By Lucy Komisar
April 21, 2011
Connecticut Congresswoman Rosa DeLauro censored? Bloomberg Businessweek censored? A press release by the New York Attorney General censored? And by the organization that represents the nation’s school superintendents and principals!
Why would the American Association of School Administrators (AASA) ban letters from legislators and government officials as well as articles in several newspapers from a display table at its February National Conference on Education at the Colorado Convention Center in Denver? Thereby hangs a corporate tale.
The AASA didn’t ban the documents over the usual culture wars issues. It was to thwart distribution of training materials on how schools can avoid being ripped off by companies that provide school meals. The papers were stacked on a paid exhibit table that had been set up by the Service Employees International Union (SEIU), which represents food service workers. SEIU had also bought the right to run a workshop.
But in the same exhibit hall were tables of major corporations, including Sodexo, Aramark and Chartwells/Compass, the three global food service management companies that run cafeterias for schools, colleges, hospitals, businesses and even the military worldwide.
AASA’s problem was that the SEIU materials mentioned how Sodexo, a French company, has cheated U.S. schools of millions of dollars by exacting kickbacks from food suppliers while charging schools full price. The documents told how Sodexo, when caught, had in July paid a $20-million settlement to New York State.
SEIU staffer Jordan Ash and a member of the SEIU’s local union had just set up their exhibit booth the morning of February 17th. What happened next is based on his account, as Kay Dillon, the AASA staffer who shut down the booth, would not provide her side of the story.
At about noon, Dillon, AASA Director of Corporate and Strategic Alliances, came over and said she was going to ask the union to leave but would refund the $4,900 it had paid for the booth and workshop. Ash asked why, and Dillon told him it was because the SEIU materials disparaged other exhibitors. The hall was filled with corporate sponsors. Ash noticed that anybody who had something to sell was in the room, including Sodexo, Aramark and Chartwells/Compass.
Dillon assured Ash that Sodexo hadn’t pushed SEIU to leave, but that the union could not display materials that mentioned companies or incidents of misconduct by food service management companies. He didn’t know how she knew what was in the literature that had just been stacked; perhaps somebody had brought copies to her.
Sodexo spokesperson Jaya Bohlmann, reached by phone, would not say whether the company had intervened.
Dillon and others were doubtless alerted by an SEIU email to conference participants. Called, “Capture Every Penny: Supplier Rebates and School Food Service Contracting,” it noted that some food service management contractors might not be complying with Agriculture Department (USDA) procurement rules to subtract supplier rebates from the amounts school districts pay the companies.
It invited participants to a seminar led by Barry Sackin, member of a USDA advisory panel on procurement training for state child nutrition staffs, “to learn how to protect your district’s finances if you outsource—or are considering outsourcing—food service operations.” Most school districts run in-house food service; others hire food service management companies.
Ash pointed out that the SEIU had at AASA’s 2010 conference distributed one of the documents, “Cafeteria Kickbacks,” a March 2009 In These Times article by this writer that exposed Sodexo’s exaction of supplier “rebates” which, in violation of federal rules, were not passed on to schools. But that conference took place before the Sodexo-New York settlement, which got a lot of press. Dillon didn’t want the article on display this year.
Ash asked about displaying a letter from the USDA that didn’t mention companies. It told education departments to follow the rules on their meal outsourcing contracts. Her reply was, “No, we don’t want to get into politics.”
Ash and Dillon went through the documents one by one as Ash hoped to salvage some. Dillon said she would not permit “anything that mentions companies by name.” She didn’t want the letter from Congresswoman DeLauro [D-Conn] or articles about the settlement, including one by AP in Bloomberg Businessweek.
The SEIU was allowed to keep one item on the table in addition to the fresh fruit bowl. That was a general brochure by SEIU called Taking Control of Your Contract.
Dillon said Barry Sackin could do a workshop presentation if he didn’t mention actions by any companies. Ash asked if the workshop could discuss food service management companies in general. Dillon said no, because everybody would know who they were. Ash thought that it defeated the purpose of having the workshop if Sackin couldn’t talk about why it was important to audit rebates received by food service management companies.
Ash pointed out that SEIU had dealt with the issue at the AASA 2010 meeting. She said a lot had happened in the last year. They both knew she meant the July 2010 agreement when Sodexo paid $20 million to New York State to settle a charge that it had kept rebates (ie kickbacks) for food it purchased on behalf of 21 state school districts and the State University of New York.
What was in the documents the AASA banned?
- A March 2009 article by Lucy Komisar in In These Times exposed how Sodexo took kickbacks from global food suppliers and charged schools and other clients full price for food used in meals Sodexo provided.
- A July 2010 Associated Press story printed in Bloomberg Businessweek ran under the headline “Sodexo to pay $20M for overcharging NY schools.” An attached press release headed, “Attorney General Cuomo announces $20 million settlement with food services company for overcharging New York schools,” said, “Settlement part of on-going industry-wide investigation.” It listed the cheated schools and colleges and the money they would receive.
- A September 2010 letter from Congresswoman DeLauro to Secretary of Agriculture Tom Vilsack asked him to alert state education and agriculture agencies about the New York-Sodexo settlement and to have the Office of Inspector General identify and recover federal funds that might have been misappropriated through illegal procurement practices the settlement identified.
- An October 2010 letter from the New Jersey Attorney General’s office to Assemblywoman Linda Greenstein and Assemblyman Wayne DeAngelo said, “This office shares your concern about Sodexo and is taking appropriate investigative action under the Consumer Fraud Act and the New Jersey False Claims Act.” August 2010 articles in The Trentonian and Asbury Park Press described the Greenstein-DeAngelo efforts and a town’s plan to audit Sodexo’s records.
- A November 2010 form letter from Kevin Concannon, Under Secretary of Agriculture for Food, Nutrition and Consumer Services, to the director of the Iowa Department of Education reaffirmed “the importance of safeguarding Federal funding in the Federal child nutrition programs by insuring that school food authorities (SFAs) are the beneficiary of any discounts, rebates or applicable credits resulting from procurements made on their behalf by third parties (eg. distributors, food service management companies, etc) through cost reimbursable contracts.”
- A January 2011 letter from New Jersey Assemblyman Patrick Diegnan to the South Plainfield Board of Education president suggested an audit of Sodexo contracts.
Why would the AASA censor such materials? One reason could be money. The AASA’s 2008 report to the IRS, the latest available, lists revenues of nearly $10 million of which there are more than $3 million in convention and advertising revenues and $3 million from “admissions, merchandise sold, services performed, or furnishing of facilities” related to the group’s activities.
I asked AASA spokesperson Kitty Porterfield how much money Sodexo and the other food service management companies contributed to the organization. She replied that “Such information is private to us and these businesses, and it would be inappropriate to disclose their prices, contracts, and business relationships with us or any other party.”
Corporate relationships are extensive and sought. On its website, the organization advertises that “AASA offers a wide variety of partnership opportunities designed to meet your company’s marketing goals.” That includes inclusion in the Buyers Guide for Educators, print and electronic advertising, exhibits, and support for meetings, conferences, receptions and special events, and publications.
AASA declined to grant an interview, but Porterfield emailed a statement that said, “Midway through the conference, the Campaign for Quality Services [the SEIU project sponsoring the exhibit] abruptly withdrew from the conference. Their departure followed an amicable discussion with AASA officials in which the AASA officials asked the Campaign to remove some of the literature at their booth and to remove the names of specific, targeted companies from their presentation. The spokesman for the Campaign agreed to remove the literature, but felt the Campaign could not hold the Knowledge Exchange Session without naming the companies whose practices they were criticizing.”
She said, “AASA was not prohibiting the Campaign from delivering its message, which AASA understood to be that, in contracting with outside vendors, a school system should be diligent in reading and understanding the agreement. This is an appropriate message for AASA members to hear, and AASA welcomed the Campaign’s desire to deliver it. AASA simply asked the Campaign to carry on a discussion in a way that would uphold the integrity of the trade show and not devolve into name-calling.”
“AASA regrets that the Campaign felt it necessary to leave the event. The association has offered to return both the booth and presentation fees on receipt of a written request, but has not heard from the Campaign. AASA also regrets that the Campaign has felt it necessary to distort the nature of the conversation that led to their withdrawal.”
However, Porterfield would not discuss the conversation nor the alleged distortions nor allow an interview with Dillon. Nor would AASA address the censorship issue. A lesson that educators might ponder.
See article on Nation Institute Investigative Fund site.