Revealing mistake: When Chucky is sawing Michelle in half, as her body starts to split, a few times you can briefly see where her body has been "pre-scored" to split apart as the chainsaw moves down.
Revealing mistake: After the credits, we see a wideshot of a snowy Hackensack, but the snow is just a digital overlay, since it only seems to be falling directly in front of camera and nowhere else in the shot.
Answer: They were blamed for the death of Jake's foster brother, which was deemed a terrible accident, and they were sent to the reform school as a punishment. Presumably, when they had to leave the reform school given what happened, they were instead given community service as punishment.
TedStixon