Monday, January 30, 2012

Exclusive: Weast cut $3.25 million from Pearson deal without Board vote

Why did Superintendent Weast do that? 
Because the cash was "no longer necessary". (See page Circle 5 of Council packet at link.)

Remember June 8, 2010 when the Montgomery County Board of Education voted to approve a surprise contract with Pearson Education, Inc. for the sale of MCPS curriculum?  That contract specified that Pearson would be paying $4.5 million in upfront curriculum development costs.  Remember how immediately after the Board voted to approve the Pearson contract they hired a whole team of high priced administrators to write the curriculum for Pearson Education, Inc.?

In May of 2011, this blog reported that it appeared that the terms of the Pearson deal had changed. We now have the documentation to show that the $4.5 million in development funds that were part of the June 8, 2010 contract were reduced to $1.25 million by Superintendent Jerry Weast on November 4, 2010.  

Below is the document that Superintendent Weast signed without a public Board of Education vote, that purports to "amend" the June 8, 2010 contract and reduce Pearson's development fund payment from $4.5 million to $1.25 million.  

Can a Superintendent simply "amend" a contract that has been approved by the Board of Education?  Where is the MCPS Press Release announcing this "exciting" change to the original contract? 

Didn't Superintendent Weast say that we needed the Pearson contract because "we are broke?" 

Here is the section of the Pearson-Montgomery County Board of Education contract that has been changed:
A. Contribution Toward Development Costs   
Subject to the Program Development Plan, Publisher shall contribute to the development costs by paying to MCPS the sum of $4,500,000 [$1,250,000]United States Dollars in the aggregate ("Development Funds"), and shall pay to MCPS, as the first installment of the Development Funds, the sum of $625,000 United States Dollars within thirty (30) days of the date hereof. The schedule of the payment of the remainder of the Development Funds shall be detailed in the Program Development Plan, and shall be payable in installments on a quarterly basis based on completion of specified milestones . As further detailed in the Program Development Plan, one-half of the aggregate Development Funds payable to MCPS shall be considered an advance on royalties (the "Advance") and recoupable by Publisher as set forth in Section 8E below.
Below is the letter from Superintendent Jerry Weast to the President of Pearson, Inc. purporting to reduce the Pearson payment to MCPS from $4.5 million to $1.25 million. 
Amended Pearson Contract


  1. Question: do the Feds recognize "in kind" contributions as satisfactory for the purpose of the i3 grant? Just wondering.

  2. Should the reference to "no longer necessary" be to page circle 5 (i.e. page 10 of the attachment which is labeled with a hand written 5 in a circle)? I didn't see anything relevant on page circle 6 but page circle 5 says "As a result of the I3 grant, MCPS amended the agreement since the advance was no longer necessary."
    Related question is the time value of the money - would the advance payment have been paid back with interest (if so, at what rate?).
    - Melanie

  3. @ Melanie - Thanks! Yes, the 6 should have been a 5. The post has now been corrected. Everything we know about the Pearson-Board of Ed contract has been posted on this blog. See the original contract and the above Weast amendment. There is another document, the Program Development Plan, that was to have been finalized right after the June 8, 2010 contract was signed. To our knowledge the final PDP has never been made public.

  4. Regarding the Program Development Plan (PDP) - which is usually a 'roadmap' for a project - we posted the draft PDP on the blog, so you can find it. I did request the final PDP but never received it from MCPS. According to the original Pearson/BOE contract, the PDP was supposed to have been completed within 14 days of the inking of the contract, if I recall correctly.


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