BSEA hearing requests from March 1, 2019 through December 31, 2019; GJU cases opened from July 1, 2017 through December 31, 2019; and GJU open cases as of December 31, 2019.
• We reviewed existing information about the data and the system that produced them and interviewed agency officials who were knowledgeable about the data.
• We reconciled agency-generated reports of the populations against reports we generated to ensure that the totals were accurate. For both BSEA and GJU, from the list of open cases from our audit period, we selected a random sample of 20 cases and traced them to the hardcopy files, and we also selected 20 hardcopy files and traced them to entries on the list of opened cases.
• We obtained and reviewed the actual case files’ source documents for our testing.

Based on the work performed, we determined that the information obtained for our audit period was sufficiently reliable for the purposes of our audit work.

1.     This period was after the Hearing Rules were revised, effective March 1, 2019, to incorporate the OSEP audit recommendations.

Date published:	April 7, 2021