Education

NC may fine closed charter schools that don’t meet obligations

Front exterior of the PACE Academy in Carrboro, Jan. 9, 2014. The charter school was closed by the state in 2015. The state is considering whether to penalize charter schools when they fail to turn over records when they close.
Front exterior of the PACE Academy in Carrboro, Jan. 9, 2014. The charter school was closed by the state in 2015. The state is considering whether to penalize charter schools when they fail to turn over records when they close. hlynch@newsobserver.com

An advisory board is wrestling with whom to hold accountable when a charter school closes in North Carolina and fails to turn over student records, pay its ex-employees and meet its other financial obligations.

Since 2012, 10 charter schools have closed and displaced 1,114 students and 143 employees with fiscal mismanagement costing millions of dollars at the taxpayer-funded public schools. State education officials said the closures have resulted in difficulties for some families getting access to student records as they move to a new school.

Three of the 10 closings – Student First Academy, Concrete Roses and Entrepreneur High – were in Charlotte. All three faced reports of financial and academic shortcomings and closed during their first school year.

Two longstanding Charlotte charter schools, Kennedy and Crossroads, are expected to close at the end of this year because the state declined to renew their charters.

There are no legal consequences for the non-profit boards of charter schools that fail to follow the closure procedures. The N.C. Charter School Advisory Board discussed Tuesday whether the boards or the employees should be held liable.

Staff recommended Tuesday increasing the legal accountability for the non-profit boards. A draft staff proposal calls for changing state law to allow the State Board of Education to issue civil penalties on the non-profit boards when they’re found to have violated closeout procedures.

The draft policy also calls for imposing civil penalties on individual board members when the charter fails to turn over student records to the family’s new school. A penalty of $100 could be issued for each day.

The idea of holding individual board members liable drew concerns that it could make it harder to recruit people to serve on charter boards.

“I agree we can’t have people closing out and leaving kids with no records,” said Cheryl Turner, longtime director of Charlotte’s Sugar Creek Charter School and member of the state advisory board. “I don’t know the best way to fix that.

“But I do think that making people personally liable for all the finances of the school if they are not paid when the school closes, nobody’s going to agree to that.”

Joe Maimone, chair of the advisory board’s performance committee, suggested instead looking at having insurance companies cover the penalties for the defunct charters.

Steven Walker, vice chairman of the advisory board, suggested charging the directors of defunct charter schools with a class one misdemeanor if they fail to turn over student records. Walker cited the difficulties getting records when PACE Academy in Orange County closed in 2015.

“They can go on probation,” Walker said. “They can go to jail. Either of these things to me that’s a whole lot more than thinking if I don’t do it, my board members are going to get charged a $100 a day.”

Maimone agreed that if there are any consequences they should shift more on the directors of the charter schools.

“As a director, I think the responsibility is absolutely on the director, and I don’t believe it’s on non-profit board members who have full-time jobs and can not be engaged in everything that happens day-to-day in the school,” said Maimone, headmaster of Thomas Jefferson Classical Academy.

The advisory board didn’t come to a decision Tuesday on what recommendation to make. Staff was asked to explore:

▪ A revision of the draft proposal that would put more of the liability on paid employees of charters;

▪ Whether charters could be required to have as additional insurance coverage something that would cover liabilities for not following the closeout procedures;

▪ Seeing if charter schools can be required to set up a restricted fund to cover close outs.

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