The Vancouver School Board overcharged the provincial government by an estimated $1.4 million this school year, according to an audit of the district’s online program known as the Vancouver Learning Network.

The mistake, attributed to problems with data management, is also projected to cost the district $900,000 in next year’s budget, which calculates to a $2.3 million error over two years.

The news worsens the district’s bad financial position - it faces cutting $16.33 million from its 2010/11 budget - subject to a report by a special adviser that's expected to be delivered to the government June 3. Now it must pay back the money the government was overcharged.

Board chair Patti Bacchus called the financial hit staggering. “It sounds like other districts are in a similar boat, so I’m not sure it’s a human error so much as a process error, but we need to make sure that the processes, the checks and balances, are in place because this is going to create a real difficulty for all of us,” she said Tuesday.

Laurie Anderson, associate superintendent of continuing and international education, told trustees about the problem at Monday night’s management coordinating committee meeting.

The VLN is undergoing a “compliance audit,” which district programs are periodically subject to by the provincial government to ensure sure student numbers submitted by districts match provincial funding.

Anderson updated trustees before the audit’s completion because of its adverse effect on the 2010/11 budget, which must be passed by month’s end. The $2.3 million projection over two years is the worse case scenario to ensure the mistake is adequately covered in the budget.

Based out of John Oliver secondary, the Vancouver Learning Network offers virtual schooling. Known as “distributed learning” in education-speak, it evolved out of text-based correspondence courses, but now primarily involves online learning.

Enrolment has doubled in the past three years with more than 7,000 students taking courses, according to district figures. It’s the largest kindergarten to Grade 12 distributed learning program in the province and possibly Canada, according to Anderson who noted its explosive growth in recent years created difficulties in data management.

Students can register any day of the year and start immediately unlike in standard schools. Data collection is required for each student. When auditors arrived, the district was also switching from its old data management system to a modern one.

“Frankly, there were situations where data was duplicated in some cases,” Anderson said.

Data input problems were also found where dates, signatures and documentation were missing.

The VSB is overhauling its data management to avoid such problems in the future. Anderson said staff also need more training. The new information system, meanwhile, doesn’t allow duplication.

Anderson expects the anticipated continual growth in VLN in coming years will offset some of the costs from the audit.

Audits of school programs around resulting in penalties for school districts is not uncommon. In an audit of the North Vancouver school district’s special education program this year, a review of 454 student files led to a $600,000 penalty due to record keeping errors.

The Saanich school district was dinged for $300,000 following an audit of its distributed learning program.

noconnor@vancourier.com