Friday, February 03, 2023

New York Blocks Payments to 20 Firms That Serve Hasidic Schools 

New York City education officials are blocking payments to 20 companies that provide education services, primarily for students in yeshivas.

The move marks a change in the city's approach to education contracting, particularly in cases involving parents of private school students with disabilities who seek city-funded services. While there is a process — parents must ask a hearing officer to order the funding — the city has until now assented to most such requests. Now it will fight those that would channel payments to any of the 20 companies.

My colleagues Brian M. Rosenthal and Eliza Shapiro write that together, the firms collected $60 million to provide special education last year alone.

The shift comes after Martin Handler, an executive at some of the city's top-earning special education providers, was arrested last month and charged with stealing millions in public money that was supposed to go for early education for low-income children. He has pleaded not guilty.

Officials say the 20 firms all have ties to Handler or at least one of his co-defendants. Two of the companies are linked to Handler in public records — Special Education Associates and Kids Domain Childcare Centers — and operate from the same building in Borough Park, Brooklyn, as Handler's child care businesses.

Handler's attorney did not respond to a request for comment, nor did representatives of many of the companies now shut out of funding.

The indictment of Handler and his co-defendants, and the city order barring payments to the 20 companies, followed a New York Times article in December that revealed that many special education providers in the Orthodox Jewish and Hasidic communities had received a windfall of taxpayer money in recent years. The money covered services that were sometimes not needed or even provided. In response to the article, city officials said they were scrutinizing requests more closely.

The Times had reported in September that scores of Hasidic boys' yeshivas across Brooklyn and the lower Hudson Valley have collected about $1 billion in taxpayer money in recent years while failing to provide their students with a basic secular education.

Last month, the state Education Department told Mayor Eric Adams's administration that a long-delayed investigation into the quality of secular education at more than two dozen Hasidic yeshivas in Brooklyn must be completed by June. That was the latest signal that the state is stepping up pressure on the city to improve yeshiva education. Betty Rosa, the state education commissioner, ruled in October that one Brooklyn yeshiva was violating a state law requiring private schools to provide basic English and math instruction. That ruling overturned an earlier determination by the city that the school was in compliance.

This week Nathaniel Styer, a spokesman for the Education Department, said the city would meet the deadline set by Rosa. He said that officials have visited all the yeshivas in the original complaint and plan to visit each school at least once more.

The criminal case against Handler and his co-defendants could take months to work its way through the court system. According to an indictment unsealed last month in U.S. District Court in Manhattan, he stole money through child care firms, some of them secretly owned, including by creating what prosecutors called a "fake after-school program" and billing for services that he never provided. Handler used the money to deal out no-show jobs, buy real estate and purchase an array of historical religious artifacts at auctions, prosecutors said.


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