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More Scrutiny for Education Contracts
May 13th, 2011

Highly paid consultants are like fat-cat lawyers. No one claims to like them but they keep getting work — and lots of it.

So, not surprisingly, consultant contracts have become a battleground in the fight over whether New York City should lay off thousands of teachers. Opponents say the consultants should get the ax instead. The department defends their contracts — and keeps writing checks.

Today Manhattan Borough President Scott Stringer tweeted about and released a copy of a letter he wrote schools Chancellor Dennis Walcott and city Office of Management and Budget director Mark Page challenging the department’s spending on consultants.

Charging that Page had been unable to supply adequate figures, Stinger said he crunched the numbers in the executive budget and “was appalled” to learn the education department plans to increase spending on consultants by $54.4 billion so that it will top $982 million next fiscal. Exact numbers for the cost of averting the layoffs vary but Stringer cites $350 million in his letter.

The department rejected Stringer’s depiction of these contract as “a black hole,” saying many fund required services, such as transportation and help for students with disabilities.

“The borough president either fails to recognize an important fact about these consultant costs or he is intentionally misleading people,” Chancellor Dennis Walcott told the Daily News. “The truth is that over $840 million of the $981 million he cites are dedicated to direct services for our students with the vast majority going toward our students with disabilities which are services that are required under the law.”

In his letter Stringer requests further information on contracts for central computer services, student transportation and teacher recruitment.

Most of these concerns are nothing new, though the impending layoffs certainly give them more weight — and increased political oomph.

The department, long under fire for its handling of tech contracts, has come under increased criticism since a department consultant was indicted in April for stealing more than $3.6 million from the city. Federal prosecutors say Willard Lanham persuaded subcontractors to overbill the city for their work and then kept the difference for himself. And city investigators have charged that major contractors Verizon and IBM abetted the scheme.

Then yesterday reports surfaced that Judith Hederman, executive director of the department’s Division of Finance, abruptly resigned earlier this month. She is thought to be the “high-level” department official cited in court papers for having oversight over a $43 million contract with Future Technology Associates — at the same time she is alleged to have had a “personal relationship” with one of the firms owners — either Tamer Sevintuna or Jonathan Krohe.

Although neither the owner nor their company has been charged, Juan Gonzalez writes in the News that, according to court papers, they are “under investigation for ‘potential corruption and conflict of interest.'”

Future Technology, investigators suspect, violated the terms of its contract by outsourcing some of its work to consultants in India and Turkey, who make far less money than their U.S. counterparts. During that tome, Gonzalez says, the firm had no offices — its “headquarters in Jacksonville, Fla., is a mailbox in a UPS store. So is a second address in Brooklyn.

The company also stands accused, the Post says, of “hiring its workers through multiple contracts so that the “hourly fee for the consultant’s services was marked up before being passed on to the DOE.”

Then there was the Achievement Reporting and Innovation System, popularly known as ARIS, which the department paid contractors $80 million to develop. Despite that investment, many schools don’t like it and have opted to buy another system. Undaunted, the city recently said it would stick with ARIS.

Earlier this year City Comptroller John Liu blocked the department’s recruitment contract with the New Teacher project, questioning why it would spend money on recruitment at a time of cutbacks. The department, though has argued that, even if it needs to get rid of many teachers it will still need to hire some in particularly hard-to-fill slots, such as bilingual special education.

Be that as it may the contact also provides the administration an avenue for funding the New Teacher Project, which works to advance many ideas on schools Mayor Michael Bloomberg also supports, such as ending layoffs based on seniority and changing the evaluation system for teachers. The supports its advocacy through paid work for clients — such as the New York City Department of Education.

In a possible effort to explore alternative to simply shutting down schools it considers to be failing, the Department of Education announced yesterday it would try to restart nine troubled schools. Each school will get up to $2 million a year for three years in federal funding and work with an as-yet-to-be-named nonprofit to turn the school around.

In comparison to all of these, school bus contracts seem relatively benign. In the past, though, City Council members have urged the department to put more of the agreements out for competitive bidding.

Future Technology, investigators suspect, violated the terms of its contract by outsourcing some of its work to consultants in India and Turkey, who make far less money than their U.S. counterparts. During that tome, Gonzalez says, the firm had no offices — its “headquarters in Jacksonville, Fla., is a mailbox in a UPS store. So is a second address in Brooklyn.

The company also stands accused, the Post says, of “hiring its workers through multiple contracts so that the “hourly fee for the consultant’s services was marked up before being passed on to the DOE.”

Then there was the Achievement Reporting and Innovation System, popularly known as ARIS, which the department paid contractors $80 million to develop. Despite that investment, many schools don’t like it and have opted to buy another system. Undaunted, the city recently said it would stick with ARIS.

Earlier this year City Comptroller John Liu blocked the department’s recruitment contract with the New Teacher project, questioning why it would spend money on recruitment at a time of cutbacks. The department, though has argued that, even if it needs to get rid of many teachers it will still need to hire some in particularly hard-to-fill slots, such as bilingual special education.

Be that as it may the contact also provides the administration an avenue for funding the New Teacher Project, which works to advance many ideas on schools Mayor Michael Bloomberg also supports, such as ending layoffs based on seniority and changing the evaluation system for teachers. The supports its advocacy through paid work for clients — such as the New York City Department of Education.

In a possible effort to explore alternative to simply shutting down schools it considers to be failing, the Department of Education announced yesterday it would try to restart nine troubled schools. Each school will get up to $2 million a year for three years in federal funding and work with an as-yet-to-be-named nonprofit to turn the school around.

In comparison to all of these, school bus contracts seem relatively benign. In the past, though, City Council members have urged the department to put more of the agreements out for competitive bidding.

The department’s announcement came after talks reportedly broke down between the city and the teachers union on how to help 31 poorly performing schools under a federal program. Measures could have included a longer school days and getting rid of half the school’s staff.

By on May 13, 2011, 12:55 pm
In category: City Hall,Education,Public Finance | 1 Comment »

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One Response to “More Scrutiny for Education Contracts”

  1. dresses Says:
    November 27th, 2012 at 1:43 pm

    I guess, it comes down to 94276 simple choice!

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