Those companies won lucrative contracts for bus transportation and school management and were paid for services that went undocumented or that were performed by school employees, according to the complaint and supporting documents. The Options managers allegedly received “exorbitant” bonuses shortly before they resigned this summer to run the companies full-time.
The managers were allegedly aided by the chairwoman of the school’s board of trustees at the time — WUSA (Channel 9) vice president and news personality J.C. Hayward — and the senior charter school official, who was responsible for charter-school financial oversight across the city. Documents filed with the court papers show that the signature of Hayward, who allegedly helped incorporate one of the companies, appears to be on some of the expensive contracts. The three ex-managers, their companies, Hayward and the charter-school board official were all named as defendants in the lawsuit.
Hayward told Channel 9 that she did nothing wrong, but she has been relieved of her duties pending further investigation, according to a news report from the station. Hayward and WUSA’s general manager did not return calls from The Washington Post to their offices seeking comment Tuesday.
Donna Montgomery, former chief executive of Options and president of the two for-profit companies, said in a statement that no public funds were misused and that all contracts and payments “were disclosed and vetted by a variety of third parties, including the Options Board, outside auditors and the D.C. Public Charter School Board.”
“People tend to believe allegations like these are true when the facts are otherwise,” Montgomery said in a statement provided by Jeff Smith, who worked at Options until July and now is director of public affairs at one of Montgomery’s companies. “This is unfortunate for the Options School and its staff, me and my team but, most of all, the students.”
Options, an institution meant to change the lives of the city’s neediest children, served as a “cash-generating machine,” according to D.C. Attorney General Irvin B. Nathan, who has asked the D.C. Superior Court to appoint a receiver to oversee the school.
Criminal prosecutors are aware of the allegations and “will review all pertinent information as we continue our review of this matter,” said Bill Miller, a spokesman for U.S. Attorney Ronald C. Machen Jr.