Panel vote could lead to closing of 2 troubled Charlotte charter schools

Kennedy Charter recently moved to the campus of Johnson C. Smith University.
Kennedy Charter recently moved to the campus of Johnson C. Smith University.

The N.C. Charter School Advisory Board voted Monday not to renew the charters for Crossroads Charter High School and Kennedy Charter School in Charlotte, a step that could lead to their closing next school year.

The vote came after panel members reviewed a history of low test scores and financial troubles. Both schools received F grades from the state this year, with more than 80 percent of students scoring below grade level on state exams. Both have run deficits and failed to submit a financial audit that was due Oct. 31.

The state Board of Education makes the final call, with a review scheduled for January and a vote in February. If the board decides not to renew the charters, the schools could close or the state could offer charter companies the chance to take over.

The possible closings come at a time of growth and turmoil for charter schools in the Charlotte region. The area has seen a surge of new schools since the state lifted its cap of 100 charters in 2011. During the last two years, three Charlotte start-ups facing academic and financial challenges closed within months.

But this is something new: A challenge to the continued existence of charter schools that have operated for more than a decade, serving some of the area’s most disadvantaged students. Monday’s review, which included the academically strong but financially struggling Queen’s Grant charter school in Mint Hill, illustrates the complexity of a system that has to decide when the state should cut off public money.

The advisory board gave Queen’s Grant a limited nod of approval Monday after Mint Hill Mayor Ted Biggers, who chairs the Queen’s Grant board, presented evidence that a longstanding and costly dispute over rent for the high school has been settled.

But panel members said they did not see proof that Kennedy and Crossroads were providing a better option for students than Charlotte-Mecklenburg Schools could offer, despite years of effort. And some worried about the high cost for small numbers of students. Kennedy, for instance, spent $4.7 million in 2014 – including more than $812,000 from Elon Homes, the group that created the school – to educate fewer than 350 students.

On a board that’s sympathetic to charter schools, some members wanted to give the schools more time.

“I believe it will become a premier school,” board member Phyllis Gibbs said of Kennedy, which has already gone through one three-year trial period designed to turn the school around.

But board member Steven Walker put it bluntly: “There’s no way I’d send my kid to that school.”

Lee Teague of the N.C. Public Charter Schools Association said he sees Monday’s vote as a sign that the advisory board is serious about maintaining quality. Charter school supporters “are going to have to work hard with our schools that are having difficulty to improve them,” he said.

Crossroads: Troubling problems

Crossroads High was created 14 years ago to offer an alternative for students who were failing at traditional high schools. Today its enrollment is declining and its academic record is worse than any CMS high school.

Crossroads representatives said they reconstituted their board in November and are working to boost achievement. Board member David Jean said the school serves a mix of students who are at-risk, ready for college or headed for jobs after high school.

But advisory board member Joe Maimone said the financial problems at Crossroads, a high school with fewer than 200 students that received about $2 million in government money in 2014, are “as clear a case as I’ve seen” for letting a charter expire. Reports presented Monday indicated that in 2013 and 2014, audits found a total of almost $49,500 in expenses that weren’t properly documented.

The report cited “$21,531 in FY2013 due to inappropriate credit card expenditures by the administrator,” prompting board members to question why Principal Gentry Campbell remains in place. The 2014 audit, which was months late, “included a repeat finding with questioned costs of state funds totaling $27,948.”

Crossroads board members said they are considering “leadership changes,” and attorney Edana Lewis told the board that the implication that the principal misspent public money was false. Lewis said “the person” repaid $6,900 the first year, and the second year’s questioned expenses were just “a receipt problem.”

Campbell declined comment Monday.

Kennedy: Constant change

In 2013, after 15 years in operation, the state gave Kennedy three years to complete a move to the Johnson C. Smith University campus and “show growth in academic performance.”

The first goal was met: The K-12 charter school is now located on the Beatties Ford Road campus. The problem with the second goal is that the state didn’t define it.

Kennedy officials argued that gains made during the first two years should count, even though scores dropped in 2015. They acknowledged that the F rating and the failure to meet the state’s target for student growth were disappointing, but blamed the turmoil of the move.

Kennedy was founded as an alternative school for children served by Elon Homes, which provides foster care, mental health services and other support for disadvantaged children. In recent years the charter school has become a general-admission school. Elon Homes continues to provide money to supplement the public spending, the state report says.

Kennedy officials say they’re cutting staff – reducing costs from $3.7 million in 2014 to $2.8 million this year – and trying to rebuild a stable school. They also acknowledged that board members have applied to open a second K-12 charter in Mecklenburg County next year, a plan that drew questions and rebukes from some on the advisory board.

The board voted not to recommend renewal.

Brad Gilliam, chairman-elect of the Kennedy board, said after the meeting that he was “shocked and aghast” at the vote. He said Kennedy leaders will try to persuade the Board of Education not to end the charter.

Queen’s Grant: Rent dispute

Queen’s Grant Community School in Mint Hill opened 13 years ago as a K-8 school, which is run by National Heritage Academy.

In 2006 the board decided to add a high school, and that’s when the finances got messy. NHA, a charter school management company, doesn’t run high schools. So the board contracted with a small firm run by former NHA employee Norman George. George was also one of the investors who bought the old Idlewild City Club and leased it to Queen’s Grant for the high school, Biggers said Monday.

Biggers said the board and George disagreed over the terms of the lease, with Queen’s Grant paying what it believed was fair and George insisting the school owed more. The difference piled up on the books as unpaid debt, leading the state to report “signs of financial insolvency” when Queen’s Grant’s charter came up for renewal.

Both Biggers and George told the advisory board that they had just agreed to settle out of court, with $471,000 in unpaid debt taken off the books. The school is now paying $33,000 a month to rent the high school, George said.

Queen’s Grant high school has also ended its contract for Norman to manage the school, Biggers said.

Because the state had no documentation of the new agreement the advisory board recommended a seven-year extension rather than the standard 10 years. But members said the school’s academic performance is strong.

Ann Doss Helms: 704-358-5033, @anndosshelms

Charters at a glance

These Charlotte-area charter schools are up for renewal in 2016 and were reviewed Monday by the N.C. Charter School Advisory Board.

Crossroads Charter High

Basics: High school that opened in 2001. Located at 5500 N. Tryon St.

Enrollment: 163 students; 96 percent are black and 86 percent come from low-income homes. Enrollment has been declining.

Academics: 19 percent pass rate on last year’s state exams, with 12 percent rated college/career ready. Graded F and barely met growth target. Graduation rate 52 percent, compared with state average of 86 percent.

Financial: Received just over $2 million in public money in 2014 and ran a deficit of almost $62,000. On probationary financial status and has not submitted required 2015 audit. State reports “inadequate internal controls” and cites almost $49,500 in inappropriate credit card spending and other questioned expenses in 2013 and 2014.

Status: Advisory board recommends not renewing charter.

Kennedy Charter School

Basics: K-12 charter school that opened in 1998. Started as an alternative school run by Elon Homes for students who had been removed from troubled families. Recently transitioned to a regular charter school and moved to the campus of Johnson C. Smith University on Beatties Ford Road.

Enrollment: 343 students; 92 percent are black and 82 percent are from low-income homes. Enrollment declined slightly this year.

Academics: 19 percent pass rate on last year’s state exams, with 10 percent rated college/career ready. Graded F and did not meet growth target. Graduation rate 67 percent.

Financial: Received $4.6 million in public money in 2014 and ran a deficit of almost $30,000. State raised concerns about a low cash balance and late reporting. Audit for 2015 has not been submitted.

Status: Received a three-year renewal in 2013, contingent on showing academic progress and moving to JCSU. Advisory board recommends not renewing in 2016.

Queen’s Grant

Basics: K-12 school that opened in 2002. It is essentially two Mint Hill schools operating under one charter: The K-8 school is run by National Heritage Academies, a national charter management company, and the high school is run independently.

Enrollment: 1,264 students; 67 percent are white and 17 percent are from low-income homes.

Academics: 69 percent pass rate on last year’s state exams, with 59 percent rated college/career ready. Graded B and met growth target. Graduation rate 92 percent.

Financial: Received $9.2 million in public money in 2015 and has run a deficit for several years, caused by a rent dispute involving the high school campus. The state says more than $440,000 is disputed and reports “signs of financial insolvency,” but the school and landlord said Monday the debt has been erased with a new lease agreement.

Status: School is seeking a 10-year renewal; the advisory board recommends seven years.