AN INVESTIGATION OF HANNA SKANDERA AND HER MANAGEMENT OF THE NEW MEXICO PUBLIC EDUCATION DEPARTMENT

January 11, 2012

INDEPENDENT SOURCE PAC

AN INVESTIGATION OF HANNA SKANDERA AND HER MANAGEMENT OF THE NEW MEXICO PUBLIC EDUCATION DEPARTMENT

January 13, 2012

Copyright Independent Source Pac, 2012. For permission to copy portions of this document, contact Michael Corwin at corwinri@mac.com

INDEPENDENT SOURCE PAC

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TABLE OF CONTENTS
Executive Summary Skanderas Political Connections and Their Influence on the Martinez Administrations Policy Involvement in the Education Privatization Sector Laying the Foundation, Academic Partnerships The Florida ModelFEE (Foundation for Excellence) Failures, Fraud and Financial Benefit for a Few Skanderas Questionable Actions as PED Secretary Designate NMPED Layoffs, Loss of Services and Risk of Losing Federal Funding Disregard for New Mexicos Bi-Lingual Law and Multi-Lingual Culture and for New Mexicans Capabilities Ethical Issues Job Qualification Requirements Rigged for Chief of Staffs Wife $67,000 a Year Job Hiring Lawyer/Lobbyist Patty Matthews to Oversee Her Own Clients K12, Inc. Pay to Play- Gaining Access to New Mexico Skandera Appointed to Board of Directors of Company that Does Business with the State of New Mexico and Her Department P.18 P.19 P.21 P.23 P.10 P.13 P.3 P. 1

P.5

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An Investigation of Hanna Skandera and Her Management of the New Mexico Public Education Department
By Independent Source Pac

EXECUTIVE SUMMARY
Governor Susana Martinez nominated Hanna Skandera to head the New Mexico Public Education Department (PED) in December 2010. Skanderas previous public education employment occurred in Washington, DC in Republican George W. Bushs administration and in Tallahassee, Florida where she worked for his brother then Governor Jeb Bush. Skandera has not lived or worked in New Mexico before taking over the administration of PED. She also has no practical classroom teaching experience in a public education classroom. Since taking over at NMPED, Skandera has continued her extensive involvement with Jeb Bush and his Foundation for Excellence in Education (FEE). FEE promotes education reform by redistributing public education funds away from public schools and handing it over to private companies. Last month, Floridas largest newspaper, the Miami Herald, exposed key components of Jeb Bushs education reform as ineffective, a gateway to fraud and a financial windfall to private companies. Her inexperience with New Mexico, and apparent disregard for its unique culture has resulted in efforts by her Department to seek an end run around New Mexico law governing bilingual education. She recently walked out of an LESC hearing on bi-lingual education, and did not even register for the Hispanic Education Conference. She has also

siphoned off hundreds of thousands of dollars from the Indian Education Division to pay director salaries for Teach for America. Skandera has bypassed eminently qualified New Mexicans and existing locally based programs already engaged in teaching, education training and curriculum development in favor of her out of state friends, cronies and Martinez Administration campaign contributors. Skandera has created an environment of unlimited insider access for a chosen few, with no accountability for her actions and those of her cronies. Her corporate style layoff of PED personnel (reminiscent of the actions of Chainsaw Al Dunlap) along with the elimination of critical divisions could potentially cause New Mexico to lose out on tens of millions of dollars of federal funds while making it more difficult to uncover and investigate the fraudulent misuse of taxpayer dollars. Finally, Skandera has instituted a level of cronyism and corruption that began with the hiring of a lawyer/lobbyist to regulate her own clients, special access to public funds for campaign contributors and even accepting a position with a company doing business with her department. Given the fraud investigations in Florida and securities fraud investigations of K12, Inc. Skanderas agenda seems to be closely affiliated more with fraud and misrepresentation than actual reform.

Skanderas Political Connections and Their Influence on the Martinez Administrations Policies.
Involvement in the Education Privatization Sector- Laying the Foundation, Academic Partnerships, The Florida Model: FEE (Foundation for Excellence in Education). Laying the Foundation
Prior to being appointed to NMPED, Skandera served as CEO of Laying the Foundation, (LTF) a Dallas, Texas based company that provides a variety of fee-based education related services. According to their website, LTF provides a comprehensive training program to states, school districts, STEM organizations, and schools that includes Pre-AP and AP teacher training, support, lessons, and classroom materials that improve student performance and create a college ready culture. Per the LTF website, school districts that utilize LTF Training show an increase in the number of high school students taking Advanced Placement courses. (See attached Laying the Foundation website printout labeled A). It was not a surprise when Governor Susana Martinez, announced on December 28, 2011 an effort to increase the number of New Mexico students enrolled in AP classes by allocating $1,000,000 to purchase books and instructional materials for students enrolled in duel credit programs and $700,000 to support AP programs across New Mexico. (See Martinez Administration 12/28/11 Press Release labeled B).

Laying the Foundation also provides for a fee, teacher-to-training, classroom ready resources linked to the Common Core State Standards, and our other services, we can help you become compliant with the new (Common Core State) standards. (See printout of LTF website labeled C). Ironically, in a press release issued by Laying the Foundation on December 21, 2010, announcing Skanderas selection by Martinez to head NMPED, Christy Hovanetz, a Senior Policy Fellow with the Foundation for Excellence in Education touts LTF as a game changer in education. Skandera initially selected Hovanetz as a consultant to assist with her transition into operating of NMPED. Skandera also appointed Hovanetz, who still lives in Minnesota, as the Director of the Common Core transition team for NMPED. (See LTF press release labeled D). Clearly, Skandera and the Martinez Administration are pursuing an agenda that is financially beneficial to companies providing services similar to Laying the Foundation. .

Academic Partnerships
Before becoming CEO of Laying the Foundation, Skandera was the Executive Vice President for another Dallas, Texas based company, Academic Partnerships. According to its website, Academic Partnerships (AP) assists public universities in converting their traditional programs into an online format, recruits highlyqualified students into these programs, and supports enrolled students throughout their learning processes. (See Academic Partnership website printout labeled E). Academic Partnerships has deployed a large proprietary field organization to recruit students for online learning and helps professors prepare for effective online instruction by connecting them with academic coaches who support them and their students throughout each course.

On January 4, 2012, Governor Martinez announced a new funding formula for New Mexicos public colleges and universities. The Martinez formula changed the allocation of funding to correspond to the number of courses completed at a school rather than being based upon the physical size of each institution. This change creates an incentive for colleges and universities to hire a company like Academic Partnerships to convert to online programs and increase enrollment of online students to maximize funding.

The Florida ModelFEE (Foundation for Excellence in Education)

In addition to working for private companies that earn money providing services to public schools, Skandera, served in Florida Governor Jeb Bushs education department during the rollout of the Florida Model, which included: A-F grading for schools, retaining 3rd grade students deemed non-proficient in reading, eliminating teacher pay based upon experience and level of training in favor of effectiveness (incentivizing the teaching process), eliminating low student to teacher ratios (so online learning can reach a thousand children per teacher), providing vouchers to pay for private school tuition for students in under performing schools, providing McKay Scholarships (similar to vouchers) to fund a private school education for students with physical or mental disabilities, and school choicecharter schools and virtual schools. These reforms should look familiar. They are basically the same agenda Skandera and Martinez have been trying to enact in New Mexico, with Jeb Bushs help. Jeb Bush was given a major role in New Mexicos education reform efforts. He told the New York Times that he was closely involved with the New Mexico education reform bill (SB 427) submitted during the 2011 legislative session. (See attached article labeled F).

However, the National Research Council has proven most of these reforms to be ineffective in reports entitled High Stakes Testing and Social Promotion and Current Test-Based Incentive Programs Have Not Consistently Raised Student Achievement in the US. The National Research Council is the non-partisan research arm of the US Congress. A major component of the Florida Model is to redirecting public education tax dollars to private companies and private schools. Vouchers are unconstitutional in New Mexico, but Patty Matthews, Director of Skanderas recently created Options for Parents division within NMPED, has been looking for a way around the anti-donation clause of the New Mexico Constitution. If successful, this would allow giving public funds to the private interests that lease buildings to charter schools. And this could become the backdoor into a voucher program. One of the components of SB 427 called for allowing children who attend failing schools as defined by Skandera and Bush, to enroll in virtual learning academies and for those failing schools to be converted into charter schools. In essence the so-called failing public schools are taken over by the Options for Parents Division of NMPED. Skandera laid out her education plans for New Mexico during an interview with the Santa Fe New Mexican entitled Skandera Seeks Help with School Reforms. During the interview, Skandera repeatedly emphasized the idea of moving those students into a virtual learning environmentwhich could include home. The virtual learning from home through a charter school may violate SB446, the New Mexico Charter School Act, which expressly states that charter schools must be a non-home-based public school. (See attached page from SB446 labeled G).

This was the same interview in which Skandera stated, I dont care when asked to respond to the fact that the New Mexico legislature has yet to confirm her appointment as Secretary of Education. (See attached article labeled H). New Mexico already operates IDEAL NM (Innovative Digital Education and Learning), a very effective digital learning program that is staffed by New Mexico teachers and all courses are aligned with New Mexico Content Standards with Benchmarks, with the only cost to a school district is a pro-rated share of the teachers salary. But, Skandera told the New Mexican, she was looking for other options to pursue when it came to virtual learning. Options such as K12, Inc., the company that earns $594 million a year from taxpayers with a $5,000 to Susana Martinezs campaign and in return was given special consideration in SB 427. Last month on December 12, 2011, the New York Times conducted an extensive and thorough investigation into K12, Inc. in an article entitled Profits and Questions at Online Charter Schools. According to the Times, a look at the companys operations, based on interviews and a review of school finances and performance records, raises serious questions about whether K12 schools and full-time online schools in general benefit children or taxpayers, particularly as state education budgets are being slashed. Instead, a portrait emerges of a company that tries to squeeze profits from public school dollars by raising enrollment, increasing teacher workload and lowering standards. The Times also uncovered, that some teachers at K12 schools said they felt pressured to pass students who did little work. Teachers have also questioned why some students who did no class work were allowed to remain on school rosters, potentially allowing the company to continue receiving public money for them. State auditors found that the K12run Colorado Virtual Academy counted about 120 students for state reimbursement

whose enrollment could not be verified or who did not meet Colorado residency requirements. Some had never logged in. This is the company that Skandera was determined to bring into New Mexico. There is now clear evidence proving that the reality of the Florida Model--Skanderas education policy road map--has not met the hype-- especially in Florida, where the Supreme Court ruled Bushs voucher system unconstitutional Just last month, the Miami Herald, Floridas largest newspaper, printed a series of investigative articles under the collective title of Cashing in on Kids that evaluated how the Florida Model reforms have actually performed. The articles formed a devastating indictment of the Florida Model. In one article, Florida Charter Schools: Big Money, Little Oversight, the Miami Herald wrote, charter schools have become a parallel school system unto themselves, a system controlled largely by for-profit management companies and private landlords-one and the same, in many cases-and rife with insider deals and potential conflicts of interest. The Herald article also pointed out that charter schools have grown into a $400-mlliona-year business in South Florida, receiving about $6,000 in taxpayer dollars for every student enrolled. That money goes primarily to landlords and management companies and not for the benefit of the students. Despite the massive amount of funds siphoned away from traditional public schools, the Herald reported, charter school students on average perform about the same as the counterparts in traditional public schools on the Florida Comprehensive Assessment Tests. (See the article labeled I). In other articles in the series, the Herald found that charter schools are not accepting special needs students and that minority students are significantly underrepresented in charter school student bodies.

In June 2011, another Florida newspaper, the Miami New Times, did an investigative report on the McKay Scholarships for Students with Disabilities, called Rotten to the Core. The McKay Scholarships are overseen by the Florida Department of Education of Independent Education and Parental Choice--the same parental choice division that handles charter schools and online learning. (See attached article labeled J). The McKay Scholarships program was found to be rife with fraud. Allegations of fraud were substantiated against 25 schools that had received $49.3 million tax dollars. Schools were caught falsifying the number of studentseven stealing identities to do it- to increase their revenue. One school was found not to exist physically and several schools were found to have no actual curriculum- the kids just watched movies all day. Skandera currently serves with FEEs Chiefs for Change group. She previously was employed by FEE assigned to staff Chiefs for Change. Skandera is also a regular panelist at FEEs annual conference. (A conference funded in part by K12, Inc.more on this company later). The founders of FEE are not immune to allegations of fraud themselves. While Jeb Bush is the face of FEE, he founded the organization with two other individuals, Zachariah P. Zachariah, is a heavyweight Republican fundraiser and Florida Medical Board member. Brian Yablonski was Jeb Bushs former chief of staff, a Florida Fish and Wildlife Conservation Commissioner and a vice-president of St. Joes Company, one of Floridas largest landowners. In December 2010, a Florida Grand Jury convened to investigate government corruption in Florida, issued an interim report, citing extensive corruption and fraud in Yablonskis Fish and Wildlife Conservation Department. We heard testimony as previously mentioned about massive fraud and abuse with the Florida Fish and Wildlife Commission. In this case, numerous employees had knowledge of and participated in the

fraud and abuse. This fraud and abuse was so prevalent that it had to be common knowledge within and outside the agency. (See attached grand jury report labeled K). But that is not Yablonskis only brush with fraud. On June 24, 2011, St. Joes Company, where Yablonski is the Vice President of Public Affairs (lobbying) received a notice from the US Securities and Exchange Commission (SEC) that it had issued an order of private investigation. The order covers a variety of matters for the period beginning January 1, 2007 including the antifraud provisions of the Federal Securities laws as applicable to the Company and its past and present officers, directors, employees, partners, subsidiaries, and/or affiliates, and/or other persons or entities. (See attached St. Joes filing labeled L). Zachariah P. Zachariah faced a long running SEC investigation that culminated in an insider-trading fraud lawsuit. Zachariah, his brother, and a close friend were alleged to have reaped a total of more than a half-million dollars in profits from their illicit scheme. (See attached SEC documents labeled M). Zachariahs brother and close friend settled their cases with the SEC. Both admitted receiving insider information from Zachariah. They both paid hefty fines as part of their settlement with the government. Zachariah ironically emerged unscathed at trial, despite his brothers testimony ---that Zachariah provided the insider information. Zachariah has other issues that raise even more serious concerns about whether New Mexico, with its former prosecutor turned governor, should implement his agenda. Zachariah lost in a class-action lawsuit by his former employees for not paying mandatory overtime. He was twice sued for sexual discrimination. He lost both of those suits too. Finally, as a member of the Florida medical board, Zachariah recently voted to allow a convicted rapist to get his medical license back upon being released from prison. (See attached documents labeled N).

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Skanderas affiliation with these different entities raises serious questions about who really benefits from the agenda she is pursuing.

Skanderas Questionable Actions as PED Secretary Designate

NMPED Layoffs, Loss of Services and Risk of Losing Federal Funding: On June 10, 2011, Hanna Skandera, State Personnel Director Eugene Moser, and the State Personnel Board laid off 33 employees from the Public Education Department. The Administration blamed budget shortfalls as the reason for the layoffs- although it is apparent that a union president was specifically targeted in those layoffs. The layoffs were carried out in a fashion more suited to the cut-throat corporate world, --Skanderas world--- than to the New Mexico public education community. Officers from the New Mexico State Police provided an armed escort for Skandera as she left the building. The 33 employees were give two weeks notice while at the same time told to pack up their belongings and sent home, and their computers were locked down, preventing them from completing any projects they had been working on at the time. Among those laid off were the Departments Inspector General, members of the Ethics Bureau and the members of the Educational Technologies Bureau including the state employee union president. The IG was responsible for conducting numerous investigations for the Department, including fraudulent misuse of taxpayer dollars. The Ethics Bureau also conducted investigations for NMPED including allegations of sexual improprieties as well as assisting in the licensing process for teachers. Investigations begun by the IG and the Ethics Bureau stopped at the time of the layoffs. The layoffs at the Ethics Bureau also severely slowed the processing licensing renewals for teachers.

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The Educational Technologies Bureau was responsible for assisting school districts and libraries to navigate the complexities of securing funding through the federal E-rate Program. The E-rate program involves federal grant money to ensure that schools and libraries have access to affordable telecommunications and information services. Annually, the E-rate program brought in approximately $45 million to New Mexico schools, particularly those in rural and poor urban areas. Laying off the Educational Technologies Bureau sent shockwaves through the education technologies community. Verne Smith, Chairperson of the New Mexico Council on Technology in Education sent an email calling for an emergency meeting of the council. Regretfully, if you have not already heard, it is my unpleasant duty to inform you that the Educational Technologies Bureau at the NMPED was laid off on Friday along with 29 other PED staffers. The implications for the State of New Mexico are disastrous at best. (See attached email labeled O). Skandera conducted the layoffs without having a back up plan in place. Out of a desire to serve the education community, the Council on Technology in Education stepped in to temporarily provide assistance for the E-rate program we wanted to ensure that no district was going to lose money due to the short-sighted actions of the NMPED. However, by October 18, 2011, Vernon Smith sent out another email to the Council, we now know that Skandera did not have a plan to address the problem. Skandera as head of the NMPED has not made any effort to replace the lost reviewers. Nor do they have a single person on staff who knows the first thing about technology plans. They have nobody on staff who can sit down with a school district and help them to develop an acceptable plan. The PED is not providing training and meeting opportunities that support technologists and Superintendents wanting to develop expertise in this critical task. Finally, the PED and the Secretary-Designate (and her staff) have seen fit to avoid communications with the CTE while we are doing their work free of charge. And,

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while we certainly have the expertise, we have neither the authority or responsibility for such a role as an ongoing activity. (See attached email labeled P). When last checked, New Mexicos share of the national total E-rate grant funds had dropped from 1.7% down to .5% --a 300% decrease while most other states have either increased their percentage or remained the same. If the percentage of decrease remains in place, rural and poor New Mexico schools will have lost tens of millions of dollars in available federal grant money. Disregard for New Mexicos Bi-Lingual Law and Multi-Lingual Culture and for New Mexicans Capabilities: When she took over PED Skandera brought in a team of out of state consultants who, like Skandera, had never previously worked in New Mexico. She brought in Leighann Lenti as her Director of Policy. Lenti came from Washington, DC where she worked as a Republican education policy advocate and as a lobbyist for Wireless Generation, a company owned by Rupert Murdoch. This has the added dimension as an ethics issue Wireless Generation has a contract with NMPED to provide technology and curriculum services. State law allows New Mexicos most at-risk students to earn their high school diplomas through a process called alternate demonstration of competency in English, Spanish or in a Native American Language. Students may submit a portfolio in English, Spanish or in a Native American language of an Indian nation, tribe or pueblo located in New Mexico. (NMAC 6.19.7.10 D (4)). Further students are permitted to take state-approved language proficiency assessments in English and the home language. Trained personnel shall administer state-approved language proficiency assessments in English and the home language annually until proficiency in each language is achieved. (NMAC 6.32.2.14 A).

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However, Lenti and Karina Vanderbilt, also from out-of-state, and at the time was a Teach for America Policy Fellow working for NMPED, attempted to make an end run around New Mexico law by consulting with NMPEDs general counsel. In an email, Vanderbilt reported to Lenti the results of her inquiry, We cannot require the majority of the portfolio to be in English due to the rule which allows submissions in Spanish or Native Languages. Darn. We could say that submissions demonstrating competency in Reading must be in English. Perhaps we could phrase it along the lines of certain submissions demonstrating competency in Reading standards must be submitted in English. (See attached email labeled Q). Skandera, and not just her consultants has shown a blatant disregard for New Mexicos minority cultures. She attended a conference for educators in San Francisco, at tax-payers expense, but chose not to attend the Summit on Hispanic Education, sponsored by the Association of Latino Administrators and Superintendents, occurring simultaneously at a nearby location. The conference hosts had carefully coordinated to allow educators to attend both events, to the extent of booking nearby venues. Albuquerque Public School superintendent, Winston Brooks, managed to attend both the Summit on Hispanic Education and the other conference attended by Skandera. Senate Majority Leader Michael Sanchez raised the issue of Skanderas failure to attend the Summit. Apparently, she did not even register for the Hispanic Education conference. With so many others attending both conferences, Skanderas failure to attend the Summit has not been taken lightly by Hispanic educators and English language learners in New Mexico. Skandera also demonstrated her disregard for New Mexicos minorities when she left the Education Study Committee hearing prior to testimony on "Educating New Mexico's Minority/Majority Children". She stayed just long enough to testify on other topics, awaiting her scheduled time on the agenda in the audience, focused on her cell phone. Instead she had an underling, Annalisa Banegas-Pea, stay to address the Committees questions. Incidentally, the committee broke for lunch after the "Educating New Mexico's Minority/Majority Children" testimony.

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According to a Santa Fe New Mexico article about the hearing, Christine Sims, an assistant professor at The University of New Mexico's American Indian Language Policy Research and Teacher Training Center, accused Skandera's administration of not communicating with the Indian Education Advisory Council, which was established in 2003 when the Indian Education Act passed. Native American educators are not the only minority educators unhappy with Skanderas lack of communication, Diane Torres-Velsquez, a UNM professor who led the first achievement-gap study in 2010 spoke during the hearing. Torres-Velsquez asked the Legislative Education Study Committee to help with increased communication between the education administration and bilingual education experts. Skandera had an excellent opportunity to demonstrate her concern about improving communication by staying for more agenda items at the hearing, but chose instead to leave. Skanderas representative, Annalisa Banegas-Pea, offered up a simple explanation for all the miscommunication or different interpretations of what is going on is that PED has a new leader, and with any new transition, there are changes that come about. Skandera has also managed to combine her love of privatization of education training with her disrespect for minority education by siphoning $800,000 from the budget of the Indian Education Division and handing it over to Teach for America (TFA), a New York based company. The money was supposed to help recruit and train Native American teachers and to provide cultural training for non-Native American teachers recruited by TFA from ivy-league and other universities around the country. While this may sound good on paper, the reality is an insult to Indian Educators and New Mexicos taxpayers. In September 2011, Skandera approved a sole-source contract, to TFA not put out for bid, for $400,000. However, only $4,272 was earmarked for Native

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Recruitment and only $2,000 for Cultural Training. The vast majority of the $400,000 was for TFA salaries including the Program Director. (See attached contract documents and sole source justification labeled R). The distribution of the initial $400,000 that TFA received up through July closely mirrored the same scant sums for Native Recruitment and Cultural Training. Both the University of New Mexico, and CNM offer programs specifically to teach Native American students to become teachers---The Institute for American Indian Education and the American Indian Scholarship Fund Teacher Training Initiative Program at UNM and Growing Educators for Native American Communities at CNM. This raises the question of why not just give these New Mexico-based programs the $800,000? Exhaustive research done on Teach for America effectiveness Teach for America: A Review of the Evidence by Julian Vasquez Heilg, University of Texas at Austin and Su Jin Jez, California State University, Sacramento compared head to head how TFA trained teachers performed against standard certified teachers. Their study covered a six-year period, 132,000 students and 4,000 teachers. The study found that over 80% of TFA teachers quit teaching by the third year. Thus, TFA is really nothing more than a temp agency and resume-builder. The high turnover rate is not beneficial to the taxpayers, if educational leaders plan to use TFA teachers as a solution to the problem of shortages, they should be prepared for constant attrition and the associated costs of ongoing recruitment and training. The study also found no instance where uncertified Teach for America teachers performed as well as standard certified teachers of comparable experience levels teaching in similar settings. Even after two-years, the study still found TFA teachers lagging, TFA teachers continued to exert a significant negative influence on their students reading scores in the elementary grades. (See the attached report labeled S).

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There is no logical reason for Skandera to have sent so much money to this out of state company given that the vast majority of TFA recruits quit teaching within three years and through the second year TFA teachers do not perform nearly as well, Especially when New Mexico already has the educational programs in place to meet the teacher training needs of our multi-lingual, multi-cultural communities. Finally, in 2009, TFA was caught (by Michael Corwin, currently Executive Director of ISPAC)) double-billing New Mexicos taxpayers for work that they had already been paid for---once by NMPED and again by a school district. They were forced to repay the school district. This activity is a violation of the New Mexico procurement code and may even be considered to be defrauding the government. (See attached documents labeled T). On 9/15/08, Landon Mascarenaz, the executive director of Teach for America New Mexico submitted an invoice to David Johnson of the New Mexico Public Education Department in the amount of $127,500. The invoice was for the recruitment and selection of new teachers. Pre-service training of new teachers and Professional development of teacher corps. The invoice was further broken out for 55 teachers for the 2008-2009 school year. The New Mexico Public Education Department cut a check to the Gallup-McKinley County Schools for the $127,500 who in turn cut a check to Teach for America for the $127,500 dated 12/17/08 (Check # 228059). However, on 6/2/09, Mascarenaz submitted an invoice to JoBe Thilgen, then an assistant superintendent with the Gallup-McKinley County Schools and Mascarenazs previous Teach for America teaching assignment. The invoice was in the amount of $110,000. The payment was for pre-service training of new teachers and Professional development of teacher corps. The invoice was further broken out for 55 teachers placed in Gallup-McKinley County for the 2008-2009 school year.

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By this time several of the 55 teachers that TFA double billed for had actually completed their two years and left the district. Further, the invoice was submitted after the fact as no requisition was made or purchase order issued prior to submitting the invoice. A requisition was hastily prepared on 6/3/09 and a purchase order was issued on 6/15/09. This process was in direct violation of the New Mexico Procurement Code.

Gallup-McKinley paid the $110,000 check on 7/22/09 (Check # 223809). When Corwin later uncovered this double billing for services already rendered and interviewed Mascarenaz he confirmed that the second payment was for work covered by the first payment. Caught double billing the taxpayers for the same services, TFA had to return the $110,000. Nationally, Teach for America earned revenue of $192,000,000 in 2010- thats money that could have gone directly to state run programs that already educate and train teachers.

Ethical Issues:
Job Qualification Requirements Rigged for Chief of Staffs Wife $67,000 a Year Job: Hanna Skandera and Eugene Moser the same people who teamed up to lay off the 33 PED employees that led to operational problems previously mentioned rigged the outcome of the hiring process in order to give Stephanie Gardner, the wife of Martinez Chief of Staff, Keith Gardner a $67,000 job.

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What Skandera and Moser did, along with Keith Gardner who was kept appraised during the whole process, was change the job requirements for this Education AdministratorAdvanced NAEP Coordinator position by instituting a requirement of one-year classroom teaching experience within the previous year. By requiring this teaching experience to be within the previous year they eliminated any current administrator from qualifying for this position. All of the previous NAEP Coordinators had extensive administrative and classroom experience. Stephanie Gardner did not. In fact, she had only received her administrators license the previous year. Most flagrant of all was the elimination of the Acting Director of the Assessment and Evaluation Bureau, from qualifying for the same position he had been performing quite capably since 2008. He also had thirty-one years in education, including serving as Superintendent of Schools, Director of Student Services, and a Special Education Instructor. Hiring Lawyer/Lobbyist Patty Matthews to Oversee Her Own Clients Patty Matthews and her law partner in the Matthews Fox Law Firm, Susan Fox, charged charter schools $175 per hour to represent them before the Public Education Commission, the New Mexico Public Education Department, and in court when their charters were in jeopardy. Matthews and Fox also testified on behalf of the New Mexico Coalition of Charter Schools, the charter school trade group, at various legislative committees. Matthews and Fox even represented their clients in appeals to Hanna Skandera after she took over as the Secretary-Designate of the New Mexico Public Education Commission. In December 2010, the New Mexico Public Education Commission voted not to renew the charters of three of Matthews Fox charter school clients, Ralph J. Bunche Academy,

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The Learning Community Charter School, and La Resolana Leadership Academy. The vote came after the Charter School Division of the New Mexico Public Education Department conducted extensive audits of the three charter schools and found, the schools proficiency levels were well below the proficiency levels of the district. The schools were given ample time and support mechanisms by the Charter School Division to meet the requirements necessary to stay afloat prior to the vote, which were disregarded or ignored. The Charter School Division also found for one of the institutions the school was not keeping pace with the progress that the district schools were making in closing the gap between the students performance and the annual measurable objectives articulated for the grade level served. Matthews and Fox appealed to Hanna Skandera, the Public Education Department Secretary-Designate appointed by Governor Martinez. Skandera then reversed the Public Education Commissions ruling, calling it arbitrary and capricious. Further, she labeled the Public Education Commissions determination to not renew the charters due to poor performance on standardized tests, as a vestige of an earlier time. Ironically, Skandera is a strong proponent of using standardized tests to grade traditional public schools. Her strong support of charter schools apparently translates to applying a different standard to charter schools than to traditional schools. On June 9, 2011, Skandera, as the NMPED Secretary-Designate, contracted with Matthews Fox to review proposed staffing levels and roles of Charter School Division employees. On the following day, June 10, 2011, Skandera laid off 33 PED employees, including Sam Obenshain, the head of the Charter School Division, who had made the recommendation not to renew the charters represented by Matthews Fox.

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On June 30, 2011, Matthews Fox, PC filed a Profit Corporation Articles of Amendment to the Articles of Incorporation (NMPRC # 2230308) with the New Mexico PRC Corporation Bureau. The only amendment listed on the form was: Article 1: The name of the corporation is Charter Law Office, P.C. The duration of the corporation shall be perpetual. This amendment was approved by resolution of the board of directors (Patty Matthews and Susan Fox) on June 29, 2011. There was no amendment changing the officers of the corporation; therefore, Patty Matthews is still an officer of the newly renamed Charter Law Office, P.C. On July 1, 2011, Skandera hired Patty Matthews to head up the newly created Options for Parents, formerly titled the Charter School Division. Matthews helped terminate Sam Obenshains job, and then replaced him. Shortly thereafter, Matthews sent an email to one of her former charter school clients in which she recommended that the charter school hire Sue Fox, my former law partner (473-3020) on your special ed question. (See all the attached documents labeled U). K12, Inc. Pay to PlayGaining Access to New Mexico As was previously mentioned, K12, Inc., contributed $5,000 to Susana Martinezs campaign for governor. The company has also been exposed for allegations of fraudulent practices. K12, Inc. was then rewarded in Jeb Bushs education reform bill (SB 427) carried by Republican Vern Asbill, a former school superintendent. In its original form, SB 427 called for any public school deemed to be failing three years out of five to be converted into a charter school and for its students to be allowed to enroll in a virtual online program currently offered or approved by any other state. However, at the time, New Mexico did not have an online academy. The final version of SB 427 eliminated this provision, meaning K12, Inc. could legally operate in New Mexico but only by subcontracting through a New Mexico online

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academy. K12, Inc. was also effectively blocked from setting up in New Mexico as a subcontractor because it did not offer enough face time between students and teachers, as required by state law. Skandera and Matthews bypassed the subcontractor provision by assisting in the creation of an online academy in Farmington, thus allowing more New Mexico education dollars to be funneled out of state. The fact time issue has yet to be addressed. K12, Inc. is the largest provider of online k-12 curriculum in the country with an annual revenue of $394.5 million dollars. It receives $5,755 per student enrolled in its online programs, with no school buildings to fund, operate, or maintain. Only 28% of K12, Inc.s staff are teachers, while the remaining 72% are employed in sales and marketing. K12, Inc. is headed by Ronald J. Packer, formerly of Goldman Sachs Mergers and Acquisitions Division. He has sponsored the annual conferences put on by FEE and works closely with Jeb Bush in the Digital Learning Council. His annual salary is $759,696, not including stock options. Although the New York Times article reported that he made $5,000,000 in 2011. The next highest officers annual salaries range between $657,657 and $359,776. Unfortunately, according to K-12, Inc.s annual report, virtual public schools that we serve generally test near state averages on standardized tests. Even with all of that money being siphoned away from traditional public schools, there does not appear to be any win for New Mexico by contracting with K-12, Inc. The New Mexico Virtual Academy, the first all virtual charter school, was given approval to open in New Mexico and will use curriculum provided by K12, Inc. thus bypassing the curriculum offered by IDEAL NM. The operator of the New Mexico Virtual Academy, Ralph Arellanes, had previously tried to open a virtual online charter school during the Richardson years called Sandia Academy.

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In the past, however, his applications were denied by the New Mexico Public Education Commission, and those denials were upheld by then Secretary of NMPED, Veronica Garcia, who deemed the application inadequate. Garcia did offer Sandia Academy a second opportunity to clarify their positions on some key issues. Rather than follow Secretary Garcias suggestion, Sandia Academy retained Patty Matthews and filed a lawsuit against Garcia and NMPED over the denial (Santa Fe District Court case CV-201000643). However, in September 2010, the court upheld Garcias decision to deny Sandia Academy a charter. In September 2011, Arellanes, now represented by Susan Fox and the Charter Law Firm, was unable to complete a federal grant application and submit it to Patty Matthews by the deadline. Susan Fox requested assistance from Matthews who then approved an extension for Arellanes so that the New Mexico Virtual Academy could still be eligible for the federal funding. However, NMPED spokesman Larry Behrens had already publicly claimed the Patty Matthews had severed all ties with her former partner and clients. It must be noted that CCd on all of the communications between Matthews and Fox regarding the grant application deadline was Cody Claver, vice-president of Business Development for K-12, Inc. (See all the attached documents labeled V). Skandera Recently Appointed to Sit on the Board of Directors with a Company Doing Business with the State of New Mexico. In August 2011, Hanna Skandera and Patty Matthews, on behalf of the Options for Parents Division of NMPED, brought in the National Association of Charter School Authorizers (NASCA) to help redesign the approach that New Mexico uses to approve new and renew existing charter schools. NASCA recommended that NMPED drop the renewal recommendation process that had been followed by Sam Obenshain.

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In November 2011, Hanna Skandera was appointed to the Board of Directors of NASCA, an entity that does business with her department. NASCA will pay all of Skanderas travel and accommodations so that she can attend NASCAs board meetings. NASCA lists New Mexico as a client on its website. In effect, Skandera is receiving compensation from a business that contracts with her department.

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