HUNTSVILLE, Ala. -- This week, the Huntsville City Schools Board of Education, on recommendation by interim Superintendent Tom Drake, ended Pinnacle Schools' contractual obligations to the district. This effectively terminated their relationship.
It's a dispute that began following the departure of former superintendent Casey Wardynski, and continues through attorney negotiations over unpaid invoices and concerns about bills the school system has already paid. Pinnacle ended some of its programs this week, its CEO telling WHNT News 19 they could not continue to operate without payment. She told her side of the story in an exclusive interview with WHNT News 19.
Drake said during Thursday's meeting, "Pinnacle's decision to send students away today was a substantial breach of contract...In light of this, any trust that previously existed between the board and Pinnacle has now been destroyed."
Attorney for Pinnacle Schools, John Wilmer, attempted to speak at the meeting, but due to the meeting's format and board members' protest, left the podium. Board members said he needed to be asking questions, not attempting a rebuttal.
Friday, he spoke with WHNT News 19, saying he wanted to ask the board, "Why? Why did you do this to Pinnacle? Why won't you pay them?"
He said Drake's assessment of the dispute wasn't based on the real facts. He claims the school system did have warning that programs would be dropped if Pinnacle wasn't paid. He also said the school system is billed, and has previously paid, sums based on agreed-upon rates.
"There is no money that they're entitled to have back," he said. "That's disingenuous."
While Wilmer maintains the school system has been paying bills to Pinnacle for years, without dispute, he says the real breach of contract was when the district ended its contract and then refused to pay their bill for the APP program. He said in a letter to the school system's attorneys that the school leaders cannot simply change their minds after verbal agreements for services and prices. He claims attorneys and the school's CFO were aware of these agreements.
"They know. They helped plan it," he said. "The work was done right under their nose. They know that it's due. And they're not, they have never offered to pay any part of it." He added, "If you dispute that there's an agreement, that can be proven," he said. "All you have to do is walk down the hall and talk to your CFO."
Wilmer told us negotiations have been going on for weeks between the attorneys on each side, but nothing has worked.
"We offered them all we could offer," he said. "We told their attorneys that. And their offers were extremely low."
Meanwhile, Wilmer said Pinnacle has been self-funding the programs while waiting for payment.
"We're a small business, and they know that it's hard for a small business to stay in the game financially when they play hardball. They know they can force a little vendor like Pinnacle to its knees, and I think that was their strategy," he explained.
Wilmer said Pinnacle would like to finish out the contract it had with Huntsville City Schools through May 2017. He noted that the school system terminated that contract Thursday, just days before a quarterly payment of more than $400,000 was due on November 1, 2016.
"I think people are not understanding that there were contracts, there were agreements, and that Pinnacle was doing and rendering these services for less money than the school system could do the same services for themselves. And I'd also like to say that Pinnacle was extremely successful. The programs that Pinnacle ran were successful," he added.
Wilmer explained Pinnacle had a contract for its RAISE alternative school program, and then had other agreements for multiple other programs, including APP, which were made but not written into the initial RAISE contract.
In his letter to board attorney JR Brooks, he wrote, "HCS had full knowledge that Pinnacle was developing and implementing the Additional Programs, and that Pinnacle expected to be paid for those services." He goes on to say, "HCS, not Pinnacle, identified the need for Pinnacle to provide additional services above and beyond what is required in the RAISE contracts, and Pinnacle developed the Additional Programs at the request of HCS to meet the needs that HCS identified."
Wilmer's letter also details each of those programs, and the reasons behind the costs for them seen in these invoices. He writes, "HCS cannot direct Pinnacle to perform hundreds of thousands of dollars' worth of work, sit back and watch Pinnacle perform that work, and then refuse to pay Pinnacle for the reasonable value of the services Pinnacle performed. That would be inherently unfair, and the law does not allow it."
The full text of Wilmer's letter can be found here.
Attorneys will continue to negotiate, and legal action could be possible if they do not reach a joint solution.