Jos-Arz Therapeutic Public Charter School was supposed to save the city millions of dollars. Two years, 55 students, and $12 million later, the school board wants to know what happened.
Photographs by Darrow Montgomery
In the spring of 2000, Garrett Isacco says he received a phone call from a woman who identified herself as an aide to Ward 7 D.C. Councilmember Kevin Chavous. Isacco usually doesn’t deal with District politicians in his job handling the financial affairs for a Catholic order called the Marist Society. But the aide, whose name Isacco can’t recall, had a favor to ask of the Marists. A big favor.
Like most political favors, this one had to do with money. The Marists were collecting mortgage payments for a former seminary of theirs at 220 Taylor St. NE from a prominent D.C.-area couple, Gwendolyn and Rollie Kimbrough. The Kimbroughs had helped a local nonprofit buy the building. Both veteran government contractors, the Kimbroughs have had ties to the D.C. political scene since the early days of home rule.
The Kimbroughs were now in the midst of turning the old seminary campus into a public charter school that catered exclusively to emotionally disturbed adolescents.
Everything was going smoothly, says Isacco, until March 2000. By then, the monthly mortgage payments had fallen behind. Foreclosure was on the table, according to Isacco. Then came the phone call.
“She said the Kimbroughs had called the councilmember to ask us to hold off on foreclosure,” recalls Isacco. “She said that it is saving the city a lot of money to have that facility there, because the city was placing kids in Ohio.” The plea swayed the socially conscious Marist Society officials. “The decision [not to foreclose] was a moral, not a financial, decision,” says Isacco.
The Marist fathers’ patience was rewarded. Two months later, the Kimbroughs caught up on the payments, and the approximately $18,000-per-month mortgage installments resumed. Since then, they have continued, says Isacco, “without a hitch.” (Chavous and his staff insist they never intervened in the matter.)
When the Kimbroughs decided to try their hands at the charter-school business three years ago, they were relative novices at starting and running a school. And even for veteran educators, the Jos-Arz Therapeutic Public Charter School—named after Josephine Love and Arzana Kimbrough, the founders’ mothers—would have been an ambitious undertaking. The school is unique in the District—a hybrid day school and residential treatment facility, with each operation subject to a different set of regulations. More challenging, perhaps, is the population the school has chosen to take on—adolescents with serious emotional problems, which can range from attention deficit disorder to severe psychosis. Even at the best-run institutions for troubled adolescents, residents do things like try to escape or set fire to their facilities.
But expertise in handling troubled youngsters isn’t the most important qualification for running a special-education charter school in the District. Perhaps more salient is experience in courting public officials and securing public funds—and on this front, the Kimbroughs have few equals in town.
The school’s allies include Chavous, former control-board member Eugene Kinlow, former school-board President Wilma Harvey, and D.C. Democratic State Committee Chair Norm Neverson. Jos-Arz also has a high-powered legal team consisting of lobbyist David Wilmot and Sean Glynn, an attorney with Arent Fox, Chavous’ firm. They’ve all advocated for the school behind the scenes, if not openly at public appearances.
One local potentate, though, is missing from the Kimbrough cheerleading section: current school-board President Peggy Cooper Cafritz. Armed with oversight authority over charter schools, Cafritz and the board have been probing Jos-Arz’s finances and contracts since February. And that’s quite a job. To date, Jos-Arz has received in excess of $12 million in city funds to operate for two years and served a total of 55 students. School officials have yet to explain exactly where some of the funds have gone. Jos-Arz, a not-for-profit corporation, runs the school, while a separate nonprofit owns the building that houses it.
The school board’s investigation of Jos-Arz kicked into high gear this summer, after the D.C. Council voted in favor of $16 million in revenue-bond financing for the school. The money can’t be released to the school until Cafritz and her colleagues give their OK. Specifically, the board must issue something known in the educational bureaucracy as a “letter of good standing.” Cafritz says she can issue such a certification only after the board completes its investigation.
Unless Cafritz and her colleagues approve the letter and allow the revenue-bond financing to go forward, Gwendolyn Kimbrough, Jos-Arz’s executive director, says the school could collapse in months.
In her stubborn pursuit of Jos-Arz, Cafritz has drawn criticism for overstepping her mandate and otherwise obstructing the development of new educational outlets in the District. “The most puzzling thing I’ve ever been confronted with is, the public school system last year jeopardized the fiscal health of the city with deficit spending in the area of special education,” says Gwendolyn Kimbrough. “Why would they bend over backwards not to have [more services] for the city?”
Yet a close examination of Jos-Arz suggests that Cafritz’s investigation may be exactly what D.C.’s often loosely regulated charter schools need. After the city gave Jos-Arz $8 million in program money in April 2001, the school used more than half of that amount to collateralize a loan for its landlord, an organization that has Rollie Kimbrough on its board. The money was slated for construction, but so far, no one has provided the school board a thorough accounting of how it has been spent.
Jos-Arz officials will have to come up with answers soon, if not for Cafritz, then for the D.C. Office of the Chief Financial Officer. An agency spokesperson says the CFO’s office will audit the school this fall.
District taxpayers, through Jos-Arz, have ended up paying almost $200,000 per student. At that price, the services at Jos-Arz should be state-of-the-art. But according to parent complaints, Jos-Arz administrators aren’t responsive to them, the faculty and management have suffered from turnover, and for two years the school hasn’t participated in the subsidized school-lunch program—even though almost all of its students qualify—because administrators never got around to filling out the necessary paperwork.
Cafritz likes being a tough watchdog, but she’s not necessarily comfortable playing the bad guy. Sitting in her office off North Capitol Street, she shakes her head when she hears her inquiry into Jos-Arz described as a “power trip.”
“Whenever I do anything, people say it’s because I don’t ‘like’ them,” she notes. “It has nothing to do with liking or not liking anyone.”
Cafritz has taken a hard line on charter schools since she became board president, in January 2001. So far, her instincts have not steered her wrong. When she sat down with the charter-school files four months into her tenure, she says certain schools immediately caught her eye. Among them were the World Public Charter School and Richard Milburn Public Charter Alternative High School. She and her colleagues eventually concluded that those schools weren’t providing basic instructional materials such as enough desks or textbooks and were not adequately serving special-
education students. In June, the school board voted to close both schools.
By being decisive, Cafritz’s school board quickly distinguished itself from its predecessor, which had taken a year and a half to shut down TechWorld Public Charter School, despite signs of serious fiscal mismanagement.
At every turn, Jos-Arz has felt the heat of Cafritz’s aggressiveness on the charter-school front. On June 18, the D.C. Council approved Jos-Arz’s application for $16 million in revenue-bond financing. At the time of the council’s vote, the D.C. Revenue Bond Program had on file a letter of good standing for Jos-Arz that was signed by school-board member Dwight Singleton. On June 19, Cafritz wrote revenue-bond program director Michael Hodge to let him know that Singleton’s letter of good standing “has no effect.” “Such a letter,” she wrote, “must be approved by the Board and signed by the President.”
Cafritz’s activism on Jos-Arz stems in part from her background. In 1968, Cafritz co-founded the Duke Ellington School of the Arts as a summer arts program for 90 students, with only $30,000. These days, after numerous tussles with the District bureaucracy, the school is widely considered one of the jewels of secondary education in the city. So the school-board president knows a little bit about the single-mindedness required to get a school off the ground.
The Kimbroughs saw a school as one of several business options. In July 1998, the Kimbroughs teamed up with Community Research Inc., a D.C. nonprofit specializing in drug- and alcohol-abuse-prevention programs, to purchase the Marist College Seminary for $3 million. In recent weeks, Community Research has become a focus of the school board’s probe.
Rollie Kimbrough’s original concept for the building was to lease a portion of it to the D.C. government, according to court documents. Negotiations went on for months. Edward Bloom, Rollie Kimbrough’s attorney, even arranged a meeting with an official from St. Elizabeths Hospital and a deputy receiver for the D.C. Commission on Mental Health, court records show. Kimbrough also flirted briefly with the idea of turning the property into town houses. But by March 1999, when Kimbrough cut off talks with the D.C. government, he and his wife had settled on making the Taylor Street campus into a residential treatment facility for children with emotional and behavioral problems.
To get the main building ready, the Kimbroughs had to carve out space for classrooms and offices, find teachers and counselors, and buy supplies and furniture. The program couldn’t serve District children unless the D.C. Council approved a new funding stream for residential treatment. The program would also have to earn accreditation as a health-care provider.
The entire enterprise promised a grueling tour of the District bureaucracy. The Kimbroughs were savvy enough to head to One Judiciary Square for guidance. In February 1999, Gwendolyn Kimbrough appealed to Chavous’ office for help “in meeting with the appropriate people” in the school system, according to an Aug. 19, 1999, memo written by then-Chavous aide Bonnie Cain. The same month, Kimbrough says, she took school-board members Thomas Kelly, Westy Byrd, and Gail Dixon on a tour of
Board officials encouraged Gwendolyn Kimbrough to apply to run a charter school. They told her they were looking for charter schools that could provide services the regular school system could not. And a residential treatment facility certainly fit the bill. Children with emotional and behavioral problems are the most ignored population in public education, say special-education experts. Without Jos-Arz, only two such facilities are within the city limits. As a result, last year about 500 District children were scattered in institutions across the country at a cost to the District of $30 million a year, according to the D.C. Department of Mental Health.
In August 1999, Kimbrough returned to Chavous’ office for more help. The former Chavous aide recalls Kimbrough saying that she wasn’t able to obtain the necessary certification to launch a new residential treatment program—called a certificate of need—from the State Health Planning and Development Administration, despite months of effort. The District wouldn’t dispense funds to Jos-Arz until it had gotten the certification. And in the meantime, there was a mortgage to pay.
So Cain says she tried to expedite matters by taking Jos-Arz’s case to Carolyn Graham, deputy mayor for children, youth, and families. “The extent of my involvement was to make clear that any organization tackling this problem [of creating a residential treatment center] would have to overcome this hurdle,” says Cain. Graham spoke with the director of the State Health Planning and Development Administration at the time about Jos-Arz’s certificate of need, according to mayoral spokesperson Sharon Gang. In April 2000, the State Health Planning office issued Community Research a certificate of need. In March 2000, Gwendolyn Kimbrough had incorporated Jos-Arz Therapeutic Public Charter School as a nonprofit organization, along with her husband and Wilmot, who signed on as a trustee. From the beginning, Jos-Arz promised a full array of programs—a day school, vocational training, and residential treatment just for special-education students with emotional problems.
Before the school board would grant Jos-Arz a full charter, it required the school to secure legislation creating a specific funding stream for public charter schools to provide residential services. In February 2000, Chavous obliged by introducing and passing legislation doing just that. In June 2000, an optimistic school board granted Jos-Arz a full charter. Soon, public money began to flow to Jos-Arz. Along with its first quarterly payment, Jos-Arz also received a $2.3 million start-up loan.
The money wasn’t enough to ensure the school’s viability. The school had a year to repay the loan with city-granted operational funds. Those funds, in turn, would be based on the maximum number of students proposed in the school’s charter, or 190 students—120 in the day school and 70 in the residential treatment program. To make sure charter schools don’t receive money for students they don’t serve, an auditor comes in to count heads every October, and the city adjusts the school’s subsequent payments accordingly.
When Jos-Arz opened, that September, the school was already looking at a serious shortfall in enrollment and potential financial disaster. The school had renovated only the first two floors of the seminary, which was enough space for about 50 daytime students. The residential treatment center on the top two floors had yet to be built. To make matters worse, only 18 children were enrolled by October. Once the District adjusted the school’s funding, Jos-Arz would not be able to pay off its loan, and it would have to find additional money to make it through the school year.
Jos-Arz didn’t find other funds. Unlike other charter schools, Jos-Arz failed to undertake fundraising drives that would ease its financial pinch. The school’s directors, instead, turned to city hall. Chavous, again, was the key. In February 2001, he introduced legislation that relieved the school of paying back half of its $2.3 million start-up loan until the next fiscal year. The legislation also allowed the school to receive a portion of its annual allocation several months in advance. The D.C. Council approved the legislation immediately. As a direct result of Chavous’ bill, the city transferred $8 million to Jos-Arz in April 2001.
Chavous says his goal in passing the temporary legislation was to fund a program that, in the long run, would save the District millions of dollars by preventing hundreds of District children from being “shipped out like cattle.”
“Me and my colleagues wanted to allow for enough creativity in the law for there to be innovative programs for children whose needs need to be served in a unique way,” says Chavous. With so few schools such as Jos-Arz, he adds, “We spend so much money shipping these kids to California and Utah and paying for their parents to visit them.”
Before agreeing to help the Kimbroughs, Chavous says, he and his staff vetted the couple to make sure they could pull off what they had set out to do. His aides were favorably impressed with the Kimbroughs’ credentials. Gwendolyn Kimbrough had worked as an education policy aide for the House District Committee and the U.S. Commission on Civil Rights in the ’60s and ’70s. She even did a three-year stint as executive assistant to the D.C. school superintendent. Since 1992, she has been the sole owner and president of American Therapeutic Services Inc. (ATS), a D.C.-based company that provides transportation, occupational and physical therapy, and employee drug testing. Her clients have included the D.C. Village nursing home, the Washington Metropolitan Area Transit Authority, and Washington Gas.
Until two years ago, she was also the secretary and treasurer of MCSI Technologies Inc., a Silver Spring, Md.-based technology-services company that her husband started in 1979. MCSI filed for Chapter 11 bankruptcy protections in March 2000. (See sidebar.) MCSI’s bread and butter were multi-million-dollar contracts with the federal and District governments.
Rollie Kimbrough did so well working for Uncle Sam that he became a sought-after patron of the Democratic Party. In the 1994 and 1996 election cycles, Kimbrough contributed more than $70,000 in soft money to the Democratic National Committee, Federal Election Commission records indicate. The amount secured him the title of trustee for the Democratic Business Council—a now-defunct group for big-dollar party donors—and a seat at a June 1995 kaffeeklatsch with Vice President Al Gore. The couple resides in a two-story red brick house in Chevy Chase, Md., that’s valued at more than $1 million. One drives a gold Jaguar XJ8, the other a late-model Ford Expedition SUV.
Chavous insists that his legislative intervention on behalf of Jos-Arz was not aimed at improving the Kimbroughs’ financial standing. Rather, he says, it was to help the District better serve special-needs kids. “I don’t know the Kimbroughs from Adam,” he says. “There ain’t no bear there.”
Funding schools on the basis of the city’s education needs makes good policy sense. However, Chavous & Co., in giving the green light to Jos-Arz, appear to have skipped over some serious questions about how the school manages its money.
Despite the reams of correspondence and documents that the school board and Jos-Arz have exchanged so far, Cafritz says she still doesn’t have complete answers on the following matters:
* The relationship between Jos-Arz and Community Research. Gwendolyn Kimbrough is both Jos-Arz’s executive director and a former Community Research board member. On various documents, Rollie Kimbrough has been listed alternately as president of Community Research’s board, its assistant director, and its executive director. In the coming fiscal year, Jos-Arz is scheduled to pay Community Research $1.3 million in rent.
* Jos-Arz’s open-ended contract with ATS. Between fiscal year 2000 and fiscal year 2002, the school paid ATS $122,000 for student transportation, employee drug testing, and speech therapy. Gwendolyn Kimbrough says that ATS spent roughly $125,000 on Jos-Arz’s development gratis. Jos-Arz does, however, pay ATS to transport Jos-Arz students even though some of them qualify for free transportation from the school district. Kimbrough says that the district can’t accommodate all of the school’s transportation needs during the day. And many of her students, she says, don’t like to ride the so-called cheese buses for “personal reasons.” Kimbrough adds that contracting with ATS helps keep Jos-Arz’s costs down.
* The details of Jos-Arz’s financial arrangements. Last year, Jos-Arz used $4.2 million of its operational funds to collateralize a $4 million line of credit for Community Research. The money was intended to go toward construction of Jos-Arz’s residential treatment facility. School-board officials want to know how the money has been spent. So far, Gwendolyn Kimbrough has not turned over Community Research’s financial records because she insists that she is “not privileged” to Community Research’s “corporate information.” When school-board officials brought up concerns over disclosure at a contentious July 8 meeting with the Kimbroughs, the school’s attorney, Wilmot, replied, “I don’t know what your definition of—there are various definitions of ‘full disclosure,’ and I don’t know what it is you’re trying to ascertain,” according to a recording of the session on file at the school board.
Board members interviewed for this story say the questions Cafritz has raised are significant. At least one board member has also complained about the pace of the investigation. Tommy Wells, who represents Wards 5 and 6 on the board, says the drawn-out probe of Jos-Arz has unfairly left the school in a precarious position.
“I’m frustrated because I don’t feel like the board has all the information that it needs, but I wouldn’t put Jos-Arz at fault for that,” says Wells. “I don’t want to see Jos-Arz unnecessarily punished because of our caution. The school deserves a determination now.”
Wells says the council’s decision to sink more than $12 million into the school doesn’t alarm him, provided the school can account for all of it. “The city has made a substantial investment to get Jos-Arz up and running. They may not have the children, but that doesn’t mean it can’t still be an asset to the city,” Wells says. “What is the worst that is going to happen if we give a letter of good standing? Why err on the side of hurting the school?”
Gwendolyn Kimbrough says no matter what the outcome, the school board’s probe into Jos-Arz has already damaged the school’s reputation. In her office on a recent afternoon, she recounts how she recently offered someone the job of chief financial officer for Jos-Arz, only to be turned down. The reason the candidate gave? He didn’t want to get entangled in D.C. politics.
Kimbrough adds that she can’t blame him. As far as she is concerned, politics is Jos-Arz’s real enemy. She notes that Jos-Arz didn’t have any problems with the school board until Cafritz became board president. Previous charter-school monitors raised some of the same questions Cafritz is raising now, including queries about the school’s contract with ATS, board records show. But Kimbrough says that she filed an accountability plan to address those issues that met the board’s standards. She even brandishes a piece of paper dated December 2001 that says Jos-Arz filed all required reports last year. Yet no matter what she does, she says, Cafritz just comes back at her with “redundant questions.”
The latest inquiry—a seven-page, single-spaced set of questions—appeared on the Jos-Arz fax machine on Sept. 5.
Gwendolyn Kimbrough says she’s answered all the board’s questions. For example, she says, she disclosed the relationships between Jos-Arz, ATS, and Community Research in the charter-school application. School-board officials have asked for some of the same documents and information more than once, correspondence shows. “Anything the school board has wanted information-wise has been shared. Everything.”
However, the Washington City Paper’s own review of the information that Jos-Arz submitted to Cafritz, public records pertaining to Community Research, and interviews with Jos-Arz and Community Research officials indicates that Jos-Arz and Community Research haven’t provided the school board a clear and thorough accounting of how they have spent public dollars. For example, Jos-Arz didn’t fully reveal to the school board until July 22, 2002, that it had used money slated for school programs to collateralize the $4 million line of credit for Community Research. Gwendolyn Kimbrough says the school board didn’t ask for the information until then. On Sept. 5, the school board requested that Jos-Arz produce all documents related to the $4 million line of credit.
Construction of the residential treatment facility, Community Research’s stated purpose for the money, was originally estimated to cost around $2.8 million, court records show. Community Research paid the contractor, S.W. Day Construction Corporation of Chesapeake, Va., $1.8 million through December 2001. In May, Rollie Kimbrough says, he fired the contractor. Another contractor was hired to finish the job, which was left 70 percent complete.
Gwendolyn Kimbrough has referred all questions about Community Research’s finances, including the line of credit, to the group’s executive director, Donald T. Freeman. When asked by the City Paper whether Community Research had spent the entire $4 million, Freeman’s answer was: “I don’t know. I can’t give you an answer.”
Next, there’s the question of what has happened to Jos-Arz’s rent payments. According to the school’s lease, in fiscal year 2001, the school owed Community Research $878,866 in rent. The rent was scheduled to increase each year, by as much as 45 percent. For fiscal year 2003, Jos-Arz will owe $1.3 million. Gwendolyn Kimbrough explains that the rent increase takes into account the planned improvements to the building.
Jos-Arz hasn’t kept up with all of its rent payments, but for the past two fiscal years, the school reports that it has forked over about $1.5 million.
But if Community Research received a $4 million line of credit to pay for construction, what has it done with the rental income?
The rent payments are Community Research’s primary source of revenue, according to the organization’s 2000 tax return. And the group has few expenses. Freeman, the group’s only staff member, receives no compensation, the group’s tax returns report. In the past, costs for its drug- and alcohol-abuse-prevention program have run about $24,000 a year. The mortgage payments on the building run about $216,000 a year. Over two years, that adds up to far less than $1.5 million.
When asked what the group has done with the unused portion of its rental income, Freeman’s reply is: “There are answers to all these questions. I assure you.”
Finally, there is the organization’s debt to the Kimbroughs. The couple personally lent $405,520 to Community Research for the down payment on the school property, a July 30, 1998, trust document on file at the D.C. Recorder of Deeds office shows. Freeman says that that loan, plus another loan to cover monthly expenses and interest payments, appears on Community Research’s 1999 tax return as a $634,196 loan from directors. But on the tax return for the following year, the line listing loans from directors is blank. Freeman says he can’t explain why the debt disappears from the line from one year to the next.
In a June 10, 2002, letter to Cafritz, Gwendolyn Kimbrough wrote that she and her husband “have yet to be repaid.” The couple, however, signed an Aug. 11, 2001, lien release that says the $405,520 debt had been “fully paid and satisfied,” according to documents on file at the D.C. Recorder of Deeds office. Gwendolyn Kimbrough says she and her husband signed the release because: “We borrowed money for the build-out. The bank wanted to have first position on the property, so we removed our lien so the bank could assume that position.”
“Why is it so hard for people to believe that some people can be magnanimous?” she says, adding: “I have never received any form of compensation from Community Research.”
Rollie Kimbrough can’t make the same claim. Freeman says Community Research has repaid a “substantial portion” of Rollie Kimbrough’s debt—but he says he doesn’t know by how much.
Community Research’s 2000 tax return reports that it paid $70,000 in compensation to Rollie Kimbrough—the only director to be paid. Freeman describes the $70,000 as “a partial repayment” of the 1998 loan. However, according to accountants the City Paper hired to review the group’s tax returns, the $70,000 doesn’t legally count as loan repayment, because it is listed as compensation.
Freeman insists:”No one is putting money in their pocket. There’s a loan agreement. If [the school-board members] need to see all that, they need to ask for that. They may be embarrassed when they find out how above-board things are. They are implying a lot of things and use implications to meet their ends. They have no facts.”
Yet Freeman and Community Research apparently don’t have complete records. For example, applications for revenue bonding require applicants to attach three years of tax returns. Community Research included only a 2000 tax return. In its application, the group explained that it “was not required to prepare such forms until the year 2000.” However, the group did prepare 1998 and 1999 tax returns. They’re available on the Internet.
“I didn’t know they existed. Rollie probably didn’t know they existed,” says Glynn, the bond attorney for both groups, who helped prepare the application. “Either he forgot or didn’t know they were filed.”
Only the 2000 return appears to have been prepared with computer software—or even a calculator. According to the City Paper’s accounting consultants, arithmetic errors abound on the group’s 1998 and 1999 forms. On the returns for all three years, the accountants say, figures from one year don’t carry over into the next, and key information is missing, such as schedules for mortgage payments and copies of the terms for the group’s loans.
The Kimbroughs and Freeman insist that there’s nothing improper going on with the public funds flowing through Jos-Arz to Community Research. “Is there no room for error in people’s daily lives?” asks Gwendolyn Kimbrough.
Though “sister organizations,” Jos-Arz and Community Research are independent entities, says Freeman. “Rollie Kimbrough has influence. He’s a close friend. But we do not make decisions based on his needs. They’re based on our history and where we’re going. We’re run as a nonprofit. There’s no ownership, no profit being made.”
Fishing for government contracts, as it turns out, has limited crossover utility in setting up a school, especially one that requires as much work as Jos-Arz.
Gwendolyn Kimbrough says her plan was always to ramp up enrollment as the building became ready to accept students. She says she told school-board officials that she planned to renovate the first two floors for the day school before building out the residential treatment center on the top two floors.
One upshot of the gradual build-out was that the school couldn’t accommodate 190 students when it first opened—even though it was receiving funding from the city based on that enrollment figure.
As for the enrollment deficit, Gwendolyn Kimbrough blames the school district for not following proper procedures for referring special-needs students to Jos-Arz.
School-system officials and charter-school experts say the onus is on the school to recruit kids. Cafritz says the school system can’t force parents to choose a particular school. “The school system is required to give parents choices,” says Cafritz. “We can say, ‘Here are a list of schools. You can look at them,’ and parents make that choice.”
Jos-Arz also had more trouble finding financing to pay for the build-out than Kimbrough had anticipated. She says Jos-Arz first applied for bank loans but was turned down. She says next the school turned to the U.S. Department of Housing and Urban Development, which offers financing for the construction of residential treatment centers. But she says that because the project included a school component, Jos-Arz didn’t qualify.
So Kimbrough got creative, using more than half of the money Jos-Arz received from the February 2001 temporary legislation to secure the $4 million line of credit for Community Research, which then was to put the loan toward construction of the residential facility on the old seminary’s top two floors.
But Jos-Arz needs the $16 million bond financing to pay off the line of credit and the balance of its $3 million mortgage. The rest is earmarked for a 45,000-square-foot addition to the school that will allow Jos-Arz to reach its 190-student enrollment. Without the completed addition, Gwendolyn Kimbrough won’t have the space for 190 students. Without 190 students, she can’t justify to the school board the receipt of public monies that she needs to build the addition. She says she plans to build a temporary structure on the front lawn to accommodate more students. But she knows that the best way out of the situation is the $16 million in revenue-bond financing. Without that infusion of money, Kimbrough says, the school may not exist in a few months, leaving both Community Research and the city out millions of dollars.
If that happens, she says, Cafritz and the school board will have hurt an organization that was only trying to help children. “Community Research is totally liable for everything that has happened. I am really sorry that I appealed to [Community Research] to help make this program option a reality,” she says. “I never in my wildest imagination thought that the very body that is responsible for providing educational opportunities to children regardless of their needs [would] be the very body that bent over backwards to squelch program options for special-education youngsters with this disability.”
“If anybody has lost in this, it’s not been the city, it’s not been these kids,” Gwendolyn Kimbrough says. “If anybody has lost in this, it’s been me and my husband.”
On a hot clear afternoon in September, balloons flutter in the wind outside the gate to Jos-Arz. More balloons form an arch over the doorway. And the front lawn is filled with tidy rows of white chairs.
About 30 people have turned out for Jos-Arz’s open house. After a long delay, the residential treatment center is finally ready.
Before the program begins, one male and one female student take turns leading groups of guests on a tour of the school building. “This is one of my favorite teachers,” says Natasha, the female student guide, stopping at one of the classroom doorways. Then she leads her guest to the new residential treatment facility on the third floor.
A few weeks earlier, Gwendolyn Kimbrough brought in her personal interior designer to spruce up the residential floors. Standing outside greeting guests, the designer, who says her name is Vita, explains how she “thought about what it would be like to be a child and what the child would need to feel pampered and loved.”
Inside, Vita’s touches are obvious, from the denim trash cans, complete with back pockets, in the boys’ rooms to the chenille blankets folded at the end of the beds. In the girls’ rooms, the comforters on the bunk beds are pulled back just enough for visitors to see the tropical-themed lining. Both genders get message boards crisscrossed with ribbons.
Still, the residential floor has an unfinished feel to it. The halls smell of fresh paint. Half-peeled price stickers cling to the front of picture frames. As Natasha stops just inside a common area on the boys’ wing, she announces unprompted, “The ‘frigerator and entertainment system are coming.”
Some parents say the sense of an institution run on the fly is nothing new at Jos-Arz. “It’s like a group of people got together and said, ‘We’re going to open a school,’ and no one came to the table with any plans. Everybody collectively started running things,” says Sharon Tyler, president of the school’s parent-teacher association. “Anybody can see the program’s not well-put-together. It’s thrown together, and they’re trying to keep it together.”
According to the school board’s files, Tyler was one of two parents who complained in December 2001 that the school lacked lockers, school lunches, and, on a couple of occasions, heat. The lockers eventually appeared, and so did the heat, but the school lunches didn’t, even though most of Jos-Arz’s students qualify for a federal lunch subsidy. During the school year, the school has an arrangement with D.C. Central Kitchen to provide lunch a couple of days a week. The other days, the kids forage on their own, say school-board officials. Tyler says that her own daughter usually ends up at a nearby 7-Eleven.
When asked why the school hadn’t participated in the summer free-lunch program, either, Gwendolyn Kimbrough told school-board officials in a May 25, 2001, letter that the school had simply “never received an application for this program.”
On the day of the open house, as guests peek into the cafeteria, where caterers are setting up a silver-and-gold punch fountain and plates of grilled eggplant and shrimp salad for the reception later, the subject of lunch comes up again. When asked by a visitor how the food at the school is, Natasha replies, “Mostly
we have pizza.”
The food may stay the same, but the staff does not, says Tyler. After two years, the school is on its third director of education and is looking for its third chief financial officer. Says Tyler: “I don’t bother to learn anyone’s name anymore, because they won’t be there for long.”
Tyler says the school has improved since it opened, but she’s still not satisfied. “I’ve been wanting to pull [my daughter] out, but there’s not too many schools in the area that are right for her,” she says. So Tyler will stick with Jos-Arz for now. “They know they got you between a rock and a hard place.”
Gwendolyn Kimbrough argues that despite the school’s trials, her staff has managed to serve its charges well. At the open house, the two tour guides, at least, seem content. “People don’t like it here at first, because it’s a small school. After a while they know they’re here for a good cause, so you can learn better,” the male student says. “People here been through what you been through. They want to help you.”CP
In their oversight of Jos-Arz Therapeutic Public Charter School, Peggy Cooper Cafritz and her colleagues on the D.C. Board of Education have limited themselves to probing the finances of the school and its landlord, Community Research Inc. Over the years, however, the school’s founders, Gwendolyn and Rollie Kimbrough, have kicked up a docket of lawsuits, debt problems, and tax liabilities. Here are some recent highlights of the Kimbroughs’ corporate career:
* Gwendolyn Kimbrough’s company, American Therapeutic Services Inc. (ATS), owes federal taxes going back to 1995. Two Internal Revenue Service liens totaling $221,879 remained open as of Sept. 17, 2002, according to the IRS.
* ATS was sued twice by subcontractors for nonpayment, according to court records. In one case, ATS paid a $23,000 judgment; in the other case, it settled for an undisclosed sum.
* Gwendolyn Kimbrough draws two $150,000 salaries, one from ATS and one from Jos-Arz, school-board records indicate.
* Rollie Kimbrough’s company, MCSI Technologies Inc., filed for Chapter 11 bankruptcy protection in March 2000. He and his wife were the company’s only two directors, court records show. And among MCSI’s debts was $500,000 in unpaid federal taxes, according to a June 8, 2000, claim filed by the IRS.
* In 1999, Rollie Kimbrough and MCSI were sued by a subcontractor, ADCS Inc., over a $40 million contract for the U.S. Department of Veterans Affairs. ADCS alleged that Kimbrough had shortchanged ADCS by $1.7 million. A U.S. District Court judge dismissed the case in 2001.
* Court records indicate that in July 1998 Kimbrough pledged revenues from the Veterans Affairs contract to PrinVest Inc., a New Jersey-based lender to “sub prime borrowers,” as PrinVest officials put it in court records. Kimbrough then began drawing $1.9 million in advances from PrinVest to pay MCSI operating costs and debts, court records show.
In a March 5, 1999, memo, Veterans Affairs contracting officer Gail Cotten wrote: “MCSI admits that they have redirected the funds received from the government to other company projects.” The same month, Veterans Affairs officials fired MCSI and hired ADCS to complete the work.
In July 31, 2000, deposition testimony, Kimbrough admitted that the PrinVest advances had helped pay for his $300,000 salary. But he insisted that he hadn’t withheld any money that belonged to ADCS.
MCSI also made payments to Rollie Kimbrough and ATS, court records show. In his July 31, 2000, deposition, Kimbrough denied that he and his family had personally benefited from MCSI’s relationship with ADCS and that MCSI had been repaying him for loans he had made to keep MCSI afloat.
* In March 2002, the D.C. Child and Family Services Agency considered taking MCSI to court over work the company performed a few years ago, says agency spokesperson Mindy Good. MCSI had a $4.9 million contract to update the agency’s case-tracking system. But the MCSI program produced data that failed to meet federal standards, according to news reports. Agency officials estimated that the city needed $14 million to get the system working properly. In a March 2002 legal opinion, an agency attorney recommended against legal action because of MCSI’s 2000 bankruptcy filing, says Good.
When asked about MCSI, Rollie Kimbrough replied: “All that stuff is out there. You go have a good time.” —Annys Shin
Art accompanying story in the printed newspaper is not available in this archive: Photographs by Darrow Montgomery.