Wednesday, January 8, 2020

MCPS Did Not Get $30,000 to Pay Down School Lunch Debt. A Private Foundation with a Paid Director & Expenses Got $$.

Multiple media outlets have reported that "Montgomery County Schools just got $30,000 of school lunch debt paid off" but that is not what just happened.

Money was donated to a private foundation that has a director that is paid $103,002 for 32 hours of work per week.  



The MCPS Foundation has a Director and expenses. That means that any donation to this private foundation will not go directly to student lunch accounts.  The Foundation will take a cut and how the funds will be used will never actually be known.

The MCPS Foundation does not provide any transparency or accountability for the expenditure of funds beyond what is shown on the 990 filed with the IRS.  The MCPS Foundation is not subject to any public audit or public accountability.

From the most recent 990 filed with Guidestar we learn that the MCPS Foundation has about $5.9 Million in investments.  Apparently those funds will not be used to pay off any lunch debt.


We also learn that one of the major Foundation projects is to throw a big breakfast "confab" for administrators and elected officials with a few students included.  The Foundation is paying for food, but not just for children who need lunch.

$635,806 of Foundation dollars goes to the big "confab" breakfast and to grants to administrators.  That's over half a million dollars that doesn't appear to go to classrooms, lunchrooms, or children.  If the Foundation would like to provide details on these expenses, we would be happy to post their detailed financial information.

2018  - IRS 990


2017 - IRS 990






5 comments:

  1. I think perhaps you are misreading the IRS 990. A few points to consider:

    1) It seems like the MCPSEF is really an affiliated 501(c)3 for MCPS. Its a way for people and companies to give money to the county and get a tax break. The board is the same, the address is the same and the form itself talks about the affiliation.

    2) I think you're misreading the salary columns. Here is how I read it: Yolanda Johnson Pruitt spends 32 hours of work per week on the Foundation. Her compensation from the Foundation is $0. Her compensation from an affiliated organization (MCPS) is $103,002. So no foundation money is paying salaries for executives. MCPS seems to absorb that.

    3) On whether the money is going to fund salaries/grants/a breakfast versus "for paying down school lunch debt": One thing to keep in mind is that although an organization like this might have a general fund, individual donors can give money for specific causes. For example, I can give money to the UMD Alumni Association and say I only want it spent on Libraries. Legally, by accepting the funds I believe the organization would need to spend that money on those funds. In this case, Darcars put "For Dine for Dignity" in their check. It is most likely that all of those funds will go to that campaign, rather than what you are suggesting.

    4) On the $5.9 Million in investments, I think its reasonable to ask for transparency on those funds. I don't think we should assume those can be used to pay down student lunch debt. In fact, there is a very common explanation in the form of scholarships. For example, I could fund a scholarship via the foundation and give $1 million, saying that the money must be invested in AAA securities, that the interest will fund scholarships for MCPS graduating seniors and that they should never touch the principal. That is actually quite common because it ensures the scholarships last in perpetuity. In those cases, the Foundation would show the $1 million as an asset on this form, show the interest earned as revenue, and show the scholarship expenses. My read of the entire 990 suggests that's what is going on.

    5) Lastly, when you say "$635,806 of Foundation dollars goes to the big "confab" breakfast and to grants to administrators. That's over half a million dollars that doesn't appear to go to classrooms, lunchrooms, or children." there are two issues with that.

    First, that money is for 3 things: grants to faculty, grants to administrators, and funding this breakfast. Most of that seems to go to faculty (which you omitted). I would argue that means it IS going to our classrooms and lunchrooms.

    Second point is that page 27 of the 990 shows the details on the breakfast. My read of this is they got 20,050 in in-kind contributions (probably food) and paid 8,492 in rental fees and 1,644 in other expenses. This seems entirely reasonable...they got 20K of free stuff and paid about $10K. And that 10K is less than 2 percent of that $635K.


    Nonprofit law is complex and I'm not a lawyer, but for the most part there are perfectly reasonable explanations for this that seem more plausible than the conclusion that "any donation to this private foundation will not go directly to student lunch accounts. The Foundation will take a cut and how the funds will be used will never actually be known." In fact, in their next filing, I expect to see Dine for Dignity as a line item/campaign, along with exactly how much they spent.

    And in case you're wondering I don't work for Darcars, the county, the foundation, etc.

    ReplyDelete
    Replies
    1. 1. The Board is absolutely not the same.
      2. Sorry, Pruitt is not on the MCPS payroll. We have that database.
      3. Nice try at guessing, but you have not presented any documentation of your guess. If the organization wants to open their financial records, we are all waiting for that. A request for their financials has been made repeatedly over the last 10 years. Nothing so far.
      4. Making up a story is nice, but has no bearing on the actual operation of this organization.
      5. Again, making up a story about where the money goes is not useful. The actual financials would be useful. You omit that money to faculty does not go to classrooms but to fund individual administrator resume boosters. Sure, that money goes to a classroom, but not a MCPS public school classroom.

      There are many public school foundations that do post their financial. Here are links to a few:

      New York City provides 5 years of audits: https://www.fundforpublicschools.org/reports-finances
      Philadelphia multiple years of audits: http://thefundsdp.org/about-us/financials/
      Chicago breaks out grant amounts: https://thefundchicago.org/our-approach/grant-portfolio/
      Palm Beach multiple years of audits: https://educationfoundationpbc.org/documents

      No need for explanations, just the facts would do.

      As for the next filing, where is the summer 2019 filing? What is your reasonable explanation for why that is not available?

      And finally, you are allowed to sign your statement with your real name if you want to establish credibility.

      Delete
  2. Read how another public school educational foundation was used by a superintendent to hide funds:

    http://parentscoalitionmc.blogspot.com/2018/03/md-v-dallas-dance-statement-in-support.html

    ReplyDelete
    Replies
    1. More on Baltimore County Educational Foundation: http://parentscoalitionmc.blogspot.com/2018/03/former-baltimore-county-schools-leader.html

      Delete
  3. 2011: We reported on the diversion of funds for renting of a public school parking lot to the MCPS Educational Foundation. Why? Why didn't this rental income go in to the MCPS Operating Budget to say, pay for lunches?

    http://parentscoalitionmc.blogspot.com/2011/07/carderock-students-sold-out-by-mcps-in.html

    ReplyDelete

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