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Originally published February 26, 2011 at 10:01 PM | Page modified April 24, 2012 at 4:13 PM

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Brash furniture man made school program his fiefdom

Silas W. Potter Jr., the man at the center of the Seattle Public Schools scandal, always seemed to get ahead at work, despite doubts about his performance.

Seattle Times staff reporters

Timeline of a troubled program

February 2007: Seattle Public Schools' risk manager writes a memo warning of serious issues about the district's small-business program, including potential misuse of public funds.

July 2007: Maria Goodloe-Johnson begins her job as Seattle Public Schools superintendent.

January 2009: A consultant hired by the district reported serious deficiencies in the small-business program.

February 2009: Goodloe-Johnson and top district officials become aware of a pending story on the consultant's report in the Daily Journal of Commerce.

March 2009: The Daily Journal of Commerce publishes the story, mentioning the possibility of criminal charges.

April 2009: The consultant's report prompts the district to reprimand Silas Potter Jr. and strip him of his ability to grant small-construction contracts, but allows him to continue overseeing other contracting.

June 2010: The district becomes aware of a suspicious $35,000 financial transaction in Potter's small-business program. The district asks for a special state audit, as Potter resigns while attempting to create a similar nonprofit operation.

December 2010: District officials report to King County prosecutors possible criminal activity in Potter's program and ask Seattle attorney Patricia Eakes to determine the culpability of top managers.

February 2011: The state auditor's report is released, revealing up to $1.8 million in losses in the program, either for work not done or for questionable public benefit. Eakes' report follows, citing failures by Goodloe-Johnson and other top district officials to maintain proper oversight of the program.

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In 2005, when Seattle Public Schools interviewed three finalists to manage its small-business contracting center, a clear favorite emerged.

It was not Silas W. Potter Jr..

Potter wasn't qualified. He'd worked for Seattle schools since 2001, coordinating the moving of classrooms during school renovations — and one auditor said he seemed marginal at doing that. Earlier, he'd managed furniture warehouses.

The search team recommended one finalist to Fred Stephens, then the district's facilities director, and said if he didn't hire that person, to reopen the search.

Stephens promoted Potter anyway.

The episode would prove telling. Whether through charisma, connections or cunning, Potter kept getting ahead despite repeated warnings to supervisors about his conduct.

Over the next few years, according to two reports released last week, Potter grew the district's small-business contracting center into a rogue fiefdom while spending time on his school computer trolling websites for dating, gambling and people modeling bath towels.

He used money from his budget improperly to pay lobbyists in Olympia, the reports say. He spent $1.8 million on questionable contracts, doling out money to favored businesses and consultants who charged inflated prices for work of little or no public value — if it was done at all. County prosecutors have launched a criminal probe.

The scandal has swept in some high-profile Seattle figures, including former state Democratic Party Chairman Charles Rolland. It could lead to the firing of Superintendent Maria Goodloe-Johnson.

Stephens, now a top deputy to former Gov. Gary Locke at the U.S. Department of Commerce, failed to rein in Potter despite years of warnings from district staff, according to audits. Last spring, with Potter under a cloud, Stephens told him in an e-mail: "Silas, you are awesome."

At the center of the scandal is Potter, 59, a midlevel school manager who vanished last year and has eluded investigators for months. The Seattle Times has located him in Florida. Still, his departure leaves behind a nagging question:

How did this former furniture repairman and real estate agent rise to a position where he could hand out millions of dollars of public money with little oversight?

Strong personality

Those who worked with him describe Potter as a man who wanted everyone to know he was in charge. He was a bulky 5-foot-11, with a shaved head and goatee. He took pride in being brash.

He often bragged that he was from New York. But like many things with Potter, that wasn't the whole truth.

He went to high school in Covert, a town of fewer than 3,000 in Michigan's southwestern corner. On his high school's alumni website, he said he spent three years at Columbia University.

But when he applied for a job with the Seattle schools, he made no mention of Columbia. His application says he studied sociology and psychology at Western Michigan University for two years. In his district file, his résumés sometimes give 1968 to 1970 as his years at Western Michigan, at other times 1972 to 1974. Other documents claim he holds a four-year degree and that he spent two years in the Marines.

Potter worked through much of the 1980s at Levitz Furniture on Long Island, N.Y., setting up warehouses and working in the repair shop.

He was known to be meticulous, whether fixing cabinets or shooting hoops.

He is "very hardworking, very particular about things he wants to do," said his 25-year-old daughter, Bri'en. "He was always good at every sport: basketball, tennis, skating."

Potter was funny and could talk up a storm. "He has the gift of gab," his daughter said. "He's very outgoing. He's a really good person, deep down."

Potter divorced and headed to the Northwest in the early-1990s. He took a job at Smith Home Furnishings in Kent, managing a repair shop and coordinating shipping. He ran a furniture-repair shop out of his Kent home. "He worked with his hands," said Fred Wright, his one-time brother-in-law. "He's super smart, great with computers."

Potter worked from 1998 to 2000 for Johnson Controls in Redmond, managing Microsoft's furniture inventory. He landed a job in the Seattle schools' facilities department in April 2001.

He started at $39,000 a year, steady income that was sorely needed. He had been having serious money troubles for years.

In the 1990s, a Northwest bill collector chased Potter for unpaid debts of $8,725. At the district, Potter's wages were garnished for unpaid federal taxes and child support starting in 2001.

In January 2002, Potter was supposed to set up temporary classrooms during a renovation at Ingraham High School, science teacher Peter Schurke said.

After the holiday break, Schurke found no classroom — in fact, work hadn't begun.

He was told "talk to Silas."

But Potter could never be reached. "He was a ghost," Schurke said.

Big promotion

Potter's big break came in 2005, when Stephens was looking for someone to run the district's small-business contracting outfit, which helped tiny companies learn how to bid for district contracts, mostly in construction.

Potter applied. Stephens said Potter should be interviewed as a courtesy, district lawyer Ron English told auditors.

English and the search committee recommended a different finalist, but Stephens chose Potter.

Potter expanded the contracting center, eventually called the Regional Small Business Development Program. He offered dozens of classes and signed partnership agreements with the city of Bellevue, Port of Seattle and Tacoma Public Schools. The program grew into an operation that spent nearly $1 million a year.

Potter operated with an imposing, aggressive style. In meetings with contractors, he liked to sit at the head of the table, a secretary to his left. He made people wait — some described having to "muscle" their way in to see him.

If he didn't like what he heard, he was quick to call people out. He teased and bullied employees and contractors, often in public.

"He could castigate people, or just give them the look," said contractor Don Jenkins.

In 2007, Potter came to the attention of Richard Staudt, the district's risk manager. In a memo, Staudt warned of sloppy practices that could lead to contractor fraud.

But Potter remained in charge. Stephens would later tell auditors that he verbally reprimanded Potter, but a district investigation found no evidence to confirm Stephens' claim.

Later in 2007, Potter's unit sent a report about the supposed successes of his program to the School Board.

English, the district's deputy general counsel, told Stephens that Potter had given false information to the board.

Stephens wasn't interested. His response, English told auditors, was: "Yeah, but we need to make the program look good."

English took his concerns to his boss, general counsel Gary Ikeda.

Ikeda shrugged. English had reported his concerns to Stephens, and "that's all you can do," Ikeda said.

Potter's shop increasingly appeared to other school employees to be rife with cronyism and sometimes apparent fraud, according to documents released by audit investigators.

One district manager told investigators that some of Potter's employees were running side businesses from their desks: One ran a travel agency; Potter worked on real-estate deals on district time. "Everyone" thought Potter was "a con artist," the manager told auditors.

Potter's organization "started off as a great program," said James Kelly, recently retired president of the Urban League of Metropolitan Seattle, which received at least $595,000 in contracts from Potter. But "all of the sudden [it] fizzled into suspicious behavior on Silas' part."

Asked if Potter was a con artist, Kelly paused and laughed. "The Urban League loves everybody — we love Republicans, Democrats, rich people, crooks," he said.

In 2008, the district hired a private auditor to investigate Potter's shop. The audit report slammed his management.

This time, Stephens reprimanded Potter in writing and the district stripped Potter of his ability to award small construction contracts — but he still could award personal-services contracts.

The new restrictions did not appear to chasten Potter. During a district hiring freeze, he was allowed to hire three "business development counselors." Some were unqualified. One was a roommate, and all had "connections" to Potter, auditors wrote. Then Potter spent thousands of district dollars hiring contractors to train the three hires.

Through it all, Potter's salary climbed. In 2005 he was bumped up with the new job to $51,400. By 2009 he was making $84,000.

His supervisor, Stephens, declined repeated requests for interviews. In an e-mail Friday, he said he was "deeply troubled" by the state audit's findings and blamed Potter.

"If the audit's characterizations are accurate, our efforts were thwarted by Mr. Potter's dishonest behavior," Stephens wrote.

For Potter, the end began in early 2010, as the district started phasing out his program. Potter created a private corporation with the exact name of his school-district program. He talked about moving the district program to his company, described as a nonprofit. He said he wanted to expand "nationwide."

Potter had $6,300 in bills for his new company sent to the school district for payment, but the district turned them down.

Potter resigned June 7. The next day, the district gave him a $55-an-hour consulting contract. Signed by the district's financial chief, Don Kennedy, the contract said Potter would work to "connect" small businesses with school-district contracts.

On June 10, 2010, a $35,000 check from Tacoma Public Schools to the Seattle district, in the name of its Regional Small Business Development Program, was deposited in a bank account for Potter's private company. The district filed a police report.

By then, Kennedy had the incident reported to the State Auditor's Office, which began an investigation.

Auditors looked for Potter but could not find him.

Florida apartment

Several days ago, The Seattle Times began to search for Silas Potter. It tracked him down in Florida.

Potter obtained a Florida driver's license and registered to vote there on Oct. 26. He gave an address at an apartment complex in Tampa, a city where he'd lived years ago.

On Friday, a man who lives next to Potter in the complex said he had seen Potter the day before. Potter drove a white Chevrolet SUV. The man confirmed Potter's identity after being shown a photo of him.

Others are looking for Potter, as well. The neighbor said employees of Aaron's, a rent-to-own company specializing in furniture and electronics, had visited Potter's apartment more than once, seeking to get merchandise returned.

On Saturday, a white Chevy Tahoe with Washington plates sat outside Potter's apartment. A reporter returned to the apartment several times during the day and knocked on the door.

No one answered.

Jim Brunner: 206-515-5628 or Tampa stringer John W. Allman contributed to this report. Additional reporting and research by Linda Shaw, Bob Young, David Turim and Miyoko Wolf.

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