Board Seeks More Time to Mull Findings Against Honig

After an unusual public discussion of a supposedly confidential federal audit, a sharply divided State Board of Education on Friday asked for more time to consider the audit’s conflict-of-interest findings against state Supt. of Public Instruction Bill Honig.

The audit accused Honig of violating state conflict-of-interest laws in his dealings with the Quality Education Program, formerly run by his wife, Nancy.

In a confidential draft report that was completed last December, Sefton Boyars, regional audits director for the inspector general’s office of the U. S. Department of Education, recommended that the State Board of Education be required to refund $222,590 to the federal government, the amount involved in three questionable Quality Education Program contracts with California school districts.

During the meeting, Boyars told the board that Honig “violated the (California) Political Reform Act” by providing a “material benefit” for the program, which Nancy Honig ran from the couple’s San Francisco home until last month, when she resigned.

Bill Honig “coordinated the (State Department of Education’s) parenting activities through QEP” and also used federal funds to start the program in three California school districts--Fremont Unified in Alameda County, Sweetwater Union High School District in San Diego County and Pasadena Unified in Los Angeles County, Boyars said.

Honig’s actions constituted a conflict of interest, Boyars said, because they produced financial gain for both the Quality Education Program and Nancy Honig, whose annual salary exceeded $100,000 when she resigned as program president in January.

“If Mrs. Honig had not taken a salary, there’d be no problem,” he said.

Boyars said auditors found no “rip-off” of federal funds by the Quality Education Program and that this was not “a nice, neat” case.

However, he said, “when you give an organization funds to hire personnel, that is a financial gift to that organization.”

Board member Joseph D. Carrabino said: “It’s very simple--what we’ve got to look at is, did money end up in the Honigs’ pockets?”

The same circumstances are being investigated by Atty. Gen. Dan Lungren, an inquiry that could lead to criminal charges against Honig.

Board President Joseph Stein at first refused to allow Honig to participate in the board’s questioning of Boyars, saying that the schools’ chief had presented his defense in an earlier closed-door meeting of the board. A motion to permit Honig to join the discussion failed on a 5-5 vote.

However, board members who are friendly to Honig then asked questions that allowed him to voice his side of the dispute.

“This is a case where a nonprofit, charitable foundation is giving services to the state,” the superintendent told the board.

Honig said the Quality Education Program gave $500,000 of its own money to the same three districts that received the federal funds, channeled through the state education department. However, without the extra federal money, there would have been no programs in those districts, he said.

“There is no benefit or cash flow to QEP, therefore there is no (conflict-of-interest) violation,” he said. “For the life of me, I can’t see how getting a charity, even one run by my wife, to give money to these districts, constitutes a conflict.”

Nancy Honig started Quality Education Program 10 years ago, offering a package of programs designed to increase parent involvement in the schools and thereby improve their children’s performance. The programs are now in more than 300 schools in 54 school districts, most in California.

Unable to reach a decision in their closed-door meeting, the board asked for an additional month to reply to the audit. The board must decide whether to accept the findings or appeal them to John T. MacDonald, U. S. assistant secretary of education. The board members also requested additional analysis of the alleged conflict of interest from Boyars and the board’s counsel.

By the time the board next meets on March 11, Gov. Pete Wilson may have named replacements for three board members whose terms have expired. That could affect the next board vote.

Honig told reporters he would file a personal appeal “regardless of what the board does.”

“They (federal auditors) have to find a legal connection between my actions and a benefit to QEP and they haven’t come close to making that connection,” Honig said.

He also said Boyars and other federal auditors are “biased” because Honig and the education department have won several disputes over use of federal money.