Three years after federal agency regulators stripped Indianhead Community Action Agency of a popular weatherization program because of numerous fiscal shortcomings, Indianhead is losing a vast swath of federal funding for two more important programs serving hundreds of families in six northwest Wisconsin counties.
The decision also follows an October 2019 Administration for Children and Families Office of Head Start review that found Indianhead with two program deficiency determinations and gave the non-profit 180 days to fix the problems. It also states seven other prior deficiencies discovered in Indianhead’s oversight of Head Start already have been corrected. The two remaining deficiencies are in Indianhead’s financial management system of Head Start — one in the non-profit’s management of Head Start and the other in its management of both Head Start and Early Head Start. OHS manages grant funding and oversees local agencies providing Head Start services.
Indianhead, which is based in Ladysmith, is now losing about $3.56 million in funding for Head Start and Early Head Start programs beginning with Fiscal Year 2021.
The federal Department of Health and Human Services Administration for Children and Families awarded Indianhead $5.34 million last year to continue overseeing Head Start and Early Head Start during the coronavirus pandemic. Indianhead was up again this year for renewal, being awarded $1.78 million for Head Start and nothing for Early Head Start.
Indianhead provided services to 349 children in Burnett, Clark, Rusk, Sawyer, Taylor, and Washburn Counties.
There are roughly 80 employees that would be affected by the grant change.
This year’s Head Start award is a two-thirds reduction from last year’s Indianhead grants for both programs based on the Tracking Accountability in Government Grants System.TAGGS is an on-line database of grants awarded by the 11 Operating Divisions of the Department of Health and Human Services, tracking obligated grant funds at the transaction level.
TAGGS shows Indianhead being awarded about $1.78 million for Head Start in 2021 compared with about $3.61 million the prior year. It shows Indianhead being awarded no Early Head Start Child Care Partnership funds in 2021 compared with about $1.73 million the prior year. TAGGS shows the most recent funding cycle ended in March 2021.
Indianhead’s Head Start program serves children ages 3-5 in Burnett, Clark, Rusk, Sawyer, Taylor and Washburn counties. Head Start helps children with school readiness and encourages parents to be active in their children’s learning. The program also helps parents with their own education, literacy, and employment goals. Head Start provides services and information around areas such as education, health, nutrition and social. Families with incomes below the federal poverty guidelines, children from homeless families and families receiving public assistance such as Temporary Assistance for Needy Families or Supplemental Security Income are eligible. In addition, foster children are eligible regardless of their family’s income. Up to 10 percent of families can be over income limits. Its locations include several in Ladysmith and the School District of Flambeau and sites in Medford, Hayward, Dorchester, Spooner, Siren, Neillsville and Minong.
Indianhead’s Early Head Start-Child Care Partnerships program provides services to families living in Burnett, Clark, Rusk, Sawyer, Taylor and Washburn counties. EHS-CCP is a collaboration between Indianhead and independent day care providers and some local school districts. The goal of providing EHS-CCP services through these collaborations is to support high-quality child care providers, support child development in infants and toddlers and prepare children for their transition to Head Start or preschool. These partnership locations include Tender Learning Center and Kids First Child Care Center, both in Ladysmith, Creative Kids Learning Center in Spooner, Granton Community Child Care Center in Granton, Kid Central in Siren, Kiddie Campus in Grantsburg, Little Angels Daycare in Medford and Starbright Child Care in Hayward.
There will be an interim management company that will continue providing Head Start services to the families and communities in Burnett, Clark, Rusk, Sawyer, Taylor and Washburn counties.
Community Development Institute will serve as an interim management company to oversee Head Start under a 1-year agreement with the Office of Head Start.
“It is with great sadness Indianhead has learned the Head Start grant application for our service area was not awarded for the 2021-2022 school year,” said Indianhead CEO Jennifer Shearer. “With this announcement will come a transition for many of ICAA’s workforce.”
Indianhead will continue to operate Head Start through June 30.
Indianhead is in a collaboration with the School District of Ladysmith for its 4-year-old Kindergarten program. Losing this collaboration will result in decreased funding to the district’s 4K programs, according to School District Administrator Laura Stunkel.
“However, it sounds like another management company is going to step in and manage Headstart/4K. So, I am not anticipating any big change in our 4K budget at this point,” Stunkel said.
Since 2013, the School District of Flambeau and Indianhead have been collaborating in a Head Start/Early Head Start Child Care Partnership. The school district has housed a 3 and 4-year-old Head Start Program for Indianhead.
School District Administrator Erica Schley called the collaboration, “A tremendous asset to the district.”
“We find that students are better equipped coming into our 4K program, they are familiar with their teachers and school, and we have the ability to identify student needs and address those needs at an earlier age,” Schley said.
Schley hopes the collaboration can continue through the interim with Community Development Institute.
“It is my hope that the interim company will work with our district to continue to provide a high- quality preschool experience to the children and families in the Flambeau area. Over the years, we have appreciated our Head Start collaboration and the services that were brought to our families,” Schley said.
Beginning July 1, many of the Head Start staff will need to apply for positions under Community Development Institute. It is anticipated the company will provide Indianhead employees first opportunity to apply for the open positions to ensure Head Start program continues to operate with continuity of services with staff that families and children are familiar with.
“Indianhead is regretful they will not be able to keep all our talented Head Start staff through the transition but are glad to know that there may be opportunities for staff to apply for employment and continue to serve their communities,” Shearer said. “Generally when you have transitions like this, your concern is ensuring your hard-working, dedicated staff continue their employment, and children and families see little to no interruption is this extremely valuable service. We’re grateful to see that many of our talented educators may have opportunities to continue working and serving our communities. That is what’s most important.”
With the continued loss of these federal grant dollars it may become increasingly difficult for Indianhead officials to convince federal funding agencies to continue awarding them more money the next time they are up to compete, said an unnamed source involved in the process.
Indianhead is a 501(c)3 charitable organization. It is one of 16 community action agencies in the state and one of about 1,100 community action agencies in the nation. Community Action Agencies were founded by the 1964 Economic Opportunity Act to fight poverty by empowerment, as part of the War on Poverty. Its mission is to assist individuals in achieving self-sufficiency by providing the resources, education and services necessary to develop healthy families, sustainable communities and strong local businesses.
Established in 1965, Head Start promotes school readiness for children, ages three to five, in low-income families and enhances children’s social and cognitive development by offering educational, nutritional, health, social and other services. Programs actively engage parents in their children’s learning and help them make progress toward their own educational, literacy and employment goals. Parents play an important role in the administration of local Head Start programs.
Shearer called it “a very real truth in the nonprofit industry that funding is never promised.” What an organization receives one year isn’t guaranteed the next.
“It is essential for our Head Start families to know that their children will still be able to continue to use these services throughout and after the transition. Continuity of high-quality, childcare and education services for our communities is one of our main goals as we work through this transition,” Shearer said. “We know how critical Head Start services are and we want to assure our families and communities that program operations will continue to operate as smoothly as possible.”
Indianhead will continue to work hard to secure funding to expand programs and services and continue to support staff and the community, according to Shearer. She added Indianhead will apply for federal Head Start funds in 2022.
Data provided by Cause IQ shows declining Indianhead revenues, expenses, assets and employees for nearly a decade. Cause IQ provides web-based information and tools to help accounting firms, nonprofit nonprofits, technology companies, consulting firms, financial services firms, fundraising companies, and other providers grow, maintain, and serve their nonprofit clients.
Cause IQ shows since 2014 Indianhead has seen its total revenues decline 20.7 percent, total expenses decline 16.8 percent, total assets decline 11.8 percent and number of employees decline 21.7 percent.
In revoking the Indianhead weatherization program in 2018 the Department of Administration, Division of Energy, Housing and Community Resources exercised its option to terminate the contract amid allegations of substantial financial concerns, including the non-profit’s failure to pay vendors on time and in full and its inability to account for funds.
In a 2018 letter to Indianhead, department officials cited they had “Lost confidence in the ability of Indianhead to successfully administer the weatherization program in accordance with state and federal regulations.”
When the Indianhead weatherization contract was revoked, the counties it serves were assigned to other action agencies. North Central Community Action Agency took Rusk, Sawyer, Price and Taylor counties. Western Dairyland Community Action Agency took Clark County. West Central Community Action Agency took Burnett and Washburn counties. Applicants in the region served by Indianhead are still able to get weatherization assistance through these other nearby surrounding agencies.
Hundreds of documents made public in 2019 show Indianhead struggling to cover staff payroll and pay area businesses for building materials, and the state Department of Administration trying to account for a $371,000 advance it made to the agency.
The Wisconsin Department of Administration released hundreds of documents including letters and e-mails describing alleged misuse of funds by the agency following a Freedom of Information request filed by the Ladysmith News. Documents detail numerous allegations, including Indianhead’s inability to account for a $371,580 weatherization advance payment.
Also included in the released documents was an admonishment by the state to Indianhead for suddenly laying off the entire weatherization and furnace staff of about two dozen workers without warning.
A May 14, 2018 letter from Sara Buschman, administrator of the state Department of Administration, Division of Energy, Housing and Community Resources, to Indianhead CEO Jennifer Shearer included criticism of the layoff.
“The division is very concerned about the mass layoff of the weatherization and furnace staff and would like to remind [Indianhead] that they were instructed not to proceed with any staffing changes without receiving prior approval from the division. Ms. Shearer confirmed this instruction in her letter of May 10, 2018. No such approval was sought or provided,” Buschman states in the letter.
Early Head Start (EHS), launched in 1995, provides support to low-income infants, toddlers, pregnant women and their families. EHS programs enhance children’s physical, social, emotional, and intellectual development; help pregnant women access comprehensive prenatal and postpartum care; support parents’ efforts to fulfill their parental roles; and help parents move toward self-sufficiency. Together, Head Start and Early Head Start have served tens of millions of children and their families.
It is not clear if Indianhead can or will appeal being denied funding.
“We haven’t learned that yet,” Indianhead Board Chairman Dave Willingham said.
There will be no interruption in services, according to Willingham.
“There would be an implementation plan,” Willingham said.
Willingham called the grants a competitive process.
“That is the process that was used,” Willingham said.
Indianhead also was in a competitive process for these grants last year, when it was awarded Head Start and Early Head Start funding during the coronavirus pandemic.
The grant dollars are required to remain in Rusk County, but it would be up to the new grantee on how to continuing to offer Head Start and Early Head Start. It could provide services in its own facilities, which could jeopardize existing collaborations Indianhead has with independent daycares and school districts.
A spokesperson for the federal Department of Health and Human Services Administration for Children and Families said Head Start grants were to be announced this week and Early Head Start grants sometime in June. However, the awards are already posted on the department’s TAGGS website.