Central Indiana Community Foundation has halted payment on a $3 million grant to Junior Achievement of Central Indiana because
of accounting questions.
Meanwhile, contractors have stopped working on a Junior Achievement building in Indianapolis that’s funded by the grant and complain that they haven’t been paid since November.
The project is a roughly 25,000-square-foot addition to Junior Achievement of Central Indiana’s headquarters at 7435 N. Keystone Ave. that’s supposed to house a new culinary school for Ivy Tech Community College.
“Everyone’s passing us to someone else. It’s very frustrating,” said Brad Pugh, secretary-treasurer of Sanjo Steel Inc. in Greenwood. Pugh has not yet filed a mechanic’s lien, but he said his family-owned company is owed $330,000 for work performed in November, December and January.
The building was slated to open in time for Ivy Tech’s fall semester, but school spokesman Jeff Fanter said the school is putting off its move.
Junior Achievement has received roughly $750,000 of the grant and broke ground on the addition last fall. Sometime in November, the community foundation “became aware that there may be material issues” with respect to the grant, President Brian Payne said.
The community foundation informed Junior Achievement in writing on Nov. 24 that all future payments under the grant would be suspended until “issues” were resolved, and JA met certain conditions, including an outside audit, Payne said via e-mail Wednesday.
Payne was not available by phone and said he didn’t have time to elaborate on the nature of the problem. The foundation has “spent hundreds of hours of staff time and tens of thousands of dollars trying to help JA resolve these issues,” he said in an e-mailed statement. “The resolution of these issues is still a work in process.”
In a separate e-mail to subcontractors on the job, Payne said Junior Achievement failed to hire an auditor, so CICF hired one on its own and hasn’t yet received the final report.
“If you have any questions regarding JACI’s use of the funds that it has received from CICF, then I strongly encourage you to contact JACI directly with those questions,” the e-mail said.
All this is news to Pugh and other subcontractors, who said they were told by their general contractor that Junior Achievement met CICF’s requirements and the rest of their payments should be released anytime.
The bulk of the work done under the first round of grant money was in design. Considering the size and utilitarian nature of the building, Pugh said he doubts the lead-up work could have cost $700,000 or more. “I don’t know what you could possibly design for three-quarters of $1 million,” he said. “What’d Junior Achievement do with it?”
Junior Achievement CEO Jennifer Burk and top board members did not return phone calls seeking comment.
The owner of the North Keystone building and Junior Achievement’s partner in receiving the $3 million grant is the Experiential Learning and Entrepreneurship Foundation. That foundation exists solely to benefit Junior Achievement, and until recently, was overseen by Junior Achievement’s managers. Technically, Junior Achievement is a tenant in the building, which it uses as it headquarters and to host schoolchildren for programs such as "BizTown" and "Finance Park."
Junior Achievement took on the culinary school project, announced in May of 2008, under longtime CEO Jeff Miller. He retired at the end of 2008, but continued to serve as president of the Experiential Learning foundation through last year.
The Experiential Learning foundation signed all the contracts for work on the culinary school addition, which it will lease to Ivy Tech.
Miller said his role last year was to raise additional donations for the $7 million culinary school project and oversee day-to-day construction activities.
“I was the project manager, but I didn’t have any communication about this stopping of money,” he said.
Miller said that was left to Burk and Gary Aletto, the volunteer chairman of the Experiential Learning foundation board.
Aletto downplayed the nature of the community foundation’s review. He said CICF officials asked for invoices and contracts to back up Junior Achievement’s requests for payment, and that they were handed over. He said he doesn’t know why CICF hasn’t released the rest of the grant money.
“This one glitch in the payments has caused us a little wrinkle,” Aletto said.
Joe Trout, the owner of Pyramid Masonry Inc. in Brownsburg, said the main contractor, Wurster Construction Co., has relayed similar messages from Aletto. Wurster Construction officials referred questions to Aletto.
Pyramid started work on the site in November and finally stopped in February. Trout said he’s laid off most of his 20-man crew, and filed mechanic’s liens worth $218,070.
“I have been hearing ‘next week’ for three months,” Trout said.