Trustee Resigns from ROP Board, Worried About 'Appearance of Impropriety'

Capistrano Unified School District board member Lynn Hatton has two educational-service businesses, one of which has contracts with neighboring Laguna Beach Unified.

Editor's note: On Wednesday, Patch will post an article examining the financial interest forms filed by the other Capistrano Unified School District board of trustees.

Citing a desire to avoid an “appearance of impropriety,” Capistrano Unified School District Trustee Lynn Hatton resigned her position on the  governing board Tuesday.

The ROP provides career-oriented classes for high school students both in the Capistrano and school districts. Both districts appoint two of their school board members to serve on the ROP’s governing board.

Hatton owns two educational-service companies, one of which has had at least $9,000 in business with Laguna Beach Unified in the past 1½ years.

Hatton told Patch she didn't believe she had a conflict of interest because her work at  was a "onetime contract."

“It is with regret that I submit my resignation from the Capistrano-Laguna Beach ROP Board, effective immediately,” Hatton wrote in a letter Tuesday to Capo Superintendent Joseph Farley and ROP Superintendent Kim Thomason.

“Although we have received legal counsel from the [Orange County Department of Education] attorney that I have absolutely no conflict of interest, I have chosen to resign to avoid even the slightest appearance of impropriety,” Hatton wrote.

On financial interest forms that Hatton filed in March with the county, she disclosed her two companies but did not reveal business relationships she has with several Orange County school districts, including Laguna Beach Unified. The forms required disclosure of individual income sources totaling more than $10,000.

"We did go over it with my accountant, and nothing was billed more than $10,000," Hatton said. 

The mandatory statements, which list the wealth and personal investments of all California elected officials, must be filed yearly to show potential conflicts of interest.

When asked to state single sources of income of $10,000 or more for each business, Hatton said InnovateED, which provides consulting and professional services to school districts, generates “no income in Orange County.”

In the last 1½ years, however, the company has had at least three different projects with the , which shares a contiguous border with Capistrano Unified. 

In February, the seaside district’s board of education approved a $4,500 check for InnovateEd for instructional training sessions held Oct. 15, 2010, and Nov. 15, 2010. Additionally, the company  has partnered with Laguna Beach High School to host a three-day college and career readiness conference in August.  

On Monday, Laguna Beach schools Superintendent Sherine Smith said the district is going to cancel the three-day seminar, however, because of lack of interest.

Additionally, on InnovateED’s website, the company lists Laguna Beach High School as a partner in helping the school achieve re-accreditation through the Western Association of Schools and Colleges. The school’s current accreditation runs through 2012.

A brief paragraph on the company website states: “InnovateED is providing support and services in connection with WASC, which has allowed LBHS to redefine at-risk students, implement systematic student support and create authentic, performance-based assessments of college and career readiness.”

According to documents Smith provided Patch, Laguna Beach Unified has paid Hatton’s company $4,500 for workshops InnovateED offered Aug. 24 and Aug. 30, 2010, at Laguna Beach High School.

According to the state’s Fair Political Practices Commission, Hatton’s role on the ROP governing board did not represent a conflict of interest unless she voted on a matter that would benefit her financially. Tara Stock, a spokeswoman for the commission, said no one has filed a complaint against Hatton. 

“Generally, if a violation of the Political Reform Act (PRA) is found, a fine of up to $5,000 may be assessed,” Stock said of any inaccurate or misleading form 700  that elected officials file. “Potential PRA violations may be referred to the FPPC or the [local] district attorney.”

Hatton’s forms were late. While the annual filings for all elected officials are due April 1 each year, newly elected officials must file what is called an “assuming office” form within one month from being sworn in.

Hatton, along with Trustee John Alpay and Vice President Gary Pritchard, took office Dec. 7, 2010. But she filed her form 700 on March 24, according to Sonia Acuna, deputy clerk of the Orange County Board of Supervisors. Although an official can be fined $10 for each day the form is late—up to $100—the county did not fine Hatton. Alpay and Pritchard filed their statements on time.

"For now, it's an oversight because our system is brand new," Acuna said of the county's electronic filing system, which is still considered a pilot program.

Capistrano Unified’s  that the previous ROP representatives, Trustees Ellen Addonizio and Sue Palazzo, called “mean-spirited.”

Just the meeting before, , fearing participation would entangle them in yet .

At the time, Pritchard said he wanted “stronger leaders” on the ROP board. Supporters of Addonizio and Palazzo saw the move as payback for actions taken at the prior meeting. Trustee Anna Bryson is the alternate member for the ROP board. The next ROP board meeting is Thursday.

While Hatton’s second company, Adelante Educational Services, does not appear to have any contracts with Laguna Beach Unified, Hatton’s financial statements list only Buena Park Unified as a client that nets her $10,000 or more. Adelante provides tutoring to underserved communities.

Many of the company's client school districts are on “program improvement,” which means they are falling short of federal performance standards. They hire Adelante and similar firms on yearly contracts to provide free-to-the-students tutoring.

According to her website and other records, Adelante has or had ongoing contracts with the Santa Ana Unified, Anaheim Union and Garden Grove Unified school districts in the last year. 

Hatton said none of those contracts brought in more than $10,000. "People don't understand SES [Supplemental Educational Services] contracts," she said. While the contracts are open-ended typically with language that says "not to exceed" a certain amount, her company only bills and receives payment when they provide tutoring for each student. 

Besides the disclosed relationship Adelante has with Buena Park Unified, it also has current contracts with Anaheim Union and Santa Ana. In addition, it had a contract in the 2009-10 school year with Garden Grove but is not on this year’s list of available tutoring services.

Alan Trudell, a spokesman for Garden Grove schools, said Adelante withdrew as a supplemental services provider in 2010-11. The company received $1,362.81 for services provided to one student in the district in 2009-10, he said.

Adelante’s current contract with Santa Ana Unified was approved by that school board at its Sept. 28 meeting. The staff report said the contract’s “amount to start” was $20,000.

The Anaheim Union board of trustees approved Adelante’s current contract at its Nov. 4, 2010, meeting “at a total cost not to exceed $20,000.”


shelly June 16, 2011 at 02:18 PM
Capo Mom, The former board imposed a contract last year. The teachers (and parents) went on strike. The former board then had to back pedal and put restorative language in the contract. It called for a restoration of salaries if there was more money that came to the district than the expected Governor's budget. The ADA was increased by the state so more money came back to the district. Since the language was in the contract then the new board had to restore. If the former board would have just negotiatied 10% for an amount of time (as it did with the administrators) and as almost every district in California did then after the time was up the teachers would have gone back to the point they had worked for and the contract could have been renegotiated. There would have been no restoration at this point in time but at the completion of the contract. But the board imposed permanent cuts on the teachers which would have had them negotiating to get back to a place that they had worked years to get to. The former board IMPOSED not negotiated. If the contract would have been negotiated there would have been no $9million dollars restored because of a contract that the former board signed.
shelly June 16, 2011 at 02:23 PM
Capo Mom, Didn't Hatton resign from the ROP board herself because preceived conflict of interest? Was there actually legal conflict of interest or preceived conflict of interest? Are all the college bound kids that are going to the colleges that I mentioned above "white kids"? Why would you assume that?
Capo mom June 16, 2011 at 03:22 PM
shelly, Trustee Hatton based her campaign on the need to restore integrity to CUSD. Fail!! She failed to file the required disclosures of financial interests in the timeframe required by law. She did however file the disclosure statement on the day she was appointed to the ROP governing board. She certified under penalty of perjury that the information was correct. It does not appear to be correct. She was concerned enough about her position on the board to seek the advice of at least one lawyer. She now says even though OCDE's attorney says she is OK, she will resign. Does that make any sense? Don't strain yourself. It doesn't make sense. Hatton's actions and the actions of those who nominated her are irresponsible. They removed the ROP board's president. Just as Hatton comes up to speed, she resigns for either no reason or because she has conflict. Take your pick, it hardly matters. What does matter is that these political shenanigans will put ROP into further disarray. It isn't the students who are going to Brown, Vassar, Yale, Harvard, UC Berkeley, Saddleback, UCLA, Stanford, Georgetown, U of O, BYU, UCI or NYU that will be impacted by this. ROP is part of CUSD program for the vast majority of students who don't attend prestigious campuses. The union's board and their political games has hurt those kids and a reminded everyone that CUSD is a mess.
shelly June 16, 2011 at 06:56 PM
Capo Mom, Read Ms. McCarthy's remarks and see what I was responding to. McCarthy claims we have some kind of syndrome if for some reason even though our kids are successfull we don't recognize that CUSD teachers and administrators are abusive and our kids are victims. I was pointing out to her that there are many, many success stories in CUSD and that most of the teachers and administrators in our schools are good and caring. You seem to imply that all the successful students in CUSD are white for some reason. Please tell me how the board is suddently union? Brick, Bryson, Addonizio and Palazzo all were supported by the same people who are not pro union. They were all supported by the CUSD "Reform" committee. Didn't Addonizio and Bryson just run together and were both re-elected. Bryson ran and won against a candidate who accepted donations from the union. Who do you consider the union board to be? Specifically. Trustee Hatton did not vote on anything that would have been a conflict of interest and she resigned. Did she not. How long was she on the ROP board? Kids who attend ROP classes often do eventually go into great colleges or into great careers. I know kids who attend ROP classes. There is nothing unprestigious about their choices or the colleges, art colleges, tech schools that they attend or their career paths. Please point out the specifics where it hurt the kids in the ROP program.
Pam Sunderman June 16, 2011 at 10:04 PM
Sharon, I thnk you are venturing very close to slander, if you have not already crossed the line. Anonymous posts can be traced and everyone should really think twice about these posts from an ethical and moral standpoint as well as legal. Will the Patch consider establishing some sort of standards for posts?
Jenna Chandler June 16, 2011 at 10:16 PM
Everyone who signs up to comment on Patch has agreed to our terms of service. For a refresher, visit www.sanjuancapistrano.patch.com/terms. Basically, we all should: “Keep it clean,” “Don’t try to trick people,” and “Treat others as you’d like to be treated.” Easy, right?
Sharon Y. June 16, 2011 at 10:34 PM
Oh Jolly this is laughable considering the venom you have been spitting for years on the capo dispatch. The lies and half truths you have spread are evil and slander but it has not slowed you down. I stand by all fo my posts as truthful, Hatton has lied on her 700 forms and someone should absolutely look into contracts and funds from other districts including money from site council funds, PTA funds and principal accounts, lots of money in those funds are used for after school services and I bet you are as nervous as she is what will be found out. Resign Hatton from the board, you only care about your own , and what CUSD can do for your business , IMHO!
Capo Parent June 16, 2011 at 10:34 PM
Jollygirl Unless you're an attorney licensed to practice law, leave the legal opinions to the professional who are qualified to render such opinions. In response to you unqualified legal opinion let me give you two words, First Amendment. On top of that Hatton, a public figure, has a much harder burden to prove slander/libel. Finally, keep in mind that the truth is an absolute defense to a claim of slander/libel. The fact is Hatton did misrepresent the truth when she stated on the form she earned no income in Orange County, when she clearly had. So, how was Sharon Y.'s assertion that Hatton lied a false and misleading statement? As for your comment about morals and ethics, I assume you really meant to direct them at Hatton.
shelly June 16, 2011 at 11:54 PM
Thanks Jenna.
shelly June 17, 2011 at 12:11 AM
On the pdf 700 form the form states "List the name of each reportable single source income of $10,000 or more." Under it Hatton or her accountant writes, "no income within Orange County" . Could she have meant no reportable single source income in Orange County. Actually she did not have to write anything on the form. She could have left it blank since she did not have any single source income of $10,000 or more. Besides turning in the form late, Penny did she break the law or not? Did she have a single source income of over $10,000 or more. Did she bring her relationship with Laguna Beach out into the open or did someone else?
Pam Sunderman June 17, 2011 at 12:32 AM
You'd think it would be easy Jenna but it seems the vitriol on anonymous blogs is getting worse.
Capo mom June 17, 2011 at 01:13 AM
The level of "vitriol" seems pretty constant of both sides. It is just seems to be worse when your union favorites are screwing up so badly.
Student June 17, 2011 at 02:29 AM
Honestly, some of you have way too much time on your hands.
Capo Parent Too June 17, 2011 at 03:26 AM
1. It is no single income of more than $10,000, income meaning "Pro-rata share of income" after taxes, etc. You just have to go read the damn instructions to understand this. 2. The 700 form is to show if there is a CONFLICT of interest, which means anything that she would have to vote on. So even with the ROP, nothing relating to the LBUSD is voted on by the ROP. She has no jurisdiction over the Laguna Beach USD. The ROP board does not decided what Laguna Beach does for tutoring or anything else. Read the damn forms. This is what the Patch is supposed to do, you don't just take the information out there and report it, you need to put it into context! She only need to report "clients doing business on a regular basis in your jurisdiction must be disclosed". That's from the damn instructions on how to fill out the form 700, page four! http://www.fppc.ca.gov/index.php?id=500 Hatton's jurisdiction? Capistrano Unified School District! This is why this is insanity! If she cannot vote on it, it is not a conflict of interest. But because of the total lack of clarity of this and understanding on this form is, it leads to more confusion here.
Capo mom June 17, 2011 at 03:33 AM
Student, sorry things have gotten slow at your site.
shelly June 17, 2011 at 01:50 PM
Capo Mom and Sharon Y., Please read form 700 and what it actually asks for. It states, "List the name of each reportable single source income of $10,000 or more." Thanks.
Sharon Y. June 17, 2011 at 02:36 PM
Shelly Spare me the reading lesson you hypocrite , you have been spouting "give the money back "for years . What did the reform website really say, any NET proceeds, did you ever call and ask if that was the case, NO. Hatton lied when she said no income, she also failed to include Santa Ana as well as Farlys old district on her form. As for Laguna Beach, let's wait and see what money was paid to her company from the site council, principal funds and the PTA.
Capo Parent June 17, 2011 at 04:56 PM
Capo Parent Too Making your comments even more shrill doesn't make them relevant or correct. It appears you have a hard time understanding what the word "no" means. Hatton said "no" income in Orange County. She had income in Orange County. There is an obvious contradiction that you can't handle. Many have read the form and understand the plain meaning of Hatton's answer. You on the other hand have a difficult time grasping the obvious. Reality must be a tough world for you.
Capo mom June 17, 2011 at 05:03 PM
If everything was fine, why didn't Hatton file her statement on time and why did she resign after less than 90 days on the board? No one was pressuring her. Hatton's timing and actions are questionable at best. At the very meeting she was appointed to the ROP board, ousting the sitting president and another member, forcing a significant change in course for ROP, Hatton said “I will no longer allow our time and focus to be hijacked away from the task at hand. I will no longer allow misguided, misplaced and imprudent actions and remarks weigh down our progress” . ISN'T THAT EXACTLY WHAT SHE HAS DONE HERE? She appears to be a hypocrite or a liar, take your pick. The students who are involved in this program aren't the ones who attend shelly's favorite ivy league universities. ROP is a trade program. To have squandered their time and resources for petty political purposes during a time of extreme financial pressure is more than unconscionable. It is simply wrong. And it demonstrates once again that politics, not students, are the priority of the union board members.
shelly June 17, 2011 at 08:12 PM
Sharon Y., Why the name calling? Why so hostile and angry. For years, really, I have been spouting give the money back ? How many years would that be? Some people involved in the "enemies list" lawsuit" stated that the lawsuit was not about money and that if there was any money gained from CUSD they would return it to CUSD. I didn't state it or make it up. People involved in the lawsuit stated it. I have stated that I believe it is a conflict of interest to vote to award money to people who supported you with campaign donations, campaign support or were on you campaign committee (wasn't Tony Beale former Trustee Winsten's campaign manager?). They should have recused themselves but Trustees Maddox, Winsten, Bryson and Brick did not. Trustess Palazzo, Addonizio and Christianson did recuse themselves. Why? They were all supported by the same people. Why was it a conflict of interest for some and not for others. It was a conflict of interest and they should have let the lawyers figure it out. On the 700 form it states, "List the name of each reportable single source income of $10,000 or more." Trustee Hatton did this. Trustee Lynn Hatton came forward herself. She chose to resign even though according to the form she did not have a conflict of interest. She did not vote on anything that had to do with any of the companies she is involved in. Please be specific where she did.
shelly June 17, 2011 at 08:33 PM
Capo Mom, Saddleback, University of Oregon, University of California Berkley, BYU, UCLA, NYU,etc. are Ivy league Schools? Really? My response was to Ms. McCarthy when she stated that parents have some kind of a syndrome because they did not agree with her and they think that their kids who attend CUSD schools are not being abused and victimized but they believe that they are getting a good education. Reread the conversation. My response to Ms. McCarthy was, "So the graduating seniors who will be attending Brown, Vassar, Yale, Harvard, UC Berkely, Saddleback, UCLA, Stanford, Georgetown, U of O, BYU, UCI, NYU etc. are all vicitms of abuse and their parents are in some kind denial because their kids are successful but abused?" And you are wrong because some of the kids who attend the ROP programs go onto great colleges and universities. In fact some of the kids who received ROP awards this year will be attending some great colleges. These kids are looking for alternatives and finding it in the ROP program. Trustee Hatton resigned. Trustee Brsyon will take her place. Can you please be specific about the time and resources that were squandered? When and where? Penny, did this stall any business that the ROP board is involved in? How much time and energy was squandered last year for petty political purposes? How much time and energy are we expending battling each other because we are both so sure we are the one that is right?
Capo mom June 17, 2011 at 10:51 PM
I agree with Kim McCarthy in that I think most parents, yourself included, would rather not consider the effects the behavior and demands of the teachers' union have on their children's education. You frequently ask parents why they send their children to school in CUSD if they don't like it. That amuses me. The answer is pretty obvious. It may not trouble you that Hatton refused to file her form 700 in the required timeframe and then provided false information when she finally did. It is at odds with the ideals she ran on. It may not trouble you that she wasted the time and resources of this program. It is at odds with the statement she made the night she was appointed. If you have ever served on a governing board, you'd recognize impact her bad behavior has had. Or maybe you think Hatton had nothing to contribute to ROP. Your slavish devotion to the union, their board members and your denials are humorous. Last year's board is your justification for what Hatton did, really? We had a strike, an election based on lies that was bought and paid for by CUEA for this? What happened last year is irrelevant. Trustee Hatton was supposed to bring change to CUSD. What she and the other union lackeys have brought instead is more of the same and worse; teachers are still being pink slipped, class sizes are still increasing, Brown Act violations are on the rise, lies and slimy political behavior. Given how the election went, that is predictable. Keep defending them.
Capo Parent Too June 18, 2011 at 12:39 AM
Capo Mom - My reality is just fine, when she said there was no "reportable income" it was there was no reportable income in Orange County that was in her jurisdiction, that's why my comment was relevant, not shrill. Facts aren't being shrill, context is not being shrill, reality is not being shrill. Sorry that the truth bothers you and that you are all making hay out of nothing, again. How typical. Calling her a liar, unethical, etc. with proof here that she has done no such thing. If you understood the form, she is truthful, no reportable income with in her jurisdiction, Capistrano Unified School District!
Capo mom June 18, 2011 at 02:44 AM
shrill has nothing to do with this, IMO. If she said she has no reportable income or even if she left it blank, I might view it differently. The form that she filed said she had no income in Orange county. That is false. And she didn't file the form until the day of her appointment. I don't believe in coincidence. The one question no one has answered is; If everything was really hunky dory as you say then why did she resign?
shelly June 18, 2011 at 03:39 PM
Capo Mom, 9 Million dollars restored to the teachers was brought up. The contract that contained the language that triggered the restoration was signed by the former board. If the board would have negotiated a 10% cut which the fact finder suggested and the teachers would have accepted then and there would be no 9 million dollar restoration at this time. The contract would have run its course and then renegotiated. But the former board did not do this. It imposed a contract. You have the right to agree with Kim McCarthy. I don't. I don't believe my children are being abused or victimized by the teachers and administrators of CUSD. And if I did believe this my children would not be in CUSD schools. Please point out from the definition in the language on form 700 and what it was asking for where Trustee Hatton lied. Didn't she step forward herself and resign? She resigned because of the appearance of conflict of interest.
shelly June 18, 2011 at 03:42 PM
Capo Mom, Why don't you call Trustee Hatton or e-mail her and ask her why the form was late?
shelly June 18, 2011 at 03:46 PM
Capo Mom, You stated, "To have squandered their time and resources for petty political purposes during a time of extreme financial pressure is more than unconscionable." Can you please be specific about the time and resources that were squandered? When and where?
Capo Parent Too June 18, 2011 at 06:42 PM
Why? Probably because of vultures like you who will dwell on this even though she has resigned. If she hadn't, you would be calling for resignation or suing, taking away even more time from the ROP and causing MORE distraction. Her action was to probably nip it in the bud. What you don't get that even the slightest bit of impropriety by these new trustees is going to be blow out of proportion, they can't sneeze without someone accusing them of spreading TB. That's why.
Capo Parent June 18, 2011 at 07:17 PM
Capo Parent Too You are the kettle calling the pot black. Stop before you put your foot and leg in your mouth, not just your foot.
M January 07, 2012 at 03:54 PM
The Bealls ...I forgot about them! Thanks capo parent too, looks like you've fueled their pathetic rant. Bealls loss, capo's gain!


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