I know some of the code has been removed such as the localization strings, trying to keep it as simple as I can.  Below you will see the first index to colModel is the formatter that I'm trying to get jqGrid to initalize that I want it to call the function to insert the html img tag, but jqGrid will not do it.  Is there something speical that I need to do for formatter to work properly when loading from JSON data?

PHP Code to return JSON data:

$results = array();

$results['rowNum']		= 100;
$results['rowList']		= array(10, 20, 30, 40, 50, 60, 70, 80, 90, 100);
$results['sortname']	= 'lastname';
$results['sortorder']	= 'asc';

$results['caption']		= array(htmlspecialchars($caption));
$results['addtext']		= array(htmlspecialchars($addtext));
$results['edittext']	= array(htmlspecialchars($edittext));
$results['deltext']		= array(htmlspecialchars($deltext));
$results['searchtext']	= array(htmlspecialchars($searchtext));
$results['refreshtext']	= array(htmlspecialchars($refreshtext));
$results['viewtext']	= array(htmlspecialchars($viewtext));
$results['emptyrecords']= array(htmlspecialchars($emptyrecords));
$results['loadtext']	= array(htmlspecialchars($loadtext));

$results['colNames']	= array(htmlspecialchars($type),
								htmlspecialchars($firstname),
								htmlspecialchars($lastname),
								htmlspecialchars($company),
								htmlspecialchars($email));

$types = array('contact:' . htmlspecialchars($contact), 'group:' . htmlspecialchars($group));

$results['colModel'][] = array( 'name' => 'type',
								'index' => 'type',
								'width' => '16',
								'editable' => true,
								'edittype' => 'image',
								'formatter' => 'js:contactTypeImage');

$results['colModel'][] = array(	'name' => 'firstname',
								'index' => 'firstname',
								'width' => '80',
								'editable' => true);

$results['colModel'][] = array(	'name' => 'lastname',
								'index' => 'lastname asc, firstname',
								'width' => '80',
								'editable' => true);

$results['colModel'][] = array(	'name' => 'companyname',
								'index' => 'companyname',
								'width' => '80',
								'editable' => true);

$results['colModel'][] = array(	'name' => 'email1address',
								'index' => 'email1address',
								'width' => '80',
								'editable' => true);

echo json_encode($results);

Javascript Code:

    $.ajax({
        type: 'GET',
        url:'/contacts/initgrid',
        data: '',
        datatype: 'json',
        success: function(response) {
            var caption = response.caption;
            var addtext = response.addtext;
            var edittext = response.edittext;
            var deltext = response.deltext;
            var searchtext = response.searchtext;
            var refreshtext = response.refreshtext;
            var viewtext = response.viewtext;
            var emptyrecords = response.emptyrecords;
            var loadtext = response.loadtext;

            var rowNum = response.rowNum;
            var rowList = response.rowList;
            var sortname= response.sortname;
            var sortorder = response.sortorder;

            var columnNames = response.colNames;
            var columnModel = response.colModel;

            $("#contact_list").jqGrid(
                    {
                        url:'/contacts/list',
                        datatype: "json",
                        colNames: columnNames,
                        colModel: columnModel,
                        autowidth: true,
                        height: 'auto',
                        rowNum: rowNum,
                        rowList: rowList,
                        toppager: true,
                        pager: '#contact_list_pager',
                        sortname: sortname,
                        viewrecords: true,
                        sortorder: sortorder,
                        emptyrecords: emptyrecords,
                        loadtext: loadtext,
                        caption: caption,
                        loadComplete : function() {
                            // Remove the close button on the toolbar
                            $('.ui-jqgrid-titlebar-close').remove();
                        }
                    }
                ).jqGrid('navGrid','#contact_list_toppager',
                    {   edit: true,
                        add: true,
                        del: true,
                        refresh: true,
                        view: true,
                        addtext: addtext,
                        edittext: edittext,
                        deltext: deltext,
                        searchtext: searchtext,
                        refreshtext: refreshtext,
                        viewtext: viewtext,
                    },
                    {
                        recreateForm: true,
                        beforeInitData: function () {
                            alert("hello beforeInitData - 1");
                        }
                    },
                    {   url: '/contacts/modify',
                        closeAfterEdit: true,
                    },
                    {   url: '/contacts/create',
                        closeAfterAdd: true
                    },
                    {   url: '/contacts/delete'
                    },
                    {   // search options
                    }
                ).jqGrid('navGrid','#contact_list_pager',
                    {   edit: false,
                        add: false,
                        del: false,
                        refresh: false
                    },
                    {
                        recreateForm: true,
                        beforeInitData: function () {
                            alert("hello beforeInitData - 2");
                        }
                    }
                );
        }
    });
});

function contactTypeImage(cellValue, options, rowObject)
{
    alert(">>> in contactTypeImage");
    var imageHtml = "[Image Can Not Be Found]";
    return imageHtml;
}