This story was produced by FOX8 WVUE, NOLA.com | The Times-Picayune and WWNO New Orleans Public Radio as part of Reveal’s Local Labs initiative, which supports lasting investigative reporting collaborations in communities across the United States.

McMillian’s First Steps Academy in New Orleans is a private school whose tuition comes from only one source: taxpayers.

The school has earned millions from the state in recent years through the Louisiana Scholarship Program’s voucher subsidies, despite its low performance, allegations of test cheating and evidence of nepotism, an investigation by a consortium of local and national news organizations has found.

In the 2017-18 year, every one of McMillian’s 156 students used state vouchers to pay tuition, according to records from the state Department of Education. That means nearly $1.3 million in public money flowed to the school that year as a result of the school choice program expanded in 2012 by then-Gov. Bobby Jindal, allowing lower-income families to opt out of struggling public schools in pursuit of a better education.

McMillian’s shows how some low-performing schools exist solely because of the program’s public subsidies, with little accountability and state oversight, according to an examination by NOLA.com | The Times-Picayune, WVUE Fox 8 News, WWNO and Reveal from The Center for Investigative Reporting.

The McMillian family used to run a preschool out of its South Claiborne Avenue building in New Orleans. But the year after Jindal expanded the voucher program, McMillian’s First Steps Child Care Center became McMillian’s First Steps Academy, an elementary school for kindergarten through 5th grades. It added additional grades later.

As a reconfigured school in the 2013-14 school year, McMillian started with all voucher students – 29 students who delivered more than $195,000 in state dollars.

Since then, as more tax dollars flowed to the school, Executive Director Linda McMillian’s pay has grown significantly. A review of the school tax records shows McMillian earned $204,328 in 2017, a 35 percent increase over her 2016 salary.

That’s more than double the pay of similar jobs in the public school system.

The salary range for an elementary school principal in the Jefferson Parish public school system, the state’s largest, ranges from about $82,600 to $93,600 a year, depending on the administrator’s experience, according to Ted Beasley, the district’s director of communications. The range for a middle school principal in the suburban district is about $87,700 to $98,700.

As a private school, McMillian’s has no public oversight over pay and can set policies and salaries as it sees fit.

The school is a family-run shop. Linda McMillian’s husband, Harold McMillian, is the chief executive officer. The assistant principal is Rashad McMillian, the son of Linda and Harold, according to the school. Another son, Christopher McMillian, is the school’s coordinator and a daughter, Fanchon McMillian, is the band director.

That likely would be prohibited in the public sector. Louisiana ethics laws ban the head of a public school system, such as an independent charter network, from hiring immediate relatives, with some exemptions.

“Nepotism in the public sector is frowned upon mightily,” said Andre Perry, a fellow at The Brookings Institution and formerly the associate director for education initiatives at Loyola University’s Institute for Quality and Equity in Education. “For that many folks to be connected puts up red flags on the quality and intentions of that school.”

Linda McMillian declined a request for an interview. In a statement Tuesday, she said voucher students attending the school arrive performing well below grade level.

“We have students we received and enrolled in (5th and 6th) grade with a skill level of a first and second grader,” her statement said. ”Who drop the ball and who left those students behind? In addition, these students are struggling and can’t keep up with our curriculum and therefore, grades are poor along with poor performance and little to non-support from the parent(s).”

The school charges the state the maximum allowed by the voucher program, nearly $9,000 per student. Yet the school has not a single private-paying student, raising questions as to how it determines its tuition in the private education marketplace.

Other private schools in the area that accept voucher students charge much lower amounts for tuition. For instance, Faith Lutheran in New Orleans charges the state $4,955 per student, and St. Stephen School, also in New Orleans, charges $5,700, state records show.

McMillian’s Academy is also among only two private and parochial schools in Louisiana with 100 percent voucher enrollment, state data shows. At least 12 schools in the program have at least 85 percent voucher students.

“They’re setting it to maximize profits,” Perry said of McMillian’s tuition. “If you have no one paying tuition, then essentially you’re going to maximize the source of revenue, and that in this case is the public dollars coming in on the voucher.”

The state requires all voucher students at private and parochial schools to take the state assessment tests designed to track classroom performance. The LEAP tests are the same ones given to students in public schools and allow the state to give a score to private or parochial schools with a significant number of voucher students.

State officials have expressed a number of concerns about how McMillian’s has administered the tests.

In 2017, the Louisiana Department of Education received an anonymous tip alleging cheating on those tests at McMillian’s.

Following the complaint, the department and the Office of the State Inspector General interviewed school staff and students. During the interviews, 21 students “self identified that they had not cheated on state tests without being prompted” by the investigators, according to an internal Department of Education letter dated Aug. 24, 2018.

“This high number of similar unprompted responses indicated that these students had likely been prepared by McMillian’s staff to answer that way,” the letter says.

Like many of the schools participating in the voucher program, McMillian’s has struggled under the weight of poor test results.

The news organizations analyzed the data on state test scores at voucher programs and found that two-thirds of all students in the voucher system attended schools with either a D or F last school year.

Among those schools was McMillian’s, which the state scored at 58.7 out of a possible 150 points – the equivalent of a D.

Last fall, the state education department sent another letter to Linda McMillian, describing “a series of concerns” uncovered by a school monitor during LEAP testing for the 2017-18 school year.

That letter, obtained through a public records request, said:

• An independent monitor hired by the state watched as a McMillian’s “test administrator’s eyes remained closed for 10 minutes during the testing period, at which point the independent monitor saw one student engaging with another student for help on the test.”
• A McMillian’s test administrator allowed a student to work on the test after time was called to end the testing period.
• For the second consecutive year, McMillian’s students exhibited a rate of changing answers from wrong to right that was above the state average.
• 69 percent of McMillian’s students received special accommodations for the test, compared with the state average of 10 percent. The school did not respond when the Department of Education sought an explanation.
• 13 of 42 students, including all 6th and 7th graders, were tested outside the one-week prescribed assessment period.

Because the school did not provide answers to the concerns, the Department of Education voided 61 of the school’s 2017-18 LEAP tests, saying the school’s “pattern of behavior” showed it was “unable to administer assessments in accordance with” state requirements, the letter said.

Only then, after seeing problems for at least two years, state officials told McMillian’s that it would not be able to accept new voucher students for the 2019-20 school year.

In her statement, Linda McMillian disputed the state’s number of tests voided, saying it was only one part of three students’ tests.

How is your child’s voucher school performing?

Many schools don’t have letter grades because Louisiana only reports test scores for schools with at least 10 scholarship students per grade level. But most students in the program are concentrated in schools that did report. We calculated letter grades based on each school’s SCI score, which the Louisiana Department of Education says is comparable to the scores used to calculate public school letter grades.

Source: Louisiana Department of Education
Graphic: Ted Han

The school is required to respond to the violations if it wants to accept new students for the 2020-21 school term, according to the letter. The state held a meeting with McMillian’s leaders on Nov. 9 to discuss the problems. At the meeting, a representative from the state education department’s assessment team reiterated the findings of test monitoring at McMillian’s and explained the process for appealing the test voids, according to the department.

Even after those violations, however, McMillian’s can still keep every voucher student it already has, according to the state’s rules for the voucher program.

Despite all that, the state gave McMillian’s a score equivalent to a C grade – a passing mark – last school year. When the news organizations began asking questions about McMillian’s last month, the state said the school score “was incorrectly listed on our website” and changed it to the equivalent of a D.

The mother of a McMillian’s student interviewed recently outside the school said she knew nothing about the testing problems at the school or the sanction issued by the state.

“I didn’t hear anything of this,” the woman said after a reporter showed her a letter from the state education department explaining the testing issue. “It’s very shocking. If this holds true, it should have been discussed at a school meeting.”

Ann Duplessis, a former state senator from New Orleans and the architect of the voucher program, viewed the letter listing McMillian’s problems for the first time during an April 24 interview. She said that the majority of the nonpublic schools in the program are effective and that most families that participate are pleased.

“I’m disappointed in it,” Duplessis said after being presented the letter. “Flip side, it’s a testament to the accountability measures we have in place. We’re not waiting five years to react.”

But Perry said struggling private schools that rely solely on public vouchers to remain afloat should be allowed to close down.

“I’m not surprised that people will try to take advantage of an opportunity to make money, open a school and provide more options,” Perry said, speaking in general terms about voucher schools. “I do think the voucher program inspires a new crop of educational providers.

“It will also invite more nefarious characters who have no interest in educating folks, but they do want easy money.”

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