Chartwells, the company that provide most DC Public School children’s school meals, has agreed to pay $19.4 million to settle a suit alleging contractual breaches. For multiple years, the suit alleges, Chartwells was paid many millions of dollars more for meals than it should have been, even while the company often delivered food late, failed to provide the full number of meals at some schools, and repeatedly served poor quality or spoiled food.
This is not the first time Chartwells has had to settle a suit of this kind. In 2012, its parent company, Compass Group USA, paid $18 million to settle a suit about its improper retention of rebates in New York State.
Despite these settlements, the Office of the Attorney General of DC, which investigated and supported the suit’s allegations, said that Chartwells will be able to keep its contract with DCPS. “In light of Chartwells’ acceptance of responsibility, DCPS looks forward to continuing its contractual relationship with the company.”
Reports of Chartwells’ financial irregularities and documentation of its failure to abide by the full terms of its contract have appeared for years. At City Council hearings in 2012, parents and community organizations testified about the poor quality of food Chartwells provided and raised questions about the yearly losses the company reported, which had to be covered by DC taxpayers to the tune of around $10 million a year. DCPS commissioned an independent audit of the company in that year and verified that the company was overcharging the city for meals and breaching its contract in other ways.
Still, Chartwells has held onto its contract with DCPS. And it appears poised to keep that contract again, even in light of this settlement.
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