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A Question about Straight, Inc. and Money

Intake Fees and Documentation Required:

Intake day: May 29, 1982. St. Petersburg, FL

I found this document among my father’s Straight, Inc. documents.

The first three items are crossed through since none of them are applicable.

According to this document parents paid:

$35.00/month for food.

$25.00/Doctor fee.

$2,000.00/Pledge Payment (aka fee for ‘treatment’)

$125 (Random fee? Appointment fee? No written explanation.)

Hmmm. I’ve heard rumor that most if not all of the food was donated to the St. Petersburg, Florida program (which is where these documents are from), but I’ll have to find proof of this. (Note to readers: If you have proof of this, please forward a copy to this site.)  However, even if it wasn’t donated, I’m sure we didn’t consume $35 worth of food there per month (especially thirty-five 1984 dollars worth).

The $25.00 doctor’s fee is hilarious. I wonder how they accounted for THIS fee in their books. I never saw a medical doctor in all my days at Straight, Inc.

And the $2000 fee for the program was classified as a pledge. I guess our parents were donors to the non-profit program, Straight, Inc.

Now, considering 99.9% of the items that made up Straight were donated, where did all that money go?

Program Expenses: 

Warehouse Building (in an industrial zone) – (most often donated or paid for by parents’ fundraising efforts).

Utilities. 

Signs on the wall.

Plastic chairs (approximately 600-1000 chairs)

Meals (usually donated? Usually only lunch and dinner or just dinner, depending on the program location, other meals were supposed to be provided by parents when possible)

Salaries (kid-graduates did 99.9% of the ‘therapy’ and got paid minimum wage, when they got paid — which wasn’t consistently)

Non-profit business registration and filing: Only a few bucks per year.

That leaves Executive Salaries. But when I spoke to one former executive staff member he scoffed at the proposal that perhaps they got paid well.

The Numbers Don’t Add Up

When I entered Straight, Inc. on May 29, 1982, there were approximately 350 kids in the group.

Though more than 350 kids had entered the program (within the year and paid the fees) but were no longer there because they escaped or were withdrawn or on the rare occasion terminated.

So let’s use a rough and conservatively estimated number of anywhere from 100 – 350 kids admitted to the program in any one location and in any one given year in the early 1980s. And let’s use the low estimate* that each one was charged $2000.

(*Low estimate: because we know parents paid more than just the initial “entry pledge payment” because there were the additional fees listed above for each kid, plus the collections of additional donations two times per week at each open meeting, plus numerous other fundraisers going on at any given point in time, in which the parents were expected to donate either their time, money and/or other resources. ‘Afterall, who can put a price on a child’s life?‘, which is what the program proclaimed was at stake if the parents didn’t meet all of these expectations.

The Math

100-350 kids at (a minimum of) $2000/each = $200,000-$700,000 of tax-free money in any given year in the early 1980’s for the nonprofit corporation that went by the name of Straight, Incorporated and proclaimed to save kids lives with their ‘breakthrough modality of kids helping kids and parents helping parents.

The Question

Where did all of the money really end up? If you have any answers or ideas, please be sure to leave them in the comments below.

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Series: First Investigation of Straight, Inc. (01/07/1978)- Part 1

[Originally posted on Jan. 16, 2016. Updated May 12, 2017]

January 1978: Report from 1977-1978 Investigation of Project Straight Inc.

Straight Inc. filed papers for incorporation on April 22, 1976.
Straight Inc.’s doors opened for operation on Sept. 1, 1976.
By November 1977, Straight was being investigated in response to complaints from the community.

Straight Inc. is referred to as Project Straight, Inc. because it was considered a project that was funded by LEAA and local contributions.

Please see the original documents here: 

Project Straight, Inc. is a private non-profit organization licensed as a day care program with foster homes.

An investigation was initiated in November 1977, concerning Project Straight, Inc. in response to reports from various people within the St. Petersburg community that there were problems with Project Straight, Inc., a private non-profit organization licensed as a day care program (yes, a day care program!) with foster homes.

How the investigation was conducted.

During this investigation, the task force conducted interviews with the following people:

9 members of the current Board of Directors

5 former member of the Board of Directors

13 members of the current staff

4 previous employees of Straight, Inc.

5 foster home families

9 graduates of the program

48 current clients (24 selected at random by Straight Staff and 24 selected at random by the task force team)

6 clients who, for one reason or another, had left the program prior to completion

2 parents who earlier had children in the Straight program

9 clients and/or their parents who we had reason to believe were either involved in or observed physical or verbal abuse.

A review of records and files was also carried out.

This blog post contains the information uncovered from the investigation interviews of current and former members of the Straight, Inc. Board of Directors.


Five Former board members were interviewed during this investigation.

In 2015, I sat down and thoroughly combed through a couple of reports written on January 11, 1978, by task force members. The task force was chaired by J.B. Holley and formed to investigate allegations being made against Straight, Inc. The interviews and documents collected by this task force corroborate the statements made in the telephone interview with Mr. Henson in November of 2001. (Mr. Henson’s 2001 telephone interview is here.)

The Henson Interviews.

Mr. & Mrs. L. A. Henson were interviewed together, with the following points being made by one or the other.

Important decisions being made without the Board of Directors’ input.

Mr. Henson felt that important decisions were being made without the Board of Directors’ input; e.g., certain aspects of the LEAA grant, hospitalization for staff, the decision to move from the Anderson Building, and the establishment of the Straight court. He also said that for a time there were no written minutes of the executive committee or the Board. After the issue was forced the practice of writing up the minutes was resumed.

Concerns about safety.

Mr. Henson had several concerns about safety; e.g., appliance left plugged in at the facility overnight, transportation of large numbers of clients in one car at one time, and foster home situations. He said that young, inexperienced persons do the investigations into foster homes, and he felt that a great deal of professional expertise, experience, and judgment, is needed in visiting and evaluating a foster home.

No written accepted procedure for handling grievances and/or complaints.

There is no written accepted procedure for handling grievances and/or complaints, and he feels the present procedure is not responsive to complaints of parents or staff. Although there is an advisory board, Mr. Henson states that they do not meet and function regularly.

Mrs. Helen Petermann is not qualified to serve as the staff supervisor.

Mrs. Henson feels very strongly that Mrs. Helen Petermann is not qualified to serve as the staff supervisor. He said that the decision to hire her was made at a Board meeting which he could not attend.

It was his feeling that originally no board member would have been willing to hire her, and then the Board took action to hire her. It puzzles Mr. Henson that this reversal took place.

He understands that Mrs. Petermann was fired from her position at the Seed. Mrs. Henson stated that she had observed Mrs. Petermann kick a client and that there were other witnesses.

Clients were told they could not discuss the program or even mention ‘Straight, Inc.’ to outsiders without receiving serious consequences.

According to the Hensons, the clients were told they could not discuss the program, or even mention “Straight, Inc.” to outsiders or they would be started over again in the program. Also a staff member was told he could not visit the Henson residence.

Mr. Henson thinks the program will fail eventually because of mismanagement, poor staff, autocratic decision making, personnel problems, and the lack of appropriate response to grievances and charges of abuse.

It was a critical issue with the Henson’s that the task force interview persons who are no longer with the program. They felt the task force would get only a partial picture of the program if they interviewed only those persons currently involved in Straight, Inc.

Another interview was conducted with Mrs. L. A. Henson and Mrs. Rose.

Mrs. Henson and Mrs. Rose were formerly intake-mothers with the Straight, Inc. program and Mrs. Rose was the mother of a former staff member in Straight, Inc.

Mrs. Henson and Mrs. Rose were involved in the formation of the Straight, Inc. program.

Mrs. Henson and Mrs. Rose advised that they were involved in the formation of the program as they and several other parents felt there was a definite need for a program of this nature in the community.

Mel Sembler said Jim Hartz was hired for his degree, but Helen Petermann would operate the program.

Mrs. Henson said she heard Mel Sembler, the president of Straight, Inc., tell her husband, Hap Henson, that Jim Hartz was hired for his degree and that Helen Petermann would operate the program.

Mrs. Henson and Mrs. Rose both said that they had no idea Helen Petermann would be involved in the program at the level she is now involved or they would not have supported it from the beginning.

Mrs. Petermann presses [the kids] a great deal for details involving anything related to sex.

Both ladies feel Mrs. Petermann has some problems, one of them is that she presses a great deal for any detail involving anything related to sex. Henson indicated that the ——‘s daughter had been in a group at one point in the program where she observed Mrs. Petermann down on the floor, in front of the group, demonstrating various sexual positions used throughout the world. This was in a female group conducted by Mrs. Petermann.

This coincides with information received from Diana Shanahan, a former staff member, in a previous interview.

Mrs. Petermann repeatedly kicked a new intake boy while he was being dragged out of an intake room by two young staff members. 

straight, helen peterman, helen petermann
Helen Petermann

Mrs. Rose stated that during one of the first intakes she conducted, she noted the youth was unusually quiet which was very alarming to her. She went to Helen Petermann and other staff members and told them of her fears with the youth. Mrs. Rose told them she did not want to be left alone with him because she thought he was going to go off the deep end.

Helen Petermann and young staff members Ron Solanas and Mike Shanahan went with Mrs. Rose back to the intake room. Mrs. Rose advised that when they entered the intake room Helen Petermann began to talk to the youth and the youth went off the deep end. The boy went rigid and was drug from the room by Ron Solanas and Mike Shanahan in that condition. She said each of the boys grabbed the new intake by his arms and dragged him with his heels dragging along the floor while Helen Petermann walked along behind the boy kicking him.

Mrs. Henson confirms this. She states she was an eyewitness to this incident and would swear to it in court. Mrs. Rose and Mrs. Henson also said that at the time this incident took place, it was also witnessed by Jim Hartz and [Solanes’s] wife, Debbie, who came in as it was going on.

Staff uses obscene language and ostracization to the detriment of the children’s welfare

Both Mrs. Henson and Mrs. Rose feel that some of the more negative aspects of the Straight program are the obscene language used by members of the staff toward clients and the practice of coventry. [Ostracizing.] Both feel this is very detrimental to the children’s welfare.

Mrs. Henson and Mrs. Rose feel that such a program is very definitely needed in this community, however, they feel the program needs to be cleaned up and operated as it was in the beginning.

Mrs. Bob Chapin’s interview:

Bob Chapin was involved with the Seed Program and helped get Straight started.

He resigned because he did not feel that he and his wife wanted to devote the time necessary to be members of the board. He feels that Straight is a good program, and would place his child there if needed. He personally feels that the staff supervisor, Helen Petermann, should be a younger person who could relate more to the children in the program. He feels that a follow-up program is needed for graduates from Straight, Inc.

Mr. Ted Anderson’s interview:

Kangaroo courts and tracking down runaways

Ted Anderson stated that the final straw that caused him to resign was when Jim Hartz reported on the establishment of what Mr. Anderson called “kangaroo court” consisting of clients trying other clients who break rules and setting their punishment. He said that Hartz reported that one of the punishments imposed was to make the client clean the bathroom floor with a toothbrush; he further said that the heard that the client was forced to drink the bucket of wash water.

He also disliked the practice of sending staff to track down runaways and felt that such clients should not be forced to return to the program.

The original concept of one-to-one attention has been lost with the extensive, no-control expansion of the program.

He feels that with the extensive, no-control, expansion of the program, the original concept of one-on-one has been lost. He feels that a distance restriction should be imposed and the client census should be held to a workable level.

Clients are kept out of school for too long.

He feels that the clients are kept in Phase I and II, and thus out of school, for too long a period of time. He is concerned about the lack of any definitive standards on which a client is moved from phase to phase.

Poor fiscal management

He is also concerned about what he considers to be poor fiscal management. He claims that he had never seen a full and accurate treasurer’s report. He feels that major decisions are made by the president and the executive director, rather than by the board.

Jim Hartz is power hungry, staff time records are falsified, and Helen Petermann

Hartz, straight
Jim Hartz

is totally unqualified for the position of staff supervisor. 

He feels that Jim Hartz is power hungry and is asking for more and more authority to act unilaterally.

He states that staff time records are falsified in that only forty hours of work are shown, whereas fifty and sixty hours are actually put in.

The original intention of the founders of Straight was to bring the staff on board and train them before any clients were accepted. This did not happen.

He feels that the staff supervisor should be a young person and that Mrs. Petermann is totally unqualified for the position.

Letters from former Board members, which were included in the task force report:

This letter is dated Aug. 8, 1977, addressed to Mr. Melvin F. Sembler, President, Straight, Inc. P.O. Box 40052, St. Petersburg, Florida 33743

Dear Mr. President:

As president of Straight, Inc. you are bound by its charter and by-laws and said charter and by-laws do not confer upon you the authority to make a unilateral decision.

The by-laws provide that decision making authority rests only with the Board of Directors and/or its executive committee and that decision making grows out of a majority vote of said duly authorized decision-making bodies.

To the extent that you continue to make and implement decisions without majority approval of said governing bodies of Straight, Inc., I am becoming concerned that said unilateral acts on your part may expose me to loss or damage and/or expensive litigation. Hence, I am placing you on notice that should such a contingency occur I will then demand that you indemnify, defend, save and hold me harmless from the consequences of your unilateral acts. Should you then fail to do so I shall bring an action for indemnity against you.

Further, I disclaim any responsibility for your unilateral actions during your term as president of Straight, Inc. both in the past and in the future.

Sincerely,

Hap Henson

Robert Chapin

Theodore Anderson

This letter of resignation was attached to the above letter.

This letter is also dated August 8, 1977. This one is addressed to Mr. Melvin F. Sembler, President, Straight, Inc., 6539 Central Avenue, St. Petersburg, Florida 33710

Dear Mr. Sembler:

We, the undersigned, submit our resignation as members of the Board of Directors of Straight, Inc. for the following reasons:

  1. It is our feeling and belief that as far as we are concerned, Straight, Inc., by no stretch of the imagination, follows the guidelines we envisioned prior to its inception.
  2. We do not feel the present Executive Director or Program Director have the necessary qualifications to rehabilitate preteens or teens, who have a drug or alcohol problem. Furthermore, we feel we cannot recommend Straight Inc. to our friends or citizens of our community.
  3. There is no method whereby a member of the board can determine how effective or ineffective the program is being administered. Factual information is not available to us. Roberts Rules of Order has not been followed at board meetings as contemplated by the original by-laws. Therefore, we cannot function effectively on a non-functional board and hereby submit our resignation.

Sincerely,

Hap Henson

Robert Chapin

Theodore Anderson

Interview with former Board Member, Mr. Ray Bourgholtzer:

Mr. Ray Bourgholtzer resigned due to a conflict of interest due to a new position with the City of St. Petersburg. He indicated that he was unhappy with the administration of the program. He felt that the program was excellent and he enjoyed working with the children. He did feel that Mel Sembler was autocratic in his position as president. This member resigned in September 1976.

Interview with former Board Members Mr. & Mrs. Bauknight:

Mr. & Mrs. Bauknight feel that the president, the executive director, and the staff supervisor make all of the important decisions without Board participation.

They felt that the staff supervisor should be a younger person and that the incumbent was appointed without Board approval. They felt that the Board was a “rubber-stamp board” and did not, in fact, set policy. They reported that one of them witnessed Helen Petermann actually kicking a client for a minor infraction of the rules.

What task force member, John Bustle, wrote on January 11, 1978, about his interview with the Bauknights:

[Mr. and Mrs. Bauknight were] Former members of the Board of Directors with Straight, Inc. During my interview, I learned very little that we don’t already know and that is not already listed in the reports by other members of the team, therefore, I did not find it necessary to record very much of the information given by the Bauknights. I did find, however, that the Bauknights were able to furnish me with several documents. One document was represented by Mr. Bauknight as the original by-laws of the corporation. Mr. Bauknight also gave me a copy of his letter of resignation from the Board of Directors and a copy of the resignation from the Board of Directors submitted by his wife,  and finally a copy of the resignation submitted by Hap Henson, Robert Chapin, and Theodore Anderson, also former members of the Board of Directors. With these documents in hand and information which helped me gain some insight into the inner-workings of the corporation, I concluded my interview with Mr. & Mr. Bauknight.

Letters of Resignation from the Bauknights:

Dated July 20, 1977

Re: Resignation

Dear Mr. Sembler:

I submit my resignation as a member of the Board of Directors of Straight, Inc. for the following reasons:

  1. Straight, Inc., in my opinion, does not operate along the guidelines envisioned by its founders.
  2. The Board of which I am a member is largely non-functional and exercises no control in the nature of establishing and enforcing rules and guidelines for the conduct of the purposes and functions of Straight, Inc.
  3. There is no method whereby a member of said Board can determine precisely how said program is being administered or the program is being conducted. To the contrary, program direction is entirely in the hands of the Executive Director and his staff without the benefit of Board monitoring as contemplated by the original by-laws.
  4. Major decisions involving the operation of Straight, Inc. are made without consultation of Board members or their approval.

Finally, I disclaim any and all responsibility for decisions which have been made outside of the framework of the Corporate Chapter and the original by-laws of Straight, Inc.

Sincerely,

Mrs. Lila L. Bauknight

————

September 22, 1976

Dear Mr. President:

This will confirm our conversation of Monday last in which I advised you that I would not serve further as Executive Vice President of Straight, Inc. I want to alert you now so you can handle my replacement.

I have advised you and others of the Executive Committee that said committee and board are not operating as required by Florida Statutes, it’s Charter and By-laws. It is the function of the Board of Directors to set guideline parameters for the supervision, control, and direction of the affairs of the Corporation. On the advice of Counsel, I am advised, informed and believe that each member of the board has dangerous personal exposure to monetary loss for errors and omissions in failing to adopt those rules and regulations for the conduct of its corporate affairs that reasonable directors and officers would have under the same or similar circumstances. Further, for failure to audit the operations of said corporation to the end that it functions as intended.

There are voids in your insurance coverage. Money is being handled by non-bonded employees and officers. The value insured on the building is understated. There is no coverage for the Director’s and Officer’s errors and omissions. There is no coverage for Malpractice and as simple a thing as cutting hair, (malpractice item) is excluded under the General Liability policy. This is not intended to be a full list of your insurance needs. I suggest you employ an agent to survey your needs. Until last Monday I have not been requested to do so and now I would prefer not to do so.

We have not promulgated basic safety rules to protect others from unreasonable risk of bodily harm, loss or damage. This failure exposes the Board to possible claims for damages.

The Executive Committee has not functioned as required by Florida Statute. It has not been in executive session since August 18, 1976, and this despite the fact that you have been urged to comply with the By-Laws and hold such meetings. The By-Laws require weekly meetings or meetings as deemed required by its members (plural, not singular). To the extent, we have not met and errors and omissions have occurred I believe that the Executive Committee is guilty of misfeasance, malfeasance, and nonfeasance. I disclaim any responsibility for the unilateral actions of any officers or board members of Straight, Inc. which are ultra vires and without color of legality under Florida Statutes, the corporate charter or the By-Laws of the Corporation.

On further consideration, I respectfully tender my resignation as a member of the Board of Directors of Straight, Inc. as of the close of its special meeting on September 22, 1976.

Cordially,

Arthur W. Bauknight


Nine Current Board Members were interviewed during this investigation.

Here is the information that was gathered from nine members of the current Board of Directors who were interviewed:

  1. There seemed to be an awareness of the state licensing regulations, however, board members did not appear to be familiar with these regulations.
  2. All were familiar with the Straight rules and regulations.
  3. While it was reported that the board met frequently, there was no set date or time for such meetings.
  4. Most of the board members reported attending board meetings regularly.
  5. There appeared to be functioning committees of the board.
  6. Several board members had a family member or a close friend in the program.
  7. It was reported that the board establishes or approves all program policies.
  8. All board members were deeply involved in the program.
  9. The program does have an advisory board.
  10. It was reported that there was no written formal procedure for the board to handle grievances and/or complaints related to the program. Certain board members have been involved in handling such grievances or complaints.
  11. Only one board member reported knowledge of any violations of program rules or regulations. This board member felt that such incidents were primarily errors in judgment by junior staff.

The Straight, Inc. program was founded on and perpetuated by deceptions and dishonesty, which is why it was ‘controversial’ from its inception. Of course, Straight, Inc. was born from The Seed, Inc., the controversial program that came before it. We will visit The Seed Program in future posts. But first, we will look into some of the other interviews that took place during this initial investigation.

Please leave your comments about this story below. 

 

 

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