Gear Up Thesis by Anna Madsen

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This thesis just recently got published and is available at USD in hard copy. I have a PDF of the document here (DOC: GEAR-UP-THESIS)

Here are some highlights of the Thesis;

The Misspent Youth of South Dakota Native American Students:

An Analysis of the Gear Up Grant Program in South Dakota

While Native Americans constitute about 9.00% of the total population of South Dakota, they represent only 3.16% of the student population in Board of Regents (BoR) institutions.1

GEAR UP (Gaining Early Awareness and Readiness for Undergraduate Programs) is a federally funded grant program the U.S. Department of Education established in 1998.

In the original grant application, a conflicting budgetary concern is clear. On page e3, the federal funds amount requested for “Consultants & Contracts” is $959,188 per year, totaling $5,755,128 or 83.12% of the total amount requested.11 The “Scholarships/Tuition Assistance” category requested $50,000 per year, totaling $300,000 or 4.3% of the total amount requested.12 In the following budget for matching funds to be provided by non-federal sources, the pattern is similar. Consultants and contracts amount to $180,000, whereas scholarships and tuition assistance account for $90,000 (the total matching funds are $723,000).13 As noted previously, of the awarded grant money, at least 50% was required to be used for scholarships, unless a waiver were requested. South Dakota’s 2005 application did not request a waiver for the scholarship requirement.14

Following the arrival of the first GEAR UP grant in South Dakota, many colorful personalities soon populated the GEAR UP world. The personal and professional relationships between and among these people rapidly grew into a tight web. Some observers see these relationships as entirely professional and beneficial – especially in a lightly populated state where educational experts may be difficult to find. Others see them as blatant conflicts of interest and reject the argument that South Dakota has to tolerate close relationships due to sparse population and a lack of professionals in technical education areas.

Additionally, the 2011 report showed the GEAR UP program lacked in special education services. According to Michael Wyland of Nonprofit Quarterly,

“Disturbingly, while the GEAR UP program reported serving several thousand low-income, predominantly Native American students prepare for success in postsecondary education, not a single student receiving special education services was served during the 2005-2011 period. We now know the original grant application stressed equitable participation in program services and even documented the percentage of special education students in each of the two dozen schools to be served.”58

Also in the letter to GOAC, Rick Melmer stated that he began his two-year employment with MCEC in 2013 (after he left USD) where he worked on three contracts with CCSSO, the SDBoR, and the GEAR UP program respectively. In June 2013, the MCEC board approved a one-year contract for $185,000 with Melmer to serve as a senior advisor, and approved a similar contract the following year for $233,000.69 Between 2012 and the termination of MCEC in June 2017, MCEC paid Melmer at least $350,000 through contracts directly among MCEC, CCSSO, and the SDBoR that were not included in Melmer’s two employee contracts for 2013-2014 and 2014-2015.70

LuAnn Werdel, the director for the SDDOE Office of Indian Education at the time, sent Schopp an email on January 10, 2011, regarding Schopp’s decision to end Werdel’s employment with the SDDOE Office of Indian Education. In the email, Werdel references several issues with the management of the GEAR UP and College Access grants by MCEC. In her email, she states:

“By ending my appointment as an exempt employee of the Department of Education you have effectively sided with people who have no integrity or morals when it comes to managing grants and federal funds. I have told you over and over what Stacy Phelps and Mid Central is doing with the GEAR UP grant and College Access grant…To conclude, you know only too well that I have been

frustrated with the daily operations of the SD GEAR UP Grant and the SD College Access Grant. In front of everyone last Friday at the last College Access meeting, Stacy Phelps directed all College Access staff to send College Access data to his GEAR UP data lady, Misty Mousseau. This co-mingling of data is illegal. Stacy Phelps remains Project Coordinator in charge of daily operations. This arrangement did not work previously and I’m not sure why we would expect a different result. He is also designated 100% GEAR UP and once I showed you and Mr. Oster the budgets a couple of months ago you were appalled. What has changed? …You told me last week not to worry so much about the grants and to focus on large policy issues-how can one focus on other issues when the foundation of the Office of Indian Education is based on unethical foundations.”111

At about 6:00 p.m. that day, Schopp and Guericke connected over a phone call, in which Secretary Schopp informed Guericke that she was terminating the SDDOE’s management partnership contract with MCEC for the GEAR UP program.127 That same night, just hours after the phone call between Secretary Schopp and Guericke, local Platte residents reported a fire at the property of Scott and Nicole Westerhuis. Scott and Nicole Westerhuis and their four young children perished. Based upon Division of Criminal Investigation (DCI) findings, South Dakota Attorney General Marty Jackley revealed that Scott Westerhuis murdered his wife and their four children with a shotgun before setting the house on fire and shooting himself.128 The news of the murder-suicide shocked the community of Platte and the entire state of South Dakota.

The continuation of these problems prompted Secretary Schopp’s cancellation of the grant contract with MCEC. A few days later, on September 21, 2015, Secretary Schopp sent a formal letter to Dan Guericke outlining the eight specific reasons for termination. They are as follows:

“(1) Lack of supporting documentation and improper documentation for match, resulting in a significant shortfall in match;

(2) Lack of fiscal capacity including lack of fiscal control and improper governmental accounting procedures;

(3) Lack of knowledge of Generally Accepted Accounting Principles (GAAP) or

failure to implement GAAP procedures;

(4) Lack of internal controls

(5) Conflict of interest and failure to disclose related parties;

(6) Lack of project oversight;

(7) Lack of oversight on school subgrants; and

(8) Lack of documentation for grant activities under OMB A-87.”131

At the AG’s press conference, questions arose about a missing safe that witnesses claim should have been in the Westerhuis’s house. The safe may hold important financial documents regarding MCEC, other organizations, and people involved with GEAR UP. According to a KELOLAND News report in November 2015, “Jackley believes it was most likely destroyed in the fire, but could have been stolen or moved somewhere else by Scott Westerhuis.”

Ten years after its inception in 2005, the GEAR UP grant did not have an effective system of collecting data or consistently tracking performance metrics. South Dakota simply does not know, through explicit data, whether the millions of dollars of grant funds helped Native American students prepare for or succeed in college.

The South Dakota GEAR UP mission statement is to “increase the number of low-income Native American students that are prepared to graduate from higher education.”164 For both GEAR UP grants, South Dakota received federal and statematched dollars totaling over tens of millions of dollars from 2005 through 2017. While the intrinsic benefits of the GEAR UP program for some students may exist, the hardline statistics of Native American students in Board of Regents universities barely fluctuated. The achievement gap between Native and non-Native students in South Dakota is very real. The GEAR UP grant program is a clear example of how “throwing money” at a problem without adequate oversight and checks and balances fails to accomplish its noble goal. In the end, good intent was lost between the dollar signs.

Are grant programs like GEAR UP, College Access, and Wakan Gli effective? Does South Dakota need to approach the achievement gap in a fundamentally different way? While many factors are at play, the above statistics suggest that the achievement gap is not closing. The state of South Dakota needs to reflect deeply on how it serves this at-risk and long neglected segment of the population.


#1 Rachel on 06.27.18 at 2:21 pm

Smart lady

#2 JKC on 06.27.18 at 11:38 pm

When you read this thesis, or attend a briefing at USD by Professor Damgaard with his board of yarn and its complex web showing the potential involvement of personalities in the GEAR UP scandal – with the two being quite similar – you quickly learn how many different educational associations that former Ed. Sec. Schopp is either associated with or headed that had ties to MCEC or MCEC personalities; and then, when you realize the timing around the ending of the States contract with MCEC by Schopp, relative to the tragedy in Platte, then it all becomes rather suspicious, in my opinion, and causes one to believe that this whole thing was not just a Platte problem, rather a Pierre problem.

Let us also not forget the Schopp and Governor Daugaard interview with Angela Kennecke from KELO, too. If you remember, Schopp and Daugaard only wanted to do the interview together, which is quite suspicious, if you ask me. Because when ever people are interviewed about a possible crime, aren’t they usually separated to get to the truth and weed out the lies? Why did they want to be interviewed together?

And One of the things that I learned from watching the Russian collusion scandal unfold is the art of a prosecutor and or criminal investigator. If you notice, Mueller, appears to first reach out to the lower echelon members of the possible scandal and gets them to cooperate through plea deals, then uses them to tell the story in order implicate the bigger fish in the scandal. But you don’t see this tactic having ever been used by Jackley and the AG’s office with this scandal. For from day one, with Jackley’s press conference on the tragedy in Platte for instance, he choose to have this press conference in Platte instead of Pierre, or the Sioux Falls media market. He also had DCI agents sitting in on Prof. Damgaard’s presentation, which I find quite odd. Can you image Mueller and his people sitting to have a professor from Georgetown or Harvard, let’s say, explain to them what they know about the Russian collusion scandal and what probably happen. Doesn’t the AG and the DCI have their own yarn board, which should be more thorough? In fact, even Jackley sat in on one of these Damgaard presentations and told the Professor that his yarn board of complicity was State’s evidence and could not be moved. So when you look at the totality of all of this, the limiting of the investigation, the venue for the press conference, and the controlling of information more than evidence concerning this case, it makes you wonder if this scandal as ever been investigated, but instead controlled. Because with this scandal, it appears that Jackley has cherry picked the investigation by limiting it to Platte. And he appears to have done the same with the EB5 scandal too, in my estimation, by merely finding Joop Bollen to be the only culprit. Except with EB5, he appears to have contained it from the top and to one person with a small $ 2000 fine, who is a foreigner, and without historic ties to the South Dakota GOP, while with GEAR UP he has contain it from the bottom. In essence, Jackley found a way remove blocks from a Ginx of corruption without the entire corruptive structure collapsing……

Now, all of this is just my opinion based on the facts and actions we know, but when it comes to the two scandals: EB5 and GEAR UP. I do not see the art of a prosecutor and or criminal investigator at hand, rather I see a politician who most likely was more concerned about his political future than the future of South Dakota. So no wonder this same AG’s office later came out with a comment just days before the Sioux Falls mayoral race, claiming that there was no “successful hack,” but isn’t an unsuccessful hack a crime, too? Isn’t it a crime to commit a conspiracy? But I guess, in defense of them, if you are not into investigating the conspiracy of possible major crimes, then an unsuccessful hack isn’t even a “third rate burglary,” is it?

Also, please keep in mind, that some of our Democratic leaders in this state are elated that Jackley recently hinted that people should vote for Billie for governor.* Well, that’s all fine, but if Democrats win this fall, let’s make sure we know who is going to Pierre with us with some Republicans in hand already, that is….If we really care about transparency in government, that is…


#3 Michael L. Wyland on 07.03.18 at 7:46 am

Ms. Madsen did an excellent job. I was proud to be a cited source and resource for her work. Marshall Damgaard and his students followed the SD GEAR UP story as far or farther than I would have thought possible. It’s just a shame that the “GEAR UP wall” in Dakota Hall couldn’t be successfully moved online.

There are trials and lawsuits still to be heard and resolved, but it’s time for policymakers to discuss how best to stop future GEAR UP, EB-5, and related scandals from happening again in our state.