The state could move to shut down a Charlotte charter school as it struggles with low enrollment and significant financial shortfalls.
If Entrepreneur High School closes, it would be the third Charlotte charter school to close within the past year amid financial problems, raising questions about state oversight of charter schools.
Entrepreneur High has only $14 in its bank account, the school’s chairman, Robert Hillman, told the state’s charter school advisory board Monday.
The school also only has about 30 students attending classes, well below the minimum of 65 set by state law. By the end of the year, the state Department of Public Instruction projects a deficit of at least $400,000. Entrepreneur High had projected having 180 students this year.
Sign Up and Save
Get six months of free digital access to The Charlotte Observer
The board removed its founder and principal, Hans Plotseneder, on Christmas Eve, according to documents from the Department of Public Instruction.
Hillman told the board that Entrepreneur High is in early discussions with a management company to take over the school. The board also is trying to drum up a corporate sponsor or receive a lifeline from the Raza Development Fund, a community investment organization that helps charter schools serving Latinos. Entrepreneur High is located on Central Avenue and has targeted the Hispanic community.
“The ship is clearly not right at this point,” Hillman said. “Something needs to be done.”
The advisory board voted Monday to recommend that the state Board of Education either terminate the school’s charter or find another board to take the school over. The Board of Education is slated to discuss the issue in February and decide in March.
“It’s just been a hot mess. It’s been very bad. It’s embarrassing to see a situation get here this quickly,” state board member Becky Taylor said. “I just don’t see how we can continue on with this school.”
Should the school fail, Entrepreneur High would be the second new Charlotte charter to close its doors this school year. Concrete Roses STEM Academy shut down in September, just a few weeks into the school year. Another Charlotte charter, StudentFirst Academy, closed in April after financial troubles in its first year.
Entrepreneur High’s experience again calls into question how the state approves new charter schools. The state legislature lifted its long-standing cap of 100 charters in 2011. Since then, the state has approved dozens of new charter schools each year.
Charter school advisory board members said at Monday’s meeting that they had serious questions about Entrepreneur High’s viability when they recommended it move forward in December 2013. Just two months before, the school’s board had dissolved itself and Plotseneder was forced to recruit new members.
In July, Entrepreneur High was one of the least prepared to open charter schools in the state. A “ready to open” report compiled by the N.C. Office of Charter Schools said it had made only “slight progress” and a meeting with state officials was needed.
Hillman did not immediately respond to an interview request from the Observer on Monday. Plotseneder said he felt the charter school advisory board did the right thing.
“We need to end these ridiculous management problems,” he said, referring to Entrepreneur High.
Entrepreneur High opened in August as a vocational school focused on advanced manufacturing and business creation. It quickly ran into trouble.
Charlotte-Mecklenburg Schools acknowledged taking some of Entrepreneur High’s ideas when the district created an advanced manufacturing and entrepreneurship school at Olympic High, creating a “rivalry” between the charter school and CMS, Plotseneder said at the time.
Entrepreneur High’s building was not complete by the start of the school year, leading parents to withdraw their children.
The school projected enrollment of 180 students and was funded based on that count. Last week, the state was told 49 students enrolled but a headcount showed only 31 students in classrooms. Charter schools are required to have at least 65 students.
Because of low enrollment, the state froze Entrepreneur High’s access to cash in September. The school has been on probation with the state charter school office since then.
Charter schools are funded by tax dollars, and receive money based on how many students attend. The state gives its first allotment before classes start and adjusts the money flow based on how many students show up to class.
Alexis Schauss, director of school business for the N.C. Department of Public Instruction, told the advisory board Monday that Entrepreneur High is unlikely to make it through the year without a significant infusion of cash from an outside source.
The school owes more than $275,000. Based on the enrollment, the state will give it monthly allotments of $41,000 beginning in February. That is not enough to meet the school’s payroll.
Elaine Worthey, who has stepped into the principal’s role, said school leaders will hold interest meetings every Saturday to try to recruit students.
The school also is working to get its financial systems back in order after its bookkeeper left in March. Hillman said his review of the finances shows no impropriety.
“There were no trips to Vegas, there were no hot tubs anywhere,” he said. “It is our desire to complete this school year and start next year.”
By the end of 2015, Entrepreneur High wants to add board members with financial and legal expertise, Hillman said.
But charter school advisory board members were more concerned about the school’s financial viability in the next six months. Members said if they want the state Board of Education not to shut the school down, leaders should secure a hard commitment of money from a company or investment group by the February meeting.
“It breaks my heart to see y’all standing here today, and it’s actually worse than we thought it was,” Taylor said.