Conflicted interests

State curious about grants to House member's nonprofit

The Georgia attorney general's office has begun investigating more than $200,000 in state grants made to a nonprofit run by Rep. George Maddox, D-Decatur.

It's an inquiry that's been halted until the legislative session ends. The state can't investigate a lawmaker while the General Assembly is in session.

Whether the office finds anything illegal about the local assistance and Governor's Emergency Fund grants made between 1998 and 2002 ignores the common-sense-defying fact that the grants were made in the first place. Maddox lobbied for and often originated the grants at the state level, according to documents filed with DeKalb County, and then turned around and signed for the checks when they were delivered. And until March of last year, Maddox's wife, Lois, served as the president of the nonprofit. Meanwhile, Maddox himself monitored its day-to-day business — right down to corresponding with DeKalb on the nonprofit's behalf using House of Representatives stationery.

Maddox was required by law to disclose such transactions with Secretary of State Cathy Cox's office. He didn't, says spokeswoman Cara Hodgson. Cox's office has no disclosure reports on file for Maddox; he says he wasn't aware that he had to file any.

Penalties for violating the disclosure law include a fine for as much as $10,000 and removal from office.

The bigger question, of course, is whether Maddox made money off the arrangement and whether the South DeKalb Improvement Initiative spent the state money as it should have. Maddox says he didn't profit from the Improvement Initiative but admits that money from at least one of the grants was spent improperly.

In an interview with Creative Loafing on Friday, Maddox didn't act like a man under investigation. In fact, he didn't know the attorney general's office had looked into the grants. But Maddox, who was elected to his fourth term in the House in November, talked openly and expansively — if not always in reassuring detail — about the Improvement Initiative. The grants funded a Saturday math program for public school children in DeKalb — Students Learning and Advancing in Math (SLAM) — as well as events for senior citizens. He also encouraged the attorney general's office and DeKalb to scrutinize the grants.

"George Maddox never made a penny out of SLAM," the lawmaker says. "There isn't a nickel missing from that program. Nobody got paid who shouldn't have. I'm just mad as hell that we can't continue to do it."

Maddox admits he may have erred in installing his wife as president, which he says he did to speed the formation of the Improvement Initiative. He added that he also may have been too involved in the nonprofit's daily business.

"For some reason, I thought I had to oversee the deal," Maddox says. "In hindsight, I didn't need to do it. My wife never did. She was just there to help the organization part. My wife couldn't tell you a thing about SLAM."

The grant Maddox identifies as being misspent was a 2000 award for $15,000. A bill signed into law by former Gov. Roy Barnes in 1998 mandates that all special grants be audited by local governments, and what DeKalb's auditor turned up doesn't look promising for Maddox and the Improvement Initiative.

Neville W. Anderson Sr., the accountant DeKalb retained to review the Improvement Initiative's performance, wrote the agency a Feb. 26, 2002, letter explaining that the $15,000 grant was intended to purchase math and reading materials. Instead, $11,063 was "used almost exclusively for payroll expenses."

Additionally, Anderson wrote two letters on June 12, 2002, stating that the county paid the agency $35,000 in state grants in the year 2000, yet the "agency incurred no expenditure in the year 2000." Anderson's most recent letter, dated Jan. 2, indicates that the Improvement Initiative didn't provide any expense statements for two 2001 grants totaling $70,000.

DeKalb's board of commissioners voted to return 2003 grants to the state, because they weren't the proper pass-through body to handle the money. Later correspondence indicated that the Improvement Initiative was not in compliance with the county's audit regulations.

Maddox says the Initiative hasn't spent any money on programs since the summer of 2002. The last SLAM class concluded in April, and he estimates that there's still $37,000 left in the nonprofit's account.

Presumably, that's what Assistant Attorney General Kimberly Schwartz, of the AG's Special Prosecutions Unit, was investigating. Schwartz declined comment regarding Maddox and referred inquiries to spokesman Russ Willard, who said an investigation could resume after the session.

But in a Jan. 9 letter to DeKalb Director of Finance Mike Bell, Schwartz asks the county to turn over information relating to 12 separate grants totaling $233,000 awarded between 1998 and 2003 to the Improvement Initiative and its predecessor, the South DeKalb Community Development Corp.

In response to Schwartz's letter, Bell responds Jan. 14 that one of the $25,000 grants may have been made through the DeKalb Board of Education, but he includes two more 2001 grants totaling $45,000 that Schwartz missed.

Maddox stands by the Improvement Initiative and says he hopes to re-start it. SLAM began in January 1999, providing math tutoring and chess lessons, among other programs, to as many as 240 children in kindergarten through sixth grade on a given Saturday, the lawmaker says. Information compiled by the group indicates an average increase in standardized test scores of 12.66 points per year. The numbers Maddox provided show significant gains in Iowa Test of Basic Skills math scores for the program's participants.

As for the senior citizen program, the Improvement Initiative described its Seasoned Citizen program as a group that organizes "two major outings per year," providing "food, fun and fellowship to approximately 400-500 senior citizens." The Improvement Initiative also provides "professional trainers" to senior citizen groups to learn anything from aerobics to arts and crafts.

Maddox welcomes any investigation.

"I live every day on what I do, and I don't want yours; I don't want anybody's," he says. "My momma taught me my word is all I got, and I don't steal. In fact, I'm very proud of the SLAM program."