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[January 18, 2014]
Critics: Earmark doesn't compute ; Money for software company taken from Children's Initiatives Fund [Topeka Capital Journal (KS)]
(Topeka Capital Journal (KS) Via Acquire Media NewsEdge) A leader of a business that is benefiting from a $12 million legislative earmark for reading software in Kansas schools said Saturday his company didn't switch its address because of questions concerning its location within Rep. Marc Rhoades' district.
Don Fast said his company, Educational Design Solutions, had been planning to change its registered address for some time.
Educational Design Solutions is the company that licenses the computer-based reading program Lexia Reading Core5 to Kansas schools. Until recently, it was based in Newton, where Rhoades lives.
In 2013, Rhoades, chairman of the House Appropriations Committee, helped add a $12 million earmark for Lexia into the state's budget - - $6 million a year for two years.
That prompted questions from critics who said it was unusual to designate a specific product or company as the recipient of an appropriation, and who questioned why Educational Design Solutions hadn't had to compete against other companies in a request-for- proposals bidding process.
Those concerns arose in June, after the earmark passed largely unnoticed as part of the annual appropriations bill.
Later that month, Fast's company changed its registered address from Newton to Walton, about seven miles away and outside of Rhoades' district, filings with the Kansas secretary of state show. On July 30, it changed registration again, to Basehor.
Fast said Saturday the company's decision to change its registration was unrelated to the boundaries of Rhoades' district or to receiving state funds.
"We had just failed to make that an official thing," Fast said. "Our operations were centered out of the Kansas City area long before." The company was created in 2003 in Newton and worked primarily within Kansas, Fast said, but a few years later it gained customers in Nebraska and Missouri, too.
"It became more expedient to become more centrally located," he said.
On June 23, 2013, the company therefore switched its registration to Walton, where the company's office manager lives, Fast said.
"But we needed to have it more centrally located," he said, and a month later his company re-registered to Basehor, a location that he said is its headquarters.
A Topeka Capital-Journal reporter who stopped by the Basehor office Friday afternoon during work hours found the office closed and dark. A table, chairs and a coffee machine were visible.
Fast said the company's employees use laptops and its headquarters don't need much in the way of equipment.
"We're a sales organization," he said. "A virtual sales organization." He said the company's logistics coordinator lives in Basehor and that three of its dozen employees use that office on a regular basis.
Other employees are in St. Louis; Jefferson City, Mo.; Kansas City; western Nebraska; and other places, he said.
Children's Cabinet The allocation for Lexia Core5 sparked controversy for other reasons, too.
On Saturday, Shannon Cotsoradis, a member of the Kansas Children's Cabinet, said the money for Lexia this year had been taken from the Children's Initiatives Fund without the cabinet's input.
In November, the cabinet voted against the second year of Lexia funding in its budget recommendations, which go to the governor's office.
One concern for cabinet members, Cotsoradis said, was the lack of an RFP process.
"This is simply not the way it would normally be done," she said. "I can't think of anything off the top of my head that parallels this." Additionally, she said the cabinet focuses on funding early- childhood programs, not grade school programs, with the Children's Initiatives Fund.
The Kansas State Department of Education oversees K-12 schools, but lawmakers didn't add the Lexia allocation to its budget.
Educational Design Solutions' most recent annual report to the Kansas Secretary of State's Office indicates the company has three members who own at least 5 percent of its capital. They are Diane Fast, Kelly Weiss and Joel Weiss. The Weisses live in Basehor. Diane Fast lives at the Newton address where the company was previously registered, which Don Fast said is the family's home. According to the Secretary of State's office, that remains the company's mailing address. Fast said he wasn't aware of that and may have forgotten to change the official mailing address.
In an interview in June, Fast said there is no relationship between anyone in his company and Rhoades or Rhoades' campaign.
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