Alleged scam: Nancy New’s school claimed to treat hospitalized kids

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JACKSON, Miss. (MISSISSIPPI TODAY) – Nancy New and her son Zach, owners of several for-profit and nonprofit organizations, were well on their way to building an education empire in Mississippi.

Their private schools, called New Summit, had been gaining acclaim, especially for catering to nontraditional students and those with disabilities — the only type students the state can pay private schools to educate.

“School choice” — the concept of allowing tax dollars to follow a student to a private school — was becoming a rallying cry in the Republican-dominated state Legislature.

Lawmakers were shorting public schools hundreds of millions of dollars annually according to state law, including for special education. And apparent holes in oversight at the Mississippi Department of Education were going ignored or unnoticed.

This was the landscape in 2016 when Nancy and Zach New allegedly began defrauding the state out of millions of public school dollars. 

To be sure, Nancy New’s schools have for years provided meaningful services to the small number of Mississippi families they serve. Her lobbying efforts and connections to powerful politicians such as former Gov. Phil Bryant and current Gov. Tate Reeves only served to further legitimize her companies, gaining them unfettered access to the public trough. 

Federal authorities are now accusing the News of scamming the Mississippi Department of Education and the Mississippi Adequate Education Program, the funding formula that is supposed to determine how many state dollars public school districts will receive for each student.

Specifically, the questioned funding comes from a niche program to educate children in state licensed facilities, such as hospitals and psychiatric treatment centers. For over a decade, the News have claimed to serve hundreds of these students each year.

The alleged fraud is reminiscent of previous charges the News still face: In 2020, they were arrested on state charges alleging they embezzled Mississippi Department of Human Services block grant funds, which their nonprofit had received to run social programs for poor adults. The lax federal guidelines around welfare spending made it easy for the New nonprofit, Mississippi Community Education Center, to get its hands on those free-flowing dollars.

But there aren’t many ways for private schools to secure MAEP dollars, since the funding is typically tied to a public school student. 

So, according to the indictments, the News got creative.

Click here to read the full story by Mississippi Today.

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