CMS broke policy by paying firm $30k monthly without contract, complaint alleges
A Charlotte-Mecklenburg Schools employee raised concerns about $30,000 monthly payments the district made to a consulting firm without an official contract with the company.
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She made the allegation in a human resources complaint filed Aug. 21. It was later shared with The Charlotte Observer, and the employee requested anonymity for fear of retaliation. The complaint alleged CMS Board Chair Stephanie Sneed insisted payments be made, despite the employee’s concerns and other employees warning it violated board policy.
The complaint’s revelation comes as CMS is dealing with twin controversies: pressure to release information about why it spent $379,000 on this summer’s two-month investigation into Superintendent Crystal Hill and recent resignations of five high-ranking district officials.
Sneed declined to comment for this story.
CMS entered into a contract with law firm Poyner Spruill on Feb. 4 for legal services related to the district’s plan to build affordable housing for educators. The Observer obtained the contract through a public records request.
The contract was extended through Feb. 3, 2027, and outlined payments to be made on a 30-day basis at a rate of $350 to $450 per hour. It listed two attorneys at the firm who would work on the project.
On Feb. 4, Poyner Spruill attorney Katie Cornetto sent a letter to Sneed that confirmed the agreement.
Acting CMS General Counsel Anna Hehenberger was cc’ed on the correspondence. The Observer obtained the letter through a public records request.
The letter adds additional information not included in the contract: CMS would be billed against a $60,000 retainer for the work in the first month, which included a $30,000 monthly consultant fee.
On March 25, Poyner Spruill entered into a strategic services agreement with Qonnect LLC, a consulting firm owned by Raki McGregor, who served as the district’s chief executive in residence last year. McGregor’s Qonnect LLC would provide consulting services related to the affordable housing initiative, according to the agreement with Poyner Spruill, for a monthly retainer of $30,000, paid by CMS to Poyner Spruill.
McGregor has been subject to controversy in CMS before for a $500,000 contract his wife’s company, SYDKIMYL Educational Consulting, had with the district. Some board members questioned whether it presented a conflict of interest, but a CMS spokesperson said the district determined there was none.
Without a formal board contract between CMS and Qonnect LLC, the CMS employee claimed she felt uncomfortable approving the payments.
“At no point was I provided an executed contract governing the consulting engagement,” the complaint stated. “As the individual responsible for supporting board operations and facilitating payment processing, I found this highly concerning.”
When the employee requested the payment for the first consulting invoice, the complaint stated, she received a message “stating that the transaction was not compliant with Charlotte-Mecklenburg Schools financial procedures.”
The employee stated Hehenberger and CMS Chief Financial Officer Kelly Kluttz advised her a contract would be necessary moving forward for the payments to be in compliance.
The complaint alleged Sneed insisted payments be made even after questions arose about the lack of a contract.
“We don’t need a contract,” the complaint alleged Sneed told the employee. “We are the board.”
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Public records show CMS has continued to make monthly $30,000 payments for the work from April 10 through Aug. 4.
Former CMS board member Rhonda Cheek, who served from 2009 through 2022, told the Observer the employee’s complaint is concerning because the payments to Qonnect are only outlined in the confirmation letter to Sneed, not in the contract approved by the board.
“I think that any kind of expenditure like that, especially if it’s $30,000 a month, definitely needs to be something that the entire board is aware of and be very public and transparent,” Cheek told the Observer. “Checks being written without a contract – that’s a violation of board policy, and that’s taxpayer money.”
Invoices obtained through public records show CMS has so far paid Poyner Spruill a total of $150,000 for the monthly consulting retainer fees. The law firm’s agreement with Qonnect LLC stipulates those fees be passed through to the consulting firm.
On Friday, Sneed informed board members via email they would vote on whether to remove her as chair at their Sept. 22 meeting, after three members requested the motion be placed on the agenda. In the same email, Sneed said she had been the victim of “bullying, discrimination, harassment and retaliation in connection with (her) service on the board.”
The same day, the North Carolina Secretary of State’s office administratively dissolved Qonnect LLC, claiming it failed to file an annual report.
McGregor has not responded to the Observer’s request for an interview.
Hill returned from a two-month paid leave in August, after the board voted to keep her in her role following an investigation into her this summer.
When she returned, the complaint alleged, Hill also “expressed concerns regarding payments and contractual arrangements involving Poyner Spruill and consulting services being provided on behalf of the board” in an email to the board on Aug. 20.
The complaint claimed Sneed replied to the email saying that the payments related to the teacher housing initiative but did not address the lack of a contract.
The board also contracted with Poyner Spruill, which again hired Qonnect LLC, to conduct a compliance audit of the district from June through September. Records show the district has paid Poyner Spruill $110,000 up front for the work, and could pay up to $220,000 once the work is completed.
Poyner Spruill will pay Qonnect LLC $132,000 for its part of the compliance audit.
However, the board decided to pause the audit Wednesday due to concerns about a conflict of interest with Qonnect LLC, WFAE reported.
Board member Liz Monterrey Duvall told WFAE she believes the dealings with Qonnect as part of the compliance audit show the district may need to revisit its protocols for tracking and disclosing subcontractor work, but she said she doesn’t believe it constitutes a conflict of interest.
Monterrey Duvall also told WFAE she supports keeping Sneed as board chair. Vice Chair Dee Rankin, Charlitta Hatch and Shamaiye Haynes have also said they will support Sneed, giving her the votes needed to retain her seat.
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