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by Seth Freed Wessler

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Update, June 30, 2022: The Army Corps of Engineers has concluded that a report the grain elevator developer commissioned is “insufficient.” The Corps, which is considering a federal permit application from the developer, will require the company to conduct a new report to assess potential harm to the surrounding historic sites, which will replace the gutted report it submitted last year, according to a Corps spokesperson.

The federal agency charged with overseeing historic preservation policy has expressed concern that a Louisiana industrial project could inflict harm on African American historic sites. The move follows a ProPublica investigation that found an archeological consulting firm had gutted a report to the Army Corps of Engineers that originally detailed that harm.

In a letter sent last week to the Army Corps, the Advisory Council on Historic Preservation said it is aware that the report commissioned by the developer of the project “has been challenged by the original author of the report.” It went on to state: “The ACHP requests that the Corps clarify how it will address this issue.” The Corps is considering a permit application from the project’s developer.

Greenfield, a Colorado-based agricultural company, plans to build a grain transfer facility, which would stretch for more than a mile from the Mississippi River through sugar cane fields. The grain terminal has been contested by community and advocacy groups that say the project would make life untenable in parts of Wallace, a small, nearly all-Black community. They also argue that the project would damage important historical sites, including the nearby Whitney Plantation Museum, which serves as a memorial to generations of people forced to work the fields against their will, and the Evergreen Plantation, an unusually intact plantation that’s been designated a national landmark.

Greenfield has said that its project will not harm any historic properties. As evidence, it cited a survey it commissioned. But that report, produced by a consulting firm called Gulf South Research Corporation to allow Greenfield to comply with the National Historic Preservation Act, was altered dramatically before it was submitted to the Louisiana Division of Historic Preservation.

The letter sent last week to the Army Corps was written by Jaime Loichinger, an assistant director at the Advisory Council on Historic Preservation, who said in an interview that ProPublica’s story had raised questions about the “validity of the report” and spurred the agency’s intervention.

The Army Corps, Loichinger said, must “take steps to supplement or replace” the report that was altered “to make sure that they [the Corps] have a full and complete understanding of the historic properties.”

The original draft of the report had concluded that the development would harm historic properties including the Whitney Plantation Museum. The report’s authors had written that the entire area around Whitney and the Wallace community should be characterized as a historic district.

According to internal Gulf South company emails that ProPublica obtained and to one of the drafters of the original report, an architectural historian-turned-whistleblower named Erin Edwards, the firm was told by its client to change the report or risk losing the Greenfield contract and other future contracts.

In its letter to the Army Corps, the Advisory Council on Historic Preservation echoed the findings of the original report.

“We understand that most of the residents of the community of Wallace are the descendants of the African Americans who labored as slaves on the Whitney and Evergreen Plantations prior to emancipation and continued as farm laborers and tenant farmers after emancipation,” the letter says. “As such, there appears to be potential for an historic district associated with this descendant community and an encompassing cultural landscape.”

Gulf South previously denied that it had changed the findings because of pressure and said it stood by the content of the final report. Greenfield said it would respect any historic sites discovered in the course of construction. “Protecting historic and cultural resources is a priority in our discussions with the Corps of Engineers,” the company said in response to questions about the recent Advisory Council on Historic Preservation letter. “We take our responsibilities as stewards of this land very seriously.”

The project has drawn recent condemnation from other prominent voices in the weeks since the ProPublica investigation. Marc Morial, the former mayor of New Orleans and current president of the National Urban League, whose own ancestors were enslaved on the Whitney Plantation, sent a letter to Greenfield’s executives on June 3 to express his “unequivocal and vigorous opposition to your ill-advised plans to develop a massive grain elevator complex” and noting his concern about the “silencing of an unfavorable independent assessment.”

And on June 21, the Louisiana Trust for Historic Preservation, the state’s leading preservation organization, placed the land around Wallace and the Whitney Plantation on its 2022 “most endangered places” list.

“Plans for a large-scale grain elevator, port and other industrial development will change this corridor’s historic integrity and destroy the overall quality of life for local residents,” the Louisiana Trust said in a press release.

The Army Corps is only now beginning its permit review. The Corps previously told ProPublica that it has concerns about possible harm to historic sites. The Corps said last week that it will be in touch with the Advisory Council on Historic Preservation this week and will then respond more formally.

Greenfield has already begun work on the land. In late May, it informed Wallace residents that it planned to drive large metal beams into the ground in a sugar cane field to determine whether construction could proceed as planned.

The Descendants Project, an organization that aims to build power among communities who trace their ancestry to people enslaved in the river parish communities, raised the prospect that the work could disturb the unmarked graves of enslaved people. As part of an ongoing lawsuit the group is pursuing, The Descendants Project asked a Louisiana judge to impose a restraining order on Greenfield’s planned “pre-construction” testing on the property.

“You’re talking about people’s final resting place,” Joy Banner, one of two sisters from Wallace who founded The Descendants Project, said on June 3 in a packed courtroom. “That’s why we are here today: because we don’t know where our ancestors are buried.”

Greenfield’s lawyer said that “there’s been no testimony at all about specific burials” in precisely the sites where the company planned to begin driving in piles. He claimed that Greenfield would incur financial losses if it was barred from beginning pile-driving work on its property.

The judge denied the emergency restraining order. Days later, the Army Corps separately refused a request from the Tulane University Environmental Law Clinic to stop the pile driving, saying it had no jurisdiction because the work on its own would not impact wetlands.

Greenfield’s builders began pounding massive beams into the ground near the Banners’ family home on June 17 and continued the work on June 20 — a federal holiday commemorating Juneteenth, which celebrates the emancipation of enslaved people.

“I think they are trying to send the message that this project can’t be stopped, and that they’re moving forward,” said Jo Banner, Joy’s sister. “The cranes are there and they’re acting like they have the permit.”

In its letter, the Advisory Council on Historic Preservation made clear its belief that the permit, and Greenfield’s plans, should not be treated as an inevitability, and it reminded the Corps of its responsibility to consider environmental justice in permitting decisions. “A federal agency should consider alternatives in a way that gives full consideration to the effects of that undertaking on historic properties,” the letter said.

by Madison Hopkins, The Kansas City Beacon

We are journalists from ProPublica and The Kansas City Beacon. We want to know what it is like inside sheltered workshops.

Sheltered workshops are special jobs where most workers are people with disabilities.

Some people in sheltered workshops make very little money. They make less than minimum wage.

Some states have closed their sheltered workshops.

Missouri still has many sheltered workshops.

We want to know what it is like inside sheltered workshops. We want to talk to people who:

• Work in a sheltered workshop in Missouri.
• Used to work in a sheltered workshop in Missouri.
• Know someone who works in a sheltered workshop in Missouri.
• Know a lot about sheltered workshops in Missouri.

To help with our reporting, you can:

• Answer the questions below.
• Email reporter Madison Hopkins at madison@thebeacon.media
• Call or text reporter Madison Hopkins at (913) 283-4743. If Madison does not answer, leave a voicemail that tells us:
  • Your name.
  • Your phone number.
  • That you are calling about sheltered workshops.

Protecting your privacy: We will let you know if we are going to write about your story. We will ask you before we share your name or any personal information. We are the only ones who will read what you submit. Thank you for sharing your story.

by Lisa Song

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Rhonda Fratzke recalls getting a strange question from her oncologist last year after she was diagnosed with cancer of the blood vessel linings: Had she ever worked with vinyl chloride?

Industrial workers exposed to the potent carcinogen, a colorless gas used to make plastic, have been known to develop the extremely rare ailment called angiosarcoma of the liver.

Fratzke, 60, spent much of her life as a homemaker. But for almost a decade, she lived near a plant in Calvert City, Kentucky, that manufactured polyvinyl chloride, a plastic known as PVC. ProPublica featured the Westlake Chemical Corporation facility in an investigation last month that revealed how regulators had failed to curb dangerous emissions, including vinyl chloride, from the company’s Calvert City operations. The cumulative cancer risk from vinyl chloride and other air pollution in the community surrounding Westlake’s plant far exceeded what the EPA considers acceptable, according to a ProPublica analysis and an EPA estimate.

Just three weeks after the story published, the Department of Justice announced a proposed consent decree that would require Westlake to pay a $1 million penalty and spend another $110 million to upgrade equipment at its Calvert City plant and at two of its other facilities in Lake Charles, Louisiana. The consent decree is a settlement between the federal government and the company that includes agreed-upon remedies for reducing Westlake’s environmental pollution and allows the parties to avoid going to trial. It targets Westlake’s industrial flares — giant candle-like devices that burn off waste gases. They’re supposed to destroy 95% of the contaminants piped into them, but Westlake repeatedly failed to operate them properly, according to the complaint, which was filed on behalf of the EPA and state environmental regulators in Kentucky and Louisiana. At times, the flares ceased working altogether, allowing all of the toxic waste to escape into the air.

The Westlake chemical plant in Calvert City, Kentucky (Joseph Ross, special to ProPublica)

The consent decree said Westlake denies violating any of the regulatory requirements that the EPA and state authorities said it had run afoul of. The company didn’t return requests for comment. In a statement provided to Law360, Westlake said it was “​​pleased to have reached an agreement with the United States Environmental Protection Agency and is making investments to reduce environmental emissions in concert with the company’s sustainability strategy.”

The news gave Fratzke a sense of validation. She and her family moved to Calvert City, near the Illinois border in Western Kentucky, in 1989. The following year, Westlake took over a local chemical plant, eventually expanding into three interconnected facilities. From 1990 to 1998 — which covers most of of the time Fratzke was living in the area — Westlake’s operations released 10,000 to 70,000 pounds of vinyl chloride per year, according to self-reported estimates that the company submitted to the EPA. That placed the company’s Calvert City plants among the nation’s top 10 industrial emitters of vinyl chloride for two of those years.

Those numbers are “absolutely astonishing,” said Arthur Frank, a Drexel University professor of public health and medicine. ProPublica shared details of Westlake’s history and Fratzke’s illness with the professor. “There’s a very high likelihood” that the vinyl chloride in the air “played a role,” he said.

In recent years, vinyl chloride emissions from Westlake have risen as high as 170,000 pounds a year, dwarfing emissions from other facilities in the city of 2,500.

It’s virtually impossible to prove that a specific contaminant caused any individual’s cancer. But Fratzke can’t help recalling how she raised four kids in that Calvert City house and spent countless hours growing roses and tomatoes in her garden. Was she breathing in extra vinyl chloride by spending all that time outside? Did the watermelon and squash she tended so carefully absorb the chemical from the soil? “Now I think, ‘Oh my God, what was I feeding my kids?’” Fratzke said.

Her youngest son, Jeremiah, rode his bike so much that he wore out the tires. She wondered: When he pedaled through the swampy area by the side of the road, was that water contaminated? Fratzke said Jeremiah was diagnosed with non-Hodgkin lymphoma at age 23 and is now in remission. Exposure to certain chemicals — including benzene, which is emitted by the Westlake plant — has been linked to that type of cancer.

Westlake’s facility has a habit of leaking vinyl chloride; in 2011, for instance, 11,000 pounds of the compound streamed from a hole in a piece of piping that hadn’t been inspected. State and federal regulators have fined the plant for at least six instances of unauthorized vinyl chloride emissions since 2010, including twice since the EPA began investigating Westlake’s flares in 2014. A recent Kentucky air monitoring study also found high levels of vinyl chloride in Calvert City. From October 2020 to March 2021, two monitors installed near the Westlake plant recorded higher levels of vinyl chloride on average than any of the 129 other monitors nationwide designed to detect the chemical. A third monitor, on the grounds of Calvert City Elementary School, recorded levels in the top 10, according to data pulled from an EPA database.

It’s “ridiculous” how long it takes to investigate a violation, negotiate a consent decree and get the Justice Department to release it, said Scott Throwe, a former senior staffer in the EPA’s Office of Enforcement and Compliance Assurance. “It’s a very slow process” — around eight years, in this case — and “in the meantime the facilities are still chugging along and operating poorly, and the public is the one that suffers.”

Fratzke said she hopes the renewed attention on Westlake will raise awareness of local health risks. “They should notify the public” that they’re “in danger living this close to the plant,” she said.

Fratzke near the Westlake chemical plant (Joseph Ross, special to ProPublica)

She worried about other residents who might have angiosarcoma without knowing it. Fratzke only received her diagnosis after her doctor ordered extra tests to determine the cause of abnormalities found on her liver.

ProPublica asked the Kentucky Cancer Registry for data on statewide angiosarcoma cases. Based on national statistics and Kentucky’s population, one would expect four or five new cases a year. The most recent data available, from 2019, reveals 17 cases. The prior nine years saw eight to 18 diagnoses per year. Frank said the numbers do seem unusual, but it’s impossible to be sure if they’re linked to air pollution without having more information on the type of angiosarcoma and knowing whether the cases are clustered near industrial plants.

The settlement would require Westlake to reduce the amount of pollutants sent to the flares and to ensure that the flares are working as they should. These changes would cut the plants’ hazardous air pollution by 65 tons per year and reduce its volatile organic compounds (which form smog) by 2,258 tons per year, the regulators predicted. Westlake will also install monitors around the boundary of each facility to monitor for benzene, a potent carcinogen.

Throwe said the document is powerful, with “a lot of teeth.” But it will only work if the EPA monitors Westlake to ensure the requirements are being implemented, he said. Without follow-up, “it’s not worth the paper that it’s written on.”

The EPA’s Washington, D.C., office, which led the investigation into Westlake that resulted in the consent decree, did not respond to requests for comment.

After a public comment period (which ends July 15), the agreement will be finalized if it receives court approval. (Instructions for submitting comments can be found here.) Throwe said consent decrees rarely receive many comments, and he doesn’t expect the terms of the final agreement to change much, if at all.

Few leaders in Calvert City were willing to criticize Westlake, ProPublica found during a reporting trip this spring. In surrounding Marshall County, more than a quarter of the private-sector jobs come from chemical plants and other manufacturing.

“What is particularly sad about this situation is, this is a small company town,” Throwe said. Westlake is “significantly impacting the health of their own employees … and the children that live in the community.”

Rhonda Fratzke with her husband, Rodney Fratzke, her granddaughter Caylee Hermann and Precious the dog (Joseph Ross, special to ProPublica)

Fratzke now lives 9 miles outside Calvert City. In the winter, when the leaves are off the trees, she can see the glow from Westlake’s flares. “It just lights up the sky,” she said.

“I’m not putting down Calvert City, I’m not putting down the plant,” she said. Westlake pays taxes and donates to the community, including the high school where her grandson enjoys more resources than what’s available at other schools, she said. The companies “pay and do all that stuff, I think, to keep people happy. … So I think people tend to turn their head the other way as the money flows.”

Do You Live Near an Industrial Facility? Help Us Investigate.

Lylla Younes contributed reporting.

by Nicole Carr

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for Dispatches, a newsletter that spotlights wrongdoing around the country, to receive our stories in your inbox every week.

Two Georgia school board candidates who criticized the hiring of a Black educator focused on diversity, equity and inclusion initiatives lost their runoff elections this week. Meanwhile, a person who helped organize the effort to push educator Cecelia Lewis out of her job is narrowly losing her bid for a seat in the state House of Representatives.

The three were described in a ProPublica story last week that detailed how Lewis was attacked in both Cherokee County and neighboring Cobb County by white parents making baseless claims that she was bringing critical race theory to both school districts. (CRT maintains that racial bias is embedded in America’s laws and institutions and has caused disproportionate harm to people of color; it’s rarely if ever taught in K-12 public school systems.)

State House candidate Noelle Kahaian, a paralegal and conservative nonprofit leader, is trailing her opponent by 23 votes. The state has until July 1 to certify results, and candidates who come within half a percentage point of their opponent can request a recount.

The two Cherokee County school board candidates, Sean Kaufman and Ray Lynch, were defeated by wide margins on Tuesday. They were part of a four-candidate slate attempting to gain a majority for a more conservative school board. That collective effort, dubbed 4CanDoMore, was endorsed by the 1776 Project PAC, a new super PAC that touted victories of far-right school board candidates it had backed in multiple states. The two other 4CanDoMore candidates, Michael “Cam” Waters and Chris Gregory, had lost to incumbents in the May 24 primary.

In a statement to ProPublica, Cherokee County School District Chief Communications Officer Barbara Jacoby said that the group of people who targeted Lewis “do not speak for our community, as was illustrated when their candidates failed in their recent attempt to win a majority on the School Board. We do not support hate, and we are deeply sorry for how Ms. Lewis and her family were treated by these members of our community.”

Kaufman, Lynch and Kahaian did not respond to requests for comments. In a public statement to his Facebook page, Kaufman congratulated his opponent, Erin Ragsdale. “I truly believe that Cherokee County had some incredible candidates — and we really could not lose,” he wrote. “I wish her the very best and give her my full support in the November election.”

Lewis, an accomplished middle school principal from Maryland, was hired in the spring of 2021 as the Cherokee County School District’s first-ever administrator devoted to diversity, equity and inclusion initiatives. Community members targeted Lewis soon after her hire was announced. Kahaian, the state House candidate, was a presenter in a meeting during which plans to push Lewis out of her job were hatched. Parents went on to attack Lewis’ credentials and wrongfully accuse her of promoting critical race theory.

Lewis quit the job before she even started, following a chaotic school board meeting during which board members and students were evacuated and escorted to safety amid threatening outbursts from attendees.

Months later, parents using a private Facebook group began complaining that Lewis had a new job in neighboring Cobb County. (People with access to the group shared screenshots of posts with ProPublica.) She’d been hired as that district’s social studies supervisor. She lasted just two months there, resigning from the position after the district received an onslaught of erroneous complaints about her supposed intentions to indoctrinate children through CRT.

After ProPublica published its story about the community’s campaign against Lewis, one woman wrote in the parents’ private Facebook group: “Looks like we should prepare for antifa here in Cherokee County. I’m genuinely concerned for those names listed in that piece.”

Community members who disagree with those who targeted Lewis have been hesitant to speak up, according to Mandy Marger, a mother of two whose family moved to Cherokee County a decade ago.

Marger said she was encouraged by the outcome of the runoffs.

“The idea that groups who had such extreme views thought that they could grab a hold of our community was frightening,” Marger said. “They made it very clear that those of us who did not align with them were going to have to stand up, and I’m really, really proud of our community — especially today — that we did.”

Jacoby said in her statement that Lewis’ departure was the district’s loss.

“No one wants their community to be the place where a story like this unfolds, but it is important for us all to understand what happened and reflect on what we can do to ensure it doesn’t happen again,” Jacoby said. “It’s a cautionary tale about the dangers of misinformation and what can happen when you judge others based on falsehoods spread on social media or by people with political agendas.”

by Paul Kiel

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Last June, drawing on the largest trove of confidential American tax data that’s ever been obtained, ProPublica launched a series of stories documenting the key ways the ultrawealthy avoid taxes, strategies that are largely unavailable to most taxpayers. To mark the first anniversary of the launch, we decided to assemble a quick summary of the techniques — all of which can generate tax savings on a massive scale — revealed in the series.

1. The Ultra Wealth Effect

Our first story unraveled how billionaires like Elon Musk, Warren Buffett and Jeff Bezos were able to amass some of the largest fortunes in history while paying remarkably little tax relative to their immense wealth. They did it in part by avoiding selling off their vast holdings of stock. The U.S. system taxes income. Selling stock generates income, so they avoid income as the system defines it. Meanwhile, billionaires can tap into their wealth by borrowing against it. And borrowing isn’t taxable. (Buffett said he followed the law and preferred that his wealth go to charity; the others didn’t comment beyond a “?” from Musk.)

2. The $5 Billion IRA

Other billionaires used less conventional ways to avoid income, we found. Tech mogul Peter Thiel amassed a $5 billion Roth IRA, a type of account that shields income from taxes and is intended to help low- and middle-class savers prepare for retirement. Back in 1999, Thiel stuffed low-valued shares of the company that would become PayPal into the account, a maneuver tax lawyers said risked running afoul of IRS rules. (It’s not clear if the government ever challenged the move.) He set himself up to reap billions in untaxed gains. (Thiel did not respond to questions for the original article.)

3. The $1 Billion Parlor Trick: Turning High-Tax-Rate Trading into Low-Tax-Rate Income

Even when tech billionaires do show income on their tax return, they tend to pay relatively low income tax rates. That’s because of the type of income they have: Gains from long-term investments, such as from stock sales, are taxed at a lower rate. But what do you do if you’re making over $1 billion every year, and it’s largely from short-term trading? Do you just accept that you’ll pay the higher rate on all that income? As we reported this week, Jeff Yass, head of one of the most profitable firms on Wall Street, did not meekly accept this fate. Instead, his firm, Susquehanna International Group, found creative ways to transform the wrong sort of income into the right kind, generating tax savings that exceeded $1 billion over just six years. (Susquehanna declined to comment but in a court case that centered on similar allegations, it maintained that it complies with the law.)

4: The Magic of Sports Ownership: Make Money While (Legally) Reporting Losses

The tax code offers business owners a slew of methods to erase income through deductions, none more awesome than buying a sports team, as former Microsoft CEO Steve Ballmer did with the Los Angeles Clippers. It doesn’t matter whether the team is actually profitable and growing in value. It can still be a write-off. (In some cases, we found, owners could effectively deduct a given player’s contract not once, but twice. They’re allowed to take deductions comparable to those for factory equipment that loses value as it ages, even as teams almost inevitably gain in value.) That’s one reason owners tend to pay far lower tax rates than the athletes they employ, or even the people serving beer in the team’s stadium. In our story, we found a Clippers arena worker who made $45,000 a year and paid a higher tax rate than the billionaire Ballmer. (Ballmer said he pays the taxes he owes.)

5. Build, Drill and Save: The Real Estate and Oil Businesses Can Both Be Tax Havens

In certain industries, like real estate or oil and gas, the tax breaks are so plentiful that billionaires can erase their income entirely even as they grow richer. That’s how real estate developer Stephen Ross (who also happens to own the Miami Dolphins) went 10 years without paying any income tax. Ross said that he followed the law. Another mogul, this one in the oil business, managed to tap a near bottomless well of write-offs via one of the biggest oil spills in history. (The mogul’s representatives did not respond to requests for comment.)

6. Even a Billionaire’s Hobbies Can Pay Off at Tax Time

Deductions from hobbies and side projects, which the ultrawealthy can structure as businesses, are another fun option. For some billionaires, it’s race horses: We found that six owners of thoroughbreds at the 2021 Kentucky Derby had taken a combined $600 million in tax write-offs on their horse racing operations. For others, like Beanie Babies founder Ty Warner, it’s luxury hotels. The billionaire splurged on a couple of landmark Four Seasons locations and then went 12 years without paying any income tax. (Representatives for Warner did not respond to requests for comment.)

7. Think Your Taxes are Too High? Change the Tax Laws

Sometimes, it pays to fight for a new tax break. For the billionaires who contributed millions to Republican politicians, the payoff came in the form of Trump’s “big, beautiful tax cut” for passthrough businesses. We found the change sent $1 billion in tax savings in a single year to just 82 ultrawealthy households. Some business owners also boosted their savings with a trick: They slashed their own salaries and categorized the money instead as passthrough income.

8. Why Tech Billionaires Pay Less Than Hedge-Fund Managers

With so many options to reduce taxes, the richest Americans often manage low income tax rates. We analyzed the incomes and taxes of the country’s top 400 earners, those averaging over $110 million in income per year. Overall, the group paid relatively low rates, but certain segments (tech billionaires, heirs, private equity executives) stood out even within this elite population because they were able to draw on the sorts of techniques detailed above. (Also drawing on these techniques were wealthy politicians, like the governors of Colorado and West Virginia.)

9. Brother, Can You Spare a Stimulus Check?

But the real standouts were the billionaires who reported such low incomes that they qualified for government assistance. At least 18 billionaires received stimulus checks in 2020, because their tax returns placed them below the income cutoff ($150,000 for a married couple).

10. Trust This: How Wealthy Families Pass Billions to Heirs While Avoiding Taxes

The holes in the estate tax, we found, are even more remarkable. There are well-worn ways to make sure Uncle Sam doesn’t get his cut of a fortune being passed on to heirs, and the most common is through a trust. How common no one can say, but we found evidence that at least half of the nation’s 100 richest individuals had used estate-tax-dodging trusts. In another story,we followed three century-old dynasties down through the generations, showing how they used trusts to avoid taxes, so that a fortune could pass all the way from the original early 20th century tycoon to, for example, the great-great-granddaughter who recently collected $210 million before her 19th birthday.

Help Us Report on Taxes and the Ultrawealthy

Do you have expertise in tax law, accounting or wealth management? Do you have tips to share? Here’s how to get in touch. We are looking for both specific tips and broader expertise.

by Abigail Kramer and Gabriel Poblete, THE CITY

This article was produced for ProPublica’s Local Reporting Network in partnership with THE CITY. Sign up for Dispatches to get stories like this one as soon as they are published.

By slashing inpatient psychiatric care, New York has left people with too few places to turn for treatment of serious mental health conditions, state Attorney General Letitia James said at a hearing held by her office Wednesday.

James called the hearing following reports by THE CITY and ProPublica on New York state’s failure to provide mental health care to children and adolescents. Our investigation found that state officials have closed nearly one-third of the beds for children in state-run psychiatric hospitals since 2014, under a “Transformation Plan” rolled out by former Gov. Andrew Cuomo. During the same period, nonprofit groups shut down more than half of the beds in New York’s residential treatment facilities for kids, in large part because state payments were too low to keep the programs running.

“We’re at a crisis point, and we certainly need action,” James said at the hearing. “Emergency departments are overwhelmed by individuals who require more intensive psychiatric services but are unable to access necessary psychiatric inpatient beds or services in the community.

“When a child is in crisis,” James continued, “parents or caretakers have only two options: go to the ER or call 911. And too often, as we’ve seen in our office, they’ve had run-ins with the police that only make the situations that much worse. These children are waiting months and months for treatment.”

The lack of care is, in large part, a direct result of cost-saving measures and deliberate hospital bed closures made during the Cuomo administration, said James, who cited our reporting during the hearing.

In return for closing beds, state officials promised to expand access to outpatient and community-based mental health services that aim to keep kids safe at home. But those programs were never adequately funded, and providers say they can’t afford to hire or retain enough staff. According to a lawsuit filed in March, New York fails to provide community-based mental health services to the vast majority of children who are entitled to them under federal law. (The state officials named in the suit have not yet responded to the complaint.)

“Things are desperate out there,” testified Alice Bufkin, associate executive director for policy and advocacy at the Citizens’ Committee for Children of New York. “Children are presenting at younger and younger ages with serious mental illness. Families are blocked at every stage from finding care. Young people are cycling in and out of ERs and hospitals because they can’t get the care they need early.”

The problems are “driven by chronic underinvestment in the children’s behavioral health system,” both by New York state and by private insurance plans, which underpay mental health providers and fail to ensure access to preventive mental health care, Bufkin said.

In March, Rich Azzopardi, a spokesperson for Cuomo, told THE CITY and ProPublica that facility closures were part of a larger effort to shift funds out of hospital beds and into outpatient care. The Cuomo administration significantly increased investment in community-based mental health services, Azzopardi wrote.

During this year’s session, the New York Legislature approved funding increases for many mental health programs. However, several providers and advocates testified at the hearing that very little of the new money has been distributed, and that the increases, while valuable, will not go far enough to reverse decades of underfunding.

It can be all but impossible to access hospital care for kids experiencing mental health emergencies, said Ronald Richter, New York City’s former child welfare commissioner and the current CEO of JCCA, which runs residential programs for children in foster care in Westchester County. Kids in crisis are turned away by the Westchester Medical Center, Richter said. “These emergency rooms are unable to evaluate young people because they are overwhelmed. They are afraid to admit young people into their ERs because they have no place to discharge these young people to. There are simply not enough psychiatric beds for children who are suffering.”

From 2014 to 2021, New York closed 32% of its state-run hospital beds for kids, cutting the total from 460 to 314. The biggest reduction took place at the New York City Children’s Center, where the bed total was cut nearly in half — down to 92 in 2021. Meanwhile, in the first five years after the Transformation Plan’s launch, the number of mental health emergency room visits by young people on New York’s Medicaid program — the public health insurance plan that covers more than 7 million lower-income state residents — shot up by nearly 25%.

JCCA staffers sometimes resort to bringing kids to Bellevue, a public hospital in New York City, for a better chance that they will be evaluated or admitted, Richter said.

In response to Richter’s testimony, James noted that hospitals are legally required to evaluate and stabilize anyone who presents at the emergency room with a medical crisis, and she asked New Yorkers who are turned away for emergency mental health care to contact her office “so we can look at these complaints to determine whether individuals are complying with the law.”

“This hearing is about exploring potential areas of reform and informing my office for future investigations into allegations of inadequate mental health treatment or lack of parity,” James said.

In all, more than two dozen people testified at the hearing, including elected officials, health care providers and New York residents who said they couldn’t access mental health care when they or their children needed it.

Among them was a mother from Long Island named Tamara Begel, whom we identified in our reporting by her middle name, Rae. Begel’s son started cycling in and out of psychiatric emergency rooms after he attempted suicide at age 9. Most times, he was not admitted to an inpatient bed. When he was, he had to wait several days in the ER because all of the psychiatric hospital beds for kids were full. “The problems started way before COVID,” Begel said at the hearing.

During his most recent hospitalization, doctors said that Begel’s son needed care at a longer-term state psychiatric facility, but beds were full there too. He waited two months in a hospital unit designed for short-term stays, where he was assaulted by other patients and restrained multiple times, both physically and with injected medication, his mom testified.

“The system of care on Long Island in general has completely collapsed,” Begel told James. “Parents are at the breaking point because we cannot get the health care for our children. We need people to step in.”

by Anita Lee, Sun Herald

This article was produced for ProPublica’s Local Reporting Network in partnership with the Sun Herald. Sign up for Dispatches to get stories like this one as soon as they are published.

Nothing about the proposal to create a “town center” in the coastal bedroom community of Gautier, Mississippi, made sense to Becky Montgomery Jenner.

The mall that once functioned as the town’s community hub is literally a shell of its former self, with a rusting metal structure covering a concrete slab where shoppers once browsed. In its place the city wants to create a downtown where people can live, shop and dine.

No developers, banks or investors have signed on to the project. An advisory board that Jenner sits on voted 6-1 against recommending the project for economic development funding paid by the oil company BP following its massive oil spill in the nearby Gulf of Mexico.

State lawmakers put up $3.5 million anyway. Jenner couldn’t believe it.

“We’ve got this shopping center, defunct shopping center, in the middle of no-friggin’-where,” she said. Lawmakers “should look at which projects had the most viability, which projects had the greater return on the investment, which projects benefited the most people.”

The money that legislators sent to Gautier is part of a $750 million settlement paid by BP to compensate the state for the economic damage caused by the 2010 oil spill. Coastal Mississippi business leaders hoped the money would be used to transform the Gulf Coast economy, attracting new industries, creating jobs and lifting wages in communities dominated by low-paying service jobs.

But Mississippi’s Gulf Coast Restoration Fund is failing to meet any conventional measure of success for an economic development program, a joint investigation by the Sun Herald and ProPublica found.

Becky Montgomery Jenner, a member of the Gulf Coast Restoration Fund Advisory Board. Lawmakers have approved projects the advisory board voted against recommending, like the purchase of a former mall site in Gautier. (Hannah Ruhoff/Sun Herald)

Legislators put the power to spend the money in their own hands, and they’re doling it out without an overall plan. They’re using the cash to fill gaps in local government budgets and funding projects with few metrics for success. They’ve disregarded input of an advisory board made up of local business leaders, a committee lawmakers created when outlining how the money should be spent. In grant agreements, recipients have committed to creating few jobs, even fewer of them high-wage jobs.

Just 33 full-time equivalent jobs have been promised by the 24 projects for which Gulf Coast Restoration Fund grants have been finalized, according to grant agreements. Those projects have received $53.3 million — an average of $1.6 million per job. Economic development experts say that’s high.

“These are very legitimate questions of whether or not this money is really going to end up doing anything,” said advisory board chair Ashley Edwards, who is president and CEO of the Gulf Coast Business Council.

The city of Gautier put the grant toward the $5 million purchase of the mall property, where a songwriters’ museum is also planned. The grant agreement requires the city to complete some improvements to an adjacent park that the city considers part of the town center. The city says an amphitheater being built at the park will provide a stream of customers and revenue.

Several promising projects have gotten money from the Gulf Coast Restoration Fund, said Jamie Miller, chief operations officer at the Mississippi Development Authority, which handles economic development for the state.

But overall, the Gulf Coast Restoration Fund is being spent exactly as state Rep. Charles Busby worried it would be when lawmakers drafted the rules in 2018.

Back then, Busby said, he hoped the Legislature would rely on the Mississippi Development Authority to decide “how we could best utilize the money to do something that was truly transformational for the coast.

“With the system that we’re currently using, I just don’t see how that’s possible,” he said.

Mississippi lawmakers awarded $3.5 million to the city of Gautier to buy the site of a former mall so the city can develop a town center. (Hannah Ruhoff/Sun Herald) The Fight Over BP Damages, Spending

For three months after the Deepwater Horizon drilling platform exploded in April 2010, millions of barrels of oil spewed into the Gulf of Mexico, fouling the coastline from Texas to Florida.

Workers in protective boots took the place of sunbathers on Mississippi beaches, scooping dark patches of oil from the white sand. Offshore, vessels trolled for oil instead of fish.

Gulf Coast states settled lawsuits against the company in 2015. For two years, Mississippi leaders battled over who would control the settlement money and where it would go.

The Gulf Coast Business Council, which represents business interests along the coast, proposed legislation that would have placed the money in a trust overseen by an independent, appointed board that would have authority to seek expert advice. That’s similar to how Florida decided to handle the money.

There, most of the BP money recovered by the state goes to Triumph Gulf Coast, a nonprofit corporation. A seven-member board, appointed by state elected officials, approves projects for funding.

The nonprofit’s staff has vetted projects and positioned them for approval by the time they reach the board, said Triumph Gulf Coast economic advisor Rick Harper. “Our statute requires us to have performance metrics,” he said.

The BP money is meant to make up for “revenue the state of Florida didn’t receive when people couldn’t plan their beachfront wedding back in 2010 or ’11,” he said. “And so, it’s our responsibility to make sure there’s a good return on those investments.”

Lawmakers in Louisiana and Alabama, which received $1 billion each from BP for economic damages, are using their settlements to fill budget holes, fund Medicaid and build roads and bridges. Mississippi House Speaker Philip Gunn said he insisted his state spend its share of BP money “in a way that would result in greater economic prosperity for the region.”

Lawmakers in Jackson decided they would choose how to spend $477 million over 15 years, but they created an advisory board to offer input from business leaders.

“We’re held accountable,” state Rep. John Read said in an interview, explaining why legislators decided to choose projects themselves. “It came down to this: How many votes did you get the last election?”

Each year, $30 million in BP money is earmarked for the six counties closest to the coast. That’s separate from BP money directed to environmental restoration and other purposes.

Workers skim a patch of weathered oil near a boat ramp in Gulfport, Mississippi, in July 2010. (Amanda McCoy/Sun Herald)

From the beginning, business leaders wanted to see the restoration fund used for “transformative” economic development in a region that has seen little in the way of new industries since casinos arrived in the 1990s.

Instead, the law outlines 15 priorities. Some are the sorts of things you’d expect to see in such a program, including job creation, measurable return on investment and projects that are "transformational for the future of the region.”

Other priorities in the law give legislators broad latitude to approve all sorts of proposals. For example, projects can enhance quality of life, which includes recreation, and can be supported by multiple public or private entities.

“This is a laundry list of economic development platitudes from 10,000 feet up that could be used to justify almost any use,” said Greg LeRoy, executive director of Good Jobs First, a nonprofit that advocates for accountability in economic development.

The Mississippi Development Authority accepts applications for funding. It scores them based on the priorities laid out in the law and passes them to the Gulf Coast Restoration Fund Advisory Board for input.

A proposal to build a public safety complex in Bay St. Louis received a score of 7 out of 45 from the Mississippi Development Authority and was not recommended by the advisory board. The project was granted $1 million by the Legislature. (Obtained and annotation added by the Sun Herald and ProPublica)

By the end of each year, the development authority is required to pass its recommendations, along with the advisory board’s input, on to the Legislature. State lawmakers representing the six South Mississippi counties meet privately to decide which projects to fund, not all of which have gone before the board.

The projects are voted on in the final frenetic days of the legislative session, when lawmakers meet late into the evening to divvy up money from various sources.

Coastal legislators said they consider the advisory board’s advice, but don’t feel compelled to follow it. In the restoration fund’s first year, 11 of the 26 projects funded by lawmakers didn’t go before the advisory board.

Former state Rep. Jim Simpson, who serves on the board, said the law gives legislators final say.

“They asked us for advice, but they didn’t give us a checkbook,” Simpson said. “And I’m not sure everybody on our committee understood the distance between our advice and the checkbook.”

$50 Million to Create Few Jobs on the Mississippi Coast

Before spending any money, economic development experts say, officials should decide how they’ll measure return on investment. Common metrics include jobs, tax revenue and private spending.

By any of these measures, the renovation of the historic Quarles House in Long Beach, Mississippi, built in the 1890s for the city’s first teacher, would not pass muster. The two-story clapboard house with a center gable sits in a modest neighborhood about a half-mile from the beach.

The building has been vacant since Hurricane Camille in 1969, said Carol Paola, a Long Beach teacher championing the project. Camille ripped off verandas that once graced the first and second floors. The house’s doors and windows are boarded up, but the interior is in remarkably good shape, she said.

The city hopes to turn the house into a venue for weddings and community events. State lawmakers approved $2 million for renovations.

The next step, as with all projects awarded BP economic development money, is a signed grant agreement between the development authority and the grant recipient. The agency requires certain paperwork first: a cost estimate, a budget, a timeline and, for government-sponsored projects, a resolution of support.

Grant applicants are supposed to submit supporting documents up front when applying for funds. But the Quarles House was one of the projects that bypassed the advisory board, and some documentation was missing. Almost two years after lawmakers awarded the money, the state is waiting on required paperwork from the city of Long Beach, no grant agreement has been signed, and the money is sitting unused in a state account.

The Legislature granted $2 million for renovations to the Quarles House in Long Beach, Mississippi. Two years later, the state is waiting on paperwork from the city to issue the grant. (Hannah Ruhoff/Sun Herald)

The payoff for the state’s investment, whenever it cuts the check? The city hopes to create one part-time job, according to its records. Meanwhile, Mayor George Bass said he hopes events at the historic home will bring in enough money to cover maintenance and insurance costs — the sort of collateral expense that development experts say local governments should avoid when using one-time funds for economic development projects.

Many of the projects that have gotten restoration fund money are like the Quarles House, with no way to judge return on investment. The majority of projects with grant agreements have no private funding, according to state records. And most of the grant agreements include no commitment to create jobs.

“Even the most lax economic development programs at least make a showing of ‘We care about the number of jobs,’” said Rachel Weber, a professor of urban planning and policy at the University of Illinois, Chicago. “So for every dollar coming out of this fund, how many jobs are the recipients claiming to make?”

The $1.6 million average cost per job is driven up largely by the number of government projects that are not expected to create any jobs, according to an analysis by the Sun Herald and ProPublica. Not counting those projects, just seven grant agreements have been signed with private and nonprofit entities. Those projects, which have received about $10.9 million, promise 26 jobs — about $421,000 per job.

That’s “far too high for Mississippi taxpayers to ever come close to breaking even,” said LeRoy, of Good Jobs First.

He said his organization has long advocated for a cap of $35,000 per job. A 2016 Good Jobs First study found that at least 19 states imposed some dollars-per-job caps, and that “the caps are quite low, seldom exceeding four figures.”

In Florida, the average cost per job for public infrastructure projects between 2018 and 2021 was $36,391, Harper said. Those are jobs promised in grant agreements and funded through the state’s BP-funded economic development program.

Some project applications in Mississippi promise lots of jobs, but those figures don’t make it into grant agreements, which is the mechanism the development authority uses to hold grant recipients accountable. An initial application by the city of Diamondhead for improvements to a commercial district, for example, said the project would create 596 jobs, but under its grant agreement the city isn’t required to create any.

Much of the BP economic development money is going to local governments, and Miller, the development authority’s chief operations officer, said the agency can’t hold government bodies responsible for ensuring that private businesses eventually create those jobs.

That’s not an issue in Florida, where public infrastructure projects get BP money only if they commit to creating new jobs. Triumph Gulf Coast works with economic development officials in eight counties along the Florida panhandle to identify public projects that will attract private companies offering jobs.

For an industrial park in Florida’s Santa Rosa County, county commissioners guaranteed 454 new jobs that would pay at least 15% above the prevailing county wage, said Harper, the adviser with Triumph. The jobs must be created no later than February 2027, five years after Triumph agreed to fund the project, or the county must return some of the $15.4 million grant to the state.

In Mississippi, job creation goals are far more modest — when they exist. The Walter Anderson Museum of Art in Ocean Springs, for example, promised to create two jobs in exchange for a grant of about $750,000, for one of two projects at the museum recommended by the advisory board. Julian Rankin, the museum’s executive director, said the museum has met that commitment.

State Rep. Manly Barton, a member of the House appropriations committee, said those projects often improve the quality of life.

“I’m not trying to defend it one way or the other,” Barton said. “Sometimes, it is community development, as opposed to economic development. But I think one kind of goes hand in hand with the other.”

That’s how state Rep. Richard Bennett defended the funding for the Quarles House: an investment in “quality of life” for weddings, receptions and student banquets. “In Long Beach right now,” he said, “there’s nowhere in the city we can do those things.”

Doors and windows are boarded up at the Quarles House. Even if the renovation goes forward, the building will be able to handle only small events, because it doesn’t have a catering kitchen or much room for parking. (Hannah Ruhoff/Sun Herald)

Even if the renovation goes forward, the building will be able to handle only small events, because it doesn’t have a catering kitchen or much room for parking. Another venue with a professional kitchen, located on prime beachfront property about 6 miles away in Gulfport, hasn’t lived up to its promise as a wedding venue.

While several legislators believe downtown projects will draw new residents and increase tax revenue, the jobs described in those proposals include retail and restaurant work, which traditionally pay low wages. For May 2021, food service and sales were among the top three occupations across three coastal counties.

Mississippi has long been starved for high-paying jobs, historically ranking last among states for median household income. The average hourly wage for the three coastal counties was 20% below the national average in May 2021, according to the Bureau of Labor Statistics.

“Job growth has not been terrible,” said William Fruth, president of Policom, a research company that ranks the economic strength of communities, “but the wages in the area are terrible.”

Several projects funded with BP money directly advance the kinds of innovation and technology that outside experts say lead to higher-wage jobs. But only one stipulates an average wage: $50,000 a year for four jobs at Mississippi State University’s Cyber Center, which plans to train military and other personnel in cybersecurity.

John Hairston, CEO of Hancock Whitney, which operates banks along the Gulf Coast, said he’s looked to see if the state has publicized outcomes for the investments made with the BP money. He hasn’t found any sign that it has.

“In my adult lifetime, I don’t recall ever seeing that sort of opportunity,” Hairston said. “Every nickel spent on anything that doesn’t create direct, trackable jobs or tax revenue is a missed opportunity.”

No Plan for Spending BP Money

Many of the projects that have received restoration fund grants are the sorts of things you’d see in a local government budget or a state bond or transportation bill: $2.1 million for a levee to protect 200 homes in a Gulfport subdivision. Nearly $500,000 to upgrade a crumbling roadway in George County. Another $1.9 million for Friendship Park in Picayune.

The Mississippi Development Authority scored those projects no higher than 6 out of 45. None were recommended by the advisory board. Legislators funded them anyway.

Although they offered explanations for many of the projects, several legislators acknowledged there isn’t an overall plan guiding their decisions. They said they spread money across their districts and turn to the fund when they can’t find money elsewhere.

Barton said the levee was funded because it would receive matching dollars from the federal government. “They weren’t going to get the money from anywhere else,” he said.

Timothy Bartik, senior economist at the W.E. Upjohn Institute for Employment Research in Kalamazoo, Michigan, reviewed a list of approved projects and the jobs promised, if any.

“I would say it’s a more speculative economic development impact,” he said, “in the sense that who knows exactly how much these infrastructure projects improve amenities and improve quality of life in a way that will attract people and jobs.”

An economic development strategy “is meaningless if what you say is ‘We’re gonna do everything,’” Bartik said. “Because you can’t do everything. You have a limited amount of money. And so you need to prioritize.”

The development authority has suggested a change to the system: The second year of the grant program, it asked lawmakers to send the money straight to the agency so it could select proposals. An agency official said in a letter to lawmakers this would enable the agency to fund projects that deliver “an appropriate return” on the state’s investment.

The Legislature rejected the suggestion.

Without a plan to guide their actions, lawmakers have responded to requests like the one that came from the head of George County’s health system. Greg Havard, CEO of the George Regional Health System, went directly to legislators to secure a $1 million grant to expand its cafeteria. In exchange, the hospital promised to create four jobs.

A cafeteria worker restocks for lunch at the George Regional Health System’s hospital in Lucedale, Mississippi. The cafeteria was expanded with $1 million from the state. (Hannah Ruhoff/Sun Herald)

Havard said the expansion is a boost to the economy of the rural county on the Alabama state line. More importantly, he said, the expanded cafeteria gives families a place to talk, and it’s easier to feed residents and staff.

Edwards, the advisory board chair, questioned the investment. “I’m sure that was a real need for them,” he said. But what is the return on investment, he asked, for a hospital cafeteria renovation in George County?

Havard said the cafeteria has four full-time employees and two part-time ones, including a few involved in food preparation and a clerk, and it has exceeded revenue expectations. The return on investment might be small, he said, but the project will pay for itself “in just a few short years.”

Edwards chose his words carefully when talking about how legislators are running the program. “They want to do everything they can to bring the bacon back home to their constituents,” he said. “We’re not in opposition to that.

“I just think that we would prefer to have a more comprehensive, more thoughtful strategy and shared vision around how to get the most bang for our buck.”

How Long Will It Take to Transform South Mississippi’s Economy?

This spring, a state income tax cut consumed much of the Legislature’s attention, making for some long nights at the close of the session. Many days, 80-year-old House Appropriations Chair John Read left the ornate Capitol building after midnight as talks wound down and the Senate and House settled on appropriations, including projects the Gulf Coast Restoration Fund would cover.

Jenner, one of the advisory board members, has complained to legislators about their approval of projects that haven’t been vetted by the board. This year, the Legislature selected only one project without an application: the third phase of the Cyber Center, spearheaded by Mississippi State University.

While it’s the Legislature’s prerogative to approve projects that bypass the board, Sen. Brice Wiggins said, “I think we recognize that that’s not the best approach.”

Nonetheless, this year the Legislature again funded several government proposals with few, if any, job projections. A public safety complex for the city of Bay St. Louis received $1 million; its application says no jobs will be created. The restoration of the Long Beach harbor will cost $1 million and would create one job, according to its application.

Read believes a number of projects the Legislature approved, including the Cyber Center, show potential for transforming the economy. He said he thinks it’s a good sign that none of the projects approved so far have “tanked.”

“To me, ‘transformative’ is how many people are going to be working down the road, and I think that’s going to have to come with time,” he said.

And that’s once the checks have gone out. About $99.2 million out of $112.5 million granted over the first three years of the program hadn’t been spent as of June 15, according to the development authority. Almost half of the 44 projects funded in 2020 and 2021 still await grant agreements as of June 15.

Several advisory board members said they want to take a more targeted approach in upcoming years.

Edwards would like to see local governments band together to propose projects with regional scope, with more backed by private investment and outcomes measured in terms of jobs with good pay.

Advisory committee member Moses Feagin, who also serves as the chief financial officer at Mississippi Power, said he would prefer that the state hold on to its money and let the fund accumulate for a large private manufacturing or business prospect that would lift wages across the region.

Feagin said he usually rejects local government projects that could secure funding elsewhere. If lawmakers award $2 million here and $3 million there, he said, “Realistically, you ask yourself, what difference is that going to make?”

A binder of applications for grants from the Gulf Coast Restoration Fund (Hannah Ruhoff/Sun Herald)

Alex Mierjeski contributed research. Ryann Grochowski Jones contributed data reporting.

by Justin Elliott, Jeff Ernsthausen and Paul Kiel

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In the high-stakes world of high-speed, short-term securities trading, investors can reap massive payouts but often face higher tax rates due to the nature of their business. But one of America's richest men somehow earns billions from speedy trades while paying a tax rate lower than many middle-class Americans.

The Man

Among dozens of Wall Street billionaires whose tax returns ProPublica examined, one stood out: Jeff Yass of Susquehanna International Group.

The Mystery

Yass consistently pays lower tax rates than his peers, even as he has risen to be one of the top 10 highest earners in the country, receiving more than $1 billion per year in income. He paid an average federal income tax rate of just 19% in recent years, far below what many of his fellow Wall Street billionaires pay. That has saved Yass more than $1 billion in taxes over six years, ProPublica estimates.

What has made this pattern all the more remarkable is the nature of Susquehanna’s business: The firm was built on high-frequency trading, which tends to produce short-term gains; these are taxed at around 40%. And yet, year after year, Yass’ income has been taxed almost entirely at the 20% rate reserved for longer-term investments. (For more details, read our full story.)

So How Does He Do It?

ProPublica spoke to former Susquehanna employees and examined court records, securities filings and tax records to find out how Yass managed this. Taxes, according to Yass’ former colleagues, are an obsession for the billionaire and his fellow executives. As one former employee put it, “They hate fucking taxes.”

Susquehanna has crafted aggressive multibillion-dollar trading strategies that appear designed to slash its tax bill.

One main engine of Yass’ tax avoidance, ProPublica found, is a huge investment fund called Susquehanna Fundamental Investments. Every year, like clockwork, the fund effectively wipes out hundreds of millions of dollars worth of Yass’ income that would otherwise get hit at the highest tax rates, while generating hundreds of millions in income that is taxed at the lower rate.

Regulatory filings give a glimpse of the fund’s trading. The fund has to disclose a snapshot of certain holdings to the Securities and Exchange Commission a few times each year, though many types of trades are exempt from disclosure.

Over several years, the fund held billions of dollars of individual stocks in such companies as Google, Wells Fargo and Coca-Cola. These stocks are among the largest companies in the S&P 500 index. Meanwhile, the fund also held a large bet against the S&P 500. In essence, it held a bet against many of those exact same stocks.

Experts say that the counterintuitive strategy of simultaneously betting for and against the market can yield tax benefits. Essentially, it can offer a relatively low-risk way to generate short-term losses and long-term gains.

The short-term losses can be used to wipe away other short-term gains that would get taxed at almost 40%. Yass’ high-speed trading business generates hundreds of millions of these gains each year. The long-term gains replace the lost income, but get taxed at a much lower rate of around 20%. For every $100 run through this process, a trader would net from $17 to $20 in tax savings, depending on prevailing rates.

The IRS Says You Can’t Do Straddles, But…

Because of the potential for abuse, there are intricate rules in the tax code barring certain kinds of bets for and against the same securities. These are known as “straddles” because the trader is standing on both sides of the same bet. (For a step-by-step on how straddles work, read our full story.)

It’s not clear whether the IRS has ever challenged Susquehanna Fundamental’s trades. But the agency has gone after Yass and his partners in other cases, resulting in bills for back taxes totaling more than $100 million.

In one recent case, the IRS found that Susquehanna violated restrictions on betting for and against the same stocks. Court records from the case show the firm bought more than $1 billion worth of Swiss stocks, while taking out equal bets against the same stocks at the same time and claiming tax savings in the process.

The firm is disputing that the trades were designed primarily to save money on taxes, and in 2020 sued the IRS in federal court to dispute its tax bill. It has maintained in court filings that it complies with all legal requirements. The case is still pending.

A spokesperson for Susquehanna and Yass declined to comment in response to detailed questions from ProPublica.

Yass And His Partners Paid Only the Low Tax Rate, Unlike Other Wall Street Billionaires

Ordinary income — including from short-term stock trading — was taxed at about 40% for high earners in 2017. But special kinds of income, like gains from long-term investments, were taxed at around 20%. This chart shows what percentage of each person’s taxable income was taxed at that lower rate in 2017.

Note: ProPublica contacted representatives for each of the billionaires listed here. All of them declined to comment. (Source: IRS records, ProPublica analysis. Image credits: Eddie Malluk, Laura Goldman, Jemal Countess, Mark Lennihan, Ryan Muir for The New York Times, Thos Robinson, Misha Friedman, Patrick McMullan)

by Ariana Tobin and Ava Kofman

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In a settlement announced by the Department of Justice on Tuesday, Meta Platforms — formerly known as Facebook — has agreed to eliminate features in its advertising business that allow landlords, employers and credit agencies to discriminate against groups of people protected by federal civil rights laws.

The deal comes nearly six years after ProPublica first revealed that Facebook let housing marketers exclude African Americans and others from seeing some of their advertisements. Federal law prohibits housing, employment and credit discrimination based on race, religion, gender, family status and disability.

For years, ProPublica and other researchers showed that problems persisted in the delivery of advertisements related to housing, employment and credit, even as Facebook pledged to fix the loopholes that we identified.

This week’s settlement was the result of a lawsuit brought three years ago by the Trump administration alleging that Meta’s ad targeting system violated the Fair Housing Act. The DOJ also argued that Facebook used a machine learning algorithm to restrict and create ad audiences, which had the effect of skewing delivery toward or against legally protected groups. This was the first time the federal government challenged algorithmic bias under the Fair Housing Act.

As part of the settlement, Meta has agreed to deploy new advertising methods that will be vetted by a third-party reviewer and overseen by the court.

The company said in a statement that it will implement a “novel use of machine learning technology that will work to ensure the age, gender and estimated race or ethnicity of a housing ad’s overall audience matches the age, gender, and estimated race or ethnicity mix of the population eligible to see that ad.”

The statement, by Roy L. Austin Jr., Meta’s vice president of civil rights and deputy general counsel, noted that although the settlement only requires Facebook to use its new tool for advertisements related to housing, it will also apply to posts about employment and credit. (Facebook declined a request for additional comment.)

Civil rights attorney Peter Romer-Friedman, who has brought several cases against the company, said that previous negotiations had tried and failed to hold Facebook accountable for algorithmic bias. “Ultimately what this shows is that it’s never been a question of feasibility to eliminate algorithmic bias,” he told ProPublica. “It’s a question of will.”

After we reported on the potential for advertising discrimination in 2016, Facebook quickly promised to set up a system to catch and review ads that discriminate illegally. A year later, ProPublica found that it was still possible to exclude groups such as African Americans, mothers of high school kids, people interested in wheelchair ramps and Muslims from seeing advertisements. It was also possible to target ads to people with an interest in anti-Semitism, including options such as “How to burn Jews” and “Hitler did nothing wrong.”

We later found that companies were posting employment ads that women and older workers could not see. In March 2019, Facebook settled a lawsuit brought by civil rights groups by creating a “special ads portal” specifically for employment, housing and credit ads. The company said the portal would curb advertisers’ targeting options and also limit its algorithm from considering gender and race when deciding who should see ads.

But when ProPublica worked with researchers at Northeastern University and Upturn to test Facebook’s new system, we found more examples of biased ad delivery. Though Facebook’s modified algorithm prevented advertisers from explicit discrimination, delivery could still rely on “special ad” or “lookalike” proxy characteristics that correlated with race or gender.

The research also found that Facebook skewed the audience depending on the content of the ad itself. How many women might see a job listing for an open janitorial position, for instance, depended not just on what the advertiser told Facebook, but also on how Facebook interpreted the advertisement’s image and text.

ProPublica also continued to find employment advertisements that favored men or excluded older possible applicants, potentially violating civil rights law. Some advertisers we interviewed were surprised to learn that they were unable to reach a diverse audience, even if they tried.

In a press release, the DOJ said Tuesday’s settlement requires Meta to stop using the “Special Ad Audience” tool by the end of the year. It also requires Meta to change its algorithm “to address disparities for race, ethnicity and sex between advertisers’ targeted audiences and the group of Facebook users to whom Facebook’s personalization algorithms actually deliver the ads.” The company must share details with the DOJ and an independent reviewer before implementing changes.

As part of the settlement, Meta also agreed to pay a $115,054 fee, the maximum allowed by the law.

“Because of this ground-breaking lawsuit, Meta will — for the first time — change its ad delivery system to address algorithmic discrimination,” U.S. Attorney Damian Williams for the Southern District of New York said in a statement. “But if Meta fails to demonstrate that it has sufficiently changed its delivery system to guard against algorithmic bias, this office will proceed with the litigation.”

by Annie Waldman, ProPublica, Beth Schwartzapfel, The Marshall Project, and Erin Einhorn, NBC News

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This article was published in partnership with The Marshall Project, a nonprofit news organization covering the U.S. criminal justice system, and NBC News. Sign up for The Marshall Project’s newsletters and follow them on Twitter, Instagram and Facebook.

Lawmakers in Louisiana passed new restrictions on the use of solitary confinement in juvenile facilities following an investigation by The Marshall Project, ProPublica and NBC News into harsh conditions in a youth lockup.

The law, which will go into effect Aug. 1, marks the first time that lawmakers in a state known as the world’s incarceration capital have put limits on solitary confinement for youth, advocates say.

The news organizations’ investigation found that in one of the state’s facilities, the Acadiana Center for Youth at St. Martinville, boys as young as 14 were held in solitary confinement virtually around the clock for weeks. The boys were forced to sleep on the floor in the dark and were shackled when they left their cells to shower. In this facility, which opened last summer, the teens received no education for months, in violation of state and federal law.

The conditions were so severe, one expert said, they amounted to “child abuse.”

St. Martinville opened despite an ongoing debate about the dangers of solitary confinement in Louisiana’s juvenile lockups, a controversy that began in 2019 after two teens in a different facility died by suicide in solitary confinement within 72 hours.

Rep. Royce Duplessis, a New Orleans Democrat and the bill’s sponsor, said he didn’t think the legislation would have been successful without reporting from NBC News, The Marshall Project and ProPublica, which brought crucial attention to the conditions in juvenile facilities.

“It showed the public, it showed legislators that some things were happening that nobody should be proud of,” Duplessis said. “It showed we need to make some changes.”

Advocates say the new law, signed by Democratic Gov. John Bel Edwards on June 16, will improve conditions at facilities like St. Martinville.

“I’m not expecting this to be a panacea, but the law makes a clear statement about what’s expected of them, and that is something that hasn’t been there before,” said Rachel Gassert, policy director at the Louisiana Center for Children’s Rights. “And unlike agency policy, it cannot be changed behind closed doors by political appointees.”

The Acadiana Center for Youth at St. Martinville (Bryan Tarnowski for NBC News, The Marshall Project and ProPublica)

The new law places strict constraints on how the state juvenile justice agency can use solitary confinement, limiting young people to no more than eight hours in isolation unless they continue to pose a physical threat to themselves or others. The agency is also required to, within the first hours of placing children in solitary confinement, check on their mental health and to notify their parents or guardians. The law additionally compels the agency to better track and report the use of isolation in its facilities.

With the new law, Louisiana joins about one-third of states that have laws restricting the use of solitary confinement for youth. Many of the remaining states lack any policies limiting solitary confinement at all.

When Duplessis introduced the solitary confinement bill in March, he wasn’t confident it would win enough support to pass.

“This is Louisiana,” he said. “We have a history, a long history of being punitive, and our history with respect to juvenile justice has not been a good one.”

When the bill came before a House committee in April, several Republican lawmakers initially expressed skepticism, raising concerns that the bill would tie the hands of juvenile justice authorities who have been dealing with escapes and violence at their facilities.

But after a hearing in which young people shared stories about the trauma they experienced in solitary confinement, the committee unanimously voted to advance the bill. It later passed both legislative houses by large margins after Bill Sommers, who leads the state’s juvenile justice agency, threw his support behind the measure.

The House hearing took place just days after a legislative auditor released a report that found that the state’s juvenile justice agency often violated its own rules on isolation, which allowed the state to hold youth in solitary confinement for up to seven days. In 2019 and 2020, about 40 percent of solitary confinements exceeded the maximum duration allowed under agency policies. The audit found that, on average, confinements lasted about six days, more than 14 times as long as the national average as of October 2020.

The bill initially would have limited time in solitary to no more than four hours, but after legislative negotiations, it was amended to allow isolation for up to eight hours at a time and up to three stints in a row, for a maximum of 24 hours. During that time, a mental health professional must try to help the person in solitary calm down at least every hour and staff must check on them every 10 minutes. The law also requires that the state provide juveniles in solitary confinement with reading materials, access to sunlight and an opportunity to contact their parents or guardians and their attorneys.

The law does not apply to juvenile facilities that house minors who’ve been accused but not convicted of crimes because those facilities — mostly run by local jurisdictions — are regulated by the state’s child welfare agency, which already has policies limiting solitary confinement.

The law covers youth prisons run by the state’s Office of Juvenile Justice, which isn’t subject to oversight by other agencies, but youth and their families will now be able to take the agency to court if it violates the law. “We finally have tools with which to hold them accountable, when previously we had none,” Duplessis said.

Medical experts and youth advocates have long decried the use of solitary confinement, saying it can lead to depression and, in some cases, psychosis. The practice is considered particularly harmful for youth, whose brains are still developing. The American Medical Association, the American Psychological Association and the United Nations have all condemned the practice. In 2016, the federal government banned solitary confinement for juveniles at its facilities, citing the harm that isolation can cause. More than half of suicides in juvenile facilities involve children who are, or recently were, in isolation, research has found.

Solan Peterson died by suicide while in solitary confinement at a Louisiana juvenile detention facility. (Courtesy of Peterson Family)

One of the boys whose deaths prompted the recent debate about solitary confinement for juveniles in Louisiana was Solan Peterson, 13. He was placed in solitary after his arrest in 2019 for allegedly setting toilet paper on fire in the bathroom at his middle school. Solan was in a private detention facility that holds minors accused of crimes. That facility would not be affected by the new law, but Solan’s father, Ronnie Peterson, applauded its passage as positive development, though he said he would like to see solitary confinement abolished altogether. “It is encouraging. I think it’s a good step. I just don’t think it’s enough,” he said.

Lawmakers held hearings last year on the use of solitary confinement in juvenile facilities, ultimately ordering the auditor’s report. Despite that scrutiny, the state’s Office of Juvenile Justice last summer quietly opened St. Martinville. The new facility was set up to isolate teens in cells for weeks or months at a time.

Sommers initially defended the state’s actions at St. Martinville, describing the facility as “born of necessity,” in the wake of several high-profile, violent incidents at dormitory-style facilities as the agency struggled to find enough staff.

But during hearings for the new legislation, Sommers acknowledged the state needed to make changes to the way it handles solitary confinement.

“There is no doubt that we have a severe staffing shortage, but this is the right thing to do here,” he told lawmakers.

D’Angelo Davis, 21, testified in the House in April that during the four years he spent in state juvenile facilities, staff typically used solitary confinement unfairly. Isolation provided none of the therapeutic or educational benefits that juvenile facilities are meant to provide, he said.

In a recent interview, Davis praised the passage of the bill, adding that it showed that lawmakers “actually care about what’s going on with kids.”

“Think about yourself inside of a four-wall box. You go days without showering, you barely eat the food they give you,” he said of his experience. “Once you see yourself, you don’t even look like yourself. You’re a whole different person. … It deteriorates you.”

If you or someone you know needs help, here are a few resources:

• Call the National Suicide Prevention Lifeline: 1-800-273-8255
• Text the Crisis Text Line from anywhere in the U.S. to reach a crisis counselor: 741741

by Mark Olalde

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for Dispatches, a newsletter that spotlights wrongdoing around the country, to receive our stories in your inbox every week.

This story was co-published with The Salt Lake Tribune.

Utah policymakers billed the 2022 legislative session as the “year of water.” Gov. Spencer Cox signed into law more than 15 measures related to water conservation, heralding “generational” progress as the West’s megadrought continues well into its third decade.

Those pieces of legislation allow farmers to earn money by sending their water downstream to shrinking lakes, require water meters for landscaping, appropriate $40 million to protect the Great Salt Lake and more. But perhaps more telling were proposals that lawmakers carved up or voted down.

Legislators in the country’s fastest-growing and second-driest state rejected a bill meant to address leaky pipes. New laws aimed at mandating low-flow plumbing both in state facilities and new homes had to be scaled back to win passage. And regulations on Utah’s lush green lawns remained largely off-limits, as interest groups stalled or rewrote bills targeting grass.

A ProPublica investigation last year found that Utah’s water policy was largely controlled by a group of water districts and allied special interest organizations and politicians who prioritized building new water projects over conservation.

ProPublica reviewed water-related proposals again following this year’s legislative session, including minutes from committee meetings, lawmaker testimony and internal communications obtained via public records requests. The analysis showed the Legislature remains hesitant to act quickly on water conservation or on a scale that fully reflects the region’s dire situation, in part due to the influence of a rotating cast of special interest groups.

With little new water to tap, Utah is running out of time to reduce the amount that residents use on a daily basis. The Bureau of Reclamation announced in mid-June that Colorado River Basin states might have to cut water use by as much as a quarter next year, compared with average consumption.

“Is it the year of water?” asked Zach Frankel, executive director of environmental advocacy group Utah Rivers Council. “The answer is, ‘Hell no.’”

The Grass Is Always Greener

The water conservation debate in Utah and around the West often focuses on residential use because taking water from farmers and appearing unfriendly to the agriculture industry remains a political third rail. In Utah, outdoor landscaping accounts for about two-thirds of residential water consumption, and a growing consensus around the region sees tearing out lawns as a key strategy to alleviate the strain on the overdrawn Colorado River.

At least five members of the Utah House of Representatives began the session intending to address the grass question. Two bills passed. One gave the Utah Division of Water Resources approval to spend up to $5 million annually on turf removal incentives, but the bill didn’t appropriate money to do it; the other prohibited municipalities from banning water-efficient landscaping or mandating grass on park strips, the narrow bands between the sidewalk and the street. Towns have grabbed headlines for threatening to fine residents who replaced lawns with water-saving alternatives.

Utah remains behind other Western states on removing grass.

California banned irrigating ornamental turf, such as landscaping on a highway median. In Colorado, lawmakers passed a bill to create a turf removal system. And Nevada, leading the fight against grass, passed a law in 2021 banning the roughly 40% of turf in the Las Vegas metro area that sees little public use. The Southern Nevada Water Authority, the area’s water wholesaler, has also increased the amount it pays property owners to remove turf from $0.40 per square foot in 1999 to $3 in 2018, and it spent nearly $269 million since 1999 to replace nearly 205 million square feet of grass with less water-intense landscaping.

The largest water district in Utah, the Central Utah Water Conservancy District, pays up to $1.25 per square foot at residential properties and $2 at commercial facilities and has ripped out about 233,000 square feet in recent years. The district’s proposed budget for fiscal year 2023 includes $1.6 million for turf removal. In southwestern Utah, the Washington County Water Conservancy District and the towns it serves are removing nearly 600,000 square feet of grass, and local municipalities are working on ordinances to ban or cap the amount of turf allowed on certain properties.

“We recognize in Utah in a lot of ways we’re behind what Colorado and some of our neighboring states have done, and we as a state are focused,” said Rep. Gay Lynn Bennion, a Democrat who worked on turf legislation this session.

But internal communications suggest Utah is stymied by politicking, with groups such as the Utah League of Cities and Towns, which lobbies on behalf of municipalities, fighting against aggressive policy.

Rep. Raymond Ward, a Republican, proposed a bill to prohibit municipalities from requiring grass lawns. In January, he told ProPublica his idea ran into early opposition from the league, “who I knew would be the chief opponent because it impinges on what they think is their birthright, which is zoning,” he said.

Ward tweaked his proposal to assure the league that the bill wouldn’t get in the way of municipalities’ beautification ordinances. The group toned down its opposition, Ward said, but lobbyists from homeowners associations continued to attack and the bill failed.

A similar turf law did pass — one endorsed by lobbyists from municipalities and water districts — that Ward described as a “watered down version” of his bill.

Sponsored by Republican Rep. Ryan Wilcox, that bill would’ve prohibited municipalities from requiring that grass cover more than 35% of a property’s irrigated area.

On the same day the House unanimously passed the bill, Justin Lee, the Utah League of Cities and Towns’ director of government relations and a registered lobbyist, emailed Wilcox: “With a few tweaks we think there is potential to get our members more excited about this bill.” Meanwhile, the Jordan Valley Water Conservancy District’s general manager, assistant general manager and general counsel were drafting substitute language.

Jordan Valley Water Conservancy District staff drafted substitute language for HB282 the day an earlier version of the bill passed the House. (Obtained and annotated by ProPublica)

Wilcox met with Lee, the water district and several towns, and later that week he sent Lee a proposed bill substitute. “Please Review,” Wilcox wrote. Lee responded to the legislator, “This is exactly what we were looking for.” Wilcox introduced the substitute, and Lee showed up to support the bill, which had been changed to keep most decision-making on landscaping with local municipalities.

In an interview, Lee said that the league isn’t opposed to all grass-related legislation and that limiting irrigated turf could be considered at some point. The group’s main concern this year was preserving municipalities’ authority to write local rules, such as beautification ordinances, he said.

Bart Forsyth, Jordan Valley Water Conservancy District’s general manager, said he wanted to ensure Wilcox’s bill wouldn’t get in the way of cities that were already implementing water efficiency standards. His district got involved, Forsyth said, because other groups were opposed and “for the bill to pass, some changes would likely be needed.”

Wilcox declined to comment.

The Utah League of Cities and Towns has opposed turf bills for years. In 2016, then-Sen. Scott Jenkins, a Republican who was upset that a local ordinance compelled him to plant a lawn around his plumbing wholesale warehouse in Orem, filed a bill to curb such mandates. Jenkins told ProPublica that the league doomed the bill.

“Considering the fact that we’re hurting for water right now, especially in Utah and in the West, that’s just so dumb to do,” Jenkins said. “They ask us to not turn our faucets on or shut them off when we’re brushing our teeth, but they’re just flat out wasting water here.”

The league’s position statement on that year’s legislation noted that Jenkins did not first run the bill past a group consisting of the league and others representing towns, real estate and development interests. The bill died on the Senate floor.

“People are realizing we need to do things differently,” Lee said. “I think some of the pushback you saw in previous years is just not going to be as big going forward.”

Pulling Punches in the Legislature

With less pushback from special interests, Utah’s Legislature had, for it, a banner year on water. Still, bill sponsors were quick to defang water conservation legislation to get it passed.

Republican Rep. Robert Spendlove wrote HB121 to push water-saving measures at state-owned properties. His bill capped how much turf could be planted at new government facilities and called for state agencies to reduce their water use 25% by 2026. But a fiscal note claimed it would cost nearly $215 million to install efficient toilets and faucets, and Spendlove amended the bill to only apply to outdoor water savings.

Spendlove didn’t respond to requests for comment.

There was also a bipartisan push to update plumbing and building codes to require more efficient toilets, showerheads, bathroom sinks and urinals. In a presentation, Democratic Sen. Jani Iwamoto and Forsyth argued that more efficient plumbing fixtures could save 4.5 billion gallons annually by 2030. Much of the bill’s substance eventually passed, but sponsors still had to remove toilets from it in an act of appeasement to a fellow legislator.

“In the Legislature, sometimes it can stop for just one person. Their plumber may have said something,” Iwamoto said, declining to name which lawmaker flushed the key provision because of unsubstantiated fears of clogged toilets. Former President Donald Trump railed against low-flow plumbing fixtures when he was in office.

Even one of the signature bills in Utah’s year of water — requiring meters on secondary water systems that allow unlimited use of untreated water outdoors — was a target. Since 2018, lawmakers had tried and failed to mandate meters statewide, which data found reduced water use by an average of 23% simply because residents saw how much water they used. But emails showed that the Utah League of Cities and Towns and some individual municipalities continued fighting it this session.

The bill passed after legislators gave cities until 2030 to install meters, exempted small counties and provided money to cover as much as 70% of the cost. Not mentioned in various news releases heralding Utah’s commitment to conservation: That money came from the American Rescue Plan Act, the federal COVID-19 stimulus package signed by President Joe Biden.

Lee said a small number of municipalities were worried about secondary meters, and paying for them assuaged those concerns.

But even when state power brokers throw support behind water conservation, it’s sometimes not enough to get through the Legislature.

Rep. Melissa Ballard, a Republican, made a third attempt to require providers to study how much water their pipes and other infrastructure lose, often from leaks, and she presented HB115 with the support of both the Utah Department of Natural Resources and the state’s largest water districts. The bill failed anyway.

Asked what happened, Ballard told ProPublica in an email: “I wish I had an answer for you. Some legislators and water districts didn’t even look at the bill.” The Legislature sent HB115 back to the clerk of the House to be filed with bills that didn’t pass.

The general session ended in March. In April, with all of Utah in a drought, Cox declared a state of emergency. The governor acknowledged the executive order was largely for public awareness and let it lapse a month later.

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by Justin Elliott, Jesse Eisinger, Paul Kiel, Jeff Ernsthausen and Doris Burke

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One day in July 1985, three young men from Philadelphia, their lawyer and a burly Pinkerton guard arrived at a horse track outside Chicago carrying a briefcase with $250,000 in cash.

Running the numbers on a Compaq computer the size of a small refrigerator, Jeffrey Yass and his friends had found a way to outwit the track’s bookies, according to interviews, records and news accounts. A few months earlier, they’d wagered $160,000, gambling that, with tens of thousands of bets, they could nail the exact order of seven horses in three different races. It was a sophisticated theory of the racing odds, honed with help from a Ph.D. statistician who’d worked for NASA on the moon landing, and it proved right. They bagged $760,000, then the richest payoff in American racing history.

But that summer day, when they presented their strikingly long list of bets at the track window, they were turned away. Their appeal to the track owner got them ejected. Yass, just 27, then sued for the right to place the bets. The track’s lawyer fumed to a federal judge that the men were trying to corner the betting market “through the use of their statistics and numbers.”

Yass lost, but that year he and his friends repeated variations of the strategy at horse and greyhound tracks around the country. Then they decided to turn their focus from a world of hundreds of thousands of dollars to a world of billions: Wall Street.

Four decades later, the firm he and his friends founded, Susquehanna International Group, is a sprawling global company that makes billions of dollars. Yass and his team used their numerical expertise to make rapid-fire computer-driven trades in options and other securities, eventually becoming a giant middleman in the markets for stocks and other securities. If you have bought stock or options on an app like Robinhood or E-Trade, there’s a good chance you traded with Susquehanna without knowing it. Today, Yass, 63, is one of the richest and most powerful financiers in the country.

But one crucial aspect of his ascent to stratospheric wealth has transpired out of public view. Using the same prowess that he’s applied to race tracks and options markets, Yass has taken aim at another target: his tax bill.

There, too, the winnings have been immense: at least $1 billion in tax savings over six recent years, according to ProPublica’s analysis of a trove of IRS data. During that time, Yass paid an average federal income tax rate of just 19%, far below that of comparable Wall Street traders.

Yass has devised trading strategies that reduce his tax burden but push legal boundaries. He has repeatedly drawn IRS audits, yet has continued to test the limits. Susquehanna has often gone to court to fight the government, with one multiyear audit battle ending in a costly defeat. The firm has maintained in court filings that it complied with the law.

Yass’ low rate is particularly notable because Susquehanna, by its own description, specializes in short-term trading. Money made from such rapid trades is typically taxed at rates around 40%.

In recent years, however, Yass’ annual income has, with uncanny consistency, been made up almost entirely of income taxed at the roughly 20% rate reserved for longer-term investments.

Congress long ago tried to stamp out widely used techniques that seek to transform profits taxed at the high rate into profits taxed at the low rate. But Yass and his colleagues have managed to avoid higher taxes anyway.

The tax savings have contributed to an explosion in wealth for Yass, who has increasingly poured that fortune into candidates and causes on the political right. He has spent more than $100 million on election campaigns in recent years. The money has gone to everything from anti-tax advocacy and charter schools to campaigns against so-called critical race theory and for candidates who falsely say the 2020 election was stolen and seek to ban abortion.

ProPublica has pieced together the details of Yass’ tax avoidance using tax returns, securities filings and court records, as well as by talking to former traders and executives. (The former employees spoke on condition of anonymity, with many citing a desire to avoid angering Yass.)

Through a spokesperson, Yass declined to be interviewed for this article. The spokesperson declined to comment in response to a long list of questions for Susquehanna and the firm’s founding partners.

Gregg Polsky, a University of Georgia law professor and former corporate tax lawyer who was retained by ProPublica to review Susquehanna’s tax records, said the tax agency may have more to scrutinize. The strategies revealed in Yass’ records, he said, were “very suspicious and suggestive of potential abuse that should be examined by the IRS.”

Yass And His Partners Paid Only the Low Tax Rate, Unlike Other Wall Street Billionaires

Ordinary income — including from short-term stock trading — was taxed at about 40% for high earners in 2017. But special kinds of income, like gains from long-term investments, were taxed at around 20%. This chart shows what percentage of each person’s taxable income was taxed at that lower rate in 2017.

Note: ProPublica contacted representatives for each of the billionaires listed here. All of them declined to comment. (Source: IRS records, ProPublica analysis) (Image credits: Eddie Malluk, Laura Goldman, Jemal Countess, Mark Lennihan, Ryan Muir for The New York Times, Thos Robinson, Misha Friedman, Patrick McMullan)

More than 35 years after he was booted from the racetrack outside Chicago, Yass still lives to gamble. Not just on horses, but on poker and on the market. He sheepishly admitted, in a podcast discussion, that he has even placed wagers on his children’s sports games.

Asked to describe his approach to trading at Susquehanna, Yass once reached for a poker analogy. “If you’re the sixth-best poker player in the world and you play with the five best players, you’re going to lose,” he said. “If your skills are only average, but you play against weak opponents, you’re going to win.”

That philosophy along with, Yass freely admits, a lot of luck, has made him a billionaire many times over.

Compared to many of his fellow billionaires — he’s richer than Hollywood mogul David Geffen, retail brokerage king Charles Schwab and “Star Wars” creator George Lucas — Yass doesn't seem particularly interested in the trappings of extreme wealth.

Yass and his wife, Janine, raised four children in the leafy college town of Haverford, on the Main Line outside of Philadelphia. Their large but unremarkable house could easily be the home of a successful doctor rather than one of the richest men in the country. In his quarter-zip pullover sweater, Nikes and no-nonsense rimless glasses, he’d be impossible to pick out of a crowd at the suburban country club where he plays golf.

If Yass collects expensive art or maintains a megayacht, he has managed to do so in complete secrecy. What comes closest to an identifiable trophy asset is a house in the ultra-exclusive Georgica Association beach neighborhood of East Hampton on New York’s Long Island. Even that property, purchased for $12.5 million in 2005 and held through an LLC, is in an area known as “bucolic and understated.”

Those who have worked with Yass say he lives less for spending money than for the competition of the market and the thrill of taking calculated risk. Yass softens any impression of ruthlessness by deploying a practiced humility and comedic timing. “Some people like art history,” he once explained, “I like probabilistic analysis.”

Yet when it comes to his philosophical outlook, he eschews the jokes. He speaks of capitalism in religious terms. Making new markets, he likes to say, is a “mission from God.”

Like many religious stories, his begins with a conversion experience. Born in 1958 to two Queens CPAs, Yass said reading the economist Milton Friedman’s “Capitalism and Freedom” as a young man delivered him from an early flirtation with socialism.

By the time Yass graduated from the State University of New York at Binghamton in 1979, he was already captivated by trading. (His father had also helped nurture Yass’ love of horse racing by taking him to local tracks to see harness racing, according to Forbes.) Yass’ college thesis weighed whether the budding market in stock options could be justified as socially useful. “I concluded that it should exist,” Yass later cracked. “I got a B.”

After college, he moved to Las Vegas for a year and a half to play poker professionally. Then he returned to the East Coast and settled in Philadelphia, where he began trading options. The previous decade had seen a burst of academic interest in the financial instruments, including a pioneering model of how to more accurately price them. Yass later called the model, and its broader implications for how to make mathematically sound decisions, “the most revolutionary idea in a long, long time.”

A share of stock is a relatively simple concept: It’s a small ownership stake in a company. An option, by contrast, is a contract that confers the right to buy or sell a given stock at a particular price and time in the future.

Options attract mathematically minded traders since a complex set of variables, including the underlying stock price, volatility, time and interest rates, determine how much one of the contracts is worth.

Options are a versatile tool. They can appeal to the risk-averse: Traders can use them as insurance to guarantee they will be paid at least today’s price when they sell in the future. They are also useful to the risk-embracing — gamblers who want to place outsized bets on how a stock will perform. (Here’s how a speculator would use an option: In early June, shares of Netflix were trading at below $200. If the speculator thinks the company’s fortunes will improve dramatically this summer, they could pay just $4.50 each for options to buy the stock at $250 in mid-August. If the stock soars over that figure, they could make a mint.)

In options Yass found more than a financial instrument. He found a way to view the world. Everything — each decision, each interaction — can be judged based on how much it will cost in money, time or negative consequences and compared with the reward. Then action is taken or avoided accordingly. To Yass’ way of thinking, it’s always worth paying $19 for a 20% chance to win $100 but it’s never worth $21.

Along with his college friends, Yass founded Susquehanna, named after the river that connects Binghamton to Pennsylvania, in 1987. The firm benefited from explosive growth in options markets. Yass later played it down to the Philadelphia Inquirer: “We got lucky being in the right place at the right time.”

One of Susquehanna’s landmark moments — involving perhaps both skill and luck — occurred soon after the firm launched: the Black Monday stock market crash on Oct. 19, 1987. Thanks to an option bet that would pay out if stocks went down, Susquehanna was one of the few firms that made money on one of the worst days in stock market history.

From early on, Yass cultivated Susquehanna’s brand as a home for the biggest brains in finance, hiring Ph.D.s and top students. But the firm wasn’t just looking for raw IQ points. It also wanted instinct. It held poker tournaments to teach traders the idea that taking the measure of your opponents is as important as understanding the odds.

The Binghamton buddies ran a freewheeling office full of arguments and gamesmanship. The office had Super Bowl pools and an officewide lottery. Everyone bet on everything. One time, as recounted in Philadelphia magazine, traders bet on whether Yass could name the last Plantagenet king of England. They called Yass. He spat out “Richard III” and then, according to a witness, yelled, “Get back to work!” But he liked the hijinks.

Still, the firm had an inside vs. outside mentality. If you weren’t with the firm, you were the enemy. When traders left to join a competitor, Susquehanna often sued them for allegedly violating non-compete clauses. Susquehanna stood out for its aggressiveness in trading even by the standards of Wall Street. “If he thinks you’re dumb, he’s betting against you,” one former Susquehanna trader said of Yass. “That’s what makes his blood flow.”

Susquehanna developed a specialty in arbitrage, or finding low-risk profit opportunities in mismatched prices of securities, like stocks or bonds. An early adopter of computers to measure risk and test trading strategies, the firm flourished.

In addition to making his own bets, Yass built his firm into one that stands at the very center of the market and takes bets from other traders. On Wall Street, this job is known as market making.

At its simplest, making a market means offering to buy or sell a thing. The jewelry shop on the corner that will sell you a gold ring and has a “We Buy Gold” sign in the window is making a market in gold. If the store buys a gold coin from a customer for $300, then sells it for $320 to the next person who walks in, the store has made a quick $20.

Susquehanna does the same thing, but with securities. Running a market making firm isn’t always as easy as quickly matching a buyer and a seller. A market maker is expected to post its prices and buy and sell to all comers. If a particular stock has more sellers than buyers, the firm might find itself holding too much, exposing the market maker to losses if the stock price drops. It’s a business that thrives when there’s lots of trading volume but can be dangerous if markets crash.

The market making business in stock options, Susquehanna’s specialty, requires juggling a huge number of trades while constantly keeping an eye on all the various bets to make sure that the firm is protected from unexpected market moves.

In 1996, the year Yass turned 38, he made $71 million, tax records show. By then, the firm was employing hundreds of people. Not long before, Susquehanna staff had gathered in Las Vegas for an annual company celebration. Traders brought their families. The firm’s employees watched the Kentucky Derby together. A Marilyn Monroe impersonator interviewed Yass’ father with some tame double-entendres. The highlight was a skit with a junior trader performing as “Jeff Yass Gump,” after Forrest Gump. “Momma always said I was like the other kids,” the trader said. “But the other kids, they went to Harvard and Yale and the University of Pennsylvania and I said: ‘Momma, why am I at the SUNY Binghamton?’ She said it was because I was special.” The crowd roared, Yass the loudest of all.

Despite losing some star traders in the late 1990s, Susquehanna continued to produce massive profits. Yass and the other co-founders managed to keep their enormous wealth a secret. Even by 2005, when Yass had collected at least $1 billion of lifetime income, he was nowhere to be found in the Forbes list of the richest Americans.

That’s in part because Susquehanna is privately held and trades only its own money, meaning it doesn’t have to publicly disclose much about its business. Like many financial firms, Susquehanna itself is not a single company but a complex and shifting web of legal entities whose profits flow to Yass and a small set of partners.

It has been a remarkably consistent profit machine for the partners, except in 2008, the year of the global financial crisis. Yass alone lost $470 million that year, tax records show. Former Susquehanna traders believe the firm risked going out of business. The danger the firm faced “sent chills through everyone,” said one. Like other big trading complexes that did huge business with investment banks, Susquehanna benefited from the massive federal bailout of Wall Street, which propped up the giant firms that were among its biggest trading partners.

Yass, the free market true believer, now owed the survival of much of his fortune to the U.S. government. On a personal level, Yass also received an extra bonus from the government: a $2,000 child tax credit because he reported losing money that year.

Susquehanna quickly bounced back to profitability. In recent years it has supplanted major banks as one of the firms that sits in the middle of massive daily financial flows in stock and other markets. A Bloomberg profile in 2018 reported that Susquehanna trades 100 million exchange-traded fund shares daily. The firm is a prominent player in cryptocurrencies like bitcoin and, in a throwback to Yass’ origins, the exploding business of sports betting. Susquehanna has also branched out into venture capital. One of those investments came through spectacularly: a large stake in ByteDance, the Chinese company behind the social media app TikTok.

By the 2010s, Yass had become one of the richest Americans. But his ultralow profile meant that almost nobody knew that. At least two of Susquehanna’s other co-founders, Arthur Dantchik and Joel Greenberg, have each made billions of dollars themselves, according to ProPublica's analysis.

Yass hit a new milestone in 2012, pulling in more than $1 billion in a single year, according to tax records; by 2018, his income was $2 billion. In the six years ending in 2018, Yass had the sixth-highest average income in the entire country, according to IRS data.

Yass’ Tax Rate Remained Low Even as His Income Grew to Billions Note: “Income tax” here is calculated using the IRS definition of “total income tax,” which excludes payroll taxes. “Income” is adjusted gross income. (Source: IRS data, ProPublica analysis.)

Court filings and ProPublica’s analysis of tax records suggest that, as of 2018, Yass owned around 75% of Susquehanna, with co-founders Dantchik owning around 19% and Greenberg around 3%. (Greenberg retired in 2016.)

Yass was finally added to the Forbes list last year. The magazine put his worth at $12 billion, which would make him the 58th-richest American. ProPublica estimates his true wealth is likely at least $30 billion — based solely on his income over the decades and stake in ByteDance — which would place him in the top 25.

On a Friday afternoon in April 2010, a Susquehanna trader in Pennsylvania emailed his counterparts at Credit Suisse to make a big bet in the stock market. The email instructed the Swiss bank to buy about $70 million worth of shares in some of Switzerland’s biggest companies on Susquehanna’s behalf.

Three minutes later, the trader sent out a second email, this time to Morgan Stanley. He placed a second bet, now wagering against the exact same stocks in the exact same amounts he’d just ordered from Credit Suisse.

The payoff from such a trade might seem to be nothing at all. But there was a winner and a loser. The winner was Susquehanna. The loser was the U.S. government: Susquehanna had managed to slash its tax bill through the trade. The emails come from an ongoing U.S. Tax Court case filed in 2020. There are rules designed to block clever traders from using offsetting bets to conjure tax savings, and the IRS argues Susquehanna broke them. (More on that case later.)

The firm’s willingness to push the boundaries of tax law is not surprising to people who know Yass and his partners. One former Susquehanna executive recalled Yass acknowledging using a trading strategy in which a main goal was not to make profitable trades, but to avoid taxes. Taxes, according to Yass’ former colleagues, are an obsession for the billionaire. As one former employee put it, “They hate fucking taxes.”

It doesn’t matter how seemingly trivial it is. Susquehanna once petitioned the state of Pennsylvania to demand “a refund of taxes paid on repairs to ice machines.” The petition was denied.

Indeed, the firm has a habit of shaping deals that slash its tax bill and then daring the IRS to intercede. Sometimes, the agency successfully challenges them, as when Yass and his two main partners were hit with a total of $121 million in back taxes in 2019. That was the single biggest such payout in ProPublica’s database of IRS records, which includes thousands of audits of the wealthiest people in the country. Susquehanna paid only after losing a long-running battle with the agency, one the firm appealed all the way to the Supreme Court.

Despite periodically tripping IRS wires, the firm’s aggressiveness seems to have paid off. Susquehanna’s tax avoidance has gone on for years, resulting in a strikingly low tax rate for Yass and his partners, according to ProPublica’s analysis.

The strategy behind that trade back in 2010 is key to understanding how they’ve done it. Similarly to how Susquehanna has taken advantage of small differences in prices of options or stocks, it has found ways to exploit a gap in tax rates to save hundreds of millions of dollars in taxes every year.

For someone like Yass, the U.S. system offers an almost irresistible proposition. If you earn the wrong sort of income — the kind that comes from a short-term trade — you’ll pay a relatively high tax rate. But if you earn the right kind — gains on long-held investments — you’ll pay half as much in taxes.

But what is considered “long-term” involves a bright, arbitrary line. Hold a security for less than 366 days, and you are on the wrong side of that line.

The result is that by the arithmetic of the U.S. tax code, $100 made from a sale on the 365th day is worth around $60 after taxes. And $100 made on the 366th is worth around $80.

Short-term, high-frequency traders like Susquehanna often hold securities for less than 365 seconds. As the company itself put it in one recent court filing, the firm “trades securities, commodities, and derivatives, seeking to earn returns from short-term appreciation and arbitrage profits.” This has been the firm’s consistent self-description. Back in 2004, a staffer was more frank in testimony: “We are not, by our nature, into holding stocks.”

With such an approach, long-term gains should be forever out of reach.

And yet, Yass and his partners have managed, year after year, to report that the vast majority of their net income came in the form of long-term capital gains. In several recent years, 100% of their income was taxed at the lower rate.

How do they do it?

One strategy, in simplified form, works like this: Make two bets that should move in opposite directions. Think of, say, both betting on and against Coca-Cola’s stock. Towards the end of the year, one bet will be up, and one will be down. At 365 days, the last day a trade is considered short-term, sell the one that’s down. A day later, sell the one that’s up.

Of course, if you consider the trade as a whole, it makes no money. But that isn’t the point. You’ve found a risk-free way to generate two valuable commodities: short-term losses and long-term gains.

On their own, these losses and gains aren’t of much use. But to someone like Yass, who separately generates an enormous pile of short-term gains each year, they work a kind of magic.

That’s because of how taxes are calculated. Short-term and long-term results are accounted for in separate buckets: Short-term losses are applied first to short-term gains. So the losses from the Coke trade reduce the existing pile of short-term gains. The money made from the Coke trade, meanwhile, goes in the long-term bucket.

In the end, the trader has essentially transformed short-term gains into long-term gains, the type taxed at the special lower rate. From 2003 through 2018, the difference between the two rates ranged from 17 to 20 percentage points. So, for every $100 run through this process, the trader would net from $17 to $20 in tax savings.

So why isn’t everyone using this strategy?

Because as laid out here, it would be illegal.

For decades, traders have devised strategies that looked something like the Coke trade, known as a “straddle” because the trader is taking both sides. Over the years, Congress passed laws and the IRS imposed intricate rules to stop them, taking away the tax benefit of simultaneously betting for and against the same stock.

And yet, Yass and his partners built a machine that produced much the same result.

Since 2011, IRS records show, a partnership called Susquehanna Fundamental Investments has been the source of the majority of long-term gains for Yass and his partners. Every year, it channeled hundreds of millions in long-term gains to them, while also providing hundreds of millions in short-term losses.

Year after year, the gains and losses rose and fell roughly in tandem, as if one were a near reflection of the other. In 2015, for example, Susquehanna Fundamental produced $774 million in long-term gains and $787 million in short-term losses for Yass. In 2017 it was $940 million in long-term gains and $902 million in short-term losses.

One Susquehanna Fund Generated Tax Savings by Combining Huge Gains and Losses Source: IRS data. The bars show the portion of short-term capital losses and long-term capital gains from the Susquehanna Fundamental Investments partnership that flowed to Jeff Yass.

Regulatory filings give a glimpse of the fund’s trading.

Susquehanna Fundamental has to disclose a snapshot of certain holdings with the Securities and Exchange Commission a few times each year, though many types of trades are exempt from disclosure.

Over several years, the fund’s disclosed positions resembled a complex version of the Coke trade. Instead of betting for and against a single stock, the firm bet for and against the entire market.

Susquehanna Fundamental held billions of dollars of individual stocks such as Google, Wells Fargo and, as it happens, Coca-Cola. These stocks were among the largest companies in the S&P 500 index.

Meanwhile, the fund also held a large bet against the S&P 500. In essence, it held a bet against many of those exact same stocks.

On its face, the fund actually lost money for Yass: Over eight years, it registered $5.4 billion in losses against $5 billion in gains — a net loss before taxes. But by transforming the tax rate on so much income, it delivered $1.1 billion in tax savings, and Yass came out way ahead.

It’s not clear whether the IRS has ever challenged the firm’s trading inside Susquehanna Fundamental Investments.

But the trading pattern has similarities to the 2010 Swiss stock trades, which involved betting for and against the exact same stocks. The IRS deems those to have been illegal under tax law.

Those trades were part of a larger deal worked out by Susquehanna and Morgan Stanley that called for the Philadelphia firm to buy $1.4 billion of the stocks and simultaneously bet against them, court records show. (Morgan Stanley declined to comment.) Over the next three years, the deal kicked out at least $365 million in low-rate income to the firm, while generating massive losses that could be used to wipe out other high-rate income, according to the IRS.

When IRS auditors scrutinized the deal, they found that Susquehanna had violated rules against betting for and against the exact same stocks. The agency demanded the firm pay tens of millions of dollars in back taxes.

Yass and his partners refused, arguing that the firm had broken no rules, and sued the IRS in U.S. Tax Court in 2020. They asserted that the deal was supposed to be profitable and wasn’t primarily intended to avoid taxes. But the firm also acknowledged the deal was tailored with an eye to “tax efficiency.” The case is still pending, with Susquehanna currently resisting requests to turn over more documents.

Susquehanna’s ability to manufacture the right kind of income has helped Yass and his partners minimize their taxes for decades. Since 2001, Yass hasn’t paid over 20% in a single year. In 2005, a year when he made what was for him the modest sum of $66 million, he paid $0 in federal income tax.

For Yass’ primary competitors, the story is far different. Citadel and Two Sigma are both huge firms that, like Susquehanna, do a mix of lightning-fast trading and market making. The heads of these firms, like Yass, reported incomes larger than almost anyone else in the country from 2013 to 2018.

But the tax returns of these Wall Street titans — Ken Griffin from Citadel, and John Overdeck and David Siegel from Two Sigma — have no mystifying source of low-rate income.

They also differ from Susquehanna in another telling respect. These firms voluntarily classify their trading activity as ordinary income, according to ProPublica’s analysis of tax records. Doing this makes sense for a firm that specializes in short-term trading and doesn’t expect to generate many long-term gains. That’s why many high-frequency firms make this “Section 475 election,” as it’s called in the tax jargon. If Susquehanna elected to treat its trading this way, its ability to generate long-term gains would be constrained.

Susquehanna also stands apart in how its taxes are prepared, ProPublica’s records show. Unlike his billionaire peers, Yass does not have his tax returns prepared by outside accountants. Instead, they’re prepared in-house at Susquehanna. Avoiding an outside accountant can offer more leeway in filing returns that test the boundaries of the law and might be challenged by the IRS later on, experts say. Several former employees told ProPublica that details of the firm’s tax strategy are closely guarded, even inside the company.

From 2013 to 2018, Griffin, Overdeck and Siegel paid average income tax rates ranging from 29% to 34%. (Representatives for the three men declined to comment.) Yass averaged 19%. ProPublica estimates that if Yass’ tax returns had resembled those of his competitors, he would have paid $1 billion more in federal income taxes during this period alone.

Yass does have one peer who achieved even lower tax rates and did so for years. Billionaire Jim Simons is one of the founders of Renaissance Technologies, one of the premier hedge funds known for high-frequency trading. His rates were often in the single digits between 2009 and 2018, never exceeding 14%. One reason Simons paid so little are deductions from charitable donations, averaging hundreds of millions of dollars each year; Yass doesn’t give nearly as much to charity. But another reason was Renaissance’s ability to create long-term gains over a decade.

That, however, didn’t last. A 2014 congressional investigation and IRS audit concluded the Renaissance scheme to generate such gains was illegal. Simons himself ultimately paid the IRS at least $670 million to resolve the case. Collectively, fund executives and investors paid an undisclosed amount, reportedly in the billions, in back taxes and penalties. A spokesperson for Simons declined to comment.

Having slashed his income tax bills, Yass has already taken steps to protect his fortune from the government for years to come.

He created special trusts designed to sidestep the estate tax when passing money to heirs at death, court records show. In using these grantor retained annuity trusts, or GRATs, Yass joins dozens of other billionaires, as ProPublica has reported.

That suggests that Yass’ adult children, two of whom work at Susquehanna, stand to someday inherit multibillion-dollar fortunes — tax-free.

Over decades of TV appearances and speeches promoting his libertarian gospel, Milton Friedman often liked to say he was “in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible.” Friedman died in 2006. Today, Yass, who reveres the economist, is trying to bring Friedman’s ideas to fruition.

Yass has not only worked assiduously to lower his own taxes but has poured millions into political efforts to eliminate them for his class. In recent years he has given $32 million to the anti-tax stalwart Club for Growth. This money paid for TV ads attacking candidates who were seen as wobbly on Friedman’s tax-cuts-anytime-anywhere philosophy.

In Pennsylvania, where Yass is the richest person in the state and a kingmaker in local politics, his favored candidates have shaped tax policy. He is a longtime financial patron of a Democratic state senator, Anthony Williams, one of the creators of a pair of tax credits that allow companies to slash their state tax bills if they give money to private and charter schools. Susquehanna is, in turn, a major user of the tax credits. (Williams did not respond to requests for comment.)

The programs limited the state tax credits a single company could receive, but Yass and the others found a way to sidestep the limits. Yass, Dantchik and Greenberg simply applied for the tax credits through individual companies each had formed, the Philadelphia Inquirer reported in 2015. In all, the credits have saved Yass and the others at least $53 million in state taxes, records show.

Yass’ views on taxes, along with another stance inspired by Friedman, school privatization, seem to have informed his shifting opinion of Donald Trump.

Yass had opposed Trump during the 2016 Republican presidential primary, instead donating large sums to Rand Paul of Kentucky, the de facto leader of the party’s libertarian wing, and to Libertarian Party nominee Gary Johnson.

A week after Trump won the presidency that November, Yass took the stage at a theater in Philadelphia. Even though Trump had not been his candidate, Yass seemed to relish the long-odds election win, joking that those who “didn’t like Tuesday’s results” could move to Canada.

He used the rest of his remarks at the event, part of a local TED Talk-style series, to promote his passion for charter and private schools and attack Philadelphia teachers. “All we ever hear about is how underpaid they are and how abused they are,” Yass said. “Well, the shocking fact is that the average school teacher in Philadelphia with benefits makes $117,000 a year.” Yass acknowledged that a large chunk of that figure was from pension and health care costs. (That year, Yass made $1.26 billion, before benefits.)

Over the next four years, Trump delivered both a historic tax cut for the rich and an education secretary who was a champion of charter schools.

Yass has since backed a range of pro-Trump candidates. In Pennsylvania, he has poured money into this year’s Republican effort to take the open gubernatorial seat, which many expect, if successful, will lead to an abortion ban in the state. The Club for Growth also backed a losing candidate for the state’s open U.S. Senate seat, Kathy Barnette, whose campaign centered on her hard-line opposition to abortion, even in cases of rape. Yass is the second biggest donor to the Club (which did not return ProPublica’s requests for comment).

He is also the largest donor to the Rand Paul-affiliated Protect Freedom PAC, giving $2.5 million of his more than $12 million in recent donations just days after the 2020 election. The group’s website says of Democrats: “Of course, they stole the election.”

Yass is looking to harness discontent with public schools during the pandemic to push privatization of the system. He has given $15 million as the sole funder of a political action committee, the School Freedom Fund, that says “school closures, mask mandates, critical race theory, and more” have created “a unique opportunity to promote School Choice as the structural solution to dramatically improve education in America.”

If Yass came to politics motivated by his libertarian ideology, he now has an acute material reason — beyond taxes — to have a voice in Washington.

Late in the Trump administration, Susquehanna’s prize investment came under threat. President Trump announced on July 31, 2020, that he was considering banning TikTok in the United States. (Backers of the ban cited national security concerns over Americans’ private data being controlled by the Chinese firm behind the app, ByteDance.) Susquehanna's multibillion-dollar stake in ByteDance accounts for a major part of Yass’ fortune.

There’s no record of Yass having given to Trump before. But on Aug. 4, 2020, just a few days after the president’s TikTok announcement, Yass gave $5 million to the Club for Growth. Two days later, the group deviated from its normal practice of funding congressional races and announced an ad campaign in the presidential race: $5 million against Joe Biden. The group didn’t mention Yass, but the ads attacked Biden on Yass’ pet issue, charter schools. Later that month, Yass gave the group another $5 million, and more ads ran against Biden.

At the same time, Trump and other administration officials were personally involved in trying to broker a deal to avoid finalizing the TikTok ban. At one point in September, Trump publicly announced his support for a deal in which U.S. companies would buy stakes in ByteDance and a new board would be formed. Among the proposed members of the board: Dantchik, Yass’ partner at Susquehanna.

It’s not clear if Yass or Dantchik talked to the White House about the deal, which ultimately fell through. Courts later blocked the proposal to ban the app.

Yass hasn’t spoken much publicly about how he thinks about his engagement in politics. A rare glimpse came after the Jan. 6 riot, when a Philadelphia political activist named Laura Goldman emailed Yass to question his donations to the Club for Growth. One of the candidates the group backed, Sen. Josh Hawley, R-Mo., had objected to certifying the presidential election results just days earlier.

“To be clear — I don’t think the election was stolen,” Yass responded in a Jan. 15, 2021, email, first reported by the Guardian. “I gave the club money a year ago. Do you think anyone knew Hawley was going to do that? Sometimes politicians deceive their donors.”

Yass appears to have overcome any doubts about the Club for Growth, which has continued to back candidates who say the election was stolen.

Since he sent that email, he has given the group another $5.5 million.

Help Us Report on Susquehanna, Jeff Yass, and Taxes

Do you have information about Susquehanna International Group or Jeff Yass that we should know? Do you have tips to share? More broadly, do you have expertise in tax law or accounting? Here’s how to get in touch.

Joshua Kaplan contributed reporting.

Update, June 23, 2022: After this article was published, Susquehanna, which declined to respond to a detailed list of questions before publication, sent a statement to The Philadelphia Inquirer, which had reprinted the story on its website and was preparing to publish it in its print edition.

A spokesman for the firm wrote: “The ProPublica story, which is derived from stolen tax records, contains numerous misstatements and factual errors to fit a flawed narrative. In fact, the tax rates cited in the article are significantly understated, because amounts paid for foreign taxes and charitable contributions are omitted. It is also worth noting that Mr. Yass is a self-described Never Trumper who has never questioned or denied the results of the 2020 election.”

The spokesman declined to send the statement to ProPublica or to cite any specific alleged error. In calculating tax rates, ProPublica used the standard methodology used by the IRS for Yass and every other individual mentioned in this article. We have used the same methodology to measure income-tax rates for every article in our “Secret IRS Files” series.

by Nicole Carr

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for Dispatches, a newsletter that spotlights wrongdoing around the country, to receive our stories in your inbox every week.

This story was co-published by ProPublica and FRONTLINE as part of an ongoing collaboration.

Cecelia Lewis did not want to share her story.

In fact, she just wanted all of this to go away.

Late last year, I was on the phone with a former colleague, talking about the local coverage of campaigns against critical race theory across metro Atlanta. CRT maintains that racial bias is embedded in America’s laws and institutions and has caused disproportionate harm to people of color; it’s rarely taught in K-12 public school systems but has still become a lightning rod in districts around the country — and a catalyst for conservative political candidates seeking to fire up their base.

He mentioned that a woman had quit her job in the Cherokee County School District before she had started and wondered what had happened to her.

We talked about a lengthy statement she’d written for the Cherokee Tribune & Ledger-News, explaining her decision to resign. The letter was published a week and a half after an ugly scene at a school board meeting during which parents railed against the hiring of Lewis (a Maryland middle school principal), as well as diversity, equity and inclusion initiatives (which Lewis had been brought on to helm) and CRT (a formerly arcane, currently politicized concept that Lewis hadn’t even heard of). I later learned people who had gathered outside the building where the meeting was held were beating on windows. School police and other law enforcement officers escorted board members to their homes, where some received ongoing security.

In that letter, Lewis, who had quit the morning after the meeting, explained the DEI plan she would have implemented in Cherokee and how it would benefit all children. And she mentioned she’d been threatened by people who have no idea who she is and what she stands for.

Seemed like something worth deeper reporting.

A comment posted at the bottom of a Cobb County Courier article caught my eye: A reader, who didn’t reveal their identity, warned that Lewis was heading to Cherokee’s neighboring Cobb County School District.

Sure enough, Lewis’ LinkedIn profile showed that she’d worked in Cobb County for a mere two months following her resignation in Cherokee. She had been overseeing social studies for that district. No one had reported on what happened to her in Cobb.

At the same time, I’d been filing open records requests to the Cobb County School District related to COVID-19. I noticed a cache of emails that showed how the then-school board chairman was receiving guidance from a local attorney about conservatives’ definition of CRT, its supposed dangers to children and how the concept was infiltrating corporations and schools.

The school board — like many others across the country in 2021 — had taken a vote against CRT. The vote was the same month that Lewis started working there.

I wanted to know exactly what happened to Lewis in both districts and how it went down. I also wanted to know who was behind the how.

I started contacting Lewis via LinkedIn in December, shortly after talking to my former colleague and trying to connect the dots between what little I knew about her brief time in Georgia. She didn’t write back. But I had some hope that I’d hear from her because I received alerts that she was at least looking at my LinkedIn profile.

She’s considering it, I thought.

Earlier this year, I found her email address and followed up. Still no answer.

I continued filing records requests in the two school districts and, through emails I received from those requests, learned more about the players behind the campaign to run her out. In both Cobb and Cherokee, people had sent similarly worded complaints to the districts, demanding to get rid of Lewis.

Then I found people who were upset about what happened to Lewis. One of them knew a good bit more about what led up to that ugly school board meeting in Cherokee.

That person had a recording of an organizing meeting days prior in a golf course clubhouse. There was also a private Facebook group filled with hysterical posts about Lewis, including some that announced false Lewis “sightings” around the county.

Two of the presenters at the clubhouse meeting are leaders of groups that encourage the public to anonymously report educators for perceived transgressions relating to curriculums, inappropriate books or lessons, or guest speakers — or to just submit any anonymous tip.

Beyond giving me details about the efforts to oust Lewis, the recording and posts provided insight into local and national conservative networks involved in strategies to overthrow school boards, vilify Parent Teacher Associations and pass state legislation to ban a slew of concepts from curriculums. At the clubhouse meeting, the crowd watched a video from Prager University that outlined how white people are being made out to be racists no matter what they say or do — because, well, CRT. They also listened to a controversial recording of a Manhattan high school principal caught on tape talking about the demonization of white children. The group was being coached on how to speak at school board meetings in a way that could land them an appearance on Fox News.

This all struck me as highly coordinated.

By March, I decided to see if meeting me might change Lewis’ mind about talking. I knew she had moved back to Maryland, so I traveled there to do some old-fashioned door-knocking, meet some folks who knew Lewis and get a direct, handwritten message to her (my ProPublica business cards hadn’t been printed yet!).

While I was sitting in my hotel room, she called.

She still didn’t want to go on the record, but we talked for hours that day and hours the next. I told her why I wanted to tell her story, and she began to piece it together for me. I learned that she hadn’t even initially applied for that DEI position. Cherokee’s district leadership encouraged her to do it after she interviewed for a job as a coach for teachers. But Lewis still would not go on the record, and she wasn’t too interested in meeting me. She had concerns. Safety and privacy concerns.

My ears perked up when, during our initial call, she mentioned an upcoming school board meeting in her own district. I decided to go sit in the back, to get a feel for the area. I heard some of the same anti-CRT lines in Maryland that I’d heard in Georgia. This time it tied back to the district’s hiring of its first Black superintendent.

Again, the language suggested there was coordination. People don’t learn these things on their own. They’re coached in the ways I’d heard in that recording of the Cherokee County clubhouse meeting.

I left Maryland without an interview I could use in my story. But I kept reporting.

I got more emails from the Georgia districts. I spoke to school employees in Cherokee and Cobb counties; they defended Lewis and felt sorry these things happened to her. Most of them said they thought of her often. One, who was disappointed I’d tried to visit Lewis, thinking it was a step too far, was especially protective of her. She didn’t want me to cause her further harm, and I had no interest in doing that.

I also attended a Cherokee County School Board meeting, standing in a long line waiting to get through the metal detectors that had been installed because of the uproar over Lewis and CRT a year earlier. In that line, women were passing around what they called evidence of lewd material in school library books. There was an informal circle of people forming around me. Some knew one another. Some were introducing themselves, knowing they shared a common goal in book banning. One woman declared that a parent leader was a “Marjorie,” as in a follower of controversial Georgia Congresswoman Marjorie Taylor Greene, who is not afraid to say anything, anywhere. Another raised her hand and proudly said, “I’m a Marjorie, too.”

Everyone in my immediate vicinity was passing around material provided by a blond woman: laminated pages of books she felt should be banned from school libraries. Well, almost everyone. No one handed them to me. Nor did anyone hand them to the Black mother standing behind me with her high school daughter.

As I continued reporting in the weeks to come, it became apparent that none of the blowback Cecelia Lewis faced in Georgia was actually about Cecelia Lewis. She happened to land in the wrong job in the wrong state at the wrong time. And yes, based on the details you’ll find in the story I ultimately wrote, the wrong skin color.

(In response to a detailed list of questions covering all aspects of Lewis’ experience in the Cherokee County School District, its chief communications officer responded that “we have no further comments to add.” In response to similar questions to the Cobb County School District and its school board, a spokesperson responded: “Cecelia Lewis was employed by the Cobb County School District during the summer of 2021, voluntarily submitted her letter of resignation in early fall of 2021, and like every Team member, her contributions and work for students was greatly appreciated.”)

In late April, Lewis agreed to take another call from me, this time via Zoom, where we could actually see each other for the first time. By then, we were inching toward the year anniversary of her resignation from Cherokee County. When I told her what I’d learned through records and interviews — and how my colleague, ProPublica research reporter Mollie Simon, found examples of educators across the country who faced similar backlash — she said she’d consult her family, her district and her pastor and pray on making a decision as to whether she’d talk to me on the record.

A few days later, my phone lit up with a call from her. She wanted to share her experience — so that it may help people understand the extraordinary challenges so many educators are facing.

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by Emily Elena Dugdale, KPCC/LAist

This article was produced for ProPublica’s Local Reporting Network in partnership with KPCC/LAist. Sign up for Dispatches to get stories like this one as soon as they are published.

Los Angeles County sheriff’s deputies disproportionately contact, cite and arrest Black students in the Antelope Valley, according to a new report by the county Inspector General’s Office. And those students are also disproportionately suspended and expelled at higher rates than other racial groups, the report said.

The analysis was spurred by a yearlong investigation into allegations of racial discrimination in Antelope Valley high schools by LAist and ProPublica. Reviewing data for the 2018-19 school year, our investigation found that Black teenagers accounted for 60% of deputy contacts in Lancaster high schools, although they made up only about 20% of the enrollment in those schools.

Inspector General Max Huntsman’s office reviewed Sheriff’s Department data for the 2019-20 school year and said its findings corroborated the news organizations’ investigation. In addition, it said the problem may be worse than the numbers indicate, due to flaws in the department’s data-collection system.

The report also slammed the Sheriff’s Department for failing to provide any evidence for claims it made that challenged the validity of our analysis.

“The practice of making public denials without factual support is fundamentally inconsistent with California law controlling the conduct of law enforcement officers,” investigators wrote. “The ProPublica analysis appears fundamentally correct.”

In an emailed statement, the Sheriff’s Department told LAist that it couldn’t provide immediate comment because it had not yet fully reviewed the report.

“What we can say is Sheriff Alex Villanueva takes allegations of misconduct very seriously and we will provide a more detailed response once we review these findings,” the department wrote.

The Inspector General’s Office presented its findings to the Civilian Oversight Commission on Thursday. This was the same body that had asked the Inspector General’s Office to look into the matter in the wake of the news organizations’ report.

Just after the article was first published last fall, Capt. John Lecrivain, the head of the Lancaster sheriff’s station, told commissioners that the investigation was “a very entertaining piece of fiction.” He struck a different tone at the Thursday meeting.

“This is a serious concern to the department, and we relish the opportunity to be involved in the discussion and find some solutions,” he said, adding that the department had looked back at its data and “we did find that there was some disparity in the contacts with the students.”

Assistant Inspector General Mahdi Mohamed said at the meeting that the Sheriff’s Department also did not comply with investigators’ request from nine months ago for information — including body-worn camera video — related to an incident at Lancaster High School in which a 16-year-old student, MiKayla Robinson, was body slammed by a sheriff’s deputy.

Mohamed said the lack of information from the Sheriff’s Department made it hard to “investigate the reason for the deputy’s contact with the student.” He said the office finally received the body camera video in the past few days.

Robinson’s attorney, Lisa Bloom, said she filed a complaint in May against both the Antelope Valley Union High School District and the Sheriff’s Department, alleging civil rights violations. Neither the school district nor the Sheriff’s Department has responded.

“The findings of this new report that Black students are cited, arrested, suspended and expelled at disproportionately higher rates than other students should be a wake up call,” Bloom said in a statement. “Immediate action must be taken to protect Black students from further harm.”

In 2015, the U.S. Department of Justice and Los Angeles County Sheriff’s Department entered into a court-ordered consent decree, agreeing to reforms that included protections against racial profiling. That agreement grew out of findings from a two-year DOJ Civil Rights Division investigation, which found, in part, that deputies routinely racially profiled Black residents in the Antelope Valley.

Underreported Data

The data examined by the Inspector General’s Office and by LAist and ProPublica came from the Sheriff’s Automated Contact Reporting system.

Huntsman’s office analyzed nearly 17,000 contacts by Lancaster station deputies — who are assigned to Antelope Valley high schools as school resource officers — during the 2019-20 school year. Roughly 400 of those contacts were conducted at or around 11 high schools in the valley.

Investigators said the SACR system “is inaccurate and significantly underreports significant data.” In a report issued this month, the office found the Sheriff’s Department underreported more than 50,000 stops and more than 70,000 arrests between 2018 and 2019.

“Any findings based upon this review of SACR data likely understates the issues identified in this report, particularly those relating to racial disparities,” investigators wrote. They called on the Sheriff’s Department to improve the system’s accuracy.

The analysis by the Inspector General’s Office found Black students experienced a disproportionately higher number of contacts with deputies than any other racial group. (Courtesy of the Inspector General’s Office)

The inspector general’s analysis found that Black students made up about 67% of the contacts made by Lancaster station deputies but only about 18% of total school enrollment.

In comparison, Latino students — who make up the majority of the school’s population, about 64% — accounted for only 26% of deputy contacts.

Black Students Cited and Arrested More

The inspector general’s analysis also showed that Black students were issued nearly 70% of all citations resulting from contact with deputies. Black students also made up nearly 60% of all arrests resulting from contact with deputies.

The report said these findings were consistent with the news organizations’ previous reporting.

Sheriff’s Deputy Justin Ruppert, team leader of the Lancaster station’s school safety unit, told LAist and ProPublica that the vast majority of deputies’ contacts on campuses are based on referrals from school staff and administrators — rather than being initiated by law enforcement. At the time of the original story, Antelope Valley Union High School District administrators did not respond to interview requests or to a list of written questions.

The inspector general’s office, though, found “the majority of school contacts were self-initiated by deputies.” However, it noted that deputies may not be coding calls correctly.

The analysis by the Inspector General’s Office found the majority of contacts with high school students were self-initiated by deputies. (Courtesy of the Inspector General’s Office)

Huntsman’s office also found that Black and Latino high school-age youth had fewer recorded contacts with deputies outside of school than inside.

Notably, white students had more contact with deputies outside of school than inside.

The Inspector General’s Office found that Black and Latino students were contacted by deputies more at school than outside of school. (Courtesy of the Inspector General’s Office)

Additionally, the Inspector General’s Office found that Black students made up 54% of total suspensions in the 2019-20 school year.

About 1 in 7 Black students at the high schools have been suspended, a rate more than twice the statewide average.

Black and Latino students each made up about 47% of expulsions, though Black students were expelled at a disproportionately higher rate given that their share of the student population is so much lower.

A Call for Transparency and Training

At the 2021 protest in Lancaster. (Bethany Mollenkof, special to ProPublica)

The office listed a number of recommendations “aimed at increasing the transparency, accuracy and efficacy of oversight of School Resource Deputies and the safety of community youth.”

The investigators also recommended that the Sheriff’s Department expand its training curriculum “to educate all patrol-related deputies on their opportunity to act as informal counselors and gateways for at-risk youth to non-criminal County services.”

Last June, the Los Angeles County Board of Supervisors passed a motion requiring the county CEO to report back on a plan to collect and publish data relating to deputy contacts with youths.

The news organizations’ investigation last fall profiled Barron Gardner, a high school history teacher working for Antelope Valley district. Gardner had become a reluctant spokesperson for a growing movement, driven primarily by Black and Latino residents, to get LASD deputies off school campuses.

On Thursday, Gardner said over the phone that he believed the numbers in the inspector general’s report “aren’t any surprise” to school staff and Antelope Valley residents.

“I could have guessed those numbers off the top of my head,” he said.

Gardner also said he wished the inspector general’s report — in addition to recognizing that his Black students were overpoliced — gave more context for the issues that his Black students face. He listed some: “homelessness, foster care, parents and prisons” — and systemic racism. Gardner said all are factors that prevent Black students from accessing socio-emotional and mental health resources.

“This is what we think is the best way to deal with it — with cops,” he said.

by Andy Kroll

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

Update, June 21, 2022: Spokespeople for Facebook, TikTok and Twitter said they would remove posts flagged by ProPublica for violating their respective community standards policies. This story has also been updated to include comment from True the Vote, which the organization sent after our story published.

The dummied-up flyer bore the hallmarks of a real WANTED poster. A grainy photo of a woman outside an election office in the suburbs of Atlanta stamped with the word “WANTED.” An image of a sheriff’s badge and the phone number for the Gwinnett County Sheriff’s Office. The implication was clear: The woman was being sought by the local sheriff for voter fraud.

The flyer was fake, and though the sheriff’s office eventually called it out, the false poster went viral, amassing tens of thousands of shares, views and threatening comments on Facebook, Twitter and TikTok and raising fears that harm could come to the unidentified woman.

Stolen-election activists and supporters of former President Donald Trump have embraced a new tactic in their ongoing campaign to unearth supposed proof of fraud in the 2020 presidential race: chasing down a fictional breed of fraudster known as a “ballot mule” and using social media to do it.

Inspired by a conservative documentary film that has won praise from Trump and his allies — and debunking from critics including former Attorney General William Barr — self-styled citizen sleuths are posting and sharing photos of unnamed individuals and accusing them of election crimes. They are calling on their followers to help identify these “ballot mules,” who are accused of having violated laws against dropping off multiple absentee ballots during the 2020 election. A state lawmaker in Arizona has even encouraged people to act as “vigilantes” and catch future “mules.”

Promoting such false information violates the policies of Facebook, Twitter and TikTok. Facebook’s “Community Standards” says its policy is to remove content that incites harassment or violence or impersonates government officials. Twitter and TikTok have similar rules and guidelines for what can and can’t appear on their platforms.

(Screenshot captured and redacted by ProPublica)

ProPublica identified at least a dozen additional posts on Twitter, Facebook and TikTok that accuse unnamed individuals of being “ballot mules” and engaging in allegedly illegal activity. Some of these posts echo the “WANTED”-style language seen in the Gwinnett County meme, while others include similar calls to action to identify the individuals.

None of the posts reviewed by ProPublica include evidence that any of the people depicted in the posters engaged in illegal activity. Yet the social media companies have reacted slowly or not at all to such posts, some of which clearly violate their policies, experts say.

Disinformation researchers from the nonpartisan clean-government nonprofit Common Cause alerted Facebook and Twitter that the platforms were allowing users to post such incendiary claims in May. Not only did the claims lack evidence that crimes had been committed, but experts worry that poll workers, volunteers and regular voters could face unwarranted harassment or physical harm if they are wrongfully accused of illegal election activity.

So far, there is no sign that any of the people depicted have been identified or suffered any threats.

Emma Steiner, a disinformation analyst with Common Cause who sent warnings to the social-media companies, says the lack of action suggests that tech companies relaxed their efforts to police election-related threats ahead of the 2022 midterms.

“This is the new playbook, and I’m worried that platforms are not prepared to deal with this tactic that encourages dangerous behavior,” Steiner said.

Spokespeople for Facebook, TikTok and Twitter said they would remove posts flagged by ProPublica for violating their respective community standards policies.

Thirty-one states allow a third party to collect and return an absentee or mail-in ballot on behalf of another voter. These laws help voters who are disabled or infirm, live in spread-out rural areas or reside on tribal lands with limited access to polling places or ballot drop boxes. In states with a history of absentee voting, both Democratic and Republican operatives have engaged in organized ballot-collection drives.

Critics, labeling the practice “ballot harvesting,” have sought to restrict its use, warning about the potential for fraud. However, incidents of proven fraud related to ballot collection are extremely rare. A database maintained by the conservative Heritage Foundation identifies just 238 cases of “fraudulent use of absentee ballots” since 1988. One high-profile case of fraud involving absentee ballots occurred in a 2018 North Carolina congressional race. A Republican operative engaged in a ballot-tampering scheme involving hundreds of ballots. The state election board later threw out the election result and ordered a redo. It was likely the first federal election overturned due to fraud, according to historians and election-law experts.

The phrases “ballot mules” and “ballot trafficking” — with their intentional echoes of the language of drugs and cartels — started to gain traction online in 2021, according to Mike Caulfield, a misinformation researcher at the University of Washington’s Center for an Informed Public. An analysis by Caulfield and his colleagues found that prominent Republicans including House Minority Leader Kevin McCarthy and Republican National Committee Chairwoman Ronna Romney McDaniel invoked “ballot trafficking” last spring.

But it wasn’t until conservative provocateur Dinesh D’Souza and a discredited conservative group called True the Vote last fall began to tease findings that would later appear in D’Souza’s movie “2000 Mules” that uses of “ballot trafficking” and “ballot mules” shot up, according to Caulfield’s research.

The “2000 Mules” film claims that a network of thousands of people illegally stuffed ballot boxes in swing states to steal the presidency for Joe Biden. It draws heavily on the work of True the Vote, which purported to use surveillance footage and geolocation data to make its claims of illegal ballot activity.

Numerous fact-checks of the film have cast serious doubt over its central premise. In a deposition with the Jan. 6 select committee, Barr said he found the conclusions of “2000 Mules” far from convincing. “My opinion then and my opinion now,” he said, “is that the election was not stolen by fraud, and I haven’t seen anything since the election that changes my mind on that, including the ‘2000 Mules’ movie.”

True the Vote founder Catherine Engelbrecht said her group had never spoken with Barr and disputed the notion that True the Vote had not proven its claims about voter fraud. “I do think that when 80%+ of America is concerned about election integrity, something must be done to address the situation,” she said. “It is the failure of leaders across all branches of government, who have allowed lawlessness to be the new law, that we find ourselves where we do.” D’Souza did not respond to a request for comment.

Despite its flimsy conclusions, “2000 Mules” found an enthusiastic audience in Trump and his supporters. In early May, Trump screened the film at his Mar-a-Lago private club. The film has since earned nearly $1.5 million at the box office, according to Box Office Mojo. In a recent 12-page letter responding to the public hearings organized by the Jan. 6 select committee, Trump cited “2000 Mules” nearly 20 times.

As the film’s dubious claims have spread online, stolen-election activists are creating and sharing online content purporting to reveal more “mules” and accusing those individuals of illegal behavior without actual evidence of wrongdoing.

The most striking example is the meme that depicts an older white woman leaving a ballot drop box in Georgia’s suburban Gwinnett County. The word “WANTED” appears above her head as does the image of a sheriff’s badge labeled “Gwinnett County” and the sheriff office’s phone number.

“Ballot mule,” the meme says. “If you can ID her, call Gwinnett Co. sheriff’s office.”

A spokeswoman for the Gwinnett County Sheriff’s Office says the meme is fake. The sheriff’s office hasn’t received calls purporting to identify the woman. The spokeswoman said that the office was investigating who created the meme.

ProPublica was unable to identify the woman in the “WANTED” meme. A spokesman for the Gwinnett County elections office confirmed that the name tag worn by the woman in the meme matched those worn by county election workers in 2020. He also verified that the drop box in the video was located outside of the county’s election headquarters.

The origins of the woman’s photo in the “WANTED” meme appear to point back to a Georgia businessman and self-described election-fraud investigator named David Cross.

For months Cross has posted short clips of surveillance footage showing people depositing ballots at drop boxes in Gwinnett County. Cross sometimes narrates these videos and makes unverified accusations of illegal ballot harvesting. In a clip that Cross posted online on May 3, an older white woman — the same woman in the “WANTED” meme — deposits multiple ballots into the drop box outside the headquarters for Gwinnett County’s elections office. In his narration, Cross accuses the woman of depositing as many as 35 ballots, though it’s not at all clear from the video exactly how many ballots the woman deposited. “Totally illegal,” he says in the video. (Cross did not respond to requests for comment.)

Georgia law prohibits many third parties from submitting a ballot that’s not their own. However, the law makes exceptions for caregivers for the elderly and the disabled, immediate family members, members of the same household, in-laws, nieces, nephews, grandchildren and more.

Cross, the Georgia activist, has filed complaints with the State Election Board and secretary of state’s office alleging illegal ballot deliveries and citing his surveillance footage clips. Last month, the State Election Board dismissed three complaints alleging “ballot harvesting” after an investigation by the secretary of state’s office found that the alleged “mules” were voters dropping off ballots for themselves and family members.

A spokesman for Georgia Secretary of State Brad Raffensperger told ProPublica that the office has a pending investigation into the woman in the “WANTED” meme. The spokesman, Walter Jones, stressed that no one should assume that an individual shown in a video delivering multiple ballots is automatically guilty of a crime, nor would the ballots in question be invalidated even if someone had violated the state’s ballot-collection law.

The video published by Cross of the woman at the Gwinnett County drop box spread rapidly online. Twitter users accused the woman of being one of the “2000 mules” and urged their followers to “MAKE HER FAMOUS!” — in other words, reveal her identity and share it widely.

One Twitter user shared the woman’s image with the “WANTED” text and the fake Gwinnett County sheriff’s badge. “Once we find out who paid these people the whole story will become clear,” the account wrote. That tweet amassed more than 9,000 retweets and more than 14,000 likes before Twitter removed it.

The “WANTED” post spread across Twitter, Facebook and TikTok. A Facebook group called “Celebrities for Trump” shared it. “We need more if [sic] these,” the post said, referring to the WANTED sign. “Keep your eyes open. Report them all it is a crime.”

Several days after the “WANTED” flyer surfaced and reached a large audience, the Gwinnett County sheriff stated that the post was “false.” Yet despite the post impersonating a law-enforcement agency, social-media companies have been slow to remove it.

While Twitter removed dozens of posts with the “WANTED” sign, ProPublica was able to find instances of it still on the platform.

Disinformation researchers tell ProPublica that they also identified posts accusing people of being ballot mules in other states with laws that restrict third parties from submitting people’s ballots. “Mule right here in PA,” one TikTok post read. “Make this Upper Dublin resident famous #2000Mules #2000MulesDocumentary #2000MulesTheMovie.”

In Arizona, a Republican state senator named Kelly Townsend has encouraged people to camp out at ballot drop boxes and write down license plate numbers of people deemed to be suspicious. “I have been so pleased to hear of all you vigilantes that want to camp out at these drop boxes,” Townsend recently said. “So, do it. Do it.”

Even if “2000 Mules” were accurate — which experts stress it almost certainly is not — the ballot-trafficking theory put forward by the film would not change the result of any election. Rick Hasen, a professor and election-law expert at the University of California, Irvine, says he believes the rigged-election message in “2000 Mules” is just the latest attempt to more broadly lay the groundwork for challenging and overturning the outcome of a future election.

“If you believe the last election was stolen, you’re going to be more likely to take steps to steal the next one back,” Hasen said. “It’s pretty obvious that what’s going on here is using false claims of fraud as a potential pretext to engage in election subversion in 2024 or another future election. That’s very dangerous for American democracy.”

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by Peter Elkind

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For the past six years, government officials have tried ever harder to kill a type of tax avoidance scheme that the Internal Revenue Service has branded “abusive” and among “the worst of the worst tax scams.” The IRS has pursued tens of thousands of audits and warned of hefty penalties facing anyone who exploits it. The Justice Department has targeted top promoters of what it calls “fraudulent” deals with criminal charges and civil lawsuits, yielding several guilty pleas and a civil settlement. In Congress, Democrats and Republicans have united to sponsor legislation to abolish the practice.

But the industry has fought back with a coterie of lobbyists, including a onetime member of Congress long viewed as a liberal lion, Henry Waxman. The battle shows how even on those rare occasions when both parties agree to take action, well-funded interests can frustrate a solution.

The result: The use of the scheme continues unabated. Along the way it has cost the U.S. Treasury billions in lost taxes, according to the IRS.

“There is a tax shelter gold mine here, and they’re fighting very hard to protect it,” Oregon Sen. Ron Wyden, chair of the Senate Finance Committee, said. “There are enormous sums of money to be made as long as the number of transactions keeps increasing. This is a textbook case of the power of lobbyists.”

The government is targeting a tax deduction that goes by the cumbersome name “syndicated conservation easement,” which exploits a charitable tax break that Congress established to encourage preservation of open land. Under standard conservation easements, landowners who give up development rights for their acreage, usually by donating those rights to a nonprofit land trust, get a charitable deduction in return. When conservation easements are used as intended, both the public and the owner of the property benefit. A piece of pristine land is preserved, sometimes as a park that the public can use, and the donor gets a tax break.

The syndicated versions are different. Instead of seeking to protect a bucolic reserve for wildlife or humans, profit-seeking intermediaries have turned the likes of abandoned golf courses or remote scrubland into high-return investment vehicles. These promoters snatch up vacant land that till then was worth little. Then they hire an appraiser willing to declare that it has huge, previously unrecognized development value — perhaps for luxury vacation homes or a solar farm — and thus is really worth many times its purchase price. The promoters sell stakes in the donation to individuals, who claim charitable deductions that are four or five times their investment. The promoters reap millions in fees.

ProPublica first investigated the booming syndicated conservation easement business, which initially took root in Georgia, back in 2017. Efforts to shut it down were then already underway, led by the Land Trust Alliance, a trade association whose 950 members administer traditional conservation easements. As longtime advocates of the charitable tax break, Alliance leaders were horrified to see it exploited, in their view, by “brazen” profiteers claiming bogus deductions.

Fearful that this would jeopardize the conservation deduction altogether, the Alliance barred its members from accepting easement donations from syndicated deals and prodded the IRS to begin a crackdown. By 2020, that effort was underway in earnest.

But the syndicators flummoxed their opponents by refusing to back down, despite IRS audits and enforcement efforts, which had shut down other tax schemes in the past. The syndicators had formed their own Washington trade group, called the Partnership for Conservation (or P4C). They began spending millions on lobbying Congress and public relations. P4C argues that syndicated deals offer conservation and profit, and it rues what it has called the “chilling effect” of the government efforts to crack down.

Today, the fight has taken on a grinding quality. By the IRS’ most recent reckoning, the use of syndicated easements grew from 249 deals in 2016, generating $6 billion in charitable deductions, to 296 deals in 2018, producing $9.2 billion in deductions. (By contrast, more than 2,000 nonsyndicated easement deductions have resulted in about $1 billion in annual deductions.)

The trend continues today, IRS Commissioner Charles Rettig told the Senate Subcommittee on Financial Services and General Government last month. He was visibly frustrated. “Notwithstanding our efforts,” Rettig testified, “we have not had an impact on essentially slowing the volume of these transactions that we receive currently. We need Congressional help. We need a statute to help us curb this activity.”

A bipartisan group of influential lawmakers has tried. Democrat Wyden and Iowa Sen. Charles Grassley, the finance committee’s ranking Republican, jointly released a 151-page investigative report in 2020 that referred to syndicated easements as a “dollar machine” for wealthy taxpayers. “You simply insert the dollar bill and then watch the Dollar Machine return two dollar bills to you,” the report explained. “But it was not the promoters who gave back the two dollars; it was the Federal government by way of foregone tax revenue, and the only risk involved was whether or not the transaction would lead to an audit.”

Others looking to rein in syndicated deals include Montana Republican Sen. Steve Daines, Michigan Democratic Sen. Debbie Stabenow and House members Mike Thompson, a California Democrat, and Mike Kelly, a Pennsylvania Republican. Together, several of these lawmakers introduced the Charitable Conservation Easement Program Integrity Act of 2017 — and have reintroduced it, in updated form, in one congressional chamber or the other, eight times since, most recently a year ago.

The legislation aims to put an end to syndicated deals by eliminating their profitability, with a bar on taxpayers claiming easement deductions that exceed 2.5 times their investments. Closing this loophole would generate $12 billion in additional tax revenue through 2027, according to the Office of Management and Budget. But the legislation has never gotten far — and lawmakers say that’s no accident.

Since 2017, syndicators have spent $11 million on lobbyists, according to publicly filed lobbying disclosures. P4C has paid for more than $6 million of that. EcoVest Capital, a big promoter based in Atlanta that is now facing a Justice Department civil fraud suit, has spent $3.3 million. (By contrast, the Land Trust Alliance has spent $2.4 million on lobbyists during the same time period.)

While recruiting congressional allies to block the Easement Program Integrity Act, syndication advocates have also gone on the attack, pressing Congress (unsuccessfully, so far) to strip the IRS of funds used to enforce the agency’s 2017 listing notice that flags profit-making syndicated deals as abusive and requires participants to report their involvement.

Syndication promoters have actively courted Democratic support, adding Waxman Strategies, a self-described “progressive-minded public affairs firm” chaired by Henry Waxman, 82, the liberal former California representative, to their lineup of heavyweight lobbyists. In April 2018, P4C founder Frank Schuler, whose Atlanta firm was then one of the most prolific promoters, advised top executives at EcoVest about the move. “P4C is about to get the Waxman group underway to work on the D side of things,” Schuler wrote, in an email disclosed in court filings. “They really believe in what we are doing and that was a condition of Waxman’s to undertake the engagement. This is another $23k per month but we are in the thick of the fight and now is the time.”

Since then, Waxman Strategies has earned $485,000 for representing syndicators, with the former congressional representative working on the issue along with others at the firm. “Partnership style conservation easements are an important tool for conserving land that is under development pressure,” Michael Goo, the firm’s managing director and a former staff director for a House environmental subcommittee, told ProPublica in a written response to questions sent to Henry Waxman. “We believe they can be used to mobilize private capital into conserving land that in fact would be developed sooner or later.” The reform legislation, he added, “would effectively remove the incentive for investors to mobilize private capital into conservation easements.”

Unable to move their Easement Program Integrity Act through a divided Congress, supporters managed late last year to get its language included in the “Build Back Better” provisions passed by the House Ways and Means Committee. This raised hopes that it could get enacted along with the spending measure, which would require just a majority vote in the Senate.

Sen. Kyrsten Sinema, the enigmatic Arizona Democrat, who represented a potentially decisive vote in her 50-50 chamber, put an end to that, telling the White House the syndication-killer language was among the provisions she wanted out of the bill, according to press reports. It was removed. That prompted 13 conservation groups to write Sinema on Dec. 7, pleading with her to “stand with us” to “curb abuse and restore the integrity of this cherished and worthy conservation program.”

Sinema, whose objections to the measure remain unclear, was unmoved. “All efforts to persuade the AZ Senator to reconsider her position have failed,” one advocate for the measure told ProPublica in an email. (Sinema’s staff did not respond to ProPublica’s requests for comment.)

Since then, President Joe Biden, signaling his support, has included the measure in his proposed 2023 budget in a section entitled “close loopholes.” But it remains far from enactment.

Rep. Thompson, an original sponsor of the measure, told ProPublica his bill is “a no-brainer. It stops a bunch of individuals who have been taking advantage of the taxpayers and lining their pockets with taxpayer dollars. It’s one degree off criminal what they’re doing, and they’re getting away with it.” Thompson said he’s looking for “other places to put the language. If we can find a vehicle where it works, we’ll put it in. I’d do it today if I could.”

Syndication easement promoters have attacked the measure by claiming it would allow the IRS to “retroactively” disallow transactions that are now legal — even though the agency first warned taxpayers against engaging in syndicated deals back in early 2017, when it identified them in its listing notice as an abusive “tax avoidance transaction.” The IRS has been routinely auditing such deals since then.

P4C has taken up this cry on its web page and Facebook site, where it promotes its members’ work on behalf of “private land conservation” as essential to the survival of the planet. One posting displays an image of two trapped raccoons, next to the words, “Don’t let this happen to our wildlife”; it warns that “retroactive tax hikes will have devastating consequences on our natural lands and wildlife.” Robert Ramsay, the group’s president, told ProPublica that such a “punitive retroactive tax law change” would harm “a large swath of American taxpayers” eager to participate in land conservation, from “a variety of walks of life.”

Andrew Bowman, CEO of the Land Trust Alliance, called the fairness argument “a canard.” As he put it, “People were on very clear notice that the federal government was saying this was abuse. They haven’t seen the need to stop.” This, he said, is why congressional action is necessary: “The IRS has thrown everything they have at it.”

In 2020, after warning that it planned to audit every taxpayer return claiming a deduction for a syndicated easement, the IRS announced a “limited-term” settlement offer, allowing individual investors to pay back taxes with a reduced penalty. Few took the agency up on its offer. In an internal IRS management review last year, agency officials lamented the poor response, noting, “Many taxpayers are undeterred and are opting for litigation, clogging up the Tax Court.” (One reason taxpayers are willing to fight: Syndicated easement deals routinely set aside $500,000 or more in advance to handle lengthy audits and tax court fights.)

The IRS is now examining the returns of 28,000 investors in syndicated easements, challenging $21 billion in deductions claimed between 2016 and 2018, according to testimony by Rettig.

For its part, the Justice Department has taken the enforcement fight to the courts, with legal actions shedding light on industry practices. In December 2018, a government civil suit targeted Atlanta’s EcoVest Capital, which built a national client-feeder network of brokers, financial advisors and accountants, who received generous referral fees.

According to an amended DOJ complaint, EcoVest had been involved in 58 syndication deals between 2013 and 2018, generating nearly $3 billion in federal tax deductions — on average, a write-off of $4.39 for every dollar invested. (For a wealthy taxpayer investing $100,000, that would have effectively generated a profit, often in a matter of months, of $60,000 or more.) Fifty-one of those 58 deals, according to the government complaint, relied on what the DOJ called “grossly overvalued” appraisals performed by a single appraiser, Claud Clark III, based in Magnolia Springs, Alabama.

The Justice Department sought to bar EcoVest and five individuals associated with the company, including Clark, from any future easement deals. It has already made some inroads. Defendant Nancy Zak, a syndicated easement pioneer, settled with the government in March 2021. She denied wrongdoing but accepted a lifetime bar from the easement business and agreed to pay an undisclosed settlement. (According to lobbying registrations, it was one of Zak’s firms, called Greenth, that hired Waxman Strategies in 2018, paying $20,000 in fees. Waxman Strategies said it terminated its relationship with Zak immediately after the government sued her. The firm then began getting paid, $465,000 to date, by Red Oak Reserve LLC, a low-profile legal entity that previously listed Zak’s office number in SEC filings. Waxman Strategies’ Michael Goo said Red Oak Reserve was founded by Brian Sullivan, who is a former Nancy Zak associate. Sullivan declined to comment.)

EcoVest’s go-to appraiser, Clark, also now appears to be out of the syndicated easement business. After several complaints to state boards about his methods, Clark has given up all his licenses to perform appraisals, according to a national appraisal industry database. His LinkedIn account now lists him as “Retired.” A recent filing in the DOJ case says he’s currently engaged in settlement talks with the government.

EcoVest’s CEO and Zak did not respond to ProPublica’s requests for comment. EcoVest and Clark (whose lawyer declined comment) have denied any wrongdoing in earlier court filings. Atlanta-based Ornstein-Schuler, another of the biggest syndicated easement promoters, announced in January 2019 that it was getting out of the business.

Criminal investigations of industry practices are reportedly underway in three states. The crackdown’s most sensational case became public in February, when a federal grand jury in Atlanta indicted North Carolina developer Jack Fisher, a major syndication deal promoter and owner of Inland Capital Management. The 135-count indictment charged Fisher and six associates with participating in a conspiracy to sell $1.3 billion worth of illegal tax shelters. The charges against Fisher include wire fraud, conspiracy to defraud the U.S., money laundering and aiding in the filing of false tax returns. He has pleaded not guilty.

The indictment was backed by a string of damning statements attributed to Fisher, including several secretly recorded by an undercover government agent posing as an easement promoter.

The indictment, for example, charged that Fisher’s conservation deals relied on “fraudulent” and “grossly inflated” land appraisals, often valuing the easement properties at more than 10 times what he had paid for them just months earlier. It asserted that Fisher routinely “pre-determined” these valuations before any appraisal was actually performed, telling his two “hand-picked” appraisers what valuation he needed to generate the generous deductions he’d promised investors. In one recorded conversation described in the indictment, Fisher said one of the appraisers simply “puts down whatever we say.” In another, he said he always made sure easement valuations were high enough to make sure investors “can still get a good return on their money,” even if a later IRS audit reduced their charitable deduction.

The government also charged that Fisher frequently orchestrated the illegal backdating of checks and tax documents, allowing him to keep offering unsold stakes in his deals to investors as much as nine months after the year-end tax deadline, after the easement was already donated. In one recording, Fisher acknowledged rewarding partners at an accounting firm with free shares in an easement deal because “they participated in basically backdating all the documents.” After learning he was under investigation, according to the indictment, Fisher told one associate he could claim that backdated checks weren’t deposited until after the close of the tax year because they had been “lost” on someone’s desk.

Both appraisers, now among Fisher’s fellow defendants, have pleaded not guilty. One says on his website that his firm decided in mid-2019 to stop doing conservation easement work “until there is greater clarity from the courts on conservation easements.”

Three accountants who worked closely with Fisher had been criminally charged earlier. One, Herbert Lewis, has pleaded not guilty. Two others, brothers Corey and Stein Agee, pleaded guilty to conspiracy to defraud the United States and are cooperating with prosecutors. According to the government, the Agees each received $1.7 million in fees from promoting the syndicated deals.

Fisher, a CPA himself, once worked for the IRS.

The indictment said he made $60 million personally from the 15 syndicated easement deals he put together between 2013 and 2020. With those funds, the government said, Fisher purchased a $2 million home on the Caribbean island of Bonaire, an airplane, a $450,000 luxury recreational vehicle, a $750,000 show jumping horse and more.

Fisher’s attorney, Russ Ferguson, said in a statement: “Jack Fisher looks forward to defending the allegations brought by the Department of Justice in court and hopes for a speedy trial. Through a congressionally authorized and IRS-approved tax deduction to encourage conservation, Jack Fisher has conserved nearly 10,000 acres of developable, natural land for generations to come. In doing so, Mr. Fisher has not only followed the law but has acted in conformity with IRS regulations, agency guidance and audit guidelines.” The statement said Fisher stopped promoting easement donations in 2019 because the government “now considers such transactions criminal.”

Paul Kiel and Doris Burke contributed research.

by Michael Grabell, photography by John Francis Peters for ProPublica

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

Join ProPublica on July 7 to discuss the current inflation crisis.

The story you’re about to read is bananas, and it’s also about bananas.

Last fall, a company called One Banana loaded 600,000 pounds of the fruit from its plantations in Guatemala and Ecuador onto ships bound for the Port of Long Beach in California. Once they arrived, the bananas, packed in refrigerated containers, were offloaded by cranes for trucking to a nearby warehouse, where the fruit would be sent to supermarkets nationwide.

But in the midst of a global supply chain crisis, none of the trucking companies the importer normally worked with were willing to come and get the containers.

As the bananas sat at the marine terminal, a logistics specialist for One Banana scrambled, contacting more than a dozen trucking firms.

With each passing hour, the bananas grew closer to spoiling.

“We need to pull out 15 containers from Long Beach Port,” the logistics specialist wrote in an email to one firm. “Please let me know if you could help me with this.”

A trucking company finally said it could — but only if One Banana first paid $12,000 per container on top of already higher transportation costs.

This is where the plot ripens.

If One Banana were to accept that additional fee and pass the full cost along to consumers, the bananas could go from 60 cents a pound to 90 cents a pound. That alone might not break your budget, but rising prices of everyday items are adding up to the worst inflation in 40 years. Many of the causes may seem obvious. Massive consumer spending and pandemic shutdowns have strained supply chains. The war in Ukraine is driving up the price of gas. But the extra fees for transporting bananas — and countless other products — are a hidden and mind-boggling source of inflation controlled by ocean carriers.

Simply put, as ballooning costs hit the wallets of American families, the global ocean shipping industry is enjoying its most profitable period in recent history. In the first quarter of 2022, the biggest carriers’ operating margins hit 57%, according to one industry research firm, after hovering in the single digits before the pandemic.

The hauler that wanted $12,000 per container to move the bananas told the One Banana logistics specialist that it needed the money to cover a slew of fees the ocean carriers were tacking onto freight bills. Hapag-Lloyd, the German shipping giant that owned the containers the bananas were sitting in, had become particularly notorious in the freight industry, leading to multiple complaints to the Federal Maritime Commission.

In normal times, the fees, known as detention and demurrage, make a lot of sense. Importers who don’t pick up their stuff on time get charged demurrage for storage at the marine terminals. Truckers who don’t return an empty container on time pay late fees, or detention. The purpose of the penalties is to incentivize the various players in the supply chain to keep goods flowing.

Most of the imported goods Americans buy are carried by ship and unloaded at ports like Long Beach for transportation by truck or rail toward their final destination.

But as supply chains snarled last year, the ports of Long Beach and Los Angeles ran out of room and became clogged with shipping containers that importers, often big-box retailers and brands, weren’t able to retrieve. Surrounding truckyards and streets were flooded with empty containers, temporarily dumped there by trucking companies that couldn’t get appointments to return them to the ports.

Hapag had made it “extremely difficult” to return empty containers, the trucking company said, and it was often left holding them for a month, all while Hapag continued to charge the firm $400 a day for each container that wasn’t returned on time. One trucking company that the importer contacted said it almost had to shut down temporarily because all the chassis — the steel frames with wheels that attach to trucks — that it needed to pull new loads from the ports were sitting under 70 empty containers that Hapag refused to take back.

Essentially, One Banana and several trucking companies said Hapag had created the situation it was now profiting from.

“It’s like renting a car at the airport, and when you try to return it, they’re saying, ‘No, you have to hang on to it for us, and we’re gonna continue to charge you,’” said Fred Johring, the CEO of one of the trucking firms, Golden State Logistics.

Hapag declined to comment, but in filings with the Maritime Commission, it denied One Banana’s allegations that the fees were unfair.

The case is ongoing, but on this late October day in the Port of Long Beach, hundreds of thousands of dollars’ worth of bananas hung in the balance.

For more than a year, retailers and brands have complained of crushing costs as the rate to ship a container from China to the West Coast skyrocketed from less than $2,000 before the pandemic to over $20,000 last year. Ninety percent of the stuff Americans buy from overseas arrives by ship, and nearly all of it is carried by a small number of ocean carriers that work together in three alliances that dominate the trade. The Federal Maritime Commission, which regulates the ocean shipping industry, recently concluded that the spike in freight rates was driven by the surge in spending and record congestion, not monopoly power. But the federal government said what’s happening with the additional detention and demurrage fees isn’t simple supply and demand. Instead, it said ocean carriers have [taken advantage](https://www.whitehouse.gov/briefing-room/statements-releases/2022/02/28/fact-sheet-lowering-prices-and-leveling-the-playing-field-in-ocean-shipping/) of the crisis and “[contributed to the pain](https://www2.fmc.gov/readingroom/docs/21-09/21-09_BOE_Opening_Brief_Public2.pdf/)” by imposing [billions of dollars](https://www.youtube.com/watch?v=FqReHGykGbE) in “purposeless” and illegal fees that violate the Shipping Act. Now, the arcane matter of detention and demurrage has made its way into corporate earnings reports. Companies ranging from [Bed Bath & Beyond](https://news.alphastreet.com/bed-bath-beyond-inc-bbby-q4-2021-earnings-call-transcript/) and [Havertys Furniture](https://www.sec.gov/Archives/edgar/data/0000216085/000021608522000010/hvtex99.htm) to [Vita Coco](https://www.sec.gov/Archives/edgar/data/0001482981/000148298122000040/coco-3312021xexx9911.htm) beverages and [Summer Infant](https://www.sec.gov/Archives/edgar/data/0001314772/000110465922034637/sumr-20220101x10k.htm), which makes baby strollers and potties, have blamed detention and demurrage fees for hurting their bottom lines or leading them to increase prices. “Most people didn’t even know what those things were,” Trevor Lang, chief financial officer for Floor & Decor, [said in an earnings call](https://seekingalpha.com/article/4490311-floor-and-decor-holdings-inc-fnd-ceo-tom-taylor-on-q4-2021-results-earnings-call-transcript) in February. In comments to federal regulators in April, the Home Furnishings Association [wrote](https://www2.fmc.gov/readingroom/docs/22-04/22-04_Comments_HFA.pdf/), “These demurrage and detention fees have become a significant part of furniture retail costs in the last 2+ years.” The trade association representing toymakers like Hasbro and Mattel called the charges “[unethical](https://www2.fmc.gov/readingroom/docs/22-04/22-04_Comments_ToyAssoc.pdf/),” while a group representing meatpackers like Tyson Foods and Cargill accused ocean carriers of “near-constant predatory and unreasonable behavior” and “[a clear abuse of market power](https://www2.fmc.gov/readingroom/docs/22-04/22-04_Comments_MICA_NAMI_USMEF.pdf/).”

Cranes move containers off ships and into the port. Containers are typically owned by the ocean carriers, which can charge fees for storage at marine terminals or when containers are returned late.

One Banana called the fees “unjust and unreasonable” in a complaint to the Maritime Commission. But other fruit importers went further in agency comments.

“Demurrage charges are one way in which ocean carriers abuse their monopoly power over ocean transport,” the fruit importer William H. Kopke Jr. Inc. wrote to the commission. “Particularly when the cargo is perishable, it is as if the cargo is held hostage. If the receiver does not pay any charges demanded immediately, not only does the cargo rot while the charges are under dispute, but demurrage charges will continue to accrue.”

In an interview, John Butler, president of the World Shipping Council, said the ocean carriers that the trade group represents have been dealing with historic demand and congestion and, with the millions of boxes that they’re moving, disputes are bound to erupt.

“In the eyes of their customers, do they get it right all the time? Of course not,” he said. “Does that make it unreasonable? Sometimes it might be. Sometimes it might not be. It really is case by case. So you can't generalize about practices because it really does come down to the situation.”

In particular, Butler said, many big-box retailers and other importers have been using the ports as storage because their warehouses are full or they can’t get truckers to move their cargo.

The fee controversy is pitting the Maritime Commission, with 128 employees and a $31 million annual budget, against a global shipping industry that raked in $214 billion in profits last year.

In recent months, the commission has been trying to crack down on the fees by inviting complaints like One Banana’s and proposing tougher rules on ocean carriers. And on Monday, Congress approved the Ocean Shipping Reform Act, giving the commission more teeth.

The Maritime Commission rebuked Hapag in one case involving Golden State Logistics, proposing the biggest fine in the agency’s history: $16.5 million.

The proposed fine was still less than the profit Hapag made in a single day last year, but the commission hoped it would send a message. In late April, an administrative law judge agreed that Hapag had violated the Shipping Act, and last week the company agreed to settle the case for $2 million — about what Hapag made in 98 minutes.

Hapag declined to comment on the commission’s case but told the judge that its practices were reasonable and that any fees were the trucking firm’s fault.

As U.S. regulators spar with the global behemoths who control the shipping trade, the inefficiencies of a supply chain that once seemed blazingly efficient are becoming clear.

You’re paying more for everything, and much of it can be traced back to the COVID-19 lockdown when consumers started buying more goods like couches and electronics.

With cargo ships focused on bringing stuff in, more containers arrived than were taken back. Empty containers started piling up. And ocean carriers were in a prime position to profit.

Suddenly, the ports had no more room. Ocean carriers refused to accept all the empty containers that truckers needed to return but charged late-return fees anyway.

With ports full, ships carrying everything from couches to bananas began backing up at sea.

When the goods finally arrived, truckers couldn’t pick them up on time because many of the chassis were occupied by empty containers. Still, the ocean carriers charged late-pickup fees.

Retailers and brands have often passed those fees on to you, the consumer, which means that now you pay more for your couches, electronics and bananas.

To understand this morass, ProPublica followed one trucking company’s battle to return empty shipping containers and the ripening plot of a load of star-crossed bananas.

(Illustration by Laila Milevski/ProPublica)

Kim Cruz, an auditor for Golden State, steered a Toyota pickup through the dusty potholed storage yard in Wilmington, California, craning her neck to read the numbers stamped on the backs of shipping containers parked in row upon row. It was April, and she was looking for a container that the trucking company had been trying to return to the Chinese shipping titan COSCO since Jan. 26. The light gray container had traveled the world, according to customs records, carrying suitcases from a Cambodian factory to a port in Vietnam, where it was loaded onto a ship called the Marco Polo that is as long as the Empire State Building is tall. The container arrived in mid-January at the Port of Los Angeles, where a trucker for Golden State picked it up and drove it to a warehouse for a major department store. Now it sat empty, hidden somewhere amid hundreds of blue, green, yellow, pink and rust-colored containers lining the dirt lot squeezed between a rail line and a refinery. “It’s insane — you have to search this whole yard,” said Cruz, who has brown curly hair and a tattoo of a sooty owl wrapped around her forearm. Cruz knew the absurdities of the global supply chain intimately. She had helped Golden State and the Maritime Commission build the case against Hapag.

Kim Cruz, an auditor for the trucking firm Golden State Logistics, at a storage yard where shipping containers rack up late fees when they can’t be returned.

Overwhelmed by detention and demurrage bills in 2021, the midsize trucking firm based in Compton, California, had tasked Cruz with fighting back. She studied the law, along with a decades-old industry code with a tongue-twisting name: the Uniform Intermodal Interchange and Facilities Access Agreement. It spells out the relationship between ocean carriers, marine terminals, equipment leasing companies and trucking firms as containers and chassis change custody along the supply chain.

Many people might assume that returning a shipping container is easy: Truckers pick up a load at the port, take it to a warehouse and return with an empty container — back and forth throughout the day.

But the supply chain doesn’t work like that. Containers typically belong to the ocean carriers, and different types of containers can only be returned to certain marine terminals at specific times. To manage the flow, terminals usually require trucking companies to make appointments.

Cruz and Golden State’s dispatchers had been trying for months to schedule a time to return the COSCO container. But appointments to simply return a container are hard to come by as terminals try to free up space by requiring what’s known as a “dual transaction,” meaning that for every container brought back, a new load needs to be taken out of the port. If one of Golden State’s customers didn’t have a load at that terminal, it couldn’t return the container. To make matters more difficult, the container was sitting on a specialized chassis that couldn’t be reused and could only be returned to a specific terminal.

Each day that Golden State couldn’t return the container to COSCO, it accrued another $180 in fees that would ultimately be passed on to the department store and most likely its shoppers. So far, the container had racked up nearly $8,000 in fees, not including thousands more for the chassis and yard storage.

COSCO declined to comment.

As Cruz scanned the storage yard, she repeated the first few letters of the container number.

“What’s that one?” she asked, pointing to a gray container. “Oh no, I don’t think it’s that one.”

Before getting hired to keep track of equipment and audit invoices for trucking companies,

Cruz studied social work and psychology and worked as a customer service representative for Harley-Davidson.

“I didn’t even know what a chassis was back then,” she said. “But now I love it. It’s like trying to figure out lots of little puzzles.”

Los Angeles County’s Alameda Street is a main thoroughfare for trucks and rail lines moving containers in and out of the ports.

In the Hapag case, Cruz provided screenshots from the terminal booking websites showing that no appointments were available. But each time, a Hapag representative responded that the marine terminals manage the appointment systems, not them, and that Golden State still owed the fees. (The trade group for marine terminals said the availability of appointments is dictated by the ocean carriers.)

Frustrated by one of Hapag’s replies, Cruz shot back over email: “We are not paying this invoice. There were no appointments available and the terminal appointment system is out of our control.” She explained that Golden State had contacted Hapag daily to ask for help or alternate return locations and had gotten nowhere.

“How does any of this make sense?” she asked. “These are unfair business practices that must be stopped immediately.”

As Cruz drove deeper into the container yard, an early spring heat wave pushing temperatures past 90 degrees, she squinted through the glare of the afternoon sun on the windshield.

“It’s got to be in here somewhere,” she said.

If a container stays out too long and late fees aren’t paid, trucking companies can be slapped with a shut-out notice, barring them from picking up any of the ocean line’s containers. The notices are akin to a death sentence in the freight industry, as trucking firms that can’t fulfill their customers’ orders will quickly lose business.

In the last year, Cruz said, Golden State had been threatened frequently with shut-outs. It’s a powerful scare tactic, she said, that often pressures trucking companies to pay invalid bills.

“Truckers usually pay it and just say be done with it,” she said. “You know, we’re gonna lose more money if we end up getting shut out. So that’s what happens.” She shook her head: “Dirty business.”

After searching through rows of containers, Cruz finally approached the back of the yard.

“Maybe behind that container?” she said.

She got closer and read the letters.

“That’s it!” she shouted.

The light gray COSCO container was pocked with rust marks, sitting between a lime-green container and one that was taxi yellow. Cruz stepped out of the pickup to look at the box that had been a line at the top of a spreadsheet and the object of so much agita.

But she still needed a trucker — and an appointment to return the container.

The impact of the fees has hit freight haulers big and small. And the circumstances causing them to pony up are often out of their control. The IMC Companies, one of the largest port trucking firms in the country, said it paid well over $100 million in demurrage fees alone last year on behalf of its customers, compared with a few million dollars before the pandemic. Jim Gillis, president of the IMC subsidiary Pacific Drayage Services, said at one point last fall one of his customers, a large household goods retailer selling small appliances and candles, had 350 containers that it couldn’t return. “By the time you’re said and done, instead of paying $10,000 a container, with all the fees racked up, with storage fees at the port, chassis fees, per diem fees, these guys are paying $60,000 to $70,000 a box,” he said, estimating the total might have reached $20 million. “If I’m an importer,” he said, “I’m adding that to the price of my products.”

Jim Gillis, president of Pacific Drayage Services, a subsidiary of IMC Companies, one of the largest port trucking firms in the country, at a storage yard behind the company’s office in Compton, California

The issue became so bad for Leslie Luna, freight coordinator for Luna and Son’s Trucking, that her family moved its small trucking firm out of Southern California to the less-congested Port of Houston in Texas.

“It got to a point where we were stressed with having to house all these containers and not getting much help,” she said. “I was lucky if I got two to three hours of sleep, because I was literally on that computer all night trying to get appointments.”

Ocean carriers and marine terminals typically don’t let truckers leave with a container until all late pickup fees have been paid. Businesses say that’s forced them to shell out even when the charges are disputed.

Sometimes, containers are pulled aside for inspection by U.S. customs officials. J&K Fresh, a customs broker for the fruit industry, said Chilean grape importers are “facing a financial crisis” at the Port of Philadelphia as congestion delays are forcing them to pay thousands of dollars in fees per container while waiting for the grapes to be fumigated — a requirement of the U.S. Department of Agriculture.

Once containers are picked up, another clock starts. Importers have a few days to take them to a warehouse, unload them and return them empty.

Often, retailers will hire freight brokers to act as travel agents to handle the whole trip.

Under some contracts, the broker can be the ocean shipping line, which arranges transportation of the container across the sea, over rails and aboard trucks to its final destination. But sometimes the ocean carrier’s trucking company is backlogged for weeks. Both retailers and freight brokers said they’ve sometimes been stuck with late fees in these cases even when other trucking firms were available.

In addition to alerting importers that their goods have arrived, ocean carriers also tell U.S. companies waiting to export products when their ship is about to dock. Those companies, often farmers and manufacturers, will then load their products into containers and take them to the port. But because of the congestion, the companies complain, the ocean carriers’ ships have been delayed, forcing them to pay fees for port storage or extra container use.

Even when supply chains aren’t snarled, fees can add up fast.

In one particularly pungent anecdote, Brian Watt, a logistics manager based in Florida, described a container carrying plastic bins full of liquid yeast extract from Europe to New York. On its journey across the Atlantic, he said, one of the bins burst open, coating the inside of the container with a slurry-like goo. The mess was discovered only after his trucker had delivered the container to a food industry and brewery supplier in upstate New York.

Watt had to send a trucker to pick the load back up, hire a waste company to clean it out and wait for a permit to dump the yeast extract in a New Jersey landfill.

“You can imagine how it smelled. This is July. Do you know how hot it gets inside a container?” he said. “We had to send guys in suits to clean that thing up.”

The process took almost two months, and in the end, the ocean carrier sent Watt a late-return bill for $42,150.

The front window of Golden State’s office glowed like a beacon among the low-slung warehouses of Compton. It was a few minutes past 4 a.m., and Lisandro Figueroa was at his cubicle, scanning terminal websites for appointments to return empty containers — like the one his coworker Cruz was dealing with. He stared at a blue-and-red grid on his computer screen, jotting down abbreviations for ocean carriers on a piece of a paper as country music hummed in the background. “This is COSCO. This is Evergreen. This is OOCL. This is ONE line. CU lines. BAL lines. Wan Hai lines. Yang Ming lines. As you can see,” he said, “everything mostly says no.” The global supply chain has often been heralded as a high-tech wonder. The movement of containers at ports and through warehouses is a heavily automated ballet of advanced robots. But keeping it all together are people like Figueroa and Cruz.

Truck traffic near the ports of Long Beach and Los Angeles, where drivers pick up and drop off containers with direction from dispatchers

Figueroa’s work as a dispatcher is kind of like a cross between Wordle and SimCity. Golden State has to pick up about 150 containers loaded with auto parts, appliances and electronics from the port terminals every day. The stores and suppliers want their stuff as soon as possible, and each load has a deadline — typically a few days after arrival in the port — after which fees start to accrue. To get those goods, Figueroa has to match up drivers with empty containers that the terminals will accept. That way, the drivers can drop off the old containers and reuse the chassis to pick up the new ones. So he scans a spreadsheet for the oldest empties he can return to stop fees from accumulating.

Golden State’s yards, meanwhile, can only accept so many containers. That morning, one of its yards had 88 containers sitting in 90 spots. If Figueroa didn’t move empties out of the yard soon, Golden State would run out of space.

By 5 a.m., his phone was ringing every few minutes. Figueroa, who has a black beard with gray streaks, switched seamlessly between English and Spanish while also speaking fluent logistics jargon.

Port truck drivers are nearly all independent contractors seeking to line up the most profitable loads and avoid those that would cost them time and money while sitting in lines at the port or stuck in Los Angeles traffic.

“To keep a driver, you’ve gotta be on their level sometimes,” Figueroa said. “I’m a driver psychologist because I do a whole lot of listening.”

One driver called looking for work, only to call back a few minutes later saying his battery had died.

“Well, let me know when you get it fixed, not a problem,” Figueroa assured him. “Ándale pues.”

He sent one driver to take a shipment from the yard to an appliance warehouse and another driver to haul an empty container back to the port and pick up a new load: “Ándale, bye-bye.”

At 6:41 a.m., a driver wearing a reflective-striped shirt and orange polarized sunglasses stopped by the office and said he was ready for a load. Figueroa sent him to fetch a shipment of tires that would start accruing fees if not picked up by the end of the day.

A few minutes later, the phone rang.

“Uh-oh,” Figueroa said. “What happened? Don’t scare me. Don’t scare me.”

It was a driver who was supposed to pick up an empty container from the yard, return it to the port and pick up a new load between 7 and 8 a.m. But he had accidentally pulled from the yard a container full of auto parts destined for a customer.

Before Figueroa could worry, a colleague reported that another driver who was supposed to pick up a load of auto parts had broken down. The problem had essentially fixed itself. Figueroa reassigned the driver who’d taken out the wrong load to cover the delivery for the driver who’d broken down.

Lisandro Figueroa, a Golden State dispatcher, at the company’s office in Compton

Yet Figueroa still had to cover the 7 to 8 a.m. appointment to pick up a new load at the port. So he called the driver with the orange sunglasses.

“Hey, that load I gave you? Cancel it,” Figueroa said. “I am going to send you another load instead.”

The tires would have to wait, getting closer to racking up fees.

As things quieted down, Figueroa started going through the COSCO containers that had been sitting on the specialized chassis for weeks, collecting thousands of dollars in fees. But as usual, there were no appointments at the terminal that would accept both the container and the chassis.

So he started to see if he could just return the container and then separately turn in the chassis later.

Amid the congestion, finding an appointment has been like trying to nab tickets for a K-pop concert or a COVID-19 vaccine in early 2021.

There was an appointment for 5:30 p.m. But before Figueroa could type in the container number to reserve it, the appointment was gone. The next one wasn’t until 10:30 p.m., and it was Friday night. The chances of getting a trucker to cover it were slim.

But Figueroa said he knew a trick.

“I’ve done this so much,” he said, “that I’ve figured out that they’ll open appointments every half hour on the two mark, and by the two mark, I mean they'll open appointments at 8:02 and 8:32.”

It was almost 8:02 a.m. Figueroa placed his fingers on the keyboard and refreshed the terminal’s website. He refreshed again. And again. And again. And again. And again. And again. And again. And again.

“If I didn’t get one by now, I’m probably not going to get one,” he said.

At 8:32 a.m., Figueroa tried again. No luck.

It too would have to wait, and the meter kept running.

A container at a storage yard in Wilmington, California, stuck for months and racking up fees

The imbroglio over the bananas was becoming increasingly desperate for One Banana. The company typically shipped five to six refrigerated containers of bananas with Hapag each week. The family-owned firm had started with one plantation in Guatemala in 1958 and grown into one of the largest producers of tropical fruits in Central America. With more than 100 vessels queueing outside the ports of Los Angeles and Long Beach last fall, One Banana’s loads suddenly had to wait longer. And shipping rates had increased substantially. Starting in September, One Banana contacted 15 trucking companies, and almost all refused to pick up the importers’ containers if they were from Hapag, because they were afraid of getting stuck with them and racking up fees.

“We have 30+ empties out of the port with nowhere to return them,” a One Banana employee wrote to Hapag in October. “On top of this, we have 30+ full containers of perishable product that is sitting at the port and getting older every day because no carrier will go into the port to get it because they know they will be stuck with containers for weeks.”

The employee added, “I do not see how it is right that we are getting charged demurrage for containers that we cannot even pickup because we cannot return your empties.”

As weeks passed without a resolution, One Banana faced a choice of whether to pay $12,000 per container to get its 600,000 pounds of bananas to grocery stores. The company had already incurred more than $300,000 in detention and demurrage fees on 67 containers since the start of September.

“We can only help you if you pay in advance,” the trucking firm told the company.

One Banana declined to say whether it agreed to pay the fees.

But it did pay a price.

The bananas had already gone bad.

An orange Hapag-Lloyd container sits on a side street near the ports of Los Angeles and Long Beach, surrounded by other containers left in limbo.

Do You Have a Tip for ProPublica? Help Us Do Journalism.

by Jennifer Smith Richards, Chicago Tribune, and Jodi S. Cohen, ProPublica

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for Dispatches, a newsletter that spotlights wrongdoing around the country, to receive our stories in your inbox every week.

This story was co-published with the Chicago Tribune.

From the moment Amara Harris was accused of stealing another student’s AirPods at Naperville North High School, she has insisted that it was a mix-up, not a theft.

She told a school dean that she thought the AirPods were her own, having picked them up a few days earlier in the school’s learning commons, where she said she thought she had left her own set. Her mother repeatedly told officers that her daughter hadn’t stolen the wireless earbuds, records show.

Still, the school resource officer wrote Amara a ticket in 2019 for violating a municipal ordinance against theft. Paying a fine would have made the matter go away, but Amara says she won’t admit to something she didn’t do. For two and a half years, she has repeatedly gone to court to assert her innocence, even delaying her plans to attend on-campus classes at her dream school, Spelman College.

Now, in a rare and dramatic example of the impact of school ticketing, the case is headed for a jury trial, with the next court date on Tuesday. As Naperville continues to prosecute the case, Amara and her mother have racked up far more in legal bills than the city’s highest fine would have cost them.

“I am innocent. I am fighting because I don’t want this to happen to anyone else,” said Amara, now 19. “Why would I say I’m innocent to everyone but then I lie in court and say I’m guilty? It doesn’t make sense to me.”

This spring, in the investigation “The Price Kids Pay,” ProPublica and the Chicago Tribune exposed the widespread practice of school officials and local police working together to ticket Illinois students for misbehavior at school, resulting in fines that can cost hundreds of dollars. Reporters documented about 12,000 tickets issued for possession of vaping devices and cannabis, disorderly conduct, truancy and other violations from August 2018 through June 2021.

Ticketing students for their behavior in school skirts a state law that bans schools from disciplining students with monetary fines. Immediately after the report was published, state officials including Gov. J.B. Pritzker and the state schools superintendent said they intended to put a stop to the practice.

The superintendent, Carmen Ayala, chided schools for outsourcing discipline to police and urged them to stop. The Illinois attorney general’s office, concerned that school ticketing was violating the civil rights of students of color, launched an investigation into a large suburban high school district and said it might investigate others.

But none of the state officials addressed how to deal with pending cases of students who, like Amara, had already been ticketed.

“The governor says he wants this to stop, he wants this to end,” said Amara’s mother, Marla Baker. “We are in the middle of it.”

Amara’s family, like so many others, was thrown into a system that uses a lower standard of proof than a criminal court. People ticketed for ordinance violations can be held responsible if the allegation is deemed more likely to be true than not, and the ticket itself is considered evidence. At every turn, the system and the officials in it encourage families to admit liability and pay a fine. And most do.

During a year of reporting on student ticketing that included attending more than 50 days of hearings, Tribune and ProPublica reporters met dozens of students and parents who paid fines even though they believed police didn’t need to be involved in the first place. Some were initially inclined to fight the citations but eventually gave up, worn down by the process.

Amara’s case demonstrates the extraordinary effort it can take to argue against a ticket in a system built for assembly-line justice. Hers is the first case the Tribune and ProPublica have encountered that could go before a jury; Naperville officials said the city hasn’t had a jury trial for an ordinance violation in at least a decade.

The ticket is a civil matter, so there’s no threat of jail time. But Amara said she is committed to clearing her name.

To Amara and her mother, the ticket — and the city’s commitment to prosecuting it — is another example of people in power discriminating against Black children. Only about 120 of the roughly 2,700 students at Naperville North are Black, and Baker has spoken out in the past about what she sees as racism and bias in the city’s schools.

A Naperville city spokesperson, responding on behalf of the city and its police department, said “the City categorically denies that race in any way played a factor in this case.”

Spokesperson Linda LaCloche declined to answer specific questions about the police investigation because Amara’s court case is pending. The spokesperson attributed the case’s slow progress to court closures caused by the COVID-19 pandemic, Amara’s change in attorneys and court scheduling issues, among other reasons.

The officer who wrote the ticket, Juan Leon, declined to discuss the case but said it was “unbelievable” that it was still pending. He blamed Baker for dragging it out.

A Naperville Community Unit School District 203 spokesperson distanced the district from the case, saying: “Naperville 203 does not ticket students.” Spokesperson Alex Mayster said school officials rely on school resource officers, who work for the city’s police department, when a disciplinary matter may involve a law being broken. State schools chief Ayala has said schools that take this approach are “abdicating their responsibility.”

Amara’s family so far has paid at least $2,000 in lawyer fees to fight the case, Baker said. She and Amara stopped working with their most recent attorney in part because of the cost of going to trial and his recommendation that they accept a plea deal.

If there’s a trial, Amara may have to defend herself. Still, she said, she is not going to quit and allow the ticket to blemish her hard-earned school record. She made the honor roll at Naperville North, participated in school activities including cheerleading and the step team, served as an aide in the classroom and for the school deans and, in 2020, graduated from high school ahead of schedule. She said she has interned at the Brookfield Zoo and hopes to become a veterinarian.

“They are taking away all of my accomplishments that I have worked hard for and substituting it with an accident that happened,” she said. “To define me as a person — that is not who I am.”

The AirPods investigation began in November 2019, when a school dean told the school police officer he had received a voicemail from a father who said his daughter’s AirPods had been stolen. Two of the school’s deans then began gathering information, according to the Naperville police report that summarizes how the school and police handled the incident.

Amara became part of the investigation, the report states, when the girl whose AirPods had gone missing reported something she had been told by a friend. During class, the friend saw Amara’s name pop up on her own laptop connected to AirPods that she thought belonged to the girl, the report says. The friend informed the girl, who then went to the school administration.

That same day, Dean Jim Konrad went to Amara’s classroom to speak with her. According to the police report, Amara told the dean she had purchased AirPods months earlier and handed Konrad the ones in her possession. They turned out to match the serial number provided by the other student.

“Amara stated that she did not know how this happened, and told him she thought they were hers,” the police report stated, recounting the conversation between the dean and Amara, then a 17-year-old junior.

The report said nothing more about Amara’s explanation for having the other girl’s AirPods.

“They never talked to me, never asked me what happened,” Amara said in an interview with ProPublica and the Tribune. But what she’d tell them is simple, she said: “I would tell them I found them in the exact location where I thought I misplaced them.”

Baker said she showed a receipt to school administrators and later to police to prove that Amara owned a set of AirPods and to show that Amara had reason to believe the ones she picked up were hers. Amara said using the other girl’s AirPods was seamless and there was no indication they belonged to someone else.

The police report makes no mention of the receipt.

After speaking with Amara, the dean went back to the police officer. The two of them agreed to call Amara’s mother, but before that happened, a fire alarm went off at the school. Amara, meanwhile, called Baker on her own. According to the police report, Baker came to the school and “started to yell” that school officials had “interrogated” Amara. She then left with Amara.

The school resource officer then called the father of the girl whose AirPods were missing. He told the officer he was glad his daughter had her AirPods back but he wanted Amara charged with theft, according to the police report. The officer said he explained “the different possible consequences toward Amara.”

School officials didn’t discipline Amara, she and her mother said, but the police continued to pursue the matter. Two weeks later Baker met with the school resource officer and a sergeant at the police station. Baker brought the former police chief of Aurora, who is retired but acts as a liaison between police and Black community members in the Chicago area. Amara was not present.

At that meeting, the Naperville school resource officer explained that he was issuing Amara a city ordinance citation for theft. According to the police report and the former police chief, Baker insisted “there was no theft” and would not accept the ticket. The officer wrote “Refused” on the signature line for the defendant when Baker declined to sign the citation.

The ticket issued to Amara Harris (Redactions by ProPublica)

“Something just wasn’t right,” said William Powell, the former Aurora police chief, who now works with the National Organization of Black Law Enforcement Executives. “When her daughter was accused of taking these AirPods, they wanted to jump on her daughter right away and press charges.”

Powell said he was troubled that the police wouldn’t explain why they believed it was theft and not a mix-up. He said he thought the police were dismissive and acted like the ticket was not a big deal.

“They said, ‘She’s not being charged, she’s being ticketed,’” he said. “It doesn’t make any difference — she’s still in the system. I felt that it might not have been investigated thoroughly.”

When racist incidents in Naperville schools caught the nation’s attention a few years ago — one student was accused of posting an online ad with a photo of a Black student that said “slave for sale” — Baker spoke out.

At a community meeting and to reporters, she described how her son had been bullied in middle school, with classmates using slurs and sending him photos of a noose and of the Ku Klux Klan.

When Amara was ticketed for theft soon after that community forum, Amara and her mother felt like it was another injustice.

“We moved to Naperville for a better education, not to be marginalized where [if] she has a situation, she is sent all the way to court,” said Baker, who moved in 2016 with her family from Carbondale in southern Illinois.

The most recent court order in Amara’s case

A Naperville Community Unit School District 203 spokesperson said the district has worked to address concerns raised in 2019 about systemic racial inequities, including by adopting an equity resolution that commits to ending racial injustice, offering districtwide implicit bias training and examining hiring and requirement practices.

For “The Price Kids Pay,” the Tribune and ProPublica were able to identify racial disparities in school-based ticketing in some districts. But that type of analysis wasn’t possible for Naperville because ticket records obtained from the city’s police department didn’t indicate the race of the young people cited.

To fight Amara’s ticket, Baker hired a lawyer and also reached out to representatives from the NAACP and other advocacy groups. She started an online petition. She appealed to members of the Naperville City Council and to the mayor in an email urging them to dismiss the citation.

“Let her move on with her life and finally be able to attend college in person,” she wrote in March. “Let her move on from this false allegation that should have stayed as a simple school disciplinary issue.”

But the city’s prosecution of Amara continued. To make it easier to appear in DuPage County court, Amara has been taking her Spelman classes online, delaying a move to Atlanta. To pay her legal fees, she dipped into money she had saved for school as well as paychecks from a recent job.

Amara uses a whiteboard in her bedroom to keep track of court dates and her work schedule. (Armando L. Sanchez/Chicago Tribune)

Earlier this year, a second lawyer representing Amara negotiated a potential plea agreement in which the city would dismiss the case if Amara paid a $100 fine plus $100 court costs. She would also have to concede that if she went to trial, the city would present a case and it was possible that she could be found guilty.

Amara wouldn’t agree to that deal and requested a jury trial. Her mother was angry. She wanted the lawyer to fight for a full vindication and felt that the plea deal would have undercut their pursuit of justice. The lawyer withdrew from the case.

“I just can’t tell my daughter to plead to something you didn’t do,” Baker said. She also acknowledges that it’s hard to know at this point what would feel like a win in Amara’s case. “I feel like no matter what, even if they dismiss it and we walk away from it, she still lost.”

When reporters asked Naperville officials about Amara’s case, city spokesperson LaCloche suggested the matter could have been resolved without a ticket. She said the decision to issue the citation was made by police after they “initially considered addressing this matter via an informal out-of-court resolution.”

Baker and Amara said police never indicated there was an alternative to a ticket and they were shocked to hear what the city told reporters. Powell, the former police chief, said no other option was mentioned in the meeting he attended.

“If you didn’t want to give the ticket, what parent would be like, ‘No, no, no — give me the ticket’?” Baker said. “If that was always the case, you still have the power to do so now. That is ridiculous to me.”

The father of the student who reported her AirPods missing in 2019 said he did not realize the case was still going on. He declined to comment further, saying he didn’t want anything to do with it.

After lawmakers said in April that they planned to take action on police ticketing at school in response to “The Price Kids Pay,” Baker renewed her efforts to get authorities to help them. She contacted a state senator and the Illinois State Board of Education. A board employee last week told Baker that she couldn’t help because the case isn’t under school jurisdiction any longer — it’s a court matter. She encouraged Baker to email the state superintendent.

Amara and her mother also reached out to ProPublica and the Tribune through a form asking students and parents to contact reporters about their experiences.

Throughout the case, Amara has remained focused on her academic goals. In addition to taking online classes at Spelman, she also enrolled at a local community college. By May 20, she had earned enough credits for an associate degree in science from the College of DuPage.

Amara crosses the stage while graduating from the College of DuPage. (Armando L. Sanchez/Chicago Tribune)

On graduation day, Amara put her green gown on over a white flowered outfit and fitted her cap over her long braids. Baker made a point of saying that she didn’t want Amara to think about court on that day.

“I want you to enjoy this, I really do. I want you to block everything else out,” Baker said when she and Amara went outside to take photos. “I hope this will encourage you to keep going, and you’re halfway there already.”

But the ticket still looms. On a whiteboard in her bedroom, Amara marks the court dates alongside her work schedule.

She and her mother say they desperately need the case to end before summer’s over so Amara can head to Spelman. “Somebody’s going to come to help us,” Baker said.

Marla Baker hugs her daughter after watching Amara graduate from the College of DuPage. (Armando L. Sanchez/Chicago Tribune) Help ProPublica and the Chicago Tribune Report on Police Issuing Tickets at Schools

Police are ticketing students at schools across Illinois for behavior such as vaping, littering and disorderly conduct. Many students are forced to appear at hearings, which means missing school time, and the cases almost always result in judgments against the students, which carry fines as high as $750. We have found students as young as 10 are being ticketed, and Black students are disproportionately impacted.

To continue with this important reporting, we need to hear from people who have been affected by tickets handed out at school. Are you a parent, school worker, researcher or attorney? Please fill out this brief survey.

We take your privacy seriously. We are gathering these stories for the purposes of our reporting and will not publish your name or information without your consent.

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by Nicole Carr

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for Dispatches, a newsletter that spotlights wrongdoing around the country, to receive our stories in your inbox every week.

This story and accompanying videos were co-published by ProPublica and FRONTLINE as part of an ongoing collaboration.

In April of 2021, Cecelia Lewis had just returned to Maryland from a house-hunting trip in Georgia when she received the first red flag about her new job.

The trip itself had gone well. Lewis and her husband had settled on a rental home in Woodstock, a small city with a charming downtown and a regular presence on best places to live lists. It was a short drive to her soon-to-be office at the Cherokee County School District and less than a half hour to her husband’s new corporate assignment. While the north Georgia county was new to the couple, the Atlanta area was not. They’d visited several times in recent years to see their son, who attended Georgia Tech.

About This Partnership

This story is part of an ongoing collaboration between ProPublica and FRONTLINE that includes an upcoming documentary.

Lewis, a middle school principal, initially applied for a position that would bring her closer to the classroom as a coach for teachers. But district leaders were so impressed by her interview that they encouraged her to apply instead for a new opening they’d created: their first administrator focused on diversity, equity and inclusion initiatives.

DEI-focused positions were becoming more common in districts across the country, following the 2020 protests over the killings of George Floyd, Breonna Taylor and Ahmaud Arbery. The purpose of such jobs typically is to provide a more direct path for addressing disparities stemming from race, economics, disabilities and other factors.

At first, the scope of the role gave Lewis pause. In her current district, these responsibilities were split among several people, and she’d never held a position dedicated to anything as specific as that before. But she had served on the District Equity Leadership Team in her Maryland county and felt prepared for this new challenge. She believed the job would allow her, as she put it, to analyze the district’s “systemic and instructional practices” in order to better support “the whole child.”

“We’re so excited to add Cecelia to the CCSD family,” Superintendent Brian Hightower said in the district’s March 2021 announcement about all of its new hires. (The announcement noted that the creation of the DEI administrator role “stems from input from parents, employees and students of color who are serving on Dr. Hightower’s ad hoc committees formed this school year to focus on the topic.”) Hightower acknowledged “both her impressive credentials and enthusiasm for the role” and pointed out that, “In four days, she had a DEI action plan for us.”

Cecelia Lewis: “The District Identified This as a Need” (FRONTLINE)

During her early visits, Lewis found Cherokee County to be a welcoming place. It reminded her of her community in southern Maryland, where everyone knew one another. But leaving the place where she’d been raised — and where, aside from her undergrad years at the University of North Carolina at Chapel Hill, she’d spent most of her adult life — wasn’t going to be easy. Before her last day as principal of her middle school, her staff created a legacy wall in her honor, plastering a phrase above student lockers that Lewis would say to end the morning messages each day: “If no one’s told you they care about you today, know that I do ... and there is absolutely nothing you can do about it!”

How We Got the Interview

Cecelia Lewis initially was reluctant to talk about her experience in Georgia. For several months, she did not respond to requests for an interview. Lewis then declined to comment in March, citing safety and privacy concerns. After multiple additional requests, Lewis agreed to an interview, her first regarding what happened to her in Georgia, seeing it as a way for her experience to help people understand what educators are facing in these times. Read more about reporter Nicole Carr's pursuit of the story.

Lewis was beginning to prepare for her move South, spending as much time with friends and family as possible, when she got a strange call from an official in her new school district. The person on the line — Lewis won’t say who — asked if she had ever heard of CRT.

Lewis responded, “Yes — culturally responsive teaching.” She was thinking of the philosophy that connects a child’s cultural background to what they learn in school. For Lewis, who’d studied Japanese and Russian in college and more recently traveled to Ghana with the Fulbright-Hays Seminars Abroad program for teachers, language and culture were essential to understanding anyone’s experience.

At that point, she wasn’t even familiar with the other CRT, critical race theory, which maintains that racial bias is embedded in America’s laws and institutions and has caused disproportionate harm to people of color. In a speech the previous fall, then-President Donald Trump condemned CRT as “toxic propaganda” and “ideological poison.”

The caller then told Lewis that a group of people in a wealthy neighborhood in the northern part of the county were upset about what they believed were her intentions to bring CRT to Cherokee County. But don’t worry, the district official said; we just want to keep you updated.

The following month, inside a gabled white clubhouse overlooking the hills of a Cherokee County golf course, dozens of parents from across the county had assembled on a Sunday afternoon for a lesson in an emerging form of warfare. School board meetings would be their battlefield. Their enemy was CRT.

One of several presenters at the meeting was Rhonda Thomas, a frequent guest on conservative podcasts and the founder of the Atlanta-based Truth in Education, a national nonprofit that aims to educate parents and teachers about “radical ideologies being taught in schools.” “So what is critical race theory?” Thomas asked the crowd. “It teaches kids that whites are inherently racist and oppressive, perhaps unconsciously,” and that “all whites are responsible for all historical actions” and “should feel guilty.”

She added: “I cannot be asked for repentance for something my grandparents did or my ancestors did, right?”

Thomas stressed that parents should form their own nonprofit groups and cut ties with their schools’ Parent Teacher Associations. “The PTA supports everything we’re against,” she told them.

Another presenter, a local paralegal named Noelle Kahaian, leads the nonprofit Protect Student Health Georgia, which aims to “educate on harmful indoctrination” including “comprehensive sexuality education” and “gender ideology.”

Kahaian emphasized how to grab attention during upcoming school board meetings. Identify the best speakers in the group, she told them, adding: “It’s OK to be emotional.” Be sure to capture video of them addressing the board — or even consider hiring a professional videographer.

“It’s good in case Tucker Carlson wants to put you on air,” Kahaian said. “It really helps.”

Inside the Clubhouse

Presenter Noelle Kahaian talks to the crowd about the “tsunami strategy.”

She then briefed them on how to file grievances about school board members’ teaching licenses and on their right to request school board members’ cellphone records.

And she advised them on the benefit of collaborating with “outside forces” to file open records requests to school systems for employee emails and curriculum plans that could provide evidence of inappropriate material being taught in classrooms. Doing so would allow those outsiders to “take some of the heat.”

But there was one agenda item that would inspire the crowd to take more urgent action than any other: They had to figure out what to do about the Cherokee County School District’s decision to hire a woman named Cecelia Lewis.

“And when I got a text message from somebody saying that this person was hired, I immediately was like, ‘Oh, my goodness, where are my people?’” said another speaker, Mandy Heda, a Cherokee County GOP precinct chair who introduced herself as a parent of four students in the district.

Thomas, Kahaian and Heda did not respond to multiple requests for comment or to a list of questions detailing the points they raised at the clubhouse meeting and elsewhere.

After asking the crowd to look at the Maryland district where Lewis was coming from, Heda wondered how Lewis could “leave that at the border” (she didn’t elaborate on what “that” was) and how the longtime educator could come “to Cherokee County and not want to change us.” (Like Cherokee, the district where Lewis was a principal serves a majority-white county that voted for Trump in 2020 — though Heda and others in the clubhouse seemed unaware of this.)

A man interjected, saying he’d contacted the Cherokee County School District to find out “how they arrived at the choice to hire” Lewis. Hadn’t there been any local candidates, he asked.

Targeting Lewis

Presenter Mandy Heda criticizes the district's decision to hire Cecelia Lewis.

“You cannot tell me, you know, that you can’t find somebody else qualified,” Heda responded. “And if you’re looking for her to be Black, that’s fine. But that’s not what this is about. This is not about the color of her skin. It’s what she’s going to bring into our district and what she’s going to teach our children.”

Another person in the crowd later asked if the arrival of Lewis was a done deal. Several confirmed that it was.

“We don’t have to accept it, right?” another man asked, the crowd’s energy rising in response with a collective yes. “We can change that, right?”

“In some way, shape or form,” another woman vowed.

The May 2021 clubhouse meeting, a recording of which was provided to ProPublica by a parent who attended, provides a window into the ways in which conservative groups quickly and efficiently train communities to take on school districts in the name of concepts that aren’t even being taught in classrooms.

National groups, often through their local chapters, have provided video lessons and toolkits to parents across the country on how to effectively spread their messaging about so-called school indoctrination. Parents Defending Education has created “indoctrination maps” tracking everything from a district celebrating “Black Lives Matter week” to one that allows students to watch CNN Student News, while the Atlanta-based Education Veritas and Kahaian’s Protect Student Health Georgia provide portals for anonymously reporting educators supposedly sympathetic to CRT, DEI and other so-called controversial learning concepts.

In the wake of 2020’s summer of racial reckoning, as the work of anti-racist authors shot to the top of bestseller lists and corporations expressed renewed commitments to diversity initiatives, conservatives mounted a counteroffensive against what they viewed as an anti-white, anti-American, “woke” liberal agenda. And with that effort came a renewed vilification of CRT, a four-decade-old theory that, contrary to its opponents’ accusations, is rarely if ever taught in K-12 public school systems (it typically is taught in graduate-level college and law school courses). That effort quickly snowballed into complaints about what used to be basic history lessons involving race and slavery, which organized groups began conflating with CRT and campaigning for their removal from curriculums.

Never miss the most important reporting from ProPublica’s newsroom. Subscribe to the Big Story newsletter.

Nearly 900 school districts across the country have been targeted by anti-CRT efforts from September 2020 to August 2021, researchers at the University of California, Los Angeles, and the University of California, San Diego, found. Teachers and district equity officers surveyed and interviewed for the report “often described feeling attacked and at risk for discussing issues of race or racism at all, or promoting equity, diversity, and inclusion in any way. Equity officers told us that at times they feared for their personal safety.”

The report also stated: “Only one equity officer described a year free of anti ‘CRT’ conflict.”

“It makes me very sad for my colleagues,” said Cicely Bingener, one of the UCLA researchers and a longtime elementary school educator.

Using local media coverage and lawsuits, ProPublica has identified at least 14 public school employees across the country, six of them Black, who were chased out in part by anti-CRT efforts in 2021. Some of the educators resigned or did not have their contracts renewed, while others were fired by school boards where elections had ushered in more politically extreme members.

Since January 2021, legislatures in more than 40 states have proposed or passed bills and resolutions that would restrict teaching CRT or would limit how teachers can discuss racism and sexism. Four days after the meeting in the golf course clubhouse, Georgia Gov. Brian Kemp released a statement solidifying his stance against CRT and asking the state Board of Education to do the same. “I urge you to take immediate steps to ensure that Critical Race Theory and its dangerous ideology do not take root in our state standards or curriculum,” it read.

On June 3, 2021, the Board of Education did just that, joining Utah’s as the first such groups to pass resolutions of that kind. Georgia’s declared that “the United States of America is not a racist country, and that the state of Georgia is not a racist state.”

In predominantly white Cherokee County, 40 miles north of downtown Atlanta, the fight over CRT has led some residents to question whether they still recognize the community they thought they knew.

“These are our neighbors,” said Leanne Etienne, a Black mother of two Cherokee County students, one of whom served on the superintendent’s ad hoc committee that led to the creation of the DEI position. “These are people who are the parents of the children my kids go to school with. It’s a very uncomfortable feeling. You don’t know who to trust. You don’t feel safe.”

After that April call from the school district official, Lewis was confused but remained optimistic. She read up on CRT and determined it had nothing to do with her role. Then came more calls.

In one, a district official asked Lewis if she has social media accounts. “Only a LinkedIn,” she replied. (Lewis barely has a digital footprint. She has never posted anything on social media nor made any professional statements in regard to CRT or any other controversial topic.) The official explained that some of the people upset about her hiring were complaining that a Twitter user with her name was posting Marxist ideology.

Around that same time, according to Lewis, several emails and handwritten letters were showing up at her school in Maryland, calling her a Black Yankee and saying her liberal thinking is unwanted. She saved only one, with typewriting on the envelope. The return address was just “A Cherokee County Citizen.”

“They ultimately just said, you know, ‘We don’t want you here, and we don’t want you to push us to find out what will happen if you come here,’” Lewis said.

On May 18, 2021, two days after the meeting at the clubhouse, Cherokee County’s schools communications chief and its school board members received the first of approximately 100 form letters that would flood their inboxes over a 48-hour period, demanding that Lewis be fired.

One of approximately 100 form letters opposing Lewis’ hiring that were sent to Cherokee County School Board members and district officials during a two-day period in May 2021. (Screenshot by ProPublica)

Another parent wrote to a school board member, citing Cherokee County’s recent census statistics: “Did you know that 77.8% of the population is considered ‘whtie [sic] alone’ 7.7% are black and 11.1% hispanic? Are we now in a county that is going to cater to a handful of people?”

Lewis said she was willing and eager, once she arrived in Georgia, to speak to concerned parents. “I just felt as if there was a misunderstanding,” she said, “and as soon as I [would] have an opportunity to get there and really speak on my own behalf, then it was going to be OK.”

She also felt comforted by the fact that school district officials were regularly checking in with her, offering reassurances that they were monitoring the situation and that everything would be OK “once they get to know you.”

Lewis tends not to talk about racism in terms of her professional life. She said that, until she got the Black Yankee email, she had not experienced racial prejudice and was accustomed to learning and working in majority-white spaces. She also recalled being surprised when someone from the district pointed out that a hiring like hers was rare, in that there were not many minority leaders working in the district.

“I did not think that in 2021 that that was really a thing,” Lewis said, noting the district’s proximity to Atlanta, with its high concentration of Black leadership and affluence. “And that was probably just ignorance on my end. And I mean that in the purest form of ignorance, of just not knowing. I didn’t know.”

On May 20, 2021, one of Lewis’ soon-to-be colleagues called to say that the people upset about her hiring were claiming to have spotted her around Cherokee County and were sharing with one another her supposed locations. Lewis, however, was still in Maryland.

That same day — following an increase in social media posts, emails and phone calls complaining about Lewis and CRT — the district installed metal detectors and assigned extra security at the county building where school board meetings are held.

Lewis soon received yet another call. Someone from district leadership asked if she was planning to watch the board meeting that night. She replied that it hadn’t been on her radar.

“You should watch it,” they said.

Well before the Cherokee County School Board meeting’s 7 p.m. start time, people hoping to get inside were being turned away. The room and the overspill viewing area in the lobby were at capacity. Those who were denied entry gathered outside near the parking lot, where they could peek through windows and glimpse the large screens mounted in the boardroom. Others hung around outside, planning to watch the livestream of the meeting on their phones.

At home in Maryland, Lewis and her husband sat in their bedroom, the laptop propped up between them.

Inside, just before the meeting started, mothers in black T-shirts printed with the words “I don’t co-parent with the government” smiled and posed for pictures. A husky man with a deep voice formed the beginning of the large prayer circle that inched toward the dais where district officials, student delegates and Cherokee County’s seven school board members were seated.

The first order of business was introduced by Mike Chapman, a Republican board member who’d held his seat for more than two decades: a resolution against teaching CRT and the 1619 Project, a Pulitzer Prize-winning New York Times series that “aims to reframe the country’s history by placing the consequences of slavery and the contributions of black Americans at the very center of our national narrative.” (Conservatives have railed against it as racially divisive and have often lumped it together with CRT in an attempt to ban both from schools across the country.)

What came next caught Lewis off guard.

Hightower, the superintendent, read from a statement: “While I had initially entertained and publicly spoken to the development of a diversity, equity and inclusivity, DEI plan, I recognize that our intentions have become widely misunderstood in the community and it created division.

“To that end, I have concluded that there will be no separate DEI plan.”

To Lewis, it was as if the “foundations of everything that I was asked to do have just shifted, and I was not a part of the conversation.”

State Rep. Brad Thomas, a Republican, spoke next. He assured the board that, as the father of a Cherokee County student, he’d done his research after fielding complaints about Lewis’ hiring.

He said he now had a plan of his own in the works: He would be drafting legislation to ensure that teaching CRT and the 1619 Project would be illegal statewide. “We’ve pulled language from Tennessee’s bill. We’ve pulled language from Texas’ bill. We’ve pulled language from Oklahoma’s bill. We’ve pulled language from Idaho’s bill,” he said. “And I’ve put some of my own language in there.”

Heda, the Cherokee County GOP precinct officer who’d spoken at the clubhouse meeting four days earlier, also addressed the board. She claimed that the definition of DEI had changed over time and now represents the views held by people with “the same woke political understanding of power dynamics and social positions.”

“We cannot fix racism with institutionalized racism,” she said.

A neighbor of Heda’s approached the lectern next. The woman, who is Black, spoke in favor of the decision to hire Lewis. It was the first time she was mentioned by name.

According to one observer, that’s when the crowd gathered outside began beating against the building’s windows.

“No, no, no!” they screamed in unison, the sound reverberating through the lobby as their fists pounded the glass.

The scene outside the May 20, 2021, Cherokee County School Board meeting. (Provided to ProPublica)

A subsequent speaker, a parent named Lori Raney, was rewarded with applause when she asked the board, “My question to you is, if you vote to do away with the DEI program, does that mean the new DEI officer has her offer rescinded? Because why do we need to pay $115,000 for somebody who doesn’t have a job to do anymore?”

At that moment, Lewis recalled, her husband said: “That’s it. We’re not doing this. You are not going there.” He left the bedroom in disgust.

Not long after, a volunteer from the campaign of Vernon Jones, a Black Republican who at the time was running for governor (Jones later switched to a run for Congress), read a statement to the school board from the candidate. “Embracing the teaching of critical race theory is a slap in the face of Dr. King’s teachings,” said the volunteer, Stan Fitzgerald. “Taxpayer-funded anti-white racism is still exactly that — racism.”

Upon hearing that, Lewis thought about how Martin Luther King Jr. promoted humanity and love, and she was devastated to hear his words used by strangers to attack her. Everything she had just witnessed felt contrary to his ideals.

Breaking down in tears, Lewis closed her laptop. She could no longer watch.

“That cut me so deeply,” she said. “It hit the core of who I am as a being.”

Lewis missed the part when Miranda Wicker, another parent and member of the county’s Democratic Party, addressed the board. “Those who want this ban are spouting talking points fed to them by an outside special interest group with a deeply political agenda to keep people riled up against an invisible other,” said Wicker, who was interrupted by loud shouts.

“Stop the disrespect!” school board Chair Kyla Cromer yelled at the crowd after banging her gavel. “Stop! Stop!”

Cromer threatened to adjourn the meeting early but ultimately allowed it to continue.

The board voted 4-1 with two abstentions to pass the anti-CRT and anti-1619 Project resolution. But the crowd was still worked up. Cromer moved to take a break. The livestream of the meeting was paused. But the yelling continued. And things spiraled out of control, to the point that Cromer abruptly adjourned the meeting.

One man in the crowd screamed: “I’m furious!”

Another declared: “We’re going to hunt you down!”

The scene inside the May 20, 2021, Cherokee County School Board meeting, as Chair Kyla Cromer moves to adjourn. (Provided to ProPublica)

The school district’s chief communications officer, Barbara Jacoby, would later say that’s when the students attending the meeting started crying.

“They had to be rushed out of the room,” Jacoby recalled. She went with them and the school board members as security guards ushered the group to a conference room behind the dais. “And then we had to be walked to our cars,” she said. “We had to be followed out of the parking lot onto the highway by police officers.”

In response to questions from ProPublica, the school board provided a statement describing how some members requested school police escorts to their homes, where city and county agencies conducted extra patrols. In response to the other questions, including ones about anti-CRT letters the board received, Jacoby responded on its behalf, stating “the information you note below is correct.” Cromer and Hightower declined to comment.

Jacoby said the scene felt unreal. “It’s certainly not anything anyone who comes to work for a school district expects would ever be part of their job.”

Cecelia Lewis: “I Don’t Even Know Why We Continue to Give Life to It” (FRONTLINE)

Lewis’ phone kept ringing that night. People from the district were telling her that this is not who they are, that they’re embarrassed by the actions of their neighbors and church members, that they’re sorry she had to witness this.

In a phone call the next morning, Hightower apologized to Lewis. He said he still wanted her to come to Cherokee. Another administrator asked if she would consider a different position.

But by then she’d made up her mind. She told Hightower: It’s just not going to work.

“I can’t say I blame her,” Cherokee County School District chief of staff Mike McGowan said in an interview with ProPublica. “There was so much misinformation about who she was, what she stood for and what was going on politically.”

In response to a detailed list of questions to the district covering all aspects of Lewis’ experience in Cherokee County, Jacoby responded that “we have no further comments to add.”

The following morning, before it was publicly known that Lewis had quit the job she’d never started, a former Cherokee County student who’d attended the school board meeting appeared on “Fox & Friends” and warned that the board was still pursuing CRT under the guise of other concepts. “I think that they’re relying on wordplay to try to confuse Cherokee County representatives or constituents that aren’t necessarily completely involved because they’re busy with their day-to-day life,” the guest, Bailey Katzenstein, said. She claimed that CRT initiatives would be carried out by “someone from Maryland” in the form of programs “synonymous” with CRT: DEI and SEL (or social emotional learning). SEL is a decades-old child development concept that emphasizes building self-awareness, teaching kids how to better communicate, fostering relationships and making responsible decisions, according to scholars and researchers.

“I don’t think it’s acceptable,” Katzenstein said of the school board not banning DEI and SEL along with CRT. “They’re hiding behind closed doors, and I think it’s completely full of cowardice.”

The Fox host, ending the segment, said: “If you thought this was an elite, New York City school problem, Bailey Katzenstein just told you the exact opposite. This is spreading. It’s going all over the country, and it’s having real impacts.”

The next day, Cherokee County parents used their private Facebook group to continue to report Lewis “sightings.” (People with access to the group shared screenshots of posts with ProPublica.)

A post to a private Facebook page falsely claimed that Lewis was in Cherokee County and working for the school district. (Screenshot provided to ProPublica)

“My husband swears he saw Ms. Lewis at Ace yesterday afternoon!” one woman wrote, adding, “He saw the Maryland plates and the driver looked just like her.”

But Lewis was still in Maryland. She hadn’t returned to Georgia since the house-hunting trip.

In a statement quoted in the Cherokee Tribune & Ledger-News a week and a half later, Lewis wrote: “I wholeheartedly fell in love with Cherokee County when I came to visit and accepted the position, but somehow, I got caught in the crossfire of lies, misinformation, and accusations which have zero basis.”

When Lewis and her husband actually relocated to Georgia later that summer, the Cherokee parents’ private Facebook group lit up.

“Guess where Cecelia Lewis is possibly landing now?” another woman wrote.

They’d figured out her next move.

Five days after Lewis quit her would-be job in Cherokee County, the district’s human resources director forwarded a copy of her resume to the chief academic officer at his former school district, one county over. “Great catching Up!” he wrote. “Talk soon.”

Officials in the Cobb County School District, the second-largest in the state, called Lewis soon after. They wanted to talk to her about an opening they had for a supervisor of social studies, a job title she’d held in another school district earlier in her career.

Lewis did not know it, but the position already had been subjected to scrutiny.

In the summer of 2020, in wake of Floyd’s killing at the hands of Minneapolis police, the Cobb County School District began to more tightly manage the way racial issues are handled in social studies teacher training and more closely vet the materials trainers and educators could use.

According to records obtained by ProPublica, the previous, longtime social studies supervisor had been reprimanded for hosting a district-approved speaker from the state Department of Education. A teacher had complained about the speaker’s presentation, titled “All are Welcome.”

The social studies supervisor’s boss wrote in the letter that most of the presentation was appropriate. There were just a few issues.

The boss wasn’t happy with the “sensitive content and images” and “probing questions” in the presentation. One slide included a photo of Minneapolis police officer Derek Chauvin atop Floyd, his knee pinned to Floyd’s neck, along with two questions that challenged educators in how they approach lessons about such controversies: “What can we share with our black students to help them cope with the bottom?” “What did the man on top miss out on learning that could have made him a better person?”

Additionally, the director’s letter reminded the social studies supervisor that there already had been discussions about references to the 1619 Project, about vetting all presentations, about monitoring social media posts for the “message they send to the greater Cobb County community” and about ensuring that outside organizations the social studies supervisor might partner with would present controversial issues in a manner acceptable to the school district.

In 2021, the social studies supervisor retired. Lewis — who holds a master’s degree in teaching the subject — applied to replace her.

In June, at around the same time that Lewis got the call from Cobb County to come in for an interview, Cobb’s seven-member school board passed its own anti-CRT and anti-1619 Project resolution. Three members — all of them Black Democrats — abstained, noting this was not the first time they were blindsided by the addition of a problematic, last-minute agenda item.

Once a Republican stronghold represented by Newt Gingrich in Congress, Cobb County flipped to blue in 2018 and has remained that way since. By 2020 the county elected its first Black sheriff and county commission chair. Though the school district’s population is 30% Black and 24% Hispanic, the school board majority remains white and conservative.

By mid-July, another metropolitan Atlanta school district was courting Lewis. But by then she was living in Cobb County and decided to follow-up with the district there. It had been weeks since she’d gone through multiple rounds of rigorous interviews, during which Cobb officials complimented her on her credentials, saying she’d be an asset in multiple leadership roles, according to Lewis.

Lewis recalled that a district official finally called her back toward the end of July to apologize for the delayed response and explained that the superintendent had been involved in vetting her hiring, something that typically doesn’t happen for a person who applies for a supervisor role.

The district offered Lewis the job on that call, and she accepted. She was asked to report to work the next day, July 20.

By the end of the week — right around the time when the Cherokee County parent circulated the tip in the private Facebook group that Lewis might now be heading to Cobb — Lewis got a call from a school district leader. It was someone above her boss, Lewis said. According to Lewis, the person requested an immediate, off-site meeting.

It was already after 6 p.m. Lewis had just settled in for a manicure and pedicure. She left her appointment and headed to a nearby Panera Bread, where she and the district official took a seat near the back of the restaurant.

The person explained that complaints about her were “percolating” out of Cherokee into Cobb, according to Lewis, who also remembered the person telling her to be careful; she’s an at-will employee (meaning she can be fired at any time for any reason without notice) and the person might not be able to help her. Lewis also recalled the person telling her that she shouldn’t have to endure in Cobb what she went through in Cherokee.

Lewis was stunned. “I did nothing but showed up to work, signed a contract, agreed to do what I was asked to do in the job description,” she told ProPublica. “And yet again, I’m getting attacked.”

Around the same time, Cobb’s four Republican school board members, its superintendent and another district official, John Floresta, were fielding complaints about the decision to hire Lewis.

“I am appalled that anyone would advocate for the racist, sexist, and Marxist ideology that is Critical Race Theory,” one woman wrote to the group in an email, which ProPublica obtained through an open records request. Her name was redacted. She went on to say, among other things: “I insist that you pass real policy reforms that forbid indoctrinating children with CRT in classrooms,” “Anyone found pushing CRT on CCSD time should be immediately terminated,” and “Make no mistake: press releases and toothless resolutions just won’t cut it.”

“I agree with you 100%,” Cobb County school board member Randy Scamihorn responded. “Thankfully, the majority of the Board did vote on June 10th to ban CRT and 1619 Project from our schools in Cobb County. We then directed Superintendent Ragsdale to implement the enforcement of this decision, which he readily agreed to do.”

“I’m glad to hear you feel that way, but it certainly seems we need to remain vigilant,” the woman replied. “Why has Cecelia Lewis been hired by Cobb? She was hired by Cherokee schools for CRT and was run off because the parents put up such a fight. Now Cobb has quietly hired her. This isn’t a good move for the optics that Cobb has supposedly banned CRT.”

There is no record of an email reply from Scamihorn.

In response to ProPublica’s request for comment on the email exchange, a spokesperson for the district responded on behalf of Scamihorn: “Your assertion that Mr. Scamihorn ‘agreed 100%’ that ‘anyone pushing CRT on CCSD time should be immediately terminated’ is grossly inaccurate and not consistent with the email you are referencing. The Cobb Board did pass a resolution which directs the District to focus on keeping schools, schools, not on political distractions.” When asked to elaborate on what was inaccurate or inconsistent, the spokesperson did not respond.

Floresta responded to a different email complaining about CRT, assuring the sender that it was not allowed to be taught per district policy. The sender then pointed to the hiring in Cobb of “Cecelia Lewis, a well known advocate for CRT and DEI agents who actually resigned from Cherokee County recently because of the push back from the parents.”

“How in the heck did Dr. Cecelia Lewis get hired on?” the email continued. “It is ASTOUNDING to think that anyone would think this was a good idea. We need answers on this, immediately, and an explanation of her role within the County. To list her under Social Studies does not fool any of us.”

On Lewis’ fourth day on the job, she got a message from one of the district secretaries.

“I received a call from a parent wanting to know if you were the same person hired in Cherokee County. I just told her that someone would give her a call back to address her questions.”

Lewis’ boss soon told her to direct all such messages to her office. She also told Lewis to hold off on responding to any emails regarding her hiring, after Lewis replied to a positive note that came in from a supportive parent.

The following week, Lewis was supposed to introduce herself to all the social studies teachers at a districtwide training meeting. She said she’d been asked, before the Panera meeting, to prepare a presentation and share the social studies program vision.

She said she was then asked to shorten the presentation to a simple series of slides. Then, to one slide.

Finally, she learned she wouldn’t even be acknowledged at the meeting as the new supervisor of social studies.

“When the day came, I was told that I had to sit in the back and flip the slides for the presenter,” Lewis recalled. “I was not introduced at all.”

Lewis said she did receive warm welcomes when she individually introduced herself to teachers, some of whom said they’d heard she’d arrived and wondered when they’d meet her.

Not long after the meeting, she recalled, other aspects of her job began to change. Her emails to social studies teachers would need to be vetted before she could hit send (not a single one was approved). And she’d now be on a special project, reviewing thousands of resources that had already been approved and adopted by the district.

“It was pretty much them tucking me away,” Lewis said. “Every meeting was canceled. Every professional learning opportunity that I was supposed to lead with my team, I couldn’t do. Every department meeting with different schools, I was told I can’t go.”

According to Lewis, the only direct communication she was allowed to have without vetting was with other supervisors.

“They were wasting their money,” she said. “I’m just sitting here in this room every day, looking through resources that have already been approved, which makes no sense, and not given much direction as to what I’m looking for — just making sure they’re aligned to standards, which obviously they were.”

At the end of August, Lewis requested a meeting with her supervisor and the district’s chief academic officer. She told them that she would be submitting her two-week notice.

The next day, she got one last email from district leadership.

“As we discussed, it is never our intention, as an organization, for an employee to feel anything other [than] the support and collegiality associated with a positive and professional work environment,” the email said. “Please know your concerns and feedback, as an individual and employee, were heard and valued.”

ProPublica submitted to the Cobb County School District and its school board a list of detailed questions about the hiring of Lewis, the community blowback and the changes to her job. A school district spokesperson responded: “Cecelia Lewis was employed by the Cobb County School District during the summer of 2021, voluntarily submitted her letter of resignation in early fall of 2021, and like every Team member, her contributions and work for students was greatly appreciated.”

Lewis’ departure from not one but two school districts didn’t put an end to the efforts of anti-CRT groups. In fact, the groups used Lewis’ retreat as a rallying call.

In August 2021, Educate Cherokee — a group with a now-defunct website that identifies itself on Facebook as a local chapter of the national conservative nonprofit No Left Turn in Education — announced that it would be holding an event. According to an online notice about the event, it would be led by Heda, who had spoken at the clubhouse and the school board meetings, and Raney, who at the school board meeting had called out Lewis’ salary. In the notice, the group claimed the elimination of “a new DEI administrative position” as one of its accomplishments. “Bring your ideas, energy, and enthusiasm,” the meeting notice said. “We need to convert all of it into an effective election effort to eliminate CRT by replacing all of the current school board members up for re-election with new conservatives committed to our cause.”

In the months to come, four school board candidates — Michael “Cam” Waters, Ray Lynch, Sean Kaufman and Chris Gregory — established themselves as part of a collective effort to gain a majority on the board, in part by ousting board members who’d come under attack following Lewis’ hiring.

The candidates dubbed themselves 4CanDoMore and launched a website, the top of which states: “In May of 2021, Cherokee County was taken by surprise when it was announced that our ‘conservative’ board voted to bring in Cecelia Lewis, as Administrator on Special Assignment, Director of Diversity, Equity and Inclusion (DEI). However, her history was riddled with Critical Race Theory (CRT) ideologies in her previous school district. Why would the current board vote 7-0 to bring in someone to implement programs not in alignment with the family values of our community?”

A promotional photo of the 1776 Project PAC’s first endorsements of the year: a slate of Cherokee County School Board candidates who are opposed to Lewis’ hiring and CRT. (Screenshot by ProPublica)

In March of 2022, the 4CanDoMore candidates got a boost. The 1776 Project PAC, founded last year by author and OANN political correspondent Ryan Girdusky, had been singling out open school board seats across the country and supporting candidates who ran on platforms to ban CRT and the 1619 Project. (The super PAC’s name is a nod to an advisory committee launched in 2020 by Trump partly in response to the 1619 Project. Trump’s 1776 Commission sought to support a “patriotic education” in schools and oppose lessons that teach students to “hate their own country.”)

In 2021, the 1776 Project PAC backed 69 school board candidates in eight states. Fifty-five won their seats, its website claims, including all 15 candidates the PAC endorsed in Texas.

The 4CanDoMore candidates were the 1776 Project PAC’s first endorsements of 2022.

Girdusky did not respond to multiple requests for comment regarding the decision to zero in on Cherokee County candidates.

In May, two of the 4CanDoMore candidates lost their primary bids to incumbents. The other two, Kaufman and Lynch, advanced to a June runoff. Another familiar face in the anti-Lewis effort also made it to the runoff: Kahaian, the paralegal who’d told parents in the clubhouse how to prepare for an appearance on Tucker Carlson’s show. She’s running for a seat in Georgia’s House of Representatives.

Even before any potential shake-up on the school board, some changes have already arrived in the Cherokee County School District. Among them is a ban on the word “equity” from any district initiative.

“We had to stop using the word because the word was redefined by people,” said Jacoby, the Cherokee County Schools communications director. “And so we had to take the word out of the equation, and say, OK, fine, ‘access.’ There’s no way around that access is important.”

After moving back home to Maryland, Lewis continues to work in education, although her role doesn’t primarily focus on DEI. “I may not have the specific acronym tied to my official title, but I am committed to celebrating diversity and promoting equity and inclusion,” Lewis said.

She also noted that, even in the face of increasing attacks, educators should not lose sight of their value and the difference they can make in children’s lives. “No one can take that away from us.”

Cecelia Lewis: “The Work Still Needs to Be Done” (FRONTLINE)

Today, the metal detectors remain installed at the entrance to the building where Cherokee County School Board meetings are held. A staff member is permanently assigned the task of evacuating students in attendance, should the need ever arise. And an increased number of security officers are strategically placed throughout the meeting room and beyond.

Standing in line outside the building before a recent school board meeting, mothers identified themselves to each other as “a Marjorie” — meaning a proponent of the speaking style of Rep. Marjorie Taylor Greene, known for her provocative and unfiltered claims.

A little while later, once the meeting was underway, a man who described himself as a school bus driver and a grandfather stepped to the microphone during the public comment period.

A security officer keeps tabs on the May 19, 2022, Cherokee County School Board meeting. After the events of 2021, county officials increased the number of security officers at the meetings. (Lynsey Weatherspoon for ProPublica)

“This is not California or New York. This is Cherokee County, Georgia. We can choose what and how our students learn on a local level,” said the man.

“I was raised in a different era, in the ’50s and ’60s, where we were equipped to survive and succeed.”

Do You Have a Tip for ProPublica? Help Us Do Journalism.

Mollie Simon contributed research.

Correction

June 17, 2022: This story originally misspelled the first name of one of the people who spoke at the Cherokee County School Board meeting. She is Lori Raney, not Lauri.

by Lexi Churchill

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This article is co-published with The Texas Tribune, a nonprofit, nonpartisan local newsroom that informs and engages with Texans. Sign up for The Brief weekly to get up to speed on their essential coverage of Texas issues.

In the past week, Texas Gov. Greg Abbott has joined the growing list of state and local officials fighting the release of records that could help bring clarity to how the emergency response unfolded during last month’s deadly shooting in Uvalde.

The governor’s office strayed from that broader opposition Monday, granting a request under the Texas Public Information Act from a Houston television station that sought the handwritten notes he used when he first spoke publicly about the shooting. The notes appear to support Abbott’s claim that he was misled when he initially praised law enforcement efforts during the mass shooting that resulted in the deaths of 19 children and two educators and left many more injured.

The recent release by Abbott underscores both the tremendous power government officials have to decide what is in the public interest and the unwillingness to release records that could call their agencies’ actions into question.

ProPublica and The Texas Tribune have submitted about 70 public information requests that could help answer larger questions as state and local leaders continue to offer conflicting accounts about why law enforcement did not confront the gunman sooner during the May 24 massacre. Those requests include 911 audio recordings, body and police car camera footage, and communications among local, state and federal agencies. The newsrooms also requested use-of-force documents, death records and ballistic reports.

Three weeks after the shooting, government officials have not provided the news organizations a single record related to the emergency response.

“The public wants immediate transparency,” said Kelley Shannon, executive director of the Freedom of Information Foundation of Texas. “The most enlightened law enforcement agencies understand the importance of being transparent, being open and doing it right away.”

Since the shooting, state police have said Pete Arredondo, the chief of police for the school district, erred in judgment by keeping law enforcement officers from immediately confronting the barricaded gunman despite 911 calls from inside classrooms indicating that children and educators remained in danger.

Arredondo, who leads the district’s six-person police force, defended his actions in an interview last week with the Tribune. He said he never considered himself in charge of directing the law enforcement response and didn’t issue any orders. He also said he didn’t know about the 911 calls because he left his radios behind. He thought they would slow him down and wanted both hands free in the event that he had to use his gun.

Abbott’s office, the Texas Department of Public Safety, the U.S. Marshals Service and the city of Uvalde are asking the state’s attorney general for permission to withhold records that may offer tangible answers to the contradictory accounts. (Under Texas law, agencies seeking to avoid disclosure of public records typically must make their case to the attorney general.) Other government entities have asked the state for extensions as they decide whether to fight such disclosures. News organizations across the country are reporting similar responses.

Among the arguments provided by government entities for withholding such documents is one from DPS stating that releasing records like footage from body cameras would provide criminals with “invaluable information” about its investigative techniques, information sharing and criminal analysis.

In most cases, however, the agencies argue that releasing such information could interfere with ongoing law enforcement investigations by the federal government and the Texas Rangers, an arm of DPS now tasked with investigating its own department. In a statement, Abbott’s office said that, upon completion of the investigations, “we look forward to the full results being shared with the victims’ families and the public, who deserve the full truth of what happened that tragic day.”

But timely disclosure of the records is paramount given the lack of transparency and contradictory accounts from state and local officials, three Texas Public Information Act experts told ProPublica and the Tribune.

Laura Prather, a First Amendment attorney in Texas, said the reason the state allows agencies to withhold information when it is part of an ongoing investigation is to protect someone who was accused of a crime but didn’t ultimately get convicted, “not to protect law enforcement for their actions in circumstances like this, where the shooter is dead.”

“The public has the right to know what happened that day, and right now they can only act on rumors and conflicting information,” said Prather, who is representing ProPublica in an unrelated defamation lawsuit. She said law enforcement must be transparent in order to earn the public’s trust, but agencies are instead using their discretionary powers “to thwart the public from getting information that they are rightly entitled to.”

Because state law allows government officials to withhold information in cases that don’t result in a conviction, it creates a loophole that lets governments deny records in cases where the offender was killed and will not be tried.

That results in a challenge for members of the public seeking records related to Uvalde because “either way, there is a statutory basis for these governmental bodies to seek to withhold information,” said Jim Hemphill, an attorney who serves on the board of the Texas Freedom of Information Foundation.

Texas House Speaker Dade Phelan, a Republican from Beaumont, raised concerns about the “dead suspect loophole” in a tweet this month. He said it would be “unconscionable” for agencies to use the loophole to withhold “information that is so badly needed and deserved right now.”

“This is an area in dire need of reform,” Phelan wrote.

The state’s attorney general has 45 days to consider requests from government and law enforcement officials to withhold records from the public.

In 2019, after a gunman killed 23 people at a Walmart in El Paso, the attorney general issued a ruling that pointed to an ongoing investigation and required the Police Department to release records but allowed it to heavily redact the information.

Families of the 2018 Santa Fe High School shooting victims are still seeking information after the attorney general sided with the district attorney who said he could not release records because of a pending prosecution, according to the Houston Chronicle. The shooter was later declared mentally incompetent to stand trial.

Shaheera Jalil Albasit, whose cousin, Sabika Sheikh, was killed during the Santa Fe shooting, feels an overwhelming sense of helplessness four years later. She and Sheikh’s sister still have biweekly conversations in which they discuss how they could shake loose more details about that horrific day.

Albasit has been following the unfolding of information in Uvalde over the past few weeks and says she imagines the frustrations families must be feeling at not knowing more about whether law enforcement could have saved lives by acting sooner.

“All of these questions, they can whack your mind, especially if you’re a family member,” she said in an interview. “You can’t help thinking about the what ifs.”

State Sen. Roland Gutierrez, a Democrat who represents Uvalde, said families should not have to wait for answers.

“Parents are grieving their children, let’s be clear, but undoubtedly the community is questioning the credibility of law enforcement,” he said. “Can you blame them? People are upset and rightly so.”

Carla Astudillo contributed reporting.