Fraud, waste hijack tutoring program

  • Article by: JEFFREY MEITRODT and DAAREL BURNETTE , Star Tribune
  • Updated: June 4, 2012 - 1:19 PM

A decade of problems has failed students, schools and taxpayers.

Jeremiah Jackson is supposed to be working on his online tutoring lesson, but the 8-year-old can't keep his eyes off "Burnout Paradise," a high-speed car racing game blaring on the family's big-screen TV in St. Paul.

"Go back and jump off the ramp," he tells his sister, Tangeline, as she controls a red Lamborghini.

His grandmother tries to keep his mind on his studies. "Pay attention to what the lady is saying," she urges.

An hour later, Jeremiah has completed just two worksheets, and the tutoring company that's being funded by taxpayers to give him an academic boost is $48 richer -- a small but telling sign of how a nearly $1 billion annual program to help the poorest students in the nation's worst schools is faltering.

The federal tutoring program, which has become a fixture in many Minnesota school districts, is rife with mismanagement and fraud, a Star Tribune investigation shows.

Most participating students are failing to achieve the academic gains educators expected a decade ago, when the government first required districts to spend federal aid on tutoring.

School officials are demanding the ouster of tutoring companies they say are predatory or incompetent. Parents complain about being forced to choose a tutor with little guidance. Many describe missed appointments and long service delays -- with some students waiting six months for their first tutoring session.

In the Twin Cities, records show that thousands of students have bailed on the tutoring program without completing a single lesson. Others have received tutoring in the wrong course or grade level, or have struggled to communicate with incomprehensible tutors in foreign countries.

At least 21 tutoring services in Minnesota have been caught seeking payment without being able to provide proper documentation or have been denied payments after billing for tutoring sessions that supposedly took place between midnight and dawn, records show.

"I don't think anybody sitting in the room would dispute that this program has been, at the very least, undermanaged if not mismanaged," said Charlene Briner, chief of staff and communications director for the Minnesota Department of Education.

However, state and federal officials have been reluctant to meddle in the lightly regulated market.

The U.S. Department of Education introduced new rules to improve oversight in 2009, but federal regulators have not checked to see whether states are implementing the measures, acknowledged Michael Yudin, acting assistant secretary of the department's office of elementary and secondary education.

In Minnesota, unfit tutoring services have been given second chances by state regulators, even after companies were fired by local school districts. The state also has never enforced a federal rule requiring regulators to eject any vendor that has failed to "contribute to increasing academic achievement" for two years in a row. Minnesota is one of more than two dozen states that did not properly monitor the tutoring program, records show.

Some parents wonder if the expensive program is worth the trouble.

Vanessa Jackson enrolled two kids with an online tutoring firm this year, but she had to switch after the company was fired by St. Paul officials for failing to start services, among other problems. Jackson said her children enjoy their new tutor, but she said she hasn't seen much improvement in their classroom performance.

She worries that her son Jeremiah is not being challenged enough, because he tends to repeat work he has already mastered. "This isn't really pushing them," she said.

The tutoring program's future could be decided later this year.

President Obama left it out of his proposed revision of No Child Left Behind, the federal law created a decade ago to improve the nation's schools. But the tutoring program still has supporters in Congress, who are seeking a compromise with the White House. School officials say they expect the tutoring industry to mount a fierce battle to protect its interests.

Meanwhile, most states -- including Minnesota -- have sought federal waivers that would free them from the tutoring program's requirements. Some of those states remain committed to the program, but Minnesota is not one of them. State officials said they believe the program is too broken to fix, and they have taken steps to limit their involvement since obtaining a waiver in February.

The waiver means local school officials will get to decide for themselves whether to offer free after-school tutoring to their students in the fall.

Susan Currey, who oversees the tutoring program in St. Cloud, predicts that only a "handful" of school districts will keep the program going. "We know what these kids need better than these companies from all over the world, with their one-size-fits-all approach," Currey said.

Others believe the blame should be cast wider. Jon Peterson, who oversaw the tutoring program in Minneapolis for three years, said more should have been done by state and federal officials, as well as local school districts.

"We are all responsible for educating our children, and we all bear some of the blame for what happened" to the program, Peterson said.

High rates, little instruction

Ten years ago, when Congress created the tutoring program as part of No Child Left Behind, proponents believed the private market would accomplish what the public sector had failed to do.

For the first time, many parents would have a say in how their kids were educated. If they didn't like the troubled school their children were attending, they could switch and districts would pay for transportation. If they wanted to take advantage of free tutoring, they would have plenty of options, and districts would foot the bill.

To pay for the tutoring program, known officially as Supplemental Educational Services (SES), school districts were required to set aside up to 20 percent of the money they receive through the federal government's anti-poverty program known as Title 1. To qualify for the extra help, students must come from low-income families and attend a Title 1 school that has repeatedly failed to meet state standards.

As the list of troubled schools grew, so did the program. Nationwide, $970 million was spent to provide Supplemental Educational Services to 700,000 students last year, up from $375 million in 2005-06.

In Minnesota, more than 80 tutoring services are competing for a maximum of $20.5 million in funding available for the program this year. Some are faith-based organizations, including the Salvation Army. Others are nonprofit groups with long-standing ties to the community or tutoring services formed by local school districts. Most offer face-to-face tutoring, either individually or in small groups.

The most successful providers, however, are for-profit companies, including online operators that do their teaching over the Internet with customized computers and, occasionally, offshore tutors.

With heavy marketing and aggressive recruiting, for-profit operators now dominate the tutoring market, even though they charge up to $90 an hour for their services in Minnesota -- vs. as little as $5 an hour for nonprofit organizations.

Educators say those high rates have seriously undermined the program, making it virtually impossible for most students to get enough hours of instruction to make a difference in their schoolwork.

On average, participants in Minneapolis and St. Paul receive just 29 hours of tutoring before federal funds runs out -- far below the minimum of 40 hours recommended in multiple studies, records show. Many students in Minnesota and other states don't even get 20 hours of help.

In Osseo, where students can receive no more than $1,147 worth of tutoring this year, many students had to quit at 15 hours, said Don Pascoe, who oversees the district's program.

"It's like giving a kid half an aspirin," said Pascoe, who believes low-performing students need at least 60 hours of tutoring to catch up to their peers. "It's not a big enough dose to make a real difference."

In 42 state and district studies reviewed by the Star Tribune, researchers repeatedly found that the tutoring program failed to make a significant difference in student achievement across the nation, including Minneapolis and St. Paul. In several reports, researchers blamed the poor results on too few hours of instruction.

In just six studies did researchers find measurable gains. Even then, the evidence was often underwhelming and contradictory. In some studies, students who did not receive the extra help outperformed those who received government-funded tutoring.

"It wasted a lot of money and a lot of people's time," said Steven Ross, an education professor at Johns Hopkins University who led at least 15 state studies analyzing the program. "It was inadequately funded and developed. The policies don't work. The whole concept was a bad turn. ... It turned out to be very dysfunctional."

Despite their frustrations, many parents remain supportive, saying a flawed program is better than no program at all.

Erlinda Gonzales, a grandmother in Minneapolis, credits the tutoring program with helping her three grandchildren catch up to their peers in school. She said it was a big job. Two of the children had already been held back a grade and all were struggling.

"When I got custody of my grandkids last year, the two [younger] ones ... didn't know their ABCs, they couldn't read. It was really sad," Gonzales said. "I've seen a big difference. ... Do not take this program away."

Educators agree the tutoring program has helped some individual students, but they say resource-stretched school districts can't afford to spend this kind of money on services that don't help most children.

"To give parents something less than adequate seems like a lie," said Sherry Carlstrom, who helps manage the tutoring program for the St. Paul public schools. "It is false hope."

'Phantom' stdents and fraud

Under federal law, school districts have little control over the tutoring market. Local officials can't set rates or dictate instructional content. They can't require a minimum number of hours of instruction. They can't even remove a provider because they think its tutoring program doesn't work.

"Even if I'm appalled by the quality of tutoring, that's not the criteria I can use in terminating a contract," Carlstrom said.

In fact, one of the few ways a district can get rid of a problem provider is finding evidence of fraud. In Ohio, several companies were ejected from the state's tutoring program last year after school officials in Columbus alleged the firms had been submitting false invoices.

In Miami, the operator of a large tutoring service was arrested and charged with 47 felonies in November for allegedly defrauding three local schools by billing for "phantom" students and overbilling for others. The nonprofit corporation received more than $1 million in tutoring payments, even though many high school students told investigators they spent their time "logging onto the NFL.com website," according to the inspector general for Miami-Dade County public schools.

In New York, the Princeton Review, one of the nation's best-known test preparation companies, was sued last month by the Manhattan U.S. attorney and accused of fraudulently obtaining millions of dollars in tutoring payments by forging student signatures and falsifying time sheets between 2006 and 2010. The lawsuit said the manager in charge of the program earned $16,200 in bonuses by inflating attendance. The company said it is working with the U.S. attorney's office to "resolve this matter expeditiously" and noted that the manager is no longer with the company.

In St. Paul, Carlstrom and her colleagues have spotted at least $500,000 in suspicious invoices for after-school tutoring, but they were able to deny just $170,000 in payments.

"There was probably a lot more fraud that we haven't been able to nail down," Carlstrom said.

At least three companies were terminated after investigators in Minnesota school districts turned up false records or other misrepresentations. Just one of those companies -- Somali Education Center -- was subsequently removed from the state's list of approved tutoring providers.

In 2009, Somali Education Center's contract was terminated in St. Paul after Carlstrom spent two weeks interviewing families and found the company was billing for sessions that didn't take place, among other problems. Altogether, the district denied more than $26,000 in payments to the nonprofit organization.

The state investigated and found multiple violations of state and federal laws.

In a 2009 letter to St. Paul officials, a director of Somali Education Center acknowledged invoice "errors," but he said the district was notified of the problem "before payment was made." He also said the district was subjecting his organization to "unprecedented scrutiny."

Carlstrom said more scrutiny is needed, but she said district administrators can't check every invoice, which can cover hundreds of tutoring sessions and take weeks to verify.

"At some point, I have to take their word for it," she said.

'Like being in a war'

To drum up business, tutoring companies typically blanket low-income neighborhoods and sign up as many families as they can in a short enrollment period. Often, those families don't even qualify. In St. Paul, officials rejected 1,500 applications last fall because students were ineligible or applied more than once.

In St. Cloud, district officials became concerned when 40 families picked the same provider this year, even though it was new to the city. The district investigated and found the families had been recruited by the vendor and were unaware that eight other providers were available. More than a dozen families switched after getting the complete list.

"They were pretty much hoodwinked," Currey said.

Perhaps the most audacious move came in Minneapolis, where an agent of a company called 1 to 1 Tutor walked into five public schools last fall and -- after convincing school workers she worked for the district -- managed to collect a bunch of enrollment forms for 1 to 1's competitors, according to district records.

In an e-mail to the district, 1 to 1's general manager apologized and promised to suspend or terminate any individuals involved with such "unacceptable and intolerable" behavior. The district, however, terminated its relationship with 1 to 1, transferring its 50 students to other providers. In its termination letter, the district also cited other improper marketing practices.

"The tolerance level for something like that is zero," said Nicole Norton, an administrator with the Minneapolis public schools who oversees the tutoring program.

Veteran recruiter Wesley Smith said he spent weeks handing out 1 to 1's fliers at discount grocery stores, homeless shelters and the county welfare office. He even set up a table at the Salvation Army's coat drive in Minneapolis.

"I'd stop kids at grocery stores and ask, 'What school do you go to?'" said Smith, who earned $10 for every signed application he delivered for 1 to 1.

"It's like being in a war," said Smith, who signed up more than 500 tutoring students for 1 to 1 and two other tutoring services this school year. "It's like being a headhunter."

Parents said it's hard to make an informed decision in selecting a tutor, considering how little information is available.

Hard lesson for parents

Unlike 20 other states, Minnesota has never helped parents distinguish between the best and worst providers by ranking tutoring services, conducting customer satisfaction surveys or evaluating provider effectiveness. Schools are supposed to give unbiased advice and not recommend a specific provider.

"Honestly, it was a close-your-eyes-and-pick-one type of situation," said Crystal Zimmerman, a Rochester parent who gave up on tutoring this year after she failed to hear back from the tutoring firm she selected for her daughter in November.

When Jennifer Johnston found out her two elementary school children qualified for free tutoring last fall, she felt grateful and enrolled them immediately through the Rochester public schools. She had no idea how to select a tutoring company, but she wasn't worried. She figured any company that had to go through a state approval process would be fine.

She wound up with 24 Hours Tutoring, a company that was fired by Anoka-Hennepin and St. Paul school officials for a range of alleged contract violations, including failure to provide promised services, submitting a false invoice and submitting "falsified learning plans" for some students.

Despite the problems, state officials did not bar 24 Hours from the program.

"Just because one district is having a negative experience with a company doesn't mean that there isn't another district having a positive experience with the same company," Minnesota Education Department spokesman Keith Hovis said.

Patrick Roy, who identified himself as the person in charge of 24 Hours Tutoring in the United States, declined to answer questions about the company.

Johnston waited three months for 24 Hours to fix a technical problem so her kids could start to receive tutoring, but she said she was never able to connect with anybody at customer service. At the end of February, she switched to another state-approved vendor and had similar problems.

It wasn't until April 16, after Johnston chose a local firm that provides face-to-face tutoring, that her fourth-grade daughter finally sat down with a tutor. Johnston decided against tutoring for her younger son.

"I'm really hoping she benefits from it, but with the problems we've had -- and the problems other people have had -- it's probably not worth it," Johnston said. "It's just a waste of time."

jeff.meitrodt@startribune.com 612-673-4132

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