CDI Relinquishes Grantee Status to Office of Head Start in Face of Financial Shortfalls

In an afternoon Board of Directors meeting on Thursday, members were notified by Assistant Executive Director Jana Bays that CDI would be placed on restricted funding and could face possible adverse consequences if it opted to not turn over the reigns of the operations.

In relinquishing its grantee status, the national Office of Head Start will bring in an interim agency to administer the programs in an effort to minimize any interruptions to services for children and families at some 30 centers across the state.

As we understand it, Child Development Incorporated will still administer state-funded programs like Arkansas Better Chance programming in its centers. Head Start and Early Head Start staff will have the opportunity to re-apply for positions with the interim agency, as explained by Bays.

Had the board voted differently, restricted funding requirements would have required CDI to receive approval on all federally money spent.

By relinquishing its grantee status voluntarily, Bays told the board, CDI would not face any further adverse consequences from the Office of Head Start and would likely also be eligible to compete for the program grant during the competition process in September.

CDI administrators have developed a 10-day budget to be approved by the Office of Head Start to ensure operations continue and that employees are paid on February 10, 2012.

However, Bays did note that funding that went into effect on February 1st cannot be used to cover past costs or debts.

On January 26, CDI staff were notified they would not be paid until further notice due to those funding shortfalls. At the time of broadcast on February 2, employees say that money still isn't in their bank accounts.

According to the State Department of Health and Human Services, CDI had attributed the pay gap to a delay in it receiving its federal funding.

However, the Administration of Children and Families, which falls under the umbrella of the U.S. Department of Health and Human Services and administers federal grant payments, said all federal funding had been distributed on time and without delays.

According to CDI's budget, it receives around $10 million in federal funding for its Head Start, Early Head Start, and Migrant and Seasonal programs.

Prior to discussing the relinquishment of the Head Start grantee status, the board recessed into executive session. When members emerged they voted to accept the resignation of one employee and approved the termination of another.

According to board member Dr. Mary Ann Rollans, CDI is operating without an Executive Director and Financial Officer as of Thursday. However, the board did not clarify who had resigned and who had been terminated.

While the items on the agenda for the board meeting included personnel discussions and the financial status of CDI, how the organization came to face such financial problems was not discussed during the open portion of the meeting.

KARK requested an on-camera interview to follow up on questions that remained and how relinquishing the grantee status would affect families and children served by CDI. That request was not fulfilled prior to broadcast.

Administrators said they did not have time to field questions, citing the need to meet with staff.

CDI administrators said during the meeting they would release an official statement to the public at some point.

There are still details that will need to be worked out regarding the transition process from CDI to the Head Start-appointed interim agency.