Long rise, hard fall of John Barranco

He found big money in an unlikely place — a regional agency serving disabled children. And then investigators closed in.

Investigators say Barranco transferred public funds from a special needs agency.

John B. Barranco’s road to riches - and maybe ruin - was paved with good intentions gone bad - very bad, if you believe what state investigators have been saying about him. He is the man, they allege, who took a Merrimack Valley agency designed to serve children with disabilities and turned it into a personal treasure chest, siphoning off enough to become the owner of four homes, including a Florida getaway and a spread on Lake Winnipesaukee that he paid for with more than $1 million in cash.

The state inspector general has called it “one of the most outrageous abuses this office has ever seen.’’

But it is more than that.

John Barranco’s story is also about an East Boston boy who loved to box and grew into a young man remembered for smarts and moxie and sometimes intimidating toughness. About a schoolteacher whom many admired, one with an ambition for greater things. About a man with a gift for building political alliances, particularly among an endangered species in Massachusetts - GOP power brokers.

And about love.

Brian Blanco for The Boston Globe
John Barranco became the owner of four homes, including a getaway in Bradenton, Fla. (above) and a house in Harvard (below).

For Barranco didn’t build his empire alone. He left his wife for one of his employees in 1997, moving in with a woman nearly 20 years younger than himself for what he later called, in a court filing, “a mutual adult relationship of trust, confidence, and love.’’

For a decade, Mary A. Clisbee was Barranco’s right hand on the job and hostess at home, rising quickly from social worker through a series of promotions until Barranco had her named as his successor as executive director of the Merrimack Special Education Collaborative, an agency that provides academic instruction and job training for about 500 special needs children and 200 adults a year.

During their affair, Barranco and Clisbee collected ever-higher salaries and ultimately, in 2006, engineered the transfer of more than $11.5 million from the Collaborative to the Merrimack Education Center, a related, private nonprofit that Barranco was running as his personal fiefdom, according to findings released in June by state Inspector General Gregory W. Sullivan. Indeed, from 2003 through 2006, Barranco and Clisbee together took in more than $2.5 million in salaries and bonuses from the two organizations.

And then it all went sour, starting with their relationship. When Clisbee broke up with him in 2007, Barranco didn’t hesitate to strike back. He forced her out of her $300,000 a year job, Clisbee said in an affidavit, and sued her for $100,000, claiming she owed him the money for work on her Groveland home. That legal battle would bring into view an intimate account of their personal and professional lives - an account that would ultimately prove useful to law enforcement.

Jonathan Wiggs/Globe Staff

Barranco now faces investigations by federal prosecutors and no fewer than six state agencies, including the offices of the inspector general and State Auditor Suzanne M. Bump, for allegedly transferring the $11.5 million and drawing on the money to award himself, Clisbee, and a tight circle of staffers extravagant salaries and benefits.

It is an accusation that astonishes some who knew Barranco back in the day as a teacher committed to bettering the neighborhood where he grew up, a charismatic sort who rose from the streets of East Boston to earn a Harvard doctorate in education and become a generous boss often eager to take underlings to lunch.

Others, however, are not so surprised, recalling Barranco as a man who could quickly turn into a “mad bull snorting and pawing at the turf’’ when he was crossed, as one former education official put it.

But all agree that he is a man worth seeing in full.

The 69-year-old Barranco would not comment for this story, but interviews with more than a dozen people who know him and documents reviewed by the Globe illuminate how he was able to gain control of an obscure public agency and, investigators say, repeatedly dip into its assets for personal gain over more than a decade - largely out of view and without anyone raising objections.

“I didn’t see any of this coming,’’ said Robert S. Hargraves, a former state representative and Groton selectman who has known Barranco for nearly 30 years. “I have found John to be nothing but aboveboard.’’

Neighbors unaware

In East Boston, where Barranco grew up during the 1940s and ’50s, former colleagues and neighbors were stunned when they learned of Sullivan’s allegations.

“I was in shock,’’ said Mary Ellen Welch, a retired grade school educator who recalled Barranco as an innovative teacher at the old Barnes Middle School, during the early 1970s. “The John Barranco I knew was committed to his job and committed to the community.’’

Laurence N. Aiello, a longtime friend of Barranco’s who today serves on the board of the Merrimack Education Center, recalled growing up with Barranco in what was then a neighborhood of predominantly Italian families.

Barranco, Aiello recalled, was an especially bright - and unusually tough - teenager who trained as a boxer at the Paris Street Gym, adding that Barranco was someone who “could take care of business - could then and presently could.’’

As for Sullivan’s allegations, Aiello said he is confident Barranco will eventually show that they are largely without merit, although he declined to address any of the specific accusations leveled against his friend.

“He’s a man of integrity,’’ Aiello said, “and when all this other stuff is sorted out people will see that.’’

Successful educator

By the early 1980s, Barranco was an educator on the rise, forging political ties with local and state Republicans that would serve him for decades.

In 1982, when he was named superintendent of the Groton-Dunstable Regional School District, he quickly won the admiration of Hargraves, then a member of the Groton Board of Selectmen, and his wife, Ellen, a member of the School Committee that hired Barranco.

Both Robert and Ellen would support Barranco for decades, even as they rose to more powerful positions. Robert would serve 16 years in the state Legislature, while Ellen would win an appointment from former Governor A. Paul Cellucci to the board of the state Teachers’ Retirement System.

It was an appointment that paid off for Barranco as recently as last December, when Hargraves asked fellow board members to reconsider a decision to dock Barranco’s $157,000 annual teacher’s pension for exceeding the limit on outside income.

“Knowing him as I do, I found it very hard to believe there could be some wrongdoing involved,’’ Ellen said, in a recent interview.

By the early 1990s, Barranco had become something of a favorite with Governor William F. Weld and then-Lieutenant Governor Cellucci, winning appointments to several blue ribbon panels; administration insiders even tried to overrule a search committee and have him named state education commissioner.

Shortly after that bid failed, Barranco left his position as regional superintendent to become executive director of the Collaborative and the Center, posts he would hold simultaneously for more than a decade.

From the beginning, the two organizations were closely entwined. In the late 1960s, a group of educators in the region established to Center to foster innovative education programs. In 1976, the Center created the Collaborative as a separate entity for special needs students, and for many years the two organizations operated in tandem, sharing managers and office space in Chelmsford.

But when Barranco arrived on the scene, in the early 1990s, the financial interests of the two groups were diverging, with the Collaborative becoming a paying customer of the Center. Under Barranco, the Collaborative would purchase a variety of services from the Center, including classroom space, transportation, and administrative support.

It was an arrangement that created an inherent conflict for Barranco, the executive director of both organizations, Inspector General Sullivan concluded in his investigation, as Barranco was both the buyer and seller of goods and services paid for with taxpayer money.

Sold technology

By the time Barranco and Clisbee began living together in the late 1990s, Barranco was already using the nonprofit Center to generate revenue by providing high-technology services to local school districts - and throwing sharp elbows at anyone who got in his way.

Through an arm of the Center called MECnet, he had already capitalized on the growing importance of the World Wide Web by selling Internet services to 200 public school districts.

So when a newly created state-funded agency decided it could offer schools a less expensive connection through a different vendor, Barranco fought back, publicly denouncing the decision as a “scam’’ and a “bag job.’’

Then he caught up with Greg Nadeau, the chief technology officer for the old state Department of Education, and, Nadeau said, offered some pointed criticism.

“He physically threatened me in the halls of the State House, yelling at me and saying he was going to shove something down my [expletive] throat,’’ Nadeau recalled. “John Barranco was an extraordinarily aggressive, ruthless bully.’’

At the time, another official, Ray Campbell, was working as the executive director of the Massachusetts Corporation for Educational Telecommunications, the state-funded agency established to provide schools with a variety of high technology teaching tools.

When the agency decided to move into the area of connecting schools to the Internet, and cut MECnet out of the process, Campbell, too, felt Barranco’s wrath.

“I’ve never encountered anyone so crass, so boorish, so incapable of sitting down and working something out,’’ Campbell recalled. “He was like a mad bull snorting and pawing at the turf.’’

In the long run, Barranco prevailed. Within a year, the vendor chosen by Campbell’s agency filed for bankruptcy, a victim of the volatile high-technology market of the era, and the Center picked up much of its business with local schools.

Methods questioned

But Barranco would lose out - permanently - on another line of MECnet’s operations, when a newly named state official questioned the quality of the service he was providing and the conditions under which he was securing contracts.

In this particular line of the Center’s business - which grossed nearly $4 million in the early 2000s - the Center sold specialized software to cities and towns to help them audit new school construction costs. Cities and towns were required to submit the audits to the state Department of Education before being reimbursed for their construction expenses.

To build its software business, Barranco and the Center hired James L. Anderson away from the Department of Education. Anderson, in turn, secured a letter from a former colleague in the department saying that the department approved of the software and would reimburse cities and towns that bought it.

To Katherine Craven, who in 2004 became head of the newly created Massachusetts School Building Authority, the letter amounted to an exclusive, no-bid contract. “There was no other software endorsed by a letter from the Department of Education,’’ she said.

Craven also decided that her office could design more sophisticated software, offer it to local schools for free, and cut off the reimbursements to cities and towns for Barranco’s product.

“This was a multimillion-dollar business and it went away after 2006,’’ she said.

Corruption allegations

By then, Barranco was relying on Clisbee to help carry out the deal that now lies at the heart of the corruption accusations lodged by Sullivan and Bump - the transfer of more than $11.5 million in taxpayer money from the Collaborative to the Center. The money had been collected by the Collaborative from member school districts in the form of tuition for disabled students.

The transfer was executed in June of 2006 through two agreements, Sullivan wrote in a letter to the two co-executive directors of the Collaborative. Under the first one, the Collaborative agreed to pay the Center $5.5 million for back rent, building improvements, and various administrative services dating to 2000.

But Bump, the state auditor, found that the Collaborative had already paid $16 million for those very same services.

The second agreement set the rates for services to be paid by the Collaborative over the next 10 years under an exclusive arrangement that Sullivan said not only violates the state’s open bidding law but has also required the Collaborative to pay the Center $6.5 million in excess of the Center’s costs for those properties. Sullivan has urged the Collaborative to demand repayment of the money.

The net result of the two agreements was dramatic: The Collaborative went from having a $3.8 million surplus, to being $2.4 million in the red in less than two years, according to Bump’s audit. The Center, meanwhile, saw its assets soar from $4.6 million to $14.6 million over the same period.

To win the approval of the two agreements, Barranco and Clisbee relied on overlapping boards of directors at the Collaborative and the Center to push them through, Sullivan’s investigation concluded. Because of the overlap, five superintendents voted twice to approve the pacts, once on behalf of the Collaborative and again on behalf of the Center, another conflict of interest.

Moreover, Barranco later awarded three of those board members high-paying jobs at the Center: James McCormick, now the superintendent of schools in Mason, N.H.; Robert Calabrese, who is dead; and David Hawkins, who appears to be still working for the Center.

The fourth of the five board members, Richard Moser, attended the Kentucky Derby with Barranco - at the Center’s expense - a year before casting his votes for the two agreements.

None of these individuals returned numerous calls from the Globe.

The fifth board member, Joseph J. Connelly, now the interim superintendent of the Harvard public schools, told the Globe that when he approved the agreements he believed he was voting on innocuous measures designed to separate the functions and assets of the two organizations.

“I thought we had done everything legal and proper,’’ he said.

Personal setback

Even as they prospered in their professional relationship, Barranco and Clisbee foundered in their personal relationship.

Clisbee, now an associate dean at Nova Southeastern University, in Florida, said in her affidavit that Barranco expected her to entertain his friends and business associates at her Groveland home, and would desert her on weekends while she was suffering from Crohn’s disease and thyroid cancer.

In March of 2007, after spending several days making preparations for a board meeting at Barranco’s Bradenton, Fla., Clisbee ended the relationship.

But Barranco quickly moved to get even, waiting only two months to file his lawsuit. Once again, he appeared to prevail. Last July, after three years of litigation, Clisbee agreed to settle for about $41,500.

In the end, however, it could turn out to be a hollow victory, with investigators - aided by details in the lawsuit - closing in on Barranco at a time when he is on an unpaid leave of absence from his $500,000 a year job at the Center.

“I do believe he’s a bad person who did bad things,’’ said Nadeau, the former Department of Education official. “I’m just surprised that it took this long for them to catch up with him.’’

Michael Rezendes can be reached at Follow him on Twitter @RezGlobe.