Monday, March 12, 2007

A costly education at PHEAA

A $10,000 bar tab.

$47,000 to cover meals on a three-day trip.

$21,308 in expenses related to "client appreciation," including spa treatments.

Those are some of the jaw-dropping bills Pennsylvania's student-loan agency ran up for a series of "educational" trips to lavish resorts for its staff members.

The total bill? Somewhere between $750,000 and $900,000. And that's just the money we know about. The Pennsylvania Higher Education Assistance Agency (PHEAA) has fought hard to keep this information secret from the taxpayers of Pennsylvania, claiming that its expense records are "trade secrets."

It took a lawsuit by three news-gathering organizations to force the independent state agency to release records of its extravagant spending.

The Associated Press and the Harrisburg Patriot-News filed requests seeking records of luxury excursion by PHEAA employees and board members. Last month, PHEAA released more than 13,000 pages of receipts and vouchers sought by WTAE-TV in Pittsburgh for airfare, hotel rooms, meals and other expenses incurred by PHEAA's 2,700 employees between 2003 and 2005.

PHEAA uses income from its student-loan business to pay for its operating costs, which totaled about $261 million last year, according to an article by Martha Raffaele of the Associated Press.

But Raffaele points out that PHEEA also received around $500 million a year in state tax dollars that it spent on college grants and subsidies.

And who is suppose to be looking out for that $500 million in taxpayer dollars? PHEAA answers to a 20-member board of directors, which includes 16 members of the Pennsylvania Legislature.

Some familiar legislative names on the PHEAA board include: Rep. William F. Adolph Jr., Sen. Sean Logan, Rep. Ronald I. Buxton, Sen. Jake Corman, Rep. Craig A. Dally, Sen. Jane M. Earll, Sen. Vincent J. Fumo, Sen. Vincent J. Hughes, Rep. Sandra J. Major, Rep. Jennifer L. Mann, Rep. Joseph F. Markosek, Sen. Michael A. O'Pake, Sen. James J. Rhoades, Rep. James R. Roebuck Jr., Rep. Jess M. Stairs, Sen. Robert M. Tomlinson.

Members of the very same Legislature that has been fleecing taxpayers for years.

Also serving on the PHEAA board is Gerald L. Zahorchak, Gov. Ed Rendell’s education secretary, one of four appointees by the governor to the PHEAA board so 'Teflon' Ed Rendell shares some of the blame in this disgrace.

According to Raffaele, the expense records released by PHEAA show receipts for golf outings, banquets, spa treatments and entertainment related to a three-day, $135,638 retreat in June 2005 to Nemacolin Woodlands Resort near Pittsburgh.

One invoice grouped the expenses into three broad categories, the largest of which was more than $79,000 for meals, events and meeting expenses, Raffaele reports.

From Raffaele's story that moved Monday:

Dinners alone amounted to more than $47,000 over three days, one of which featured a "Tour of Italy" themed dinner buffet, a mashed-potato bar, and carving stations with bourbon honey mustard-glazed ham and southern-fried turkey breast. The total included a bar tab of $10,726. Another category included $21,308 in expenses related to "client appreciation." Spa treatments totaling $9,542 accounted for the largest single expense in that category, followed by almost $9,000 for golf outings. More than $34,000 in expenses were related to lodging. The board has also taken trips to resorts in California's Napa Valley, Maryland's Eastern Shore, Virginia and West Virginia.

How many Pennsylvania students could have used the $900,000 wasted by PHEAA to cover loans for college? Only Ed Rendell and the Pennsylvania legislators on the PHEAA board know.

Ken Schaefer, chairman of Vote For Integrity, has called for the resignation of Richard Willey, president and CEO of PHEAA. Willey is also the highest paid public official in Pennsylvania.

Even Rendell, no stranger to excess government spending, says changes must be made at the student loan agency.

"It has to have a total housecleaning," Rendell told reporters earlier this month. "When the cost of college is more and more challenging to Pennsylvanians and their families, we can't have the abuses that PHEAA has had for so long."

It should be noted that most of the "abuses" took place under Gov. Rendell's watch.

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