EducationNews.org

KELLEY'S KICKBACKS -- PARMA CITY SCHOOL DISTRICT BOARD DISCUSSES ALLEGATIONS

by George Deabold

It was reported to SchoolWatch that at the Board of Education meeting of August 13th, the Parma Board hustled through business and postponed other planned business so that they could scurry into executive session and discuss the allegations made against board member Kevin Kelley that he has been involved in kickback schemes.  Kelley was one of three individuals that had his home and office searched pursuant to a warrant executed by the FBI. 

The board did undertake some hasty necessary business and appointed a new principal.  There was also discusison of an audit being conducted. They cut short the public comment section announcing that they had to get into executive session to discuss a 'public employee that is under investigation.' 

The newly appointed principal feigned excitement before the board and her mother who attended with her.  One could not help but note a degree of stress on her face, perhaps due to her being hired by a district in the middle of Ohio's biggest corruption scandal of the decade.

One board member insisting on not being named, confirmed that the public employee that was discussed in executive session is board member Kevin Kelley.  As alleged on www.mapthemess.com Kelley is linked to kickbacks from contractors and lawyers.  The board discussed at length how to counter the allegations to alter public perceptions.  Kelley refused to resign when it was proposed, and pushed strongly an audit to be done.  Discussion occurred regarding legal counsel to deal with the investigation, and Kelley pushed for that counsel to be the Squires firm. For those of you who want some insight into how a scheme such as this is pulled, here's how.

Most school district boards operate in a manner of providing oversight to the administration.  Most administrations are given certain decision-making powers, within limits, and the board monitors the administration actions.  For larger issues, the administration would consult with the board, make recommendations, and the board would vote to approve or disapprove the recommendation.  In large contracting issues, generally the administration would put something out to bid, sealed bids would arrive, the administration would investigate those doing the bidding, and then make a recommendation to the board.

But in Parma, Kelley pulled off a very unusual seizure of power.  Kelley came in with a highly funded campaign that financed his election and others that he convinced to follow him.  Once elected, those that were elected along with him placed him in the president's seat.  Once there and with the support of those elected with him, they orchestrated a legal, yet highly unusual seizure of administrative powers over contracts.  Interestingly, the individual behind Kelley's coup was Vincent Carbone who directly and indirectly financed Kelley's election.  If you have all been reading the news, you are aware that Carbone has plead guilty to a corruption/kickback scheme in another construction scandal.

Now, those close to the investigation are aware that Carbone was a board member in the Orange City School District, where the same type of coup occurred under Carbone's watch.  Just as in Parma, allegations of contract steering were made.  And also just as in Parma, legal fees shot through the roof.  Not surprisingly, the firm representing both Districts is Squires, Sanders and Dempsey.  And as suggested on www.mapthemess.com , there may be some benefit to board members in these districts to allow legal fees to shoot through the roof.

Now, once the board had control over contracts, steering these contracts was simple.  Who is building a house right next to Kelley on Johnson's Island? Joe Gouker, a Parma School District project director who was served a subpoena last week by the FBI in connection with the probe. And who do sealed bids get sent to? Joe Gouker, of course.  And who brought Joe into his position shortly after his election? Kelley, of course. So, Carbone finances Kelley's election move. Then Kelley pulls of the coup seizing complete control of bidding and contracts from the administration. And then Kelley puts his boy in the key position to steer the contracts.  This appears not to have been a scheme by happenstance, but a long thought out plan to seize control of public finances for personal benefit.

Now another large contract that boards control is the one for legal services.  This is another area that raises suspicion.  Kelley pulls of his coup, and along with Gouker being brought in, Michelle Nolan is brought in as the Director of Special Education.  Nolan had not even been in a Directors position, and was coming from the tiny district of Lakewood.  Experienced for the job of a 12,000 student district?  Of course not. The prior director Judy Hudgins was made subserviant to Nolan, with no explanation. The administration at the time opposed this change, and Kelley's board pushed it through.  As a result, the prior special education director leaves, being unwilling to work under these conditions.  Now, the position Nolan filled was not advertised in any fashion. It was a board directed change.  Why?  Likely because of this well thought out plan to get people in place who would "play ball." What immediately occurs after Nolan is brought in?  Special education litigation costs shot through the roof!  Parma spends about $1 million dollars on special education litigation each year -- three or four times the cost of similar districts. (Let's not count Orange, as they experience the same phenomenon when Carbone got on their board.)  The law firm in both districts?  Squires, Sanders and Dempsey.  The attorney? Christina Peer.  Coincidence?

When Kelley orchestrated this coup, the district had a long serving superintendent who decided it was time to retire.   Kurt Stanic, an honorable gentleman, was hired as the superintendent while Kelley was engaged in pulling in "his people." Stanic spoke out against Kelley and what he was setting up.  He was superintendent for about three months and chose to leave before his contract was completed. The word on the street is he did not want his reputation tarnished by what was being pulled off in Parma.  He is now the superintendent in Dayton. Kelley then brought in Zatik, who turned a blind eye to the shenanigans.  And what benefit to her?  Well, recently she was rewarded by the Board by retiring and then being hired back, allowing her to nearly double her income.  Was this a payoff for her role in the corruption?

We are hearing from our sources that there is at least on individual that has been actively working with the feds for the last 14 months. This investigation has been ongoing, reportedly, for 19 months.  This individual supposedly has taped conversations with subjects of the investigation implicating others, including people in the Parma City School District's employ.  It sounds as if Kelley may have been a bit of a braggard about his exploits in Parma.

Let's predict Parma's next move, shall we?  Kelley and the other "players" on the Board and in the administration are going to push strongly for an audit to be done.  Yes, they will ask some outside company to come in and audit the District's books.  And for what purpose?  So that once the audit is complete, they can shout from the roof tops, "See, there are no problems in the District and the auditors confirmed it. Therefore, I Kelley am inicent of any wrong-doing."  And most of the ignorant masses will accept those statements.  The truth is, however, that an audit of the District books and contracts is not going to show evidence of the type of scheme that appears to have been carried out here.  The disbursements flowing to the corrupt public officials don't show up on the public entities books.  They are delivered in brown envelopes under the table in a crowded restaurant.  They are delivered with backhoes that put in the new pool at no cost.  They are delivered with connections to the county office building, where someone under-assesses your property saving you thousands each year. They are delivered by giving your spouse a government job
for which he/she is not qualified.  But, Kelley will be using this audit to argue his innocence.

Remember the Nixon tapes, and the problems they caused?  What is going to be very interesting is to see this investigation unfold, and it will be particularly interesting to see the crimes that are discovered as individuals attempt to conceal the original corruption.  Might the Parma board itself engage in criminal activity to cover up wrong-doing?  Might a sham audit, which we predict to be their next move, be such a cover up activity that will lead to further charges.  Will Kelley have the ability to "steer" the auditing contract?

School Watch will be offing more information, opinions, and predictions about this on-going corruption scandal in the Parma City School District.  Stay tuned.

Published August 15, 2008