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Witness Testimony
Dr. William Singleton
Problems with the E-rate Program: Waste, Fraud, and Abuse Concerns in the Wiring of Our Nation's Schools to the Internet
School Year 1999-2000 I was somewhat familiar with the E-Rate Program some time before 1999. However, after attending the National Alliance of Black School Educators (NABSE) Conference in Nashville, Tennessee, I became more familiar with the program. I began to take notice after being approached by a representative from VNCI, who had on display numerous pieces of telecommunication equipment in the hotel lobby. VNCI representatives stood in the hotel lobby soliciting conference participants to attend a breakout session on how to acquire E-Rate funds. Several announcements were made by NABSE officials encouraging conference participants to attend the breakout session. A representative of VNCI encouraged conference participants to attend the breakout session to hear testimonies from other school districts that were recipients of their equipment (see Exhibit A). The breakout session was very interesting. School district representatives and superintendents that had received E-Rate funds shared how they enhanced their school district's technology program. As I recall, a superintendent from a small school district in the state of California shared during the breakout session that he had received somewhere in the neighborhood of three million dollars. The school district was approximately half the size of Jasper County School District's three thousand student population. I became interested because the California school district's demographics for free and reduced lunch population was very similar to Jasper County. The second selling point was that VNCI was promoting a special NABSE bonus package of free telecommunication equipment. The school district would receive as "in-kind" donations to be used as the school district's 15% match (district had at this time 85% free and reduced lunch program). The bonus package included a 33" TV monitor for each classroom, pan-tilt-zoom cameras, 400 computers, 12 laptop computers, 100 teacher workstations, etc. (see Exhibit B). During the presentation at the NABSE Conference, VNCI agreed to assist any school district that needed help with the application process. After the session, participants returned to the lobby and completed the first phase of the application process, Form 470. Upon my return from the NABSE Conference in Nashville, Tennessee, I turned the project over to Michael Duncan, the school district's Director of Technology. As we continued throughout the school year, the Director of Technology, along with VNCI and NEC staff, filed the other necessary paperwork. School Year 2000-2001 After notification of the E-Rate subsidy awarded to Jasper County, Judy Green, VNCI representative, and Gerard McNulty made a presentation to the Jasper County Board of Education (see Exhibit C). At this meeting, the focus seemed to change from VNCI to NEC. As a matter of fact, Gerard McNulty announced that Ken Morrison would be the onsite manager for NEC and Jonathan James for VNCI. These individuals worked with Michael Duncan, Jasper County Director of Technology, in completing the application process and designing the system. Believing everything was legitimate, Michael Duncan informed me periodically on the status of the project. Michael Duncan resigned from the school district on June 25, 2001 due to health reasons. School Year 2001-2002 Early in the 2001-2002 school year, I was contacted by George Marchelos, VNCI representative, to recommend him to Eleanor Adams, Director of the Salkehatchie Consortium, to present the E-Rate program to the other superintendents using Jasper as a model for acquiring E-Rate funds. As I recall, George Marchelos and Judy Green presented the program to the consortium superintendents on November 27, 2001 (see Exhibit D). Ed Sauls was brought in to replace Michael Duncan and found that most of the VNCI video-conferencing equipment did not work properly or was not working at all. School Year 2002-2003 Attorney Karen Jones, U. S. Department of Justice, came to Jasper County to investigate the E-Rate subsidy that was allocated to Jasper County. I shared with her what I knew about the program, basically the information communicated in this document. School Year 2003-2004 On July 30, 2003, I was subpoenaed to appear before the United States District Court Eastern District of Michigan Grand Jury. I gave the same testimony as outlined in this document and what was shared with Attorney Jones. After receiving notice that NEC pleaded guilty and agreed to pay restitution and supply Jasper County School District with eighteen months of free maintenance services, we are still trying to negotiate a workable contract. Summary I believe it is vital that the E-Rate program continue although the application process seems to be complicated and burdensome. After learning more about the E-Rate program over the past three years and our school district's involvement in the investigation of E-Rate, I feel the following problems were present:
It appears that large companies, such as VNCI/NEC, have been going around the country offering solutions to school district technology problems and taking advantage of the E-Rate program. |
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