14-001096SP Pam Stewart, As Commissioner Of Education vs. Barrington Academy And Barrington Academy Ii Status: Closed Recommended Order on Monday, May 19, 2014.

Summary: Private schools participation in scholarship programs should be terminated for failing to verify attendance of scholarship recipients and for wrongly endorsing scholarship checks made payable to parents.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PAM STEWART, AS COMMISSIONER OF

EDUCATION,

Petitioner,

vs. Case No. 14 - 1096SP

BARRINGTON ACADEMY AND

BARRINGTON ACADEMY II,

Respondent s .

_______________________________/

RECOMME NDED ORDER

Pursuant to notice, a formal administrative hearing was

conducted on April 10, 2014, by video teleconferencing between

sites in Tallahassee and Lauderdale Lakes, Florida, before

Administrative Law Judge (ALJ) Claude B. Arrington of the

Division of Administrative Hearings (DOAH).

APPEARANCES

For Petitioner: Bonnie Ann Wilmot, Esquire

Department of Education

325 West Gaines Street

Tallahassee, Florida 32399

For Responde nt: Marc Anthony Douthit, Esquire

Douthit Law, LLC

Third Floor

6625 Miami Lakes Boulevard

Miami Lakes, Florida 33014

STATEMENT OF THE ISSUE

Whether Respondents (pr ivate schools participating in

certain scholarship programs) engaged in fraud and/or failed to

comply with provisions required of private schools participating

i n such scholarship programs and , if so, whether Petitioner

(Commissioner) should suspend or rev oke RespondentsÓ right s to

participate in the scholarship programs.

PRELIMINARY STATEMENT

Respondents are private schools that participate in the

John M. McKay Scholarship for Students with Disabilities Program

(McKay Scholarship Program or McKay Schola rship ) and the Florida

Tax Credit Scholarship Program (FTC Scholarship Program or FTC

Scholarship ).

On October 4, 2013, the Commissioner alleged in an

Administrative Complaint certain facts relating to scholarship

money for Student A. Based on those fac ts, the Commissioner

suspended Barrington AcademyÓs (Barrington) participation in both

scholarship programs and proceeded to revoke that participation.

On February 19, 2014, the Commissioner filed an Amended

Administrative Complaint against Barrington an d Barrington

Academy II (Barrington II) that re - alleged the facts as to

Student A and added facts relating to Student B and Barrington

II. Based on those facts, Petitioner suspended the participation

of both Respondents in both scholarship programs and pr oceeded to

revoke that participation in both scholarship programs.

Succinctly stated, both Respondents were accused of accepting

McKay S cholarship Program payments for Student A and Student B

and verifying that each student was in attendance when neither

was in attendance. The Commissioner also alleged that school

employees endorsed scholarship checks made payable to the

respective parents of the two students and placed the proceeds in

a Barrington bank account.

Respondents timely requested a formal adm inistrative

hearing, the matter was referred to DOAH, and this proceeding

followed. This is an expedited proceeding pursuant to section

1002.395(11)(b)3., Florida Statutes (2013) . 1/

The Commissioner presented the following witnesses: Carla

Green (the edu cational director of a Department of Juvenile

Justice (DJJ) facility in Greenville, Florida), Laura Harrison (a

Department of Education employee in the Office of School Choice),

Gwendolyn Thomas (the Administrator of both Respondents), and

Kate Goss (a Dep artment of Education employee specializing in

private school programs). Petitioner offered five pre - marked

exhibits, four of which were admitted into evidence.

Respondents presented the testimony of Curtis Thomas, the

husband of Gwendolyn Thomas. Respo ndents offered no exhibits.

The Transcript, consisting of one volume, was filed

April 28, 2014.

The parties timely filed their respective p roposed

r ecommended o rders, which have been duly considered by the

undersigned in the preparation of this Recommen ded Order.

FINDING S OF FACT

1. Barrington and Barrington II are private schools located

in Florida City. They are located in the same facility under the

same administration. Both have been eligible to receive McKay

and FTC Scholarships for qualified stu dents.

2. Gwendolyn Thomas is the long time administrator of

Barrington, which has been in existence for approximately 25

years. Ms. Thomas is also the administrator of Barrington II,

which has been in existence for approximately two years.

3. For me dical reasons, Ms. Thomas did not participate in

the day - to - day operation of either school between October 2010

and November 2013. During her absence, Mack Brown, the assistant

principal, was in charge of both schools until he left in June

2013 to start a competing school.

4. Ms. Thomas has been in charge of the day - to - day

operation of Barrington and Barrington II since November 2013.

5. McKay Scholarship payments are disbursed on a quarterly

basis. 2 / Pursuant to sections 1002.39(8)(b) and 1002.421( 2)(d),

any private school participating in the McKay Scholarship Program

is required to affirmatively verify to the Department of

Education that each scholarship student is regularly enrolled in

the school at least 30 days prior to the issuance of any

quar terly scholarship payment.

6. Pursuant to section 1002.39(9)(f), McKay Scholarship

checks are made payable to the parent of a scholarship student,

which only the parent can sign. Private school personnel cannot

sign such a check on behalf of the parent , even with the parentÓs

permission.

7. Prior to June 9, 2011, Student A was enrolled in

Barrington and received a McKay Scholarship. On June 9, 2011,

Student A left Barrington and has not been a student at

Barrington since June 9, 2011.

8. Between A ugust 26, 2011, and August 23, 2013, nine

checks, totaling $12,230.25, were issued to the mother of Student

A pursuant to the McKay Scholarship P rogram. Those checks were

issued on the following dates in the following amounts:

August 26, 2011 $1 ,336.75

October 27, 2011 $1,336.75

January 24, 2012 $1,336.75

March 21, 2012 $1,336.75

August 21, 2012 $1,382.50

October 22, 2012 $1,382.50

January 23, 2013 $1,382.50

March 20, 2013 $1,382 .50

August 23, 2013 $1,353.25

9. The back of each check contains an endorsement that

appears to be the name of Student AÓs mother. Student AÓs mother

did not sign any of these check s . Each check was signed by an

employee of Barrington or Barr ington II. Each check was

deposited into an account owned by Barrington.

10. For each of these payments, Barrington submitted

documentation to the Department of Education that Student A was

attending Barrington prior to the issuance of the payment ,

wit hout verifying that Student A was in attendance. As noted

above, Student A was not in attendance.

11. On October 4, 2013, the Commissioner filed her

Administrative Complaint against Barrington and suspended

BarringtonÓs participation in the McKay and F TC S cholarship

P rograms. The Commissioner had information that Student A was

not enrolled in Barrington and had probable cause to believe that

Barrington Academy had engaged in fraudulent conduct. 3/

12. Afterwards, many of the Barrington students were

administratively transferred to Barrington II, and continued to

receive scholarship payments.

13. Prior to June 7, 2013, Student B was enrolled in

Barrington II and received a McKay Scholarship. On June 7, 2013,

Student B was taken into the custody of th e DJJ and enrolled in a

residential facility in Greenville, Florida. Student B was in

the custody of DJJ until March 7, 2014. 4 /

14. Between September 25, 2013, and January 23, 2014, three

checks, totaling $8,316.75, were issued to the mother of Student

B pursuant to the McKay Scholarship P rogram. Those checks were

issued on the following dates in the following amounts:

September 25, 2013 $2,772.25

October 23, 2013 $2,772.25

January 23, 2014 $2,772.25

15. The back of each check contains an endorsement that

appears to be the name of Student BÓs mother. Student BÓs mother

did not sign any of these check s . Each check was signed by an

employee of Barrington or Barrington II. Each check was

deposited into an account owne d by Barrington.

16. For each of these payments, Barrington II submitted

documentation to the Department of Education that Student B was

attending Barrington II prior to the issuance of the payment ,

without verifying that Student B was in attendance. A s noted

above, Student B was not in attendance.

17. On February 19, 2014, the Commissioner filed her

Amended Administrative Complaint against Barrington and

Barrington II and suspended their participation in the McKay and

FTC Scholarship Programs. The Commissioner had information that

Student B was not enrolled in Barrington II and had probable

cause to believe that Barrington II had engaged in fraudulent

conduct.

18. Barrington has reimbursed the Department of Education

for the McKay Scholarship pay ments made on behalf of Student A.

19. Barrington II has deposited with its attorney

sufficient funds to reimburse the Department of Education for the

McKay Scholarship payments made on behalf of Student B.

20. Although Ms. Thomas had returned as admin istrator when

at least two of the McKay Scholarship payments at issue were

processed by a school employee, she testified, credibly, that she

had not authorized that action and was unaware of the misconduct

before the Administrative Complaint and the Amende d

Administrative Complaint were filed.

21. The persons responsible for the deficiencies discussed

above have either voluntarily left their employment or have been

fired.

22. Barrington and Barrington II have hired a person to

ensure compliance with McKa y and FTC Scholarship P rograms.

CONCLUSIONS OF LAW

2 3 . DOAH has jurisdiction over the subject matter of and

the parties to this proceeding pursuant to sections 120.569,

120.57(1), and 1002.395(11)(b)3 , Florida Statutes .

24. This is a de novo proceeding designed to formulate

final agency action. See Hamilton Cnty Bd. of Cnty Comm'rs v.

Dep't. Envtl. Reg. , 587 So. 2d 1378 (Fla. 1st DCA 1991) and

section 120.57(1)(k).

2 5 . In this proceeding the Commissioner seeks to revoke

RespondentsÓ participation in t he McKay Scholarship Program and

the FTC Scholarship Program. The burden of establishing the

grounds for that action falls on the Commissioner, who must prove

her allegations by a preponderance of the evidence. See Winn v.

Muskateers Academy , DOAH Case N o. 06 - 5074, Conclusion of Law 42;

Dep't of Transp. v. J.W. C. Co., Inc. , 396 So. 2d 778 (Fla. 1st

DCA 1981) (burden of proof is usually upon party asserting the

affirmative of the issue); and § 120.57(1)(j) , Fla. Stat .

26 . A "preponderance" of the evidence means the greater

weight of the evidence. See Fireman's Fund Indem. Co. v. Perry ,

5 So. 2d 862 (Fla. 1942).

27. Pursuant to sections 1002.39(7)(c)2. and

1002.395(11)(c)3., the Commissioner is authorized to immediately

suspend McKay Scholarship payments and FTC Scholarship payments

if the Commissioner has probable cause to believe there is

fraudulent activity on behalf of a private school. Here, the

Commissioner had reliable information that Barrington and

Barrington II had verified the attendance of stu dents who were

not in attendance. Moreover, for Student A, the Commissioner had

reliable information that the parent had not endorsed the

scholarship payments that had been issued in her name. That

information provided the Commissioner with probable caus e to

immediately suspend McKay Scholarship payments and FTC

Scholarship payments to Barrington and Barrington II and to

in itiate these proceedings to revoke their participation in both

scholarship programs.

28. Subject to a private schoolÓs due process rights, which

can include a formal hearing before DOAH, s ection

1002.39(7)(a)1., pertaining to the McKay Scholarship Program,

provides that the Commissioner:

Shall deny, suspend, or revoke a private

schoolÓs participation in the scholarship

program if it i s determined that the private

school has failed to comply with the

provisions of this section. However, if the

noncompliance is correctable within a

reasonable amount of time and if the health,

safety, or welfare of the students is not

threatened, the com missioner may issue a

notice of noncompliance which provides the

private school with a timeframe within which

to provide evidence of compliance before

taking action to suspend or revoke the

private schoolÓs participation in the

scholarship program. 5 /

29. The Commissioner proved that Respondents repeatedly

failed to comply with the provisions of chapter 1002.39 over a

period that began in August 2011 when Barrington falsely verified

the attendance of Student A and falsely endorsed and deposited

the scholar ship check made payable to Student AÓs parent. That

misconduct continued until February 2014 when Barrington II

falsely verified the attendance of Student B and falsely endorsed

and deposited the scholarship check made payable to Student BÓs

parent. The Commissioner has the authority and the discretion to

revoke both BarringtonÓs and Barrington IIÓs participation in

both scholarship programs. In its Proposed Recommended Order,

the Commissioner argues that Respondents ' participation in both

scholarship pr ograms should be revoked. That action is

reasonable given the nature and duration of the misconduct.

30. In making the recommendation that follows, the

undersigned has considered that Ms. Thomas is back in charge of

both schools, that she was unaware of the misconduct at the times

the misconduct occurred, that Barrington Academy has repaid the

amounts paid for Student A, that Barrington II is prepared to

repay the amounts for Student B, that Respondents have hired a

compliance officer, and that the em ployees directly responsible

for the misconduct are no longer employed by Barrington or

Barrington II.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Department of Education revoke

the participatio n of Barrington Academy and Barrington Academy II

in the McKay Scholarship P rogram and the FTC Scholarship P rogram.

It is further RECOMMENDED that both schools be permitted to re -

apply to participate in these programs after the Department of

Education has been reimbursed for the scholarship payments made

on behalf of S tudent B and after both schools demonstrate that

they have personnel and written procedures that will ensure

compliance with all applicable rules and statutory provisions.

DONE AND ENTERED this 19th day of May , 2014 , in Tallahassee,

Leon County, Florida.

S

CLAUDE B. ARRINGTON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 19th day of May , 2014 .

ENDNOTE S

1/ Each statutory reference is to Florida Statutes (2013), and

each reference to a rule is to the rule published in Florida

Administrative Code as of the date of this Recommended Order.

2/ All deficiencies at issue in this proceeding pertained to the

McKay Scholarship Program. Because no deficiency relating to the

FTC Scholarship Pro gram is at issue, that process will not be

discussed.

3/ The Commissioner acted pursuant to sections 1002.39(7)(c)2.

and 1002.395(11)(c)3., which authorize such suspension from the

McKay Scholarship Program and FTC Scholarship Program,

respectively, wh en there is probable cause to believe there has

been fraudulent activity on the part of the private school. The

Commissioner utilized the same authority in subsequently filing

the Amended Complaint.

4/ Pursuant to section 1002.39(3)(a), a student is n ot eligible

for a McKay Scholarship while he or she is enrolled in a school

operated by or for DJJ.

5/ Section 1003.395(11)(a)1., pertaining to the FTC Scholarship

Program, contains almost identical language to section

1002.39(7)(a)1., and provides the Commissioner the authority to

take action against RespondentsÓ participation in the FTC

Scholarship Program.

COPIES FURNISHED:

Bonnie Ann Wilmot, Esquire

Department of Education

325 West Gaines Street

Tallahassee, Florida 32399

Marc Anthony Douthit , Esquire

Douthit Law, LLC

Third Floor

6625 Miami Lakes Boulevard

Miami Lakes, Florida 33014

Lynn Abbott, Agency Clerk

Department of Education

Turlington Building, Suite 1514

325 West Gaines Street

Tallahassee, Florida 32399

Pam Stewart, Commissioner

Department of Education

Turlington Building, Suite 1514

325 West Gaines Street

Tallahassee, Florida 32399

Matthew Carson, General Counsel

Department of Education

Turlington Building, Suite 1244

325 West Gaines Street

Tallahassee, Florida 32399

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

1 0 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in thi s case.