Recovery School District, Inspector General to part ways after clash

The city’s Office of Inspector General, apparently fed up with what it views as interference by Recovery School District officials in New Orleans, has decided to pull out of a year-old contract that placed it in charge of preventing fraud and waste in the district’s sprawling school construction program.

In a letter to the district dated June 7, Inspector General Ed Quatrevaux told state Superintendent John White, who oversees the district as head of the Louisiana Department of Education, that he would be ending their deal unless the state “is able to fully remedy its consistent breaches of the requirements of the agreement.”

In a pair of sharply worded responses that the district released on Friday, White agreed to end the inspector general’s contract, rejected accusations of district interference and rebutted the conclusions of a yet-to-be released report from Quatrevaux on the district’s construction master plan.

“We have grave concerns about the release of this report in its current form, given the methodology and process used to conduct the review,” White wrote. “It is clear that the Office of the Inspector General team that completed this review has a fundamental misunderstanding of the type of contract the RSD has with JacobsCSRS,” the main contractor managing the construction plan.

The Recovery District, a state agency that has governed most schools in New Orleans since shortly after Hurricane Katrina, is overseeing the bulk of a roughly $1.8 billion rehabilitation of the city’s school infrastructure. The Orleans Parish School Board, which was left with about 17 schools after the state takeover, is handling a smaller portion. And both districts are now at odds with the Inspector General’s Office regarding oversight of various ongoing projects.

Quatrevaux’s June 7 letter outlines a litany of complaints against the Recovery District, noting that officials “routinely failed to provide access” to records; twice directed the Inspector General’s Office to halt work altogether; refused to pay for forensic engineering reviews while allowing its own contractors to conduct tests; “impeded implementation” of a code of ethics and vendor screening policy; failed to make employees available for interviews; and “arbitrarily withheld payments” due under their contract.

“Under the difficult circumstances created by the RSD, the OIG is unable to fulfill its professional responsibilities to provide independent oversight,” Quatrevaux wrote, “and I can no longer allow this office to be associated with this project unless there is a full and complete cure no later than June 21.”

White shot back with a point-by-point counter-argument in a letter dated June 19. He wrote, “Your position that we are required to produce records and documents on demand without legitimate inquiry on our part as to whether or not the work is within the scope of our agreement is not reasonable.”

The letter acknowledges that RSD officials asked the inspector general to halt work but claims the district never sent his office a formal “stop work order.”

It also argues the district does not have the funding available to pay for independent engineering reviews that its contractors are already handling.

White claims, “We have never prevented our employees or the employees of our contractors from participating in interviews,” but adds, “It is the right of both our employees and the employees of our contractors to have legal counsel present during interviews.”

On the ethics code and vendor screening, the letter claims the district has negotiated “in good faith” but ultimately isn’t required under its contract with the inspector general to “implement all recommendations exactly as proposed by the OIG.”

Another letter from White, this one also dated June 19, addresses a report on the construction program that Quatrevaux hasn’t released yet, an unusual move which makes it difficult to parse exactly what type of criticism the district is responding to. The letter includes a four-page rebuttal from JacobsCSRS, the district’s contractor.

“The OIG’s erroneous findings are based on a small sample of program documents that they selected and nothing else,” wrote John Wallace, program director for Jacobs, adding that the inspector general’s report “does not mention, nor explain, the fact that the program manager offered to help the OIG to fully understand the program.”

Quatrevaux said he disagrees with “each and every point” that White made, but won’t be releasing his latest report on the construction program until next week.

In the absence of continued oversight from the inspector general, White said that the district is in talks with the Louisiana Legislative Auditor’s Office about broadening the scope of audits that the agency already performs on school construction projects. He added that the Governor’s Office of Homeland Security and Emergency Preparedness has agreed to provide district staff with fraud prevention training.

The Recovery District has already paid the inspector general about $271,000 and plans to fold the remaining $1.2 million left on the contract back into construction projects.

The Orleans Parish School Board, meanwhile, has resisted any type of audit by the inspector general in the first place, arguing that the OIG doesn’t have jurisdiction over the board. Quatrevaux has said publicly that he may bring the board to court if it continues to resist.