SPARTANBURG Co., SC (WSPA) — An investigation by the S.C. Office of Inspector General revealed fiscal mismanagement by former High Point Academy CEO and Superintendent Lori Manning.
Manning was suspended by the charter school’s board during the investigation in July. She resigned in October.
The OIG began investigating after receiving a complaint of alleged mismanagement and conflicts of interest involving Manning.
Manning opened High Point Academy Spartanburg in 2014. During that time, Manning’s business partner Katie Stellar also opened a High Point Academy Forth Worth in Texas.
Stellar and Manning previously formed a non-profit called Faith in Action Forth Worth or FIAFW. Manning stepped down from FIAFW when opening HPA Spartanburg, but continued to be paid by the organization.
FIAFW was hired for tutoring services and consulting services by Manning for HPA. The investigation revealed that over a two year period, Stellar received $824,570 for those services. Only a forth of that amount was used for operating expenses. According to a report by the OIG, Stellar made a profit of $548,840.
Manning also set up a company called ZES Education Services Corporation, which consulted for Stellar’s Fort Worth campus. Manning received $289,963 for consulting and after school services.
Investigators found that the business partners created contracts for each other that did not list descriptions of services they would provide, but guaranteed Stellar would make $1 to $3 million over 10 years.
“Based on the evidence collected, it appears Stellar and her companies’ level of effort did not warrant the level of compensation Manning approved HPA to pay,” the report states.
The investigation also looked into falsified Title 1 documents submitted for funding.
That complaint alleged 40 of the 373 reported Title 1 students were actually ineligible. The OIG found 53 students were not eligible because information was missing or incomplete from their forms, or the forms had been denied.The OIG determined it was not possible to trace who entered the denied forms. The review did not find conclusive evidence of intentional manipulation of Title 1 eligibility records, but there was evidence to suspect wrongdoing.
Manning was also investigated for using her position to hire her husband and brother, possibly violating state ethics laws. The investigation revealed she paid her husband’s business without considering other proposals or giving a written contract. She later hired her husband as an Algebra teacher and tutor, although he was not certified. There was no written letter of employment, nor was the position ever advertised. Manning also hired her brother to provide computer services, and no other competitive proposals were considered.
In 2016, Manning also approved year-end bonuses for herself and her husband from HPA funds.
The investigation recommended that the South Carolina Public Charter School District’s create standards for ethical requirements for HPA and all charter schools in the state. It also recommended that the district help new charters get a board trained to offer oversight to the school.
The South Carolina Ethics Commission is reviewing several conflicts of interests and payments to Stellar and Manning.
The report notes that the school has been very successful in growing and thriving despite the claims of mismanagement.
The SC Public Charter School District Issued this statement following the report;
“The South Carolina Public Charter School District has reviewed the Office of Inspector General’s report involving actions by the former Chief Executive Officer Lori Manning of High Point Academy. The District appreciates the work of OIG and the recommendations in this report directed toward the District. Prior to the OIG investigation, the District was already implementing the recommended actions in the form of a more robust application process and the development of a Core Performance System with differentiated oversight for first year and struggling schools. While the Charter School Act contains only general oversight requirements by authorizers, the SCPCSD has a detailed oversight program that balances the need to monitor expenditure of state and federal funds while respecting the statutory autonomy of SCPCSD schools. The District will continue to work with HPA and all of its schools to ensure the proper expenditure of taxpayer money in the education of our states, most valuable resource, its children.”
High Point Academy released this statement:
“The High Point Academy Board of Directors is in receipt of the report issued by the South Carolina Office of the Inspector General (“OIG”). Over the last several months, the HPA Board of Directors has acted in full cooperation with the OIG in connection with the OIG’s investigation of allegations related to HPA. The Board has been and is continuing to diligently focus on board governance, including implementing policies and procedures to correct past mistakes and ensure that the school complies with all applicable laws and regulations and utilizes prudent business practices. Moreover, the Board continues to be very excited about the high academic and educational achievements of HPA’s students. The HPA Board of Directors does not plan to comment on any of the former employees or contractors referenced in the OIG’s report. The HPA Board will continue striving to lead at all
times with honor, integrity, and service.”