Lehighton Area School District is negotiating with the National Education Foundation looking to get something in return for the more than $1 million it paid the company as part of a convoluted Qualified Zone Academy Bond program in 2016.

“We’re going to sit down tomorrow and kind of come up with a shopping list,” Jack Corby, LASD acting assistant to the superintendent, said during a workshop meeting Monday night.

“We have drug our feet on this long enough. I think it will be a hard sell to get money back from them, but we’re going to work through our solicitor to try and get something our students and staff can benefit from.”

No return on money

The district applied for a QZAB in 2016, amid plans to build an elementary center and renovate its middle and high schools, and was approved for $6.8 million. The QZAB program allowed Lehighton to receive an interest-free bond to help finance its construction projects. One of the conditions of eligibility for the program required the district to obtain a written commitment from private entities for a cash and/or in-kind contribution having a present value of not less than 10% of the bond proceeds.

In order to fulfill this requirement for each bond issuance, the district entered into an agreement with NEF. The company, according to a 2020 state audit, agreed to extend its in-kind commitment for five years if the district signed a “Solution Site License” agreement with NEF to support a STEM program at the high school. The cost to the district for the agreement was 20% of the bond proceeds, or $1.36 million.

“Our review of available records, as well as interviews with an NEF official and numerous district employees, disclosed that NEF did not provide the district with the deliverables outlined in the agreement,” Eugene DePasquale, then state auditor general, wrote in 2020. “Specifically, NEF did not provide the stipends, rewards, mentors, tech support, etc. as stipulated in the agreement. Therefore, the district paid NEF $1.36 million and did not receive anything in return.”

Negotiations

Corby said NEF offered the district program licenses but the quantity far exceeds what the high school would need.

“They offered us 1,000 licenses when we only have around 700 kids in that building so we really didn’t think that was the best benefit,” Corby said. “We might look at technology or software packages and go back to them with a counter proposal. They’re willing to give us a product, but we want it to be something that’s useful.”

In the 2020 audit, DePasquale urged the district to either request a refund of the $1.36 million it paid for services it never received or work with NEF immediately to start obtaining those services outlined in the agreement, which ran out at the end of the 2020-21 school year.

“My main goal was satisfying the QZAB,” Director Barbara Bowes said. “NEF doesn’t have to cure this but they have offered to do that. The contract is over so we have to be flexible and I thank them for being flexible and caring about students. Hopefully we can come to a mutual agreement and get something provided that our students could use.”