Bankrupt Newark Head Start Agency May Owe Feds $10M

NEWARK, NJ — Federal authorities are claiming that Newark Preschool Council Inc., a defunct nonprofit formerly responsible for administrating Head Start programs throughout the city, may have to return $10 million in funding.

A recent U.S. Office of the Inspector General (OIG) report alleges that the Newark agency didn’t maintain its funded enrollment level over a 17-month period in 2013 and 2014, although it received an excess of nearly $8 million in Head Start funds. In addition, the agency allegedly used Head Start funds for “unallocable general and administrative costs” that came to $1.5 million, “unauthorized purposes” worth $450,000 and $46,000-worth of salary paid to its former executive director that “did not comply with Newark's policies.”

The agency also didn’t “monitor its partner agencies' operations to ensure that children at these facilities received Head Start services,” federal authorities charged.

Federal authorities recommended that the agency should refund the government $10 million for the “unallowable” costs.

Read the OIG report here.

Despite the OIG’s allegations, it may prove extremely difficult to recoup any of the funds; Newark Preschool Council Inc. filed for Chapter 7 bankruptcy in October of 2016, officials said.

Representatives with the now-defunct agency told NJ.com that their enrollment reports for the period in question were accurate, and they had met their obligation to serve nearly 2,500 preschoolers at more than 30 locations in the city.

Patch File Photo: Newark Preschool Council

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