Mississippi Today

State adds USM volleyball project to effort to recoup misspent welfare funds

Published

2 years ago

December 5, 2022

State adds USM volleyball project to effort to recoup misspent welfare funds

by Anna Wolfe, Mississippi Today
December 5, 2022

After months of national coverage about how former NFL quarterback Brett Favre solicited welfare money to build a volleyball stadium at his alma mater, the state of Mississippi has filed civil charges attempting to recoup the money.

The lawsuit alleges that Favre “understood that grant funds provided by MDHS could not be used for brick-and-mortar construction” — the first time Favre has officially faced this charge.

The new allegation comes just one week after Favre filed a punchy motion to dismiss the welfare department’s civil charges against him.

Mississippi Department of Human Services filed its initial civil suit, the agency’s response to a multi-million dollar fraud and embezzlement scandal, in May. The initial complaint targeted Favre for $1.1 million he received under a “vague, illusory promise that Favre make appearances or record PSAs” and $2.1 million the athlete helped secure for a pharmaceutical venture.

But the complaint did not initially include the University of Southern Mississippi Athletic Foundation, which took $5 million in welfare money to build a volleyball stadium — billed as a “wellness center” — on its campus.

The amended complaint, filed Monday, adds the athletic foundation and sheds more light on the roles of Favre and other state officials in the scheme, including university officials who are not included as defendants. Former welfare director John Davis and nonprofit founder Nancy New have both pleaded guilty to several fraud and bribery charges in connection with the welfare scandal.

“Despite the Foundation’s expressing worries about ‘rais[ing] negative concerns’ and being ‘scared to death,’ Brett Favre urged Nancy New that it was necessary for the Foundation to ‘utilize you guys [John Davis and Nancy New] in every way,'” the filing reads.

While the new complaint increases Favre’s potential liability by $5 million, it removed the $1.1 million claim against Favre in the initial complaint because he repaid that amount to the state in 2020 and 2021.

The new filing also adds a lobbyist, two former MDHS attorneys and a virtual reality company as defendants in the lawsuit.

It does not mention former Gov. Phil Bryant or the discussions the governor had with Favre about finding funding for the volleyball stadium or Prevacus, the company purportedly developing a drug to treat concussions.

“Governor Bryant was both aware of and supported MCEC’s payments to Prevacus at issue in this lawsuit, as well as its $5 million payment to Southern Miss in connection with the construction of a wellness center,” Favre alleged in his most recent motion.

The lawsuit still names fitness trainer Paul Lacoste and his organization Victory Sports Foundation, which received $1.3 million under what former MDHS leader Davis described as “the Lt. Gov’s fitness issue,” referring to then-Lt. Gov. Tate Reeves. Now governor and in control of the suit, Reeves is also not mentioned in the amended complaint.

In the new complaint, MDHS added the following new defendants:

USM Athletic Foundation.
N3 Holdings, the company that Nancy New and her sons Zach and Jess New owned and allegedly used to personally invest in Favre’s pharmaceutical start-up companies called Prevacus and PreSolMD.
Lobaki, Inc. and Lobaki Foundation, a virtual reality company that received welfare funding to prop up a VR training academy.
JTS Enterprises, the company formed by Brian Jeff Smith, John Davis’ brother-in-law, through which he received welfare funds.
William Longwitz, former lawmaker and lobbyist who received nearly $320,000 in welfare funds to lobby on behalf of New’s organization.
Inside Capitol, LLC, Will Longwitz’s lobbying firm.
Jacob Black, former MDHS attorney.
Garrig Shields, former MDHS attorney who left the agency to work for New’s nonprofit.
William, Weiss, Hester and Co., PLLC, the accounting firm that conducted regular audits of the New nonprofit.

The initial complaint sought to claw back a total of about $24 million. The new complaint asserts that the two nonprofits through which most of the money was misspent — Mississippi Community Education Center and Family Resource of North Mississippi — breached their agreements with MDHS and should have to return their entire awarded amounts, $39.3 million for MCEC and $38 million for FRC. Neither nonprofit has assets totaling anywhere near those amounts.

Former U.S. Attorney Brad Pigott, the private attorney MDHS first hired to bring the suit, planned to include the volleyball project in the complaint, but Reeves’ office instructed him to remove it before filing. In July, after Pigott subpoenaed the athletic foundation for its communication with former Gov. Bryant, among other individuals, Reeves’ appointed welfare director Bob Anderson fired the attorney. At that time, Reeves said the agency was still considering more potential defendants to add to the suit, including the athletic foundation.

“Governor Tate Reeves tasked me with correcting the path of MDHS,” Anderson said in a statement Monday. “As part of that process, MDHS has been working hard to restore trust and put in place numerous internal controls to ensure that misspending is not repeated in the future. The rest of the task involves recovering and returning to the taxpayers the millions of dollars in misspent funds which were intended to benefit Mississippi’s needy families. We continue that task with this motion to file an amended civil complaint.”

The amended complaint alleges that in April of 2017, Favre made a “handshake agreement” with USM, where his daughter played volleyball, to personally guarantee the funds to construct a new facility for the team. He then contributed $150,000 worth of autographed merchandise and began soliciting donations from various people and companies, including the Kohler family.

“Favre, however, was unable to convince his friends and connections to donate enough money to meet his obligation to fund the construction of the volleyball facility, and he did not want to pay the costs out of his own pocket,” the complaint reads.

Favre’s attorney Eric Herschmann rejected the assertion that the athlete personally committed funds to the project, pointing to emails from USM’s athletic director at the time, Jon Gilbert, that say Favre agreed to fundraise for the project.

In July of 2017, Gilbert introduced Favre to nonprofit founder Nancy New, Favre said in his recent filing.

New, who sat on the athletic foundation board alongside Favre, and another nonprofit operator Christi Webb had just become the recipients of a massive cash flow from the welfare department. At the time, New’s nonprofit Mississippi Community Education Center already had existing leases with USM, including for a large suite at the football stadium, where the nonprofit could invite guests to watch the games.

Shortly after connecting with New, Favre met at USM with her, Gilbert, Davis, MDHS attorney Garrig Shields and former WWE wrestler Teddy DiBiase to discuss using MDHS funds on the volleyball construction.

“John Davis discussed his plan to ‘do good things for USM’ and ‘give them 4 mil’ with Christi Webb and Nancy New, both of whom enthusiastically agreed. John Davis suggested that Nancy New tell Jon Gilbert that the facility should be named after Favre,” the complaint reads. “The Foundation told Brett Favre that they were ‘very leary [sic] of accepting such a large grant,’ and suggested ‘trying to find a way for John [Davis] to allocate money to an entity that could then give to us that would pay for brick and mortar.’ Brett Favre also told Nancy New he ‘passed [this] same info[rmation] to John [Davis] and of course he [John Davis] sent back we will find a way to make it work.'”

The lawsuit alleges attorneys Shields and Black were instrumental in crafting the sham lease agreement, as well as facilitating several other allegedly fraudulent purchases.

Black was one of the employees who gathered and brought information about Davis’ alleged fraud to Gov. Bryant in June of 2019.

Favre denies any wrongdoing in the volleyball project. Longwitz, Black, Shields and a spokesperson for USM did not return calls to Mississippi Today on Monday.

“While he had helped raise funds for the facility and thereby met Davis and New, Favre, as with the transfers complained of in the Complaint, did absolutely nothing wrong in connection with the Wellness Center,” Favre’s Nov. 28 motion reads. “During Favre’s fundraising efforts, in July 2017, the Southern Miss athletic director introduced Favre to New, a Southern Miss Athletic Foundation board member, as someone who could assist Favre with the fundraising. New was well connected with numerous Mississippi officials, including Davis and then-Governor Bryant, and close friends with Governor Bryant’s wife Deborah Bryant.”

Tom Duff, current president of the Institutions of Higher Learning Board of Trustees and one of the board members who signed off on the $5 million MDHS grant to build the volleyball stadium in 2017, told Mississippi Today last month that he believed USM should return the funds.

“MDHS’s proposed amended complaint, in which MDHS has dropped its original $1.1 million claim against Brett Favre, while adding new groundless allegations about him, is as frivolous as its original complaint,” Herschmann said in a statement Monday after the state’s latest filing. “Again, MDHS omits facts key to these new allegations—including that the Mississippi Attorney General signed off on the transfers of funds from MDHS to another state entity, the University of Southern Mississippi, all with the full knowledge and consent of the Governor and other State officials. That a private citizen, like non-lawyer Brett Favre, could have any liability under these circumstances is baseless. Accordingly, we will oppose, on Brett’s behalf, MDHS’s motion to amend the complaint to the extent it adds these new groundless allegations. “

Editor’s note: Mississippi Today Editor-in-Chief Adam Ganucheau’s mother signed off on the language of a lease agreement to construct a University of Southern Mississippi volleyball stadium. Read more about that here.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

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Mississippi Today

Mississippi Legislature approves DEI ban after heated debate

Published

18 hours ago

April 2, 2025

Staff Editor

mississippitoday.org – @MSTODAYnews – 2025-04-02 16:34:00

by Michael Goldberg, Mississippi Today
April 2, 2025

Mississippi lawmakers have reached an agreement to ban diversity, equity and inclusion programs and a list of “divisive concepts” from public schools across the state education system, following the lead of numerous other Republican-controlled states and President Donald Trump’s administration.

House and Senate lawmakers approved a compromise bill in votes on Tuesday and Wednesday. It will likely head to Republican Gov. Tate Reeves for his signature after it clears a procedural motion.

The agreement between the Republican-dominated chambers followed hours of heated debate in which Democrats, almost all of whom are Black, excoriated the legislation as a setback in the long struggle to make Mississippi a fairer place for minorities. They also said the bill could bog universities down with costly legal fights and erode academic freedom.

Democratic Rep. Bryant Clark, who seldom addresses the entire House chamber from the podium during debates, rose to speak out against the bill on Tuesday. He is the son of the late Robert Clark, the first Black Mississippian elected to the state Legislature since the 1800s and the first Black Mississippian to serve as speaker pro tempore and preside over the House chamber since Reconstruction.

“We are better than this, and all of you know that we don’t need this with Mississippi history,” Clark said. “We should be the ones that say, ‘listen, we may be from Mississippi, we may have a dark past, but you know what, we’re going to be the first to stand up this time and say there is nothing wrong with DEI.'”

Legislative Republicans argued that the measure — which will apply to all public schools from the K-12 level through universities — will elevate merit in education and remove a list of so-called “divisive concepts” from academic settings. More broadly, conservative critics of DEI say the programs divide people into categories of victims and oppressors and infuse left-wing ideology into campus life.

“We are a diverse state. Nowhere in here are we trying to wipe that out,” said Republican Sen. Tyler McCaughn, one of the bill’s authors. “We’re just trying to change the focus back to that of excellence.”

The House and Senate initially passed proposals that differed in who they would impact, what activities they would regulate and how they aim to reshape the inner workings of the state’s education system. Some House leaders wanted the bill to be “semi-vague” in its language and wanted to create a process for withholding state funds based on complaints that almost anyone could lodge. The Senate wanted to pair a DEI ban with a task force to study inefficiencies in the higher education system, a provision the upper chamber later agreed to scrap.

The concepts that will be rooted out from curricula include the idea that gender identity can be a “subjective sense of self, disconnected from biological reality.” The move reflects another effort to align with the Trump administration, which has declared via executive order that there are only two sexes.

The House and Senate disagreed on how to enforce the measure but ultimately settled on an agreement that would empower students, parents of minor students, faculty members and contractors to sue schools for violating the law.

People could only sue after they go through an internal campus review process and a 25-day period when schools could fix the alleged violation. Republican Rep. Joey Hood, one of the House negotiators, said that was a compromise between the chambers. The House wanted to make it possible for almost anyone to file lawsuits over the DEI ban, while Senate negotiators initially bristled at the idea of fast-tracking internal campus disputes to the legal system.

The House ultimately held firm in its position to create a private cause of action, or the right to sue, but it agreed to give schools the ability to conduct an investigative process and potentially resolve the alleged violation before letting people sue in chancery courts.

“You have to go through the administrative process,” said Republican Sen. Nicole Boyd, one of the bill’s lead authors. “Because the whole idea is that, if there is a violation, the school needs to cure the violation. That’s what the purpose is. It’s not to create litigation, it’s to cure violations.”

If people disagree with the findings from that process, they could also ask the attorney general’s office to sue on their behalf.

Under the new law, Mississippi could withhold state funds from schools that don’t comply. Schools would be required to compile reports on all complaints filed in response to the new law.

Trump promised in his 2024 campaign to eliminate DEI in the federal government. One of the first executive orders he signed did that. Some Mississippi lawmakers introduced bills in the 2024 session to restrict DEI, but the proposals never made it out of committee. With the national headwinds at their backs and several other laws in Republican-led states to use as models, Mississippi lawmakers made plans to introduce anti-DEI legislation.

The policy debate also unfolded amid the early stages of a potential Republican primary matchup in the 2027 governor’s race between State Auditor Shad White and Lt. Gov. Delbert Hosemann. White, who has been one of the state’s loudest advocates for banning DEI, had branded Hosemann in the months before the 2025 session “DEI Delbert,” claiming the Senate leader has stood in the way of DEI restrictions passing the Legislature.

During the first Senate floor debate over the chamber’s DEI legislation during this year’s legislative session, Hosemann seemed to be conscious of these political attacks. He walked over to staff members and asked how many people were watching the debate live on YouTube.

As the DEI debate cleared one of its final hurdles Wednesday afternoon, the House and Senate remained at loggerheads over the state budget amid Republican infighting. It appeared likely the Legislature would end its session Wednesday or Thursday without passing a $7 billion budget to fund state agencies, potentially threatening a government shutdown.

“It is my understanding that we don’t have a budget and will likely leave here without a budget. But this piece of legislation …which I don’t think remedies any of Mississippi’s issues, this has become one of the top priorities that we had to get done,” said Democratic Sen. Rod Hickman. “I just want to say, if we put that much work into everything else we did, Mississippi might be a much better place.”

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

Mississippi Today

House gives Senate 5 p.m. deadline to come to table, or legislative session ends with no state budget

Published

18 hours ago

April 2, 2025

Staff Editor

mississippitoday.org – @MSTODAYnews – 2025-04-02 16:13:00

by Taylor Vance, Mississippi Today
April 2, 2025

The House on Wednesday attempted one final time to revive negotiations between it and the Senate over passing a state budget.

Otherwise, the two Republican-led chambers will likely end their session without funding government services for the next fiscal year and potentially jeopardize state agencies.

The House on Wednesday unanimously passed a measure to extend the legislative session and revive budget bills that had died on legislative deadlines last weekend.

House Speaker Jason White said he did not have any prior commitment that the Senate would agree to the proposal, but he wanted to extend one last offer to pass the budget. White, a Republican from West, said if he did not hear from the Senate by 5 p.m. on Wednesday, his chamber would end its regular session.

“The ball is in their court,” White said of the Senate. “Every indication has been that they would not agree to extend the deadlines for purposes of doing the budget. I don’t know why that is. We did it last year, and we’ve done it most years.”

But it did not appear likely Wednesday afternoon that the Senate would comply.

The Mississippi Legislature has not left Jackson without setting at least most of the state budget since 2009, when then Gov. Haley Barbour had to force them back to set one to avoid a government shutdown.

The House measure to extend the session is now before the Senate for consideration. To pass, it would require a two-thirds majority vote of senators. But that might prove impossible. Numerous senators on both sides of the aisle vowed to vote against extending the current session, and Lt. Gov. Delbert Hosemann who oversees the chamber said such an extension likely couldn’t pass.

Senate leadership seemed surprised at the news that the House passed the resolution to negotiate a budget, and several senators earlier on Wednesday made passing references to ending the session without passing a budget.

“We’ll look at it after it passes the full House,” Senate President Pro Tempore Dean Kirby said.

The House and Senate, each having a Republican supermajority, have fought over many issues since the legislative session began early January.

But the battle over a tax overhaul plan, including elimination of the state individual income tax, appeared to cause a major rift. Lawmakers did pass a tax overhaul, which the governor has signed into law, but Senate leaders cried foul over how it passed, with the House seizing on typos in the Senate’s proposal that accidentally resembled the House’s more aggressive elimination plan.

The Senate had urged caution in eliminating the income tax, and had economic growth triggers that would have likely phased in the elimination over many years. But the typos essentially negated the triggers, and the House and governor ran with it.

The two chambers have also recently fought over the budget. White said he communicated directly with Senate leaders that the House would stand firm on not passing a budget late in the session.

But Senate leaders said they had trouble getting the House to meet with them to haggle out the final budget.

On the normally scheduled “conference weekend” with a deadline to agree to a budget last Saturday, the House did not show, taking the weekend off. This angered Hosemann and the Senate. All the budget bills died, requiring a vote to extend the session, or the governor forcing them into a special session.

If the Legislature ends its regular session without adopting a budget, the only option to fund state agencies before their budgets expire on June 30 is for Gov. Tate Reeves to call lawmakers back into a special session later.

“There really isn’t any other option (than the governor calling a special session),” Lt. Gov. Delbert Hosemann previously said.

If Reeves calls a special session, he gets to set the Legislature’s agenda. A special session call gives an otherwise constitutionally weak Mississippi governor more power over the Legislature.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

Mississippi Today

Amount of federal cuts to health agencies doubles

Published

20 hours ago

April 2, 2025

Staff Editor

mississippitoday.org – @MSTODAYnews – 2025-04-02 14:48:00

by Gwen Dilworth, Mississippi Today
April 2, 2025

Cuts to public health and mental health funding in Mississippi have doubled – reaching approximately $238 million – since initial estimates last week, when cancellations to federal grants allocated for COVID-19 pandemic relief were first announced.

Slashed funding to the state’s health department will impact community health workers, planned improvements to the public health laboratory, the agency’s ability to provide COVID-19 vaccinations and preparedness efforts for emerging pathogens, like H5 bird flu.

The grant cancellations, which total $230 million, will not be catastrophic for the agency, State Health Officer Dr. Daniel Edney told members of the Mississippi House Democratic Caucus at the Capitol April 1.

But they will set back the agency, which is still working to recover after the COVID-19 pandemic decimated its workforce and exposed “serious deficiencies” in the agency’s data collection and management systems.

The cuts will have a more significant impact on the state’s economy and agency subgrantees, who carry out public health work on the ground with health department grants, he said.

“The agency is okay. But I’m very worried about all of our partners all over the state,” Edney told lawmakers.

The health department was forced to lay off 17 contract workers as a result of the grant cancellations, though Edney said he aims to rehire them under new contracts.

Other positions funded by health department grants are in jeopardy. Two community health workers at Back Bay Mission, a nonprofit that supports people living in poverty in Biloxi, were laid off as a result of the cuts, according to WLOX. It’s unclear how many more community health workers, who educate and help people access health care, have been impacted statewide.

The department was in the process of purchasing a comprehensive data management system before the cuts and has lost the ability to invest in the Mississippi Public Health Laboratory, he said. The laboratory performs environmental and clinical testing services that aid in the prevention and control of disease.

Mississippi State Health Officer Dr. Dan Edney addresses lawmakers during the Democratic caucus meeting at the State Capitol in Jackson, Miss., on Tuesday, April 1, 2025. The discussion centered on potential federal healthcare funding cuts.

The agency has worked to reduce its dependence on federal funds, Edney said, which will help it weather the storm. Sixty-six percent of the department’s budget is federally funded.

The Centers for Disease Control and Prevention pulled back $11.4 billion in funding to state health departments nationwide last week. The funding was originally allocated by Congress for testing and vaccination against the coronavirus as part of COVID-19 relief legislation, and to address health disparities in high-risk and underserved populations. An additional $1 billion from the Substance Abuse and Mental Health Services Administration was also terminated.

“The COVID-19 pandemic is over, and HHS will no longer waste billions of taxpayer dollars responding to a non-existent pandemic that Americans moved on from years ago,” the Department of Health and Human Services Director of Communications Andrew Nixon said in a statement.

HHS did not respond to questions from Mississippi Today about the cuts in Mississippi.

Democratic attorneys general and governors in 23 states filed a lawsuit against the U.S. Department of Health and Human Services Tuesday, arguing that the sudden cancellation of the funding was unlawful and seeking injunctive relief to halt the cuts. Mississippi did not join the suit.

Mental health cuts

The Department of Mental Health received about $7.5 million in cuts to federal grants from the Substance Abuse and Mental Health Services Administration.

Phaedre Cole, president of the Mississippi Association of Community Mental Health Centers, speaks to lawmakers about federal healthcare funding cuts during the Democratic caucus meeting at the State Capitol in Jackson, Miss., on Tuesday, April 1, 2025.

Over half of the cuts were to community mental health centers, and supported alcohol and drug treatment services for people who can not afford treatment, housing services for parenting and pregnant women and their children, and prevention services.

The cuts could result in reduced beds at community mental health centers, Phaedre Cole, the director of Life Help and President of Mississippi Association of Community Mental Health Centers, told lawmakers April 1.

Community mental health centers in Mississippi are already struggling to keep their doors open. Four centers in the state have closed since 2012, and a third have an imminent to high risk of closure, Cole told legislators at a hearing last December.

“We are facing a financial crisis that threatens our ability to maintain our mission,” she said Dec. 5.

Cuts to the department will also impact diversion coordinators, who are charged with reducing recidivism of people with serious mental illness to the state’s mental health hospital, a program for first-episode psychosis, youth mental health court funding, school-aged mental health programs and suicide response programs.

The Department of Mental Health hopes to reallocate existing funding from alcohol tax revenue and federal block grant funding to discontinued programs.

The agency posted a list of all the services that have received funding cuts. The State Department of Health plans to post such a list, said spokesperson Greg Flynn.

Health leaders have expressed fear that there could be more funding cuts coming.

“My concern is that this is the beginning and not the end,” said Edney.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.