Under the Dome

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.

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 state has had issues with some charter schools turning over student records when they closed.

When PACE Academy in Carrboro was closed by the state in 2015 due to financial issues, parents were clamoring for their children’s records. Adam Levinson, interim director of the state Office of Charter Schools, said the records were only recovered when the landlord for PACE called the state asking about what to do with the abandoned documents.

The PowerPoint presentation given to the advisory board includes a picture of the abandoned PACE records. They’re now in the possession of the Office of Charter Schools.

“The PACE board basically walked away and didn’t complete the closure process and left the records so our staff had to go to the school,” Levinson said in an interview.

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, a longtime charter school director 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 specificially cited the issue with the records at PACE.

“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 at a future meeting:

▪ 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.