From 2017 to 2019, the state auditor revealed that the nonprofit was at the heart of the largest public embezzlement scandal in state history. The state auditor said that the nonprofit spent at least $400,000 in welfare funds to “maintain government revenue streams or lobby for their organization”. She and her son received almost $1.3 million in direct legislative appropriations from the public education budget over those three years. Investigators found that little documentation is available to prove their influence over the purchases made by her non-profit Mississippi Community Education Center. The audit revealed that nearly $320,000 of lobbying payments went to Will Longwitz, a former senator and attorney who claimed he was hired by Mississippi Today to secure funding for dyslexia and autism therapists. However, his filings to the secretary of state’s said that he had received no money from the non-profit. Also, the auditor cited payments to lobbyists Serena Flowers. She told Mississippi Today that she did general counsel work for the nonprofit and Lucas Compton, a D.C.-based policy consulting company. Entities in Mississippi often get large government contracts or legislative funding by hiring well-connected consultants to argue why they should be. Many of these lobbyists fail to provide accurate reports to the secretary-of-state’s office. These reports do not show how much money they have received, how much income they have earned, and how much money they have spent on gifts for officials. Lobbyists who fail to comply with reporting rules are not subject to any penalties or enforcement under state law. The Mississippi Community Education Center was founded in 2016 by Nancy New. It received a large amount of cash from the Mississippi Department of Human Services, which enabled it to hire many high-end lobbyists and lawyers to represent it in powerful circles. In fiscal years 2015 and 2016, the agency gave $1 million to the nonprofit as a Temporary Assistance for Needy Families. In 2017, the amount had risen to over $14 million. The agency gave the organization $21.5million in 2018. Interviews with several lobbyists revealed that New, who is also the owner of New Summit School, was principally lobbying for private education programs. Her for-profit private education company New Learning Resources Inc., and the affiliated Mississippi Autism Center have received almost $3 million in direct appropriations from Mississippi’s Legislature through the Mississippi Department of Education budget. According to an internal audit, the schools have received about $28 million in public school funds since 2006. This includes direct appropriations, education scholarships accounts, and any other state-accredited, non-public schools that may be eligible for special needs funding. The Department of Human Services had hired a separate nonprofit to manage a program called Families First for Mississippi. This was to use welfare money to assist low-income families to find work and support their families with wages, instead of public assistance. The program was run by the Mississippi Community Education Center and the Family Resource Center of North Mississippi. This audit also revealed that Mississippi Community Education Center had misappropriated welfare money. Families First for Mississippi, under the former director of the agency John Davis, essentially privatized Mississippi’s anti-poverty program called “gen+” (or “generation plus”) in 2016. Lynn Evans, a retired lobbyist for public interest, stated that “the problem with this was there wasn’t any accountability.” The accountability was obscured by the fact that John Davis would travel down to the Capitol )… and discuss the “Oh this is so wonderful.” contract. Aren’t you pleased that I am transferring all of these responsibilities to private companies? Evans said: “It somehow escaped his attention that it was his responsibility that that money be used wisely.” New continued to lobby, but many lawmakers became skeptical about the increase in funding for the Family First for Mississippi program. Legislators said that officials from both nonprofits hosted lunches where they presented their mission to lawmakers. They vaguely described their “free” services but could not quantify their accomplishments. Rep. Jarvis Dortch (D-Raymond) said that they couldn’t answer my questions about what exactly they were doing with the money. One legislator had questions and turned to the Joint Committee of Performance Evaluation and Expenditure Review (PEER), a legislative watchdog group. James Barber, PEER’s executive director, said that there was a drastic increase in grant funding. Barber stated that the legislator who requested information about Families First had concerns about the services provided by the organization and that there wasn’t a lot of bricks and mortar to support the program. Barber stated that the legislator was concerned about Families First, the type of services they provided and the fact that there wasn’t a lot of brick and mortar to be able to point to as the program. Barber wrote to the Department Human Services in October 2017 asking three questions: What is Families First? What benefits are participants receiving; what organizations were contracted to run Families First; and were any state agencies involved. Davis replied with a nine-page letter outlining the outcomes and services provided by Families First for Mississippi. It included exhibits, dozens upon pages of agency communications, PowerPoint presentations and directories, as well as blank assessments for Families First clients. Davis didn’t include the outcome data that the agency required nonprofits to submit in order to track how many people they served in his reply. Mississippi Today discovered that the reports contained absurd figures. Barber followed up in 2019 just before the investigation started, but lawmakers did not take further action to force the agency to show how the money was spent or who it had helped. In February, a Hinds County grand juror indicted Davis and three other employees of the agency on charges of embezzlement. They have pleaded not guilty. Mississippi Today did not reach any lobbyists who claimed they lobbied Human Services for funds. Instead, Nancy New’s lobbying efforts were focused on her other for profit ventures, including programs that fall under the umbrella her corporation New Learning Resources Inc. MCEC and New Learning Resources employed the following lobbyists or consultants to government relations: Longwitz represented New Learning Resources at Capitol in the 2017-2018 and 2019 sessions according to his filings with the Secretary of State. In an email, he stated that he worked for insurance and coverage for children with autism and dyslexia during his time in the Senate. “After I left office I was asked by New Learning Resources for help explaining the legislative process and to assist them in getting funding to pay for dyslexia therapists and autism therapists.” Longwitz filed paperwork at the Secretary of State’s Office showing that the New private school company paid him $12,000 between 2017 and 2019. Longwitz also reported that he represented Mississippi Community Education Center in 2018, and received $0 in compensation. However, the report of the state auditor states that Mississippi Community Education Center paid Inside Capital LLC $318,325 for those three years. Mississippi Today did not receive any emails or calls from Longwitz regarding this story. Similar to the above, Secretary of State filings indicate that Alice Mitchell lobbied in Mississippi Community Education Center 2011-2012, 2014-2017. She received $24,200 for her efforts. However, she stated in February to Mississippi Today that she represented New Summit School. She also filed for New Learning Resources in 2018-2019, but received $0 in compensation. Mitchell stated in a text that she was not certain when MCEC began. I worked with them to obtain funding for an exercise program designed for school-aged children. I then monitored legislation for them. I wasn’t involved in any of their programs. “My only focus was on the school.” Sidney Allen and Caroline Sims, lobbyists at powerful firm Butler Snow registered as lobbyists in New Learning Resources under the name NLR Inc. (and affiliates) in 2019 and 2020. Sidney received $36,000 in fees in 2019, while the other two reported $0. The audit only focused on Mississippi Community Education Center purchases. Allen was not included in the audit. Allen claimed that New Learning hired him as a consultant to help educate legislators about educational services, such New Summit’s Spectrum Academy. This academy specializes in autism and developmental delays services. Allen stated in an email that “there are many parents who benefit from this Legislature’s support for these programs.” According to the audit, Mississippi Community Education Center paid AvantGarde Strategies owned by Serena Flowers $21,000 in 2019 while Lucas Compton received $72,000 between 2018-2019. According to the audit, Compton was hired by the nonprofit, which is based in D.C. “for services including sustaining federal revenues streams and bipartisan advocacy.” The audit also revealed that Family Resource Center of North Mississippi entered into a contract for lobbying with Lucas Compton in 2018 for $84,000. Flowers claimed she was working with the nonprofit as general counsel. This work was mostly related to labor law, such renewal of employment contracts and rewriting the organization’s handbook. It wasn’t for lobbying or government relations. She stated that this is why she didn’t register with the Secretary. Flowers claimed that she gave her contract to the auditor’s, but it was never returned to her. The annual audit does not include a complete accounting of nonprofit purchases. It only covers fiscal year 2019, and a few earlier purchases that were connected to the ones made in 2019. The audit found that Inside Capital and AvantGarde Strategies did not give the auditor a contract detailing the work they had hired. The audit stated that welfare funds should not be used for “influencing activities.” Just before the audit began, Mississippi Community Education Center had hired Clare Hester, a powerful lobbyist from Capitol Resources. She received $67,500 over the following months. She is not included in the audit. Hester was also registered in 2020 as the nonprofit’s lobbyist, but she did not receive any compensation. The accounting was muddled by the transfer of funds between the welfare nonprofit organization and the for-profit private education firm, which sometimes obscured the exact actions of the News. According to their criminal indictments, Nancy and Zach New used this method to steal $2 million from welfare funds. The audit also revealed that they transferred at least $6 Million to private schools. The audit didn’t track the whereabouts of the money after that. Audit found that the New nonprofit also used TANF funds for building costs at the Mississippi Dyslexia Center, which Nancy’s sons Zach New (and Jess New) own. Jess New is an attorney and executive director of Mississippi State Oil and Gas Board. She is also listed as an officer in many of the New company’s business filings. The Mississippi Community Education Center received the majority of its revenue from Human Services. There were also several million from other agencies such as the Mississippi State Health Department to provide anti-smoking education, and the Mississippi Community College Board which runs early childhood academies. The nonprofit and New Learning Resources Inc. received $28.9million from the Mississippi Department of Education for programs for students who have disabilities. This was a mixture of special needs scholarship account funds and dyslexia scholarships. The department stated in an email that MDE had not been lobbied to contract MCEC or New Learning Resources and that MDE has never had contact with either entity. The New-affiliated Mississippi Autism Center and New Learning Resources each received $1.5 million in flow-through grants from the Legislature since 2006. This includes $550,000 in 2017, $360,000 2018 and $360,000 2019. Allen confirmed that these funds were what he was appointed to secure in 2019. Legislators passed legislation in 2015 that allowed the education department to reserve public school funds for children with special needs. This money could then be used to pay private school tuition. Legislators have failed to pass any bills that would expand the program to include all children in the years since. Gov. Tate Reeves was one of the strongest supporters. He used Nancy New’s New Summit School for his 2019 gubernatorial TV ad. With Lt. Governor. With Delbert Hosemann’s new leadership at the Senate, lawmakers will need to reauthorize scholarship account bills this year. They’ve already written language that would increase accountability for the whole program, including the schools eligible. They have not moved any legislation to improve accountability in grant funding at Department of Human Services. After Davis’ sudden resignation in July, the News organizations’ influence began shrinking. Investigators raided Davis’ office and Human Services frozen their funding. Agents arrested Nancy and Zach New in February. According to interviews with people familiar with the matter, the nonprofit had also hired large law firms on retainer. These included Bradley Arant and Watkins & Eager. Butler Snow still represents the nonprofit and its board members as well as Zach New in his criminal case. Governor and Zach New were among the elected officials to have received donations from Nancy or Zach New in recent years. Tate Reeves ($5,000), and Lt. Governor. Tate Reeves ($5,000), Lt. Gov.