Orleans Parish District Attorney Jason Williams is launching a special investigation into the Dryades YMCA, the nonprofit that runs James M. Singleton Charter School, after Orleans Parish School Board officials wrote to him to report allegations of misappropriated school funds totalling more $1 million.
The YMCA operates Singleton school at its Central City facility, and the organization and district have been at odds for over a year due to academic, financial and operational issues. Those problems include the allegedly misappropriated funds, which a financial audit said the organization owes to the school, and allegedly phony background checks that allowed an employee with a criminal record to work at the school. That resulted in the June arrest of former Dryades Chief Financial Officer Catrina Reed. Reed was quickly released from jail without a cash bond. Williams has not yet filed formal charges against Reed. And he did not address her case during his Thursday press conference announcing the Singleton probe.
NOLA Public Schools District Superintendent Henderson Lewis Jr. and OPSB President Ethan Ashley wrote to Williams and the state Legislative Auditor on Monday, informing them of a series of allegedly misappropriated or mismanaged public funds and the district’s failed attempts to learn more about the problems over the last several months.
“They detailed allegations that the Dryades YMCA … has misappropriated school funds in excess of $1 million over the course of several years,” Williams said.
“As with any case that comes to my office alleging illegal activity or corruption, especially those actions that harm the most vulnerable in our community, our children. My office will vigorously investigate this matter,” he said. “We will in very short order issue subpoenas for additional information and use every other law enforcement tool available to ensure we have access to all the information … to support a thorough investigation and get to the bottom of this matter.”
It’s another tumultuous step in a months-long simmering battle that began when the district started cracking down on the school through a series of written warnings, and in June announced it was planning to revoke the school’s charter. The Dryades YMCA sued to prevent the school from closing and was granted a restraining order that allowed the school to open as scheduled in August.
The district warned the school about the allegedly misappropriated money this summer and said it needed more answers from the YMCA. At the time, YMCA officials said their financial contractors needed to complete an investigation. District officials maintain they did not receive that report.
The district, meanwhile, appears to be using the Dryades lawsuit as an instrument to find some of the answers. As part of the suit, the district is currently seeking approval from Orleans Parish Civil Court Judge Jennifer Medley for subpoenas for records from three of the YMCA’s financial contractors. After that motion was filed, the YMCA filed a motion to dismiss the case. In response, the school district filed a motion opposing that request earlier this week. The two sides are scheduled to meet in court Friday, regarding the subpoenas.
Singleton is in the final year of its charter and did not meet the standards for a new contract. That sent the school into the district’s comprehensive review process, which is wrapping up in the next few weeks. Lewis is expected to announce whether the school will remain open or close at the board’s November meeting.
Singleton is unusual among New Orleans charter schools in that it’s operated by an organization that also has other programming and services. For years, Dryades YMCA operated Singleton under its financial umbrella, but last summer district officials asked them to separate and create a separate education committee for the school to report to. It’s also not housed in a district-owned building, meaning that if OPSB revokes its charter, it cannot take over the campus.
Asked if his office was looking into the organization prior to receiving the communication from OPSB officials, Williams said he was aware of the news concerning the school but the referral from the district this week offered new information.
“That was the first time we were advised there could be criminal activity with regards to misappropriation of in excess of $1 million,” Williams said.
First Assistant District Attorney Bob White will lead the investigation. Williams said he has a background in finance.
“Clearly he is tailor made to lead an investigation like this,” he said.
White spoke briefly after Williams. He called the allegations “very serious.”
“Anyone found to be involved will be facing felony charges based on the quantum of the money that is alleged to have been misappropriated,” White said.