Charter School Boondoogle
By Rick Outzen
Last week, an Escambia County Grand Jury indicted Newpoint Education Partners, LLC; School Warehouse, Inc.; Red Ignition, LLC; and Epiphany Management, LLC for grand theft, money laundering and aggravated white collar crime in relation to the charter schools Newpoint ran in Escambia County.
Newpoint and three of its vendors-School Warehouse, Red Ignition and Epiphany-were charged with fraudulently billing the local charter schools for hundreds of thousands of dollars of supplies, equipment and services. It was furthered alleged that Newpoint, in concert with the vendors, laundered the proceeds of the thefts through multiple bank accounts to conceal the criminal activity. The source of the funds was the charter school program grant funds appropriated by the state of Florida for charter schools to use to procure supplies, equipment and services to start charter schools.
The investigation began in April 2015 when Inweekly reported on the claims by a whistleblower of irregularities at Pensacola Newpoint High and Newpoint Academy. She alleged grade tampering, inappropriate conduct by teachers with female students and mishandling of funds.
After the school district’s auditors reviewed the schools’ records, the Escambia County School Board voted to terminate the contracts of the two schools. In his recommendation to the school board, Superintendent Malcolm Thomas outlined 14 sections of the charter contracts that had been violated by Newpoint, including failure to maintain cumulative folders of the students’ completed courses, health, discipline and special needs.
The Florida Department of Education had been given Pensacola Newpoint High an “A” grade for the 2013-14 school year and had received a bonus check from Gov. Rick Scott at a media event hosted by the School District in March 2015. The District staff later found that three Newpoint students were given diplomas in 2014, even though they did not meet graduation requirements.
In late May 2015, 21st Century Academy of Pensacola, the non-profit set up by Newpoint Education Partners to own its Pensacola charter schools, closed the two schools and Five Flags Academy, an elementary school in its first year of operation, without paying its teachers their final checks.
Last summer, Inweekly interviewed several former teachers and administrators who worked for Newpoint in charter schools in Escambia, Bay and Pinellas counties. They mentioned Marcus May, whom they described as the president & CEO of Newpoint Education Partners.
A former teacher in Bay County liked the challenge of teaching at a charter school but was quickly dismayed at how his Newpoint school was run.
“My perspective is that charter schools have a terrific opportunity to make a terrific difference for kids that really need this kind of environment,” he shared last June. “However, what very much disappoints me is that this has essentially become a boondoggle for wealthy people to continue to be wealthy.”
He said that May, who came from Ohio, looked down on people in Florida. “For some reason, I think Marcus got it into his mind that everybody down here in the south is dumb. I’ll tell you what; I’ve been in Ohio. They’ve got rednecks everywhere. Anyway, that’s why I think Marcus always, whenever he did show up with his very fashionable jeans and corduroy jacket there, no tie, he just tended to not show much respect for the people.”
The former teacher said that all financial decisions at the Bay County school had to be run through May. He alleged that several school vendors had ties to May.
He said, “I started to see that Newpoint is just a building, but it’s a 501(c)(3) (federal tax exempt non-profit). There’s nothing that the building has, nothing. Newpoint Education Partners is the business. All the money from the school goes to the business. The school itself has nothing. Everything goes through Newpoint Education Partners.”
He said that May had ties to the school’s IT provider, Epiphany Management, and other vendors.
“Everybody’s getting paid, and Marcus is sitting on the top of this pyramid,” the former teacher told Inweekly.
A former teacher from the Tampa area said he saw thousands of dollars monthly leave his school in “money bags, all cash.”
“This was money made through selling food to the students, and the school was encouraged to allow students to purchase snack food between classes and allow them to snack during class as well,” he told Inweekly. “If the numbers did not meet his expectations or sales were low, (Marcus May) would really lay into the Internship Director who was in charge of the ‘books’ for this enterprise, which never was officially part of the school’s income.”
In Pensacola, teachers and parents have shared that the schools never seemed to have enough of anything.
“The teachers did not have enough text books in the classroom,” said a former teacher. “The school was advertised as a technology school, but the internet was down a lot. The phone lines were tied into the internet, so when it went down we had no phone service to call out, and parents couldn’t call the school.”
When teachers complained, she said that there wasn’t any money for things they needed. Parents were sent emails requesting donations for their used computers, televisions, computer speakers, mice, chairs, tables, bookcases, file cabinets and books through the years because the school didn’t have enough of these items. The school borrowed chairs and tables from the church next door. Employees picked up chairs from the curb that people threw out so every student had a chair in their classroom.
“A student’s dad donated 30 computers to the school when the company he worked for bought new ones,” the former teacher told Inweekly. “It turned out that our school couldn’t use them, because the system we used wasn’t compatible with the donated computers.”
In June, the Bay County School District found that Newpoint Education Partners violated Florida Department of Education rules. Its auditors found that 80 items, including computers, tables and monitors, purchased with charter school program funds intended for Newpoint Bay Preparatory Academy were delivered to Newpoint Schools in Pensacola.
Recently in Pinellas County, Newpoint Education Partners told its teachers that a nonprofit with Alliance Education Services would acquire all of Newpoint’s assets, including school management agreements for three financially-troubled charter schools; Windsor Preparatory Academy, East Windsor Middle Academy and Newpoint Pinellas Academy.
However, Newpoint Education Partners was still listed as the management company of record last week. When the Tampa Bay Times contacted an Alliance Education Services official about Newpoint’s indictment, the reporter was told the hand-off was never completed and Alliance had never assumed operations of any Newpoint schools.
In light of the indictment, the official wrote in an email, “…we have no intention of moving forward.”
Meanwhile, the State Attorney’s Office and School District continue to investigate Newpoint Education Partners and its operations.
Pull quote: “This has essentially become a boondoggle for wealthy people to continue to be wealthy.” –former Newpoint teacher
