While the founder of the Bambinos Hood River Learning Center contests state claims for reimbursement of over $86,000, Lorena Lowell has let the Center’s child care license lapse so a new nonprofit can assume the reins and continue providing child care.
The previous license expired Aug. 31, according to Kathleen Hynes, legal and compliance manager for the Office of Child Care with the Oregon Department of Education. Hynes says the agency has received a request for an operating permit, and issued a temporary license to the new nonprofit.
In its corporate filing in January, the Columbia Gorge Early Learning Center registered as a nonprofit, with Dr. Rich Martin as president, and Tim Doty as registered agent and secretary. It succeeds the for-profit Hood River Learning Center, incorporated in 2008 by Lowell and her husband, Thomas.
Lowell and Bruce Knivila, the attorney for the HRLC, are working separately to address concerns raised last December by a state examination of the Learning Center’s billing records.
Knivila, based in Portland, says he is exchanging documents with the Department of Human Services.
“We expect to schedule a hearing, but there is none scheduled yet,” he said Sept. 13.
“The claims of overpayment by DHS are merely allegations,” he said. “Hood River Learning Center will be able to present its side of the story at the hearing.”
Lowell declined immediate comment, but said she is preparing formal media releases.
“The total amount that is contested in the Bambinos case is $86,666.75,” wrote Gene Evans, communications director for the state Department of Human Services, in an Aug. 12 e-mail to The Buzz.
The state Department of Education separately wants repayment of $12,279.15, citing “deficiencies” in how Bambinos worked with a program that provides help with nutrition for children in its care.
Unpaid federal and local property taxes add more than $140,000 to the amount owed by the Hood River Learning Center.
Bambinos opened west of Safeway and south of Nunamaker Realty in 2008. Lowell had started and operated her first Bambinos in White Salmon, Wash.
Following anonymous tips, state investigators with the DHS visited Bambinos in December 2012 and reviewed its records. Based on their findings, investigators alleged that past payments from federal child care support funds weren’t supported by Bambinos time logs.
According to the DHS web site, the Employment-Related Day Care program “helps approximately 20,000 Oregon families every year pay for child care for approximately 35,000 children.”
The Buzz in March received an anonymously mailed photocopy of a DHS form notifying Lowell of the agency’s intent to hold a hearing for an “intentional program violation.” State officials confirmed only that it was a legitimate document, but would not speculate as to who might have sent it.
State officials have declined further comment, pending outcome of all hearings.
In a May 30 letter to Lowell and her husband, Thomas, the Oregon Department of Education said it was suspending Bambinos from participation in the U.S. Department of Agriculture Child and Adult Care Food Program (CACFP). The Department of Education administers the program. The letter said Bambinos had been “seriously deficient” in its administration of the program.
In the letter, Joyce Dougherty, director of child nutrition programs, noted that the DOE and Bambinos had entered a settlement agreement. Under that plan, the business was to repay the state $12,279.15 by June 1, 2013.
Lynne Reinoso, manager of community nutrition programs with the Department of Education, on Sept. 3 said that amount is still owing, and the DOE has invoiced Bambinos.
Around the time of the DHS investigation last December, Lowell announced conversion of Bambinos to a nonprofit organization. Persons initially enlisted to serve on the board are no longer involved. Lowell said she plans now to assume an exclusive role as manager of the property.
(Full disclosure: the writer of this story, doing business as Watsonx2, on Dec. 5, 2012, contacted Lowell to address a rumor about Bambinos closing. Lowell requested assistance preparing a media release announcing that change to nonprofit status. That release was prepared without any knowledge of the investigation occurring at roughly the same time.)
“I and others (on the board) are just trying to do something good to save a good resource for parents in the community,” said Dr. Martin, a pediatrician. “DHS kids and their families benefit significantly from the extended hours and modern facility that the center offers, and this is a valuable benefit for parents struggling to work in our local economy.”
Janet Hamada, executive director of The Next Door Inc., echoed those sentiments, noting the need for quality child care in Hood River County. She said her own children had benefited from the availability of care through Bambinos. Lowell is a member of the board of The Next Door Inc.
Lowell is facing other challenges. The Internal Revenue Service on Nov. 15, 2010, filed a lien for $14,976.40 in unpaid federal taxes against Lowell and the Hood River Learning Center (its previous corporate name, before its pending reincorporation). Separate IRS UCC filings late last year and this spring add another $13,968 to the amount owed.
The IRS in its UCC filings noted that the unpaid amounts were required under Form 941, which covers quarterly payment of income tax withholding, social security and medicare. All IRS liens are still active.
According to minutes from an April 2012 meeting of the Oregon Investment Board, Lowell claimed no knowledge of the IRS filing during discussion of her request to restructure an existing loan and get additional support. The OIB, because of concerns about outstanding debts, denied the request for additional support.
Eric Nerdin, loan fund manager for the Mid-Columbia Economic Development District (which administers the revolving loan fund for the OIB), confirmed that the Learning Center had received two different loans, totalling $125,000, for help with construction and equipment. He said both loans “are open and active.” To secure the loans, MCEDD has filed a UCC claim against “all personal property” owned or acquired by the Learning Center.
According to the Hood River County Assessor’s office, the Hood River Education Center owes $119,051.12 in back property taxes dating to the 2009 tax year.
Deanna Lainhart, chief deputy tax collector for the county, said the county has filed for tax foreclosure. By paying at least the $37,594.90 owed for 2009, the property owners could avoid a foreclosure judgment. The court will consider the matter later this month.
If a judgment is issued, Lainhart said, the county would secure an ownership interest in the property. The property owners would then have two years to pay all back taxes to avoid a foreclosure sale.
According to county records, the Hood River Learning Center property at 220 Clearwater Lane has a real market value of $1,866,840 and an assessed value of $1,421,840.