Monday, June 18, 2018
Education

Prosecutors: Businessman diverted education money meant for Pinellas, Hillsborough charter schools

A businessman whose companies managed 15 charter schools in Florida, including six across Pinellas and Hillsborough counties, was charged Monday with racketeering in what prosecutors said was a scheme to steer public education money his way using huge markups, bogus invoices and a web of related corporations.

From 2007 to 2016, according to an affidavit, charter schools controlled by Marcus Nelson May and his company, Newpoint Education Partners, received more than $57 million in public funds — including more than $1 million he used for personal expenses and to purchase residential and business properties in Florida.

The sum does not include the 18 percent fee and other reimbursements that Newpoint received under generous management agreements that May secured with inexperienced local charter school boards, the affidavit states.

 

A TIMES INVESTIGATION: Loose record-keeping, huge markups, a web of companies

 

Documents point to inflated spending at troubled Pinellas charter schools

Grand jury indicts company that led four Pinellas charter schools into financial peril

Warrants have been issued for May's arrest and the arrest of an associate, Steven Kunkemoeller, who operated Red Ignition and School Warehouse. Those companies, along with Newpoint, were the focus of a 2016 Tampa Bay Times investigation and were found to have sold marked-up goods to Newpoint-run charter schools.

The 14-page affidavit was filed in circuit court in Escambia County, where a local investigation into grade tampering and other misconduct at Newpoint-managed schools eventually spread to six other counties: Bay, Broward, Duval, Hillsborough, Holmes and Pinellas. It soon uncovered suspicious financial dealings and involved the Office of Statewide Prosecution.

Neither May nor his attorneys, Kim Anthony Skievaski and Dave McGee, could be reached Monday for comment.

"Justice won't be served until the criminals are behind bars," said Chris Wenzel, a parent who served as the board chairman for Windsor Preparatory Academy in St. Petersburg, one of four Pinellas charters that fell into financial ruin and closed under Newpoint's management.

"They stole money from innocent kids and the people of Florida," Wenzel said.

Among the numerous alleges against May are that he:

• Charged Hillsborough's Newpoint Tampa High $157,000 for computers that actually cost $53,844, a 192 percent markup.

• Overestimated schools' enrollments to receive more money from a federal grant program. In 2012, for example, May estimated 360 students would start in a Pinellas school, but only 170 were actually enrolled and May was overpaid $350,000.

• Used more than 85 percent of all grant funds, or more than $3.2 million, to buy furniture, computers, equipment and services at grossly marked-up prices from May-affiliated vendors.

• Directed School Financial Services to pay $150,000 in commingled school funds to a company May owned with his wife, Mary Walker May. That money was then used toward lease payments for the Mays' residence in Sarasota. Part of it also paid a salary for May's wife and reimbursements for restaurant bills, personal electronics and massages.

• Sold marked-up school uniforms from his own company. The money from those sales — including $11,000 in collections for student lunches and activities that was off Newpoint's books — was deposited into an account that May used for personal expenses, including credit card payments, a jet ski, country club costs and a car lease.

• Directed funds from so-called lease payments from Newpoint, consultation fees and other funds for a company owned by the Mays. That money was used for $355,000 in credit card bills, $190,000 for May family members, $62,000 for mortgage payments, $52,000 in utilities, pool services and homeowners fees.

The company also paid for $11,000 in plastic surgery and tens and thousands of dollars for over a dozen cruises and trips to the Caribbean, Europe and Asia.

Marcus May, 55, of 8156 Gabanna Drive in Sarasota, now faces two charges of racketeering and one charge of organized fraud, all three filed in Escambia County. His bail was set at $600,000 with the provision that he not leave Florida.

Kunkemoeller, 56, of 793 Watch Point Drive in Cincinnati, Ohio, faces one charge of racketeering and one charge of organized fraud. His bail was set at $100,000.

According to the affidavit, Kunkemoeller's School Warehouse received $375,000 in 2014 from Newpoint-managed charter schools in Pinellas and Duval with markups as high as 165 percent. It said Kunkemoeller used $175,000 of that money for his home mortgage, and sent the remaining funds to a company owned by May, who used it to pay down his home equity line of credit.

Monday's charges come one year after Newpoint was indicted by a grand jury on charges of grand theft, money laundering and aggravated white collar crime. Red Ignition and School Warehouse also indicted on similar charges.

Escambia County Assistant State Attorney Russell Edgar said he hopes to consolidate May's and Kunkemoeller's individual charges with their companies' cases.

Newpoint operated five schools in Pinellas. Four of them — Windsor Preparatory Academy and East Windsor Middle Academy in St. Petersburg and Newpoint Pinellas Academy and Newpoint Pinellas High in Clearwater — have closed, displacing about 900 students.

The remaining school, Enterprise High School in Clearwater, quietly separated from Newpoint in 2015.

Hillsborough County closed Newpoint Tampa High in 2013 after three years. Newpoint no longer manages schools in Florida.

Comments
Ethan Hooper steps up with a salute to teachers

Ethan Hooper steps up with a salute to teachers

Editor’s note: Ethan Hooper wrote today’s column to give Ernest Hooper Father’s Day off.In May, I graduated from the University of Central Florida with a degree in elementary education, and I recently secured a job as a first-grade teacher with Orang...
Updated: 8 hours ago
AP World History course is dropping thousands of years of human events - and critics are furious

AP World History course is dropping thousands of years of human events - and critics are furious

Since 2002, the AP World History course has covered thousands of years of human activity around the planet, starting 10,000 years back. But now the College Board, which owns the Advanced Placement program, wants to cut out most of that history and st...
Published: 06/16/18
School board races attract new faces

School board races attract new faces

TAMPA — When long-time Hillsborough County School Board member Susan Valdes resigned this month from the board to run for the State House of Representatives, the decision affected more than just her seat in west Hillsborough’s District 1.It also coul...
Published: 06/14/18
Updated: 06/17/18
Hillsborough schools tax referendum is unlikely for November

Hillsborough schools tax referendum is unlikely for November

TAMPA — Money that the Hillsborough County School District needs to build schools and replace air conditioners might be farther from reach, thanks to a new state law and a bureaucratic process required before the voters can decide on a tax referendum...
Published: 06/14/18
University of Chicago eliminates SAT/ACT requirement

University of Chicago eliminates SAT/ACT requirement

The University of Chicago will no longer require ACT or SAT scores from U.S. students, sending a jolt through elite institutions of higher education as it becomes the first top-10 research university to join the test-optional movement.Numerous school...
Published: 06/14/18
Unhappy with superintendent’s budget wish list, Hernando School Board shuts down talk of tax increase

Unhappy with superintendent’s budget wish list, Hernando School Board shuts down talk of tax increase

BROOKSVILLE — Hernando County schools Superintendent Lori Romano presented to the School Board Tuesday nearly $53 million worth of budget priorities, asking them to choose which will be funded in the upcoming school year.The board voted 3-2 later Tue...
Published: 06/13/18
UT shines the spotlight on visiting authors

UT shines the spotlight on visiting authors

The University of Tampa’s MFA program will host the June 2018 Residency Visiting Writers Lectores Series that runs from now until June 21 on the ninth floor of the Vaughn Center, 401 W Kennedy Blvd. Each reading will be held at 7:30 p.m.Each January ...
Published: 06/12/18
Updated: 06/15/18
Hernando School Board fires Superintendent Lori Romano after member says she ‘lost the public trust’

Hernando School Board fires Superintendent Lori Romano after member says she ‘lost the public trust’

BROOKSVILLE — Hernando County schools Superintendent Lori Romano will step down at the end of this month following a 3-2 vote by the School Board to terminate its contract with her amid increasing concerns about her ability to lead.Romano has suffere...
Published: 06/12/18
Updated: 06/13/18
Pasco summit aims to merge school cultures while making students feel included

Pasco summit aims to merge school cultures while making students feel included

NEW PORT RICHEY — The dozen Fivay High school students and their administrators arrived at the Pasco County school district’s annual Together We Stand conference with a clear goal in mind.With hundreds of former Ridgewood High students arriving in th...
Published: 06/12/18
Central’s air rifle team prepares for national competition

Central’s air rifle team prepares for national competition

BROOKSVILLE — Historic Camp Perry is where it’s at. Located near Clinton, Ohio, the National Guard training facility is where the nation’s top shooters go to compete.Next week, some of Hernando County’s top shooters compete there in the Civilian Mark...
Published: 06/11/18
Updated: 06/14/18