Smart Start Partnership Re-Awards Multi-Million Dollar Contract to Mismanaging Non-Profit

In a controversial decision that followed heated opposition by the public and alarming questions raised by the members of the board, Durham County’s Partnership for Children voted to re-award a multimillion dollar contract to a non-profit with a very troubled past.

The Durham County Partnership for Children is the local Smart Start branch in Durham County and funds childcare programs and centers throughout the region.

Earlier this year a Civitas Institute investigation reported on a case of financial mismanagement on the part of a Smart Start contractor, Child Care Services Association (CCSA), that mishandled their $3.4 million budget for a childcare subsidy program that provides affordable childcare to needy children. As a result of their handling of the contract, nearly 200 children were abruptly kicked out of their childcare centers halfway through the year-long childcare scholarship. Consequently, many of the poorest children in Durham County were sent home, leaving childcare providers in dire straits trying to make up for lost revenue, and causing lower income parents considerable headache after losing quality childcare for their children.

The crisis occurred when CCSA overspent their budget—spending two thirds of a year-long contract in just six months. Budget documents provided by Durham County Partnership for Children show that CCSA was spending at a rate that would’ve exceeded their allocated budget by $1.2 million. Thus, halfway through the year CCSA was forced to cut back on many of the children promised a year of quality childcare, giving them only weeks notice beforehand.

CCSA subsequently attempted to justify their actions in documents released on their website, yet admit to knowing at the writing of the budget that a potential funding crisis was possible. They left a structural deficit in their budget that hinged upon hope for additional stimulus funding. “CCSA knew at the beginning of the year that there was a potential crisis,” the document states. “CCSA had hoped that more funds would become available [through additional federal stimulus funding]… Unfortunately, no new funds were available.”

With a budget based upon hope, CCSA promised many of Durham County’s poorest children a year’s worth of quality childcare, a promise broken just prior to Christmas last year.

That was then…

At a board meeting last week, the Durham County Partnership for Children met to make funding decisions for the coming fiscal year. Several vocal members of the public expressed their opposition to the decision to re-award CCSA with the $2.9 million subsidy contract, including a Civitas representative and an emotional speech from a childcare provider negatively affected by CCSA’s mismanagement.

During deliberations several board members raised concerns that they had never heard the official story as to why the CCSA failed in its administration of the FY10-11 contract, and a newer board member asked to hear the story to catch her up to speed.

“I would hate to inadvertently give any credence to a concern raised by members from Civitas, but I do feel compelled to ask for a brief summary of the situation last year, with the subsidies,” Durham County Public Schools member Leigh Bordley asked the board.

Durham Partnership Executive Director Laura Benson responded by reassuring Bordley that extra steps were taken to ensure the situation doesn’t happen again, including enhanced monitoring requirements to keep track of CCSA’s spending.

“It would be more helpful to me if we could have a brief rundown of how we got to that point,” Bordley responded.

Benson argued that the board meeting was not the appropriate venue to discuss that matter.

“I wonder if this is the place to unpack a very complex situation, and one that occurred over time,” Benson responded.

A large number of members of the board were directly affected by CCSA’s mismanagement and had a conflict of interest in the matter, and thus were not permitted to speak or vote on the contract. Nearly a third of board members present were rendered speechless.

“Ok, so there’s nobody left who can talk,” Board chair Angie Welsh said in reference to the long list of conflicts of interest that prevented deliberation over CCSA’s candidacy for the subsidy contract. CCSA’s rival for the contract was Durham County Department of Social Services, who had effectively administered the contract prior to CCSA winning it in FY09-10.

With the most impacted and knowledgeable members unable to speak or vote, the vote carried unanimously awarding CCSA $2.9 million for this particular program in the coming fiscal year.

Board members raised other pointed questions about the fairness and propriety of the allocations committee, the board that makes formal funding recommendations for the Durham County Partnership.

“Is there any reason or concern about this committee not being a representative, fair group?” Leigh Bordley, member of the Durham County School board asked the Durham County Parnership.

Gerri Robinson, Director of Durham County Social Services, agreed with Bordleys question, raising her own concerns about the board’s makeup.

“I think the makeup of the board is an issue… This group does not reflect the community or the people we serve,” Robinson argued.

Durham County Partnership for Children pays around 80 percent of its budget to CCSA. The Durham Partnership will fund CCSA $4.1 million of its $5.2 million budget for the upcoming fiscal year.


This article was posted in Education, Life & Family Issues by Andrew Henson on June 28, 2011 at 3:01 PM.

© 2011 The Civitas Institute. Visit us on the web at www.nccivitas.org.
This article can be found at http://www.nccivitas.org/2011/smart-start-partnership-re-awards-multi-million-dollar-contract-to-mismanaging-non-profit/

Comments on this article

  • 1

    Anonymous
    Anonymous Jul 02, 2011 at 21:34

    Maybe of DSS hadn’t reverted 600,000-650,000 at the end of FY 2010-2011, they would have been awarded the contract for this upcoming year. The fact that they reverted such a large amount of money that could have helped but children back in quality child care and that could have helped these providers maintain their businesses does not speak highly for Durham County DSS Subsidy program. Ultimately the Partnership had to choose between two programs: one program (CCSA that over spent while trying to help children and another program (DSS) that didn’t serve needy children despite having an extensive waiting list and an obvious need in the community. To revert that much money is a shame and an investigation needs to be done regarding their practices and decision-making for FY 2010-2011.

  • 2

    Anna
    Anna Jul 04, 2011 at 23:50

    Child Care Services Association has always put the best interest of children and families ahead of its own. I encourage everyone to look beyond the negativity that Civitas suggests and betrays. Just know that CCSA will always stand up for what is right, children, families and teachers.

  • 3

    Adriana
    Adriana Jul 05, 2011 at 13:55

    I am a child care provider from Orange County. I have been in business for almost 10 years now. I can proudly say that I own a great part of my successes to the support and guidance of Child Care Services Association.
    I do not see in this article the position of CCSA on this matter which is very much needed to make this article a fair one.
    CCSA is one of organizations responsible for improving child care quality in NC therefor it deserves the respect of the community.

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