An investigation by the Arizona Auditor General’s Office has found former Higley superintendent Dr. Angela Denise Birdwell, her close associate, Kay Hartwell Hunnicutt, and two Higley vendors, Gary Aller and Steven Nielsen may have violated State procurement laws.
The investigation requested by the Arizona Attorney General’s Office found that the violations stem from a $2,557,125 Project development services contract.
The Auditor General Office submitted its report to the Arizona Attorney General’s Office, which on July 13, 2021, presented evidence to the State Grand Jury. The action resulted in the indictment of:
• Birdwell on 18 felony counts related to procurement fraud, fraudulent schemes and practices, fraudulent schemes and artifices, misuse of public monies, conflict of interest, filing a false return, and conspiracy.
Birdwell started at Higley in 2007 as an associate superintendent, becoming superintendent in 2009 and holding that position until her June 2015 retirement. Scottsdale Unified School District contracted with Birdwell as its superintendent from January 2016 through June 2019; however, in March 2018, the Scottsdale Governing Board approved a motion to provide Birdwell with a notice of intent to dismiss after hearing a statement of charges that she had, in part, received money from and failed to disclose a substantial, personal interest with Hunt & Caraway.
In April 2018, the Scottsdale Governing Board entered into a severance agreement in which Birdwell ended her employment a year early and was provided a $150,000 lump sum severance payment.
• Hartwell Hunnicutt on 3 felony counts related to filing a false return.
Hartwell Hunnicutt and Birdwell had financial and personal associations, including sharing a home, co-owning a timeshare, jointly serving as parent/guardian/monitor of Hartwell Hunnicutt’s grandson, sharing a joint checking account, naming each other as sole beneficiary on a personal bank account, and Birdwell naming Hartwell Hunnicutt as the emergency contact on a Higley employment form.
Additionally, in 2016, Hartwell Hunnicutt in her professional capacity as an attorney helped negotiate Birdwell’s superintendent contract at Scottsdale.
• Aller of Educational Facilities Development Services, LLC on 3 felony counts related to fraudulent schemes and practices, fraudulent schemes and artifices, and conspiracy.
• Nielsen of Educational Facilities Development Services, LLC on 3 felony counts related to fraudulent schemes and practices, fraudulent schemes and artifices, and conspiracy.
Educational Facilities Development Services, LLC (EFDS) was incorporated on June 6, 2012, 14 days prior to Higley issuing an RFP to procure the Project development services. Higley ultimately awarded EFDS the $2,557,125 Project development services contract through its affiliate, EFDS Higley I, LLC. Gary Aller filed articles of organization with the Arizona Corporation Commission for EFDS with himself as statutory agent and 3 principal members including himself, Steven Nielsen, and a Nevada limited liability company.
For 22 years prior to founding EFDS, Aller was the director of Arizona State University’s (ASU) Alliance for Construction Excellence. From 2003 through 2014, Mr. Nielsen was the assistant vice president of ASU’s University Real Estate Development.
“This is truly a sad day for the Higley Unified School District and the students and families it serves,” said Arizona State Representative Jake Hoffman, a former Higley Governing Board member. “The level of apparent corruption is staggering and heartbreaking. I am proud to have actively fought against this abuse of power, misuse of taxpayer monies, and blatant disregard for the law during my tenure on the Higley governing board.”
“As a result of these findings, I will be looking at opportunities for education reform legislation to introduce next session in order to ensure that crooked administrators stop bleeding our schools of their resources and start putting students and teachers first,” added Hoffman.
Hoffman was elected to the Higley Governing Board in 2012 and served from 2013 to 2015. During his tenure, he reports that he was attacked and stonewalled by district administrators as he and another board member fought to get to the bottom of serious concerns and suspicions that many people had at the time.
The Auditor General’s Office found:
At either the direction of or with the knowledge of Dr. Birdwell, Higley staff provided material information regarding Higley’s Project development services procurement to Gary Aller and Steven Nielsen of Educational Facilities Development Services, LLC (EFDS) and to a now-deceased former president of Hunt & Caraway Architects, Ltd. (Hunt & Caraway), who acted as Higley’s procurement advisor and was part of EFDS’ development team.
After failing to provide other prospective vendors with this same information and allowing EFDS to influence the request for proposals (RFP) requirements, Higley awarded the $2,557,125 contract to EFDS.
Dr. Birdwell, Mr. Nielsen, and Mr. Aller may have also violated a State law related to fraudulent schemes when they seemingly concealed their wrongdoing by certifying false information on Higley records, making what appear to be false attestations regarding following School District Procurement Rules for the Project.
Additionally, Dr. Birdwell may have violated the misuse of public monies statute and circumvented voters’ decisions when, in December 2012 and November 2013, she authorized or caused the unlawful use of restricted public monies totaling $6 million to pay for some of the Project’s costs.
Finally, Dr. Birdwell may have violated State conflict-of-interest laws when, from August 2014 through April 2016, she received $43,000 indirectly from Hunt & Caraway, $1,000 from Hunt & Caraway’s former president’s personal checking account, and $2,500 from CORE Construction, a Higley vendor that was also part of EFDS’ development team, yet participated in decisions related to their services and failed to disclose her substantial interest.
Similarly, Dr. Birdwell and her close acquaintance, Ms. Hartwell Hunnicutt, may have violated State income tax laws when they failed to claim these and other Hunt & Caraway payments as income on their respective State income tax returns.