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BUFFALO, NY - For months 2 On Your Side has been reporting on some of the excessive spending within Buffalo Public Schools -- from tens of thousands of dollars going to fund lavish hotel stays for staff members for out-of-area conferences and money going to employees on administrative leave who do no work, but still get paid.

At the start of this school year, Buffalo schools say it had a deficit of $54 million. The district says rising costs include health insurance costs and pension payments. The district says it has been trying to address the deficit by closing schools and cutting staff.

But, in a recent newsletter from school board member Carl Paladino, city comptroller Mark Schroeder and Paladino have had talks about the city possibly doing an audit on the school district's spending.

Paladino outlined numerous issues that he felt were problems within the school district in regards to how the district spends money. For example, how grant funding is spent; and Paladino suggests all of the district's spending should be examined.

But, the comptroller says he needs to have more specific areas of concerns to look into, rather than review all of the district's spending.

Schroeder says in an email, within the body of the newsletter, "If my office, as you suggest, were to pursue an audit of the disbursement of grants by the school district, we would take a targeted approach in order to maximize our limited resources. Rather than looking at all grants, we would instead select a grant or grants where there is the most potential for exposing waste, fraud or, abuse."

Schroeder added: "Therefore, if you could provide more information on which specific grants you are most concerned about, as well as what types of improprieties or illegalities you think may be associated with these grants, it would assist us in determining whether to pursue an audit."

Paladino did not return a phone call from 2 On Your Side whether he will be more specific about his claims.

On Monday, state comptroller Thomas DiNapoli released a report saying the city's finances are improving because of good budgeting. But the review did not focus on Buffalo schools or the district's spending, but rather its financial status.

DiNapoli's office says that, "any potential review of city finances could also include reviewing the school district's finances."

This is because the district's financial impact can impact the city's financial standing.

The state says that there is no review at this time of Buffalo Schools of the City of Buffalo on how either spends its money.

This comes as DiNapoli released a report Tuesday saying that "New York's school districts have faced major fluctuations in their federal and state aid over the last decade and revenue growth was nearly flat the last three years, averaging only 1.3 percent."

The report went on to say: "In describing the challenges facing school districts, the report highlights the impact of federal American Recovery and Reinvestment Act (ARRA) funds, and the temporary effect they had in offsetting the impact of the state's reduction in school aid when it was dealing with its deficit problems."

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