Louisiana Charter School CEO Racks Up Thousands in Questionable Charges to School’s Credit Card
D’Juan Hernandez, a New Orleans attorney and businessman, spent less than a year as head of a struggling local charter school called Milestone Academy. But he managed at least one significant accomplishment before resigning last month: racking up $13,000 worth of expenses on a school credit card, including $4,000 in payments to Tulane University, where his daughter attends, and $500 for plane tickets to Florida, where his family vacationed.
On the night of the Zulu Ball — his daughter was a maid in Zulu’s court — he racked up a $687 bill at Sweet Lorraine’s Jazz Club on St. Claude Avenue. Other big-ticket items included a $224 bill at the Smith & Wollensky restaurant in Miami Beach, Florida, and hundreds of dollars on upgrades to first-class flights.
Tessa Jackson, president of the nonprofit board that governs Milestone, says that Hernandez obtained an American Express card in the school’s name without getting approval from the board.
Meanwhile, a spat has broken out between Jackson and the Louisiana Department of Education over who is to blame. Jackson claims that state education officials, including the department’s head of monitoring, Patrick Walsh, foisted Hernandez on the school’s board after threatening to shut the school down.
In response, department spokesman Ken Pastorick sent a statement pointing out that Milestone has struggled academically and churned through principals in the past few years. “These are serious issues that affect children and need to be addressed,” he said. “This is no time for playing the blame game.”
Whatever the case, Milestone was in a jam when it hired Hernandez as an interim CEO in July of 2014.
All sides agree that state officials began to work solely with Hernandez — bypassing the board — after his appointment as interim CEO. While Jackson doesn’t believe the Louisiana Department of Education knew about the questionable charges, she says that well-connected Hernandez – a former candidate for Orleans Parish School Board superintendent and the brother-in-law of state senator Karen Carter Peterson – felt like he was above the rules because of the favored treatment he received from big players at the education department.
The dispute raises broader questions about what the role of the state should be in the administration of charter schools, and who ultimately calls the shots: the state department of education or the board — especially at schools like Milestone with less-than-stellar performance.
The school’s board had just parted ways with Sabis, the for-profit school manager that had been running Milestone since its inception a decade ago. The school itself was hopscotching from one building to the next, from Uptown New Orleans to Gretna to Old Jefferson. Its academic performance had been hovering at a “D” for years, and state officials were threatening to revoke the school’s charter. That would have given its 350 students little time to find a new school.
There had been talks aimed at joining the Algiers Charter Schools Association, so the school could remain open, but they had fallen through.
At the time, Hernandez was serving as attorney for Milestone’s board. He was also on the board of the Algiers charter group. His name came up at one point on a short-list of candidates to serve as superintendent for the Orleans Parish School Board.
On July 15, 2014, Milestone brought Hernandez on to serve as interim CEO on a contract basis, agreeing to pay him $12,500 a month. He signed an agreement promising to secure the school a building and set up a hiring process for a new principal, among other things.
Jackson said state officials were keen on the Milestone board hiring Hernandez, though she acknowledged that he was on their own list of potential interim leaders.
In November, according to emails provided by Jackson, Hernandez had the school’s business manager provide the financial statements necessary for him to open the American Express account. By the close of the January statement, Hernandez had racked up a $6,000 bill.
Jackson says she found out about the American Express when the credit card company called the school and demanded to talk to “the person who pays the bills.” She said the business manager got the statements on the morning of June 10, 2015 and that they forced Hernandez to resign that day, then told state officials about the spending.
Both Milestone and Hernandez said the American Express card was paid off with money withheld from Hernandez’s pay.
Hernandez says he won’t comment on the appropriateness of the expenses until he sees the credit card statements. “I haven’t seen the bill so I don’t know what’s on it or what’s not on it,” Hernandez said. “But I can say I have paid for all of my personal expenses.”
Hernandez says he resigned for other reasons.
“I had intended to resign months earlier, there was some fighting between the board and the school staff and I had been asked by the staff to stay,” Hernandez said. “I had stayed longer than I needed to, I don’t know if the school needs a CEO unless they are expanding into a charter management organizations”
At a meeting of the state Board of Elementary and Secondary Education last month, John White proposed that his department conduct an independent audit of Milestone’s board policies and procedures, citing Hernandez’s spending.
“We continue to see a pattern of repeated problems at Milestone that stem, I believe, from leadership that has not set a clear course for the school,” White said. “My hunch is that this financial problem that has emerged can be traced back to that.”
The action was taken up last minute and Milestone wasn’t notified that BESE would be taking any action against the school. Jackson says that this is another example of the state undermining the authority of the Milestone board.
Jackson argues that state officials are unfairly laying blame on the board, and that they should have stepped in with help sooner if they thought Milestone was struggling.
“The state never came and asked us what our concerns were, Jackson said. “If the state thought we are rookies, why didn’t they help us?”