More than a decade after the Virgin Islands Inspector General flagged critical mismanagement of Education Initiative Fund dollars, a newly released audit reveals the problems not only persist, but have grown more severe.
According to the Inspector General’s 2025 report, the Virgin Islands Education Department misused more than $5.1 million in EIF money between October 2019 and September 2022, directing funds meant to benefit public school students instead toward hurricane debris removal, promotional merchandise, office expenses, and unrelated contractor payments. Of the $6.3 million drawn from the fund during that period, only a fraction made it to classrooms.
Auditors found that VIDE repeatedly failed to comply with the law requiring $50,000 annual allocations to each public school by October 15. Some schools never received their funds at all, while others saw disbursements delayed for months, undermining the purpose of the EIF, which was established by law in 1998 to channel Virgin Islands Lottery proceeds directly into student enrichment.
“VIDE did not administer the Education Initiative Fund in accordance with Act No. 6255,” the audit states. “The majority of the funds were not used for their intended purpose of directly benefiting students and improving educational outcomes.”
Instead, roughly $3.6 million was spent on hurricane cleanup services — costs that, according to the audit, should have been borne by disaster recovery appropriations, not student-directed dollars. Another $1.2 million went toward items like T-shirts, medals, banners, and other promotional materials with little to no documentation linking them to actual school initiatives.
Auditors also cited poor internal controls, weak record-keeping, and insufficient oversight by top-level officials. One purchase order reviewed included a $13,500 payment for trophies and medals, but no justification or final accounting. In another case, $24,500 in EIF funds were used to purchase chairs for a VIDE office conference room.
The Inspector General’s findings echo concerns raised more than a decade ago. A 2011 audit warned that EIF funds were being inconsistently allocated, poorly tracked, and at risk of being treated as a “slush fund” for noninstructional expenses. At the time, the Inspector General recommended a clearer distribution process, strengthened accountability, and detailed reporting requirements. Many of those recommendations were either not implemented or not sustained.
In a formal response included in the 2025 report, VIDE officials accepted all 15 of the audit’s recommendations and acknowledged the breakdown in internal controls. Education Commissioner Dionne Wells-Hedrington, who was nominated for the position in December 2022, pledged that the department will work swiftly to improve fund management and restore public confidence.
“We take these findings seriously,” Wells-Hedrington wrote. “We are committed to ensuring that the EIF is administered transparently and that funds are allocated directly to schools in a timely manner.”
The commissioner added that steps have already been taken to review vendor agreements, implement clearer guidelines for fund use, and enforce compliance with the Oct. 15 school disbursement deadline.
Still, the audit paints a picture of a department that has struggled for years to prioritize student needs in its financial decisions, even when funding was earmarked specifically for that purpose. While auditors noted that some expenditures may have been well-intentioned, the widespread failure to document or justify them suggests a deeper culture of weak oversight and blurred priorities.
In several cases, payments were issued with minimal description or follow-up. A $45,000 expense, for example, listed only “graduation activities” as its purpose, with no itemized breakdown provided. Other EIF checks were made out directly to contractors without any proof of student benefit or school involvement.
The Inspector General’s Office concluded that unless the department makes structural changes, including enforcing procurement policies and documenting all school-based allocations, the Education Initiative Fund will continue to fall short of its mission.
