Jackson Free Press

The Jackson Free Press has obtained Mississippi Department of Education documents that raise concerns about how Jackson Public Schools spent nearly $1.3 million in federal No Child Left Behind funds. In early June of this year, the state education office presented JPS with a report saying JPS "misappropriated federal funds" in its transaction with a tutoring company, Gray & Associates, run by the police chief of Terry.

Days later, however, MDE officials backed off that assertion, took back the document and distributed a second citation letter that no longer included that specific language. This was an oddly swift move for the department, considering it had taken nine months to develop the report from a September 2008 audit of the district.

At issue was the district's use of funds for Supplemental Educational Services, which the No Child Left Behind law requires the district to make available to all low-income students at schools that do not meet academic progress targets two years in a row. By federal law, districts must allow parents to select a tutoring provider for their child from a list of state-approved, private companies and then pay these companies at an agreed-upon rate, using federal funds earmarked for SES.

In Mississippi, SES providers must submit regular invoices to school districts based on the number of students they tutor each day, all of whom specifically chose that agency. For each school district, MDE sets a cap on the amount that the district can pay an SES provider for tutoring one student.

In JPS, that cap was $1,242 per pupil for 2007-2008.

During the 2007-2008 school year, JPS paid $1.8 million to SES providers to tutor 1,455 students from 10 middle and high schools. Gray & Associates, owned by Terry Police Chief Juan Gray, dominated the SES business in Jackson that year. Gray received $1.3 million from the district in 2007-2008 for tutoring 1,060 kids at the seven eligible middle schools—Blackburn, Brinkley, Siwell, Hardy, Whitten, Chastain and Peeples.

Gray may have had an edge in the tutoring rush, though. Parents from at least two middle schools, Whitten and Blackburn, received SES selection forms with Gray & Associates' name already typed onto the form.

At four of those schools, Gray's bill to the district exceeded what he could charge under the district's contract, according to JPS reported submitted to the Mississippi Department of Education.

At Blackburn, JPS reports that it paid Gray $203,688 for tutoring 119 students. With a $1,242 per-pupil cap, though, JPS should have paid only $147,798 for that many students. The reports show similar discrepancies at Chastain and Siwell, totalling $117,790 that Gray received beyond the terms of his contract.

A Tale Of Two Citations

Despite the glaring discrepancies in the report JPS submitted to the state—leaving more than $100,000 at question—the state has shown remarkable patience in addressing the district's SES program. In September 2008, state evaluators monitored JPS' SES program. After reviewing district records from Sept. 8-12, evaluators took until early June—a full nine months later—to mail a list of citations to the district.

During that nine-month interval, evaluators found time to conduct a monitoring visit on April 1, 2009, for the 2008-2009 school year. After only a two-month turnaround, that 2008-2009 report arrived at JPS, bearing one minor citation—and arriving before the previous year's report.

The 2007-2008 report was a different beast, however. In early June, the state delivered a report stating that JPS "misappropriated federal funds for the provision of Supplemental Educational Services."

The district, according to this report, "failed to verify the actual fee for services provided by Gray & Associates, Inc. before making payment for invoices received from the provider."

"Evaluators also found that (JPS) paid for services that were not provided to eligible students, in addition to the (district) paying for the provision of services in advance," the report said.

The original report also cited the SES provider selection forms that had provider names already typed on them.

Days later, though, state officials withdrew the first 2007-2008 report and, on June 16, mailed a second version. This second 2007-2008 report did not include many of the more detailed and damaging claims in the earlier report, limiting its citation to whether ineligible students received SES and instructing the district to "revisit its procedures." And the second report does not mention Gray & Associates.

Quentin Ransburg, the MDE official who mailed the second report on June 16, said JPS should not have received the earlier version of the report, which he called a "draft" and "inaccurate."

"The draft document was mailed, and it shouldn't have been mailed," Ransburg said. "It was an error."

When asked what made the first report inaccurate, Ransburg was vague. "That was not an accurate reflection of what we wanted (JPS) to do and what we found as a result of looking at all of the records," Ransburg said.

"Of course, internal controls needed to be corrected, but services were provided to the kids," Ransburg said. "There was nothing to support what was written in the draft."

The first report does not allege that SES providers did not tutor students, however, only that the district paid Gray & Associates without verifying the actual fee for services, that JPS paid for services in advance and that it paid for services "that were not provided to eligible students." When asked again what state evaluators found in the days following the first report's distribution that rendered these other citations inaccurate, Ransburg just reiterated that his office had found the first report to be inaccurate without further explanation.

"I regret that you have the draft," Ransburg said. "That's not a document that we wanted the public to have. It's not something that we intended to send to the district."

Ransburg referred further questions to MDE's Communications Office.

On July 16, MDE spokesman Pete Smith explained by e-mail that "because the records were not well organized, (evaluators) could not conclusively determine if the district failed to verify for the actual fee for services or the district paid for services in advance."

Before receiving payment, SES providers are supposed to submit a dated invoice, along with sign-in sheets showing student names, plus hours and dates tutored.

Smith also suggested that the state's nine-month delay in issuing its citations was a consequence of being overworked. "We have 152 school districts and many federal programs to monitor and limited staff and resources to perform the duties," Smith wrote.

"With greater staff and resources available, we could provide information in a more timely manner."

Fee for Services?

If the first report was accurate, it would hardly make JPS unique. Gray & Associates ran afoul of federal regulations in four other school districts during the 2007-2008 school year, according to a monitoring report that Ransburg's office mailed to the company Dec. 30, 2008. Gray & Associates either charged for tutoring ineligible students, charged the district in advance or charged for services on a date that it did not actually hold tutoring, the report said. The report cited Gray & Associates for its work in Hazlehurst, Quitman County and Wilkinson County but did not mention JPS.

Chief Juan Gray, founder and executive director of Gray & Associates, confirmed to the JFP that MDE has not cited his company for its work with JPS, nor has the district contacted him about possible overbilling. Gray also disputed his citations for other districts, arguing that his agency had not falsified invoices for dates that it did not provide services. Gray & Associates paid back $11,537 to the Wilkinson County School District, he noted, after the district discovered that he had overcharged for SES.

His agency's over-billing was the state's fault, Gray said. "The state came in and changed the rules and regulations of how SES was going to be performed," Gray told the Jackson Free Press earlier this month.

Sometime in the middle of the 2007-2008 school year, MDE demanded that districts pay SES providers according to a maximum per pupil rate, Gray said. This was a new obligation, he said, and conflicted with his existing contracts, which set a flat annual fee—regardless of how many students Gray tutored—to be paid out in fractions.

Ransburg disputed Gray's characterization, however. "It should've been the practice all along," he said. "Fee for services."

The MDE monitoring report instructs Gray & Associates to pay back to the districts the difference between what it received and its correct fee for services. Gray & Associates has already repaid $6,242 to the Yazoo City Municipal School District, along with its Wilkinson County payment. Gray has disputed his citation for Hazlehurst City, however, and claims that district still owes him $15,091.

Gray is no stranger to conflict with the state. In a recurring battle, Gray has sued MDE twice and is currently planning to sue the department again for forcing him to reapply for state approval as an SES provider.

"I'm a small fish in a big frying pan," Gray said. "I'm a small non-profit agency that has pretty much dominated the SES listings. Most of the schools that are in SES have always chosen our agency to come into their school district and make a difference."

MDE ultimately reinstated Gray & Associates, along with all other approved SES providers before the 2007-2008 school year, but Gray's suit was thrown out of Hinds County Circuit Court because it concerned a discretionary action by MDE, which legally gives the department immunity.

Gray says he plans to sue the state again for asking him to reapply, after he missed a renewal application deadline by minutes.

Fuzzy Memories

JPS Superintendent Lonnie Edwards, who took his position this school year, said on July 7 that he was aware of citations for the district's SES program during 2007-2008.

"That is something that is correctable, and we have worked at trying to get that matter resolved," Edwards said.

Edwards would not give details about whether the district would seek repayment if it was overbilled, however. "It depends on what the state department asked and the amount," Edwards said. "I'm not sure what that amount was, and I'm just aware of it, and at the same time I was advised by the state department that we could work with that matter and correct it and move on.

"We're probably in the correction mode and making sure that infractions of this nature don't occur," Edwards added. "Most times it was no intent on anybody's part."

JPS board members gave differing responses on their knowledge of the state citations. Board President Sollie Norwood and Vice President Ivory Phillips both said that they did not know of any issues with the district's SES program.

"No, I'm not aware of that," Norwood said Friday. "We'll have to verify to make sure that it's rectified."

On Friday Board member H. Ann Jones referred all questions to board attorney Dorian Turner. The same day, Board Secretary Delmer Stamps confessed to being out of touch with the issue. "I remember the state department coming in and taking a look at one of our title programs back in the fall, but I don't recall getting a report about it at the time," Stamps said. "I'm just not up to speed on that one."

Reached for comment Monday, board member Jonathan Larkin said that he has been "advised that there are some noncompliance issues."

"I've also been advised that the district and appropriate staff members are handling these and reporting to the state department," Larkin said.

"We expect, as board members, to receive a report once this has been handled."

Larkin said he had no knowledge of the first state report citing the district for misappropriating federal funds, however.

Cynthia Johnson-Armstrong, executive director of state and federal programs for JPS, said Friday that she had no knowledge of any issues arising from the state's September 2008 audit. She assumed her current position after the audit, in October, she said. She referred questions about the district's SES implementation to Royce Smith, the district's SES coordinator. Reached at home, Smith said Tuesday that he needed Edwards' permission to discuss "anything that relates to Supplemental Services at all."

"I've been instructed to refer all matters to the superintendent," Smith said.

District officials had 30 days from their receipt of the state report, June 17, to return responses to each citation. Armstrong-Johnson said that the superintendent's office handled the district's responses. After the initial conversation July 7, Edwards did not return repeated calls for comment last week and this week.

The Jackson Free Press is continuing the investigation into this issue and has requested numerous related documents. Follow developments in this story at jacksonfreepress.com and in the JFP Daily (jfpdaily.com). Contact reporter Ward Schaefer at [e-mail missing] or 601.362.6121 ext. 21.

Previous Comments

ID

149929

Comment

Oh yeah. Someone's buddy got caught in the till. Nothing will happen.

Author

Ironghost

Date

2009-07-22T11:24:29-06:00

ID

149933

Comment

I got to agree with you, if they are typing the name of his company on the forms for selecting a provider already, the fix is probably in.

Author

WMartin

Date

2009-07-22T12:18:38-06:00

ID

149934

Comment

It's strange that when Delmer Stamps and Sollie Norwood were contacted about this matter as well as the Earl Watkins 2009 contract matter, they both feigned ignorance, even though in both cases when questions arose, one or the other was President of the JPS School Board. I say: follow the money.

Author

Kacy

Date

2009-07-22T12:59:08-06:00

ID

150410

Comment

Amazing story Ward. Sorry it took me so long to read it. Posting this everywhere.

Author

bryan doyle

Date

2009-08-03T13:35:13-06:00