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Kevin Johnson, St. HOPE suspended from receiving federal funds

Published: Thursday, Sep. 25, 2008 - 12:00 am | Page 19A
Last Modified: Thursday, Sep. 25, 2008 - 12:26 am

In a rare move, mayoral candidate Kevin Johnson and at least part of his St. HOPE organization have been barred from receiving federal money until an investigation into the use of funds for its volunteer program is completed.

Johnson, St. HOPE Academy and former top executive Dana Gonzalez on Wednesday were placed on the governmentwide "excluded parties" list, a database that informs federal agencies across the nation of people and programs no longer allowed to receive federal grants or contracts.

Although federal officials would not comment on the suspension or the investigation of Johnson's youth volunteer organization, Hood Corps, a spokesman previously said suspension is rarely invoked.

"If we find really egregious stuff and we want to stop the bleeding, we seek immediate suspension," William O. Hillburg, a spokesman for the inspector general's office conducting the investigation, told The Bee earlier when explaining the process.

Individuals suspended cannot receive federal funding personally and suspension also prevents them from voting or acting on federally funded programs that come before them as employees or board members, Hillburg said.

In an e-mail response Wednesday, Johnson didn't address the suspension. Instead, he said: "From day one we have fully cooperated with the review by the federal government. We will continue to do so until the investigation is completed."

Gonzalez, St. HOPE's director of new site and school development, left the organization in August, according to Rick Maya, St. HOPE's executive director.

Incumbent Mayor Heather Fargo, facing Johnson in a runoff next month, declined comment on the federal action.

However, Johnson campaign manager Steve Maviglio suggested the timing of the suspension, made by federal officials in Washington, was politically motivated.

"It's politically conspicuous" that it came "days before voting begins," he said.

The election is Nov. 4, but absentee voting begins Oct. 6.

The financial ramifications of the suspension on the diverse operations under the St. HOPE banner, including its public schools, were unclear. Historically, such an action has been wide-reaching, Hillburg said, including suspension of all federal funding, ranging from student lunch subsidies to redevelopment money, from student loans to federally backed mortgages.

St. HOPE schools locally, including Sacramento Charter High School and PS 7, last year received more than $1.3 million in federal dollars.

Maya, however, said he does not believe the suspension will have much impact on the organization.

"St. HOPE Academy ... does not currently receive any federal funds," Maya said.

In addition, he said, "It will have no effect on St. HOPE public schools, it will have no effect on St. HOPE Development Co., and it will have no effect on St. HOPE Leadership Academy in Harlem, because these are separate entities."

Maya said the federal government has not discussed the scope of the suspension with St. HOPE, nor did it notify St. HOPE of its action.

Maria Lopez, spokeswoman for the Sacramento City Unified School District, said the district will seek clarification from St. HOPE about whether the suspension will affect its charter schools.

Lopez pointed out that the district does not provide financial support for independent charters.

"Charters have an obligation to remain fiscally solvent," she said.

St. HOPE Public Schools has filed separate tax forms from the other St. HOPE organizations since 2003, but the schools and the academy share the same top leader. Kevin Johnson was listed as president of St. HOPE Academy on the fiscal year 2007 nonprofit tax forms filed in May and as CEO of St. HOPE schools on forms filed in February. In recent months, Maya has served as spokesman for the schools and the rest of the local St. HOPE organization.

Maya said Johnson stepped down in January as chairman and chief executive of St. HOPE public schools and St. HOPE Development Co., which created the 40 Acres complex in Oak Park.


Call The Bee's Terri Hardy, (916) 321-1073. Phillip Reese also contributed to this story.


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