Campaign Finance Office to Probe Charter Officials

By David S. Fallis and James V. Grimaldi
Washington Post Staff Writers
Saturday, December 20, 2008

The District's Office of Campaign Finance will investigate whether two members of the city's Public Charter School Board violated conflict-of-interest laws when they or their companies pursued private business involving schools they regulate.

"Any effort to realize personal gain through official conduct, that is what I am looking at," Kathy Williams, general counsel for the office, said yesterday.

The action by the office is the second examination announced this week into the overlap of private and public business among charter overseers. On Tuesday, the District's attorney general, Peter Nickles, said he will examine the official conduct and business ties of members of the board and the separate charter credit enhancement committee.

Williams said her office will send letters to the board chairman, Thomas A. Nida, and a former board member, Karl E. Jentoft, informing them about the investigation. If the office finds violations of conflict-of-interest laws, it could issue fines of up to $2,000 a violation, she said.

She said the investigation by her office, which enforces the city's ethics laws, is the result of a Washington Post report about conflicts of interest among key members of the two unpaid panels that oversee the city's charter schools. The Post found that members of the panels have taken part in official decisions that stood to benefit themselves, their colleagues, employers and companies with whom they have had business ties.

Nida, for example, has repeatedly voted or taken other official actions that involved schools or their developers and landlords that were clients of United Bank, where he is a senior vice president. During his time on the board and at the bank, United has lent more than $55 million to charter schools or their landlords and developers. Nida, who was personally involved in about $35 million of those loans as a loan officer or bank representative, has said he recused himself from votes when appropriate to do so.

Jentoft, who recently resigned from the board and moved to London, was hired in February for $14,000 a month by a developer as a consultant on two projects, including a D.C. charter school project that was funded by Nida's bank. The developer hired Jentoft weeks after he, acting on behalf of the charter board, reviewed and recommended approval of a charter school's lease with the developer.

Jentoft, who served on the board during the consulting work, has said he took appropriate steps to deal with potential conflicts of interest. In an e-mail yesterday, he said, "I am confident that I will be exonerated by any investigation."

Nona Richardson, charter board spokeswoman, said the board "will cooperate fully and provide any information" the campaign finance office requests.

Some elected officials have called for Nida's resignation and tighter controls on the growing charter system, one of the largest in the nation. The charter board and the credit enhancement committee are reviewing their policies on conflicts of interest, officials said.

Williams said her office is determining whether the credit committee, which has awarded about $47 million in loans and guarantees since it was created in 2000, is subject to the conflict-of-interest statutes enforced by her office.

Nida, 60, has not responded to a request for comment on the investigations.

Staff writer Joe Stephens contributed to this report.

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