IASB Appears Before Oversight Again

The Oversight committee issued it’s first subpoena last weekend to the former director of the Iowa Association of School Boards (IASB), Maxine Kilcrease, after repeated invitations to appear before the committee were ignored. She appealed the subpoena with the district court on grounds that she is being compelled to appear before a biased committee. This came about from comments made during previous committee meetings indicating that she was a “thief.” The court denied her appeal and she appeared before the committee for the first time. And while she seems to be a source of some of the turmoil surrounding the organization, there is more to uncover behind the scenes.

The committee met on Thursday, the first time since the legislative session ended. During the five hour meeting several current and former IASB staff members testified. That list includes: Maxine Kilcrease, former Executive Director, who was terminated just this past month on allegations of raising her own salary and keeping the board of directors in the dark on financial matters of the organization; LeGrande Smith, currently employed as the legal counsel for the IASB; Mary Gannon, lobbyist for the IASB; Margaret Buckton, former associate executive director of the IASB; and Larry Sigel, former CFO of the IASB.

Ms. Kilcrease appeared along side her lawyer who gave her opening statement and consulted with her on nearly every answer she gave during the questioning. She was not very forthcoming with answers, mostly pleading the fifth amendment and telling members that she cannot answer accurately due to her being blocked access to her documents and information. Her contract was terminated with the IASB at the end of March.

Others who testified before the committee were much more forthcoming with answers. LeGrande Smith, IASB’s current legal counsel, answered much of the committee’s questions. Former associate Executive Director, Margaret Buckton, and former CFO, Larry Sigel, also answered many of the committee’s questions. Both Ms. Buckton and Mr. Sigel applied for the Executive Director position, along with Ms. Buckton’s brother, Jon Muller, when it was open last year. All three were denied interviews and Ms. Kilcrease was given the job. Muller left within days after this occurred, Sigel left a few months later, and Buckton was fired from the organization in September of last year.

The committee spent time asking Larry Sigel about his new company which he formed shortly before leaving the IASB. The company, Iowa School Finance Information Services (ISFIS) provides financial consulting to schools. A contract was signed between the IASB and ISFIS right before he left the association. The contract had the IASB pay newly formed private company $300,000 over three years in return for various lobbying and financial-education services. A lawsuit was filed by the IASB claiming ISFIS did not hold its end of the contract. The lawsuit has since been dropped, but lawmakers questioned the situation telling Sigel it seemed like an unethical deal and that his company was “spying” on the competition to the school board’s programs.

Questions were also raised about the openness of IASB’s records. The legislature passed a measure this year requiring the IASB to comply with Iowa’s open meetings and open records laws. But the situation needs to be revisited, as it was hastily applied at the end of the session. A measure to further increase transparency regarding non-profit boards was defeated when a disagreement between the two bodies of the legislature killed it.

One of the big questions on the minds of the Republican members of the committee that still remains unanswered is what are the financial dealings of Skills Iowa? Two Des Moines Register articles have uncovered information showing questionable financial transactions regarding Skills Iowa.

Skills Iowa is an entity under the IASB that provides online learning tools for students and teachers called Assessment Center and Skills Tutor. These programs are provided by a software company in Rhode Island called US Skills, Inc. Skills Iowa was formerly called Following the Leaders (FTL) and was overseen by a group in the eastern US called the Education Learning Council (ELC). FTL was started around 2002 and was tested in several states as a project to see how online learning could enhance student achievement. It started out with impressive funding, receiving about $30 million in federal funding for the first 6 years. After some mismanagement allegations and questions raised about ELC, and studies on the effectiveness of FTL showed poor or unknown results, the program floundered. ELC let the program go and told states still using it that they were on their own.

Iowa was the largest user of FTL, so management of it was transferred to IASB and Skills Iowa became the arbitrator of the program. Sen. Harkin took particular interest in Skills Iowa, funneling over $12 million in federal funds to the IASB for it in the form of earmarks. The program is even called “a special project of Senator Tom Harkin.”

In 2007 and 2008 when federal funding could not be secured for Skills Iowa, the Democratic legislature appropriated $3 million and $500,000 to Skills Iowa. Federal funding resumed again in 2009. Over the course of the last 8 to 10 years it appears that Skills Iowa and FTL have received nearly $40 million in taxpayer money.

Perik has donated more than $1 million to Democratic campaigns across the country…

Where it gets dicey is who the money is going to. FTL contracted out to Achievement Technologies for their programs, a company run by Michael Perik. US Skills, the company contracted by Skills Iowa, is also owned by Michael Perik. Millions of dollars have been spent by FTL and Skills Iowa on software provided by Perik’s companies; about $6.2 million since August of 2007. Perik has donated more than $1 million to Democratic campaigns across the country, including $50,000 to Governor Culver, $31,000 to the Iowa Democratic Party, and $13,500 to Senator Harkin.

Coincidence or not, it’s clear that Skills Iowa needs to show its financials to the committee for review.

The Oversight committee plans to meet again in May. How many more meetings remain, though, is still up in the air. Senator Olive said he felt one more meeting might help close the issue. Rep. Watts disagreed, saying there are still more people to question and more answer to find.

Still waiting to appear are Kevin Schick, former CFO, and Jack Hill, former president of the Board, who resigned this week. Republican members would also like to see Susie Oleson, director of Skills Iowa, appear to provide answers on that entity. She has been with Skills Iowa in one capacity or another since around 2002.