Still, HDC stubbornly clung to the program and dismissed the growing criticism. Its board chairman, Larry Hinton-Johnson, repeatedly voiced indignation and irritation at being forced to defend the agency's performance. "Whoopee-doopee-do," was his response when asked earlier this year about the government's concerns about HDC's management ("Shortchanged," RFT, Jan. 12).
Despite the bravado of its administrators and board members, the agency's directors voted May 4 to relinquish a $11 million contract to provide Head Start services to thousands of low-income children at 63 locations in St. Louis and Wellston.
The decision was good news to federal officials, who plan to hire an interim provider to take over for HDC after the school year ends next month.
"We're certainly pleased they've taken this action," says Michael Kharfen, a spokesman for the U.S. Department of Health and Human Services in Washington, D.C. "We will work out a smooth transition to minimize any disruption to children and families. HDC has a number of programs they operate, and this will give them the opportunity to concentrate their efforts on those programs."
HHS officials have repeatedly cited the nonprofit for a range of problems, including low enrollment and poor financial supervision. HDC has failed to serve 2,519 children annually -- even though it is paid to serve that number in a city where an estimated 5,000 children qualify.
Several board members, including Hinton-Johnson, did not respond to phone calls seeking comment.
Head Start is not the only program operated by the nonprofit HDC, but the federal grant of $11.6 million does supply the vast majority of the $16 million in funding that HDC takes in each year. HDC's other programs include a temporary emergency-food-assistance program and the Women, Infants and Children Supplemental Food Assistance Program, known as WIC, both funded by the U.S. Department of Agriculture; and an energy-crisis-assistance program, funded by the state of Missouri. HDC employs more than 400 full- and part-time workers.
HDC has held the federal contract in the city of St. Louis in the decades since Head Start was launched in the 1960s as part of the federal War on Poverty, intended to help prepare disadvantaged children for kindergarten. HDC's most recent problems date back to 1997, when it was cited for low enrollment and attendance, failing to keep parents involved and failing to make a concerted effort to reach disabled children. At one point, it was more than 1,000 children short on its enrollment. The agency was also cited for financial irregularities.
In the years since, federal regulators have continued to cite those problems -- and others. HDC failed to pay its bills on time, overdrew on its bank account by $500,000 and finished two recent fiscal years more than $300,000 in debt. In November 1998, HHS officials told the agency it would be losing its $11 million contract altogether, but HDC appealed and won on technical grounds, receiving additional time to fix its problems. A review team visited in agency in February to follow up, but problems persisted.
"They had not really made substantial progress in correcting the problems that had been identified," says Kharfen. Another attempt by the federal government to terminate HDC's Head Start contract was a "distinct possibility," he says.
HDC's decision to relinquish its contract came as a surprise to the Roman Catholic Archdiocese of St. Louis' Catholic Education Office, which operates about 20 Head Start locations for HDC and serves about 550 children. The archdiocese is weighing whether its Head Start program should be run by another agency of the diocese, such as Catholic Charities. George Henry, superintendent of education for the archdiocese, says he spoke with HDC's executive director, Ruth Smith, on May 2, when she inquired about the status of those discussions. "She never mentioned anything about HDC dropping out of the program," Henry says. "I was rather surprised, to say the least, to hear they were ending the program next month."
The archdiocese has been working with HDC for more than 30 years, but since December it has been working without a contract. Henry says he met with HDC in January and was assured a contract was forthcoming. Five months later, he has yet to receive a contract. He was told by HDC officials that the attorney who was to draw it up was ill.
"I hope the conversation would begin soon on how we can successfully transition this program to whoever, so that teachers currently employed can continue to be employed," Henry says. "I would hope whoever the interim grantee would be, we could have conversations with them about how we can see that these services are continued and upgraded."
Kharfen says Head Start services won't be interrupted. The federal agency is holding discussions with another local nonprofit that could serve as the interim provider. The contract will be opened for bids later this year, and grants will likely be awarded to more than one provider. Kharfen will not name the interim provider but notes that it is an agency "familiar with Head Start." The YWCA of Metro St. Louis now provides Head Start to low-income children in most of St. Louis County, and Youth In Need provides those services in St. Charles County.