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Emma Brown, Washington Post

Recent fraud allegations against leaders at two D.C. public charter schools have illuminated what city officials are calling a gap in their ability to effectively oversee the financial dealings of the fast-growing charter school sector.

Following two cases in which the D.C. attorney general has accused charter school leaders of schemes to divert millions of tax dollars to private companies they owned, the D.C. Public Charter School Board is seeking legislative changes that would give it greater authority to examine the records of some of the organizations that manage the city’s charter schools.

The charter board also is looking to tighten standards that charter schools must meet to sign contracts with “related parties,” such as school founders, school employees, members of the board of directors and their relatives.

While the move indicates that the charter board wants more transparency, it also shows that city officials often don’t know how management companies are spending tax money that is meant for students’ benefit.

Any new authority probably will be narrow: The charter board’s draft legislation, developed months ago, would allow it to examine the records of only a small number of companies. The notion of broad new oversight power probably would spark protest from some in the charter school movement, which is built on the premise that schools should operate free of outside interference as long as they produce solid academic results.

Scott Pearson, the charter board’s executive director, said he doesn’t want new rules to be so onerous or invasive that they deter good charter operators. But “they’re using taxpayer dollars, and there should be a standard” for how those dollars are used, Pearson said.

The D.C. attorney general in October sued three former managers ofOptions Public Charter School for allegedly funneling more than $3 million from the school to two for-profit companies they owned. In May, the attorney general sued the founder of another charter school, Community Academy, alleging that he enriched himself by creating a shell management company that was paid more than $13 million in taxpayer dollars for work largely performed by school employees.

The charter board had given a clean bill of financial health to both schools in June 2013, finding “no patterns of fiscal mismanagement” at either, according to a charter board report.

Defense lawyers in both cases have argued that the charter schools’ business deals were legal and no different than contracts that more than a dozen D.C. charter schools have with outside management companies to operate the schools in exchange for a fee.

Several charter school management companies declined to comment on the board’s effort to seek additional oversight authority because legislation has not yet been introduced. Ramona Edelin, executive director of the D.C. Association of Chartered Public Schools, also declined to comment, saying that her members haven’t yet discussed the issue.

Donald Hense, executive director of the Friendship charter schools, one of the largest networks in the city, criticized the D.C. attorney general’s most recent lawsuit as unfair and said the charter board’s desire for more authority is part of a pattern of overreach. And Kara Kerwin, president of the pro-charter Center for Education Reform, said she worries that giving the charter board more power “is a slippery slope.”

“Allowing the legal process to take care of malfeasance is the proper way to go, as opposed to the charter board imposing more regulation,” Kerwin said.

City taxpayers send more than $600 million to charter schools, and in return, charters — which are required by law to be nonprofit organizations — submit independent financial audits, annual budgets, large contracts and other financial data to the city charter board.

The charter schools that have contracts with outside management organizations send fees that range from 2 to 100 percent of their operating budgets.

The management agreements are something of a financial black hole, according to charter school board officials, who say they have limited ability to monitor how the tax dollars are used. When the management organizations are private for-profit companies, they are not subject to the same financial disclosure rules as nonprofits.

There are at least four for-profit charter management companies operating in the District now: Imagine Schools Inc., a Virginia company that runs Imagine Southeast and Imagine Hope Community schools for a fee of 12 percent of each school’s revenue; Academica, a Florida company that runs Somerset Prep Academy for a 5 percent fee; Community Action Partners, which collects a 6 percent fee to run the Dorothy I. Height Community Academy Public Charter School; and Basis Educational Group, an Arizona company that runs Basis DC for a 20 percent fee.

Phil Handler, a spokesman for Basis Educational Group, said the company’s fee is relatively high because the company covers the salaries of the school’s top officials.

Most of the management companies operating in the District are nonprofits, and two charter schools slated to open in D.C. next fall —Democracy Prep and Harmony — also are run by out-of-state nonprofits.

Nonprofits must disclose some financial information with the Internal Revenue Service annually via Form 990, including the salaries of any employees who make more than $100,000. But charter board officials said that the publicly available information is not necessarily sufficient for strong oversight.

St. Coletta Special Education Public Charter School transfers its entire $16 million budget to its management organization. As a result, the charter school’s public budget is stark, showing that the school spends zero dollars on personnel, office expenses and student services.

The management organization, St. Coletta of Greater Washington, operates two schools under the same roof, a D.C. public charter and a private school that accepts tuition-paying students from Maryland and Virginia. Pearson said that while the board has no reason to suspect wrongdoing at St. Coletta, it’s difficult to know for sure that D.C. tax dollars are being used only to serve D.C. public school students.

St. Coletta executive director Sharon Raimo said the charter school and the parent organization already go through multiple layers of financial review by independent auditors and the IRS, state education agencies, Medicaid oversight agencies and the D.C. Public Charter School Board.

“I don’t know what else we could possibly give them that they don’t already have,” Raimo said, adding that she wasn’t afraid of additional oversight but that it would take more of her staff’s time.

Last fall, the charter board proposed legislation that would give it access to the books and records of only a subset of management organizations: those that received more than half their income from D.C. charter schools or received more than 20 percent of any one school’s budget.

Such expansion of oversight probably would affect only a few existing management organizations. Robert Cane, executive director of the pro-charter group Focus, said he could support such narrow expansion, but it would not be appropriate to demand financial records from management companies that run schools across the country and receive only a small fraction of their income from D.C. charters.

The charter board’s existing draft legislation would require schools entering contracts with related parties to ensure that those deals are fair and that conflicts of interest are fully disclosed to the school’s board of directors. Currently, schools have to meet one of those two conditions to comply with the law. The charter board is working to refine the proposed legislation.

D.C. Council Education Committee Chairman David A. Catania (I-At Large) said last fall that he was willing to work with the board to pass legislation and a spokesman for Mayor Vincent C. Gray (D) said Gray is also supportive.

There has been no public movement on the issue, but the May lawsuit against Kent Amos, the founder of Community Academy, appears to have kick-started discussions again. “My sense is we’re both committed to resolving this, so I would be surprised if we don’t have some legislation by the end of the council term,” Pearson said.

The Blaze
June 11th, 2014

Kara Kerwin on The Blaze discussing teacher tenure and the importance of the landmark decision, Vergara v. California. This court case goes beyond Brown v. Board of Education. For the first time in U.S. history, a child’s education has been solidified as a civil right. But, U.S. teachers win too, because archaic laws will no longer hinder great teachers from having autonomy in their own classroom.

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CNN Newsroom
June 11th, 2014

CER founder, Jeanne Allen, defends the Vergara v. California decision on CNN Newsroom with Randi Kaye. The landmark decision ruled that California’s teacher tenure, dismissal, and layoff laws are unconstitutional.

Steven Nelson, U.S. News & World Report

Los Angeles County Superior Court Judge Rolf Treu declared California’s tenure protections for public schoolteachers unconstitutional Tuesday, rattling powerful unions that support protection for long-term educators.

Opponents view tenure as a free-pass from accountability for low-quality teachers and nine student plaintiffs made that argument in a lawsuit, Vergara v. California, alleging unprepared and incompetent teachers were savaging their students’ potential.

Treu agreed.

The judge leaned on the U.S. Supreme Court’s landmark 1954 Brown v. Board of Education ruling, which outlawed racial segregation in schools, finding California’s tenure system deprives minority and low-income students of equal education, The Associated Press reports.

The court did not make the decision available in digital form, instead opting to sell printed copies.

The National Education Association, the largest American teachers union, promptly condemned the ruling.

“A California Superior Court judge today sided with Silicon Valley multimillionaire David Welch and his ultrarich cronies in the meritless lawsuit of Vergara v. State of California,” the group fumed in a press release. “The lawsuit was brought by deep-pocketed corporate special interests intent on driving a corporate agenda geared toward privatizing public education and attacking educators.”

NEA President Dennis Van Roekel called the ruling “deeply flawed.”

“Let’s be clear: This lawsuit was never about helping students, but is yet another attempt by millionaires and corporate special interests to undermine the teaching profession and push their own ideological agenda on public schools and students while working to privatize public education,” Van Roekel said. “Today’s ruling hurts students and serves only to undermine the ability of school districts to recruit and retain high quality teachers.”

The American Federation of Teachers, the second-largest U.S. teachers union, also bristled at the news.

“While this decision is not unexpected, the rhetoric and lack of a thorough, reasoned opinion is disturbing,” said AFT President Randi Weingarten in a release.

“[Treu] argues, as we do, that no one should tolerate bad teachers in the classroom. He is right on that. But in focusing on these teachers who make up a fraction of the workforce, he strips the hundreds of thousands of teachers who are doing a good job of any right to a voice,” Weingarten said.

“This will not be the last word,” she added. “No wealthy benefactor with an extreme agenda will detour us from our path to reclaim the promise of public education.”

In a June 2 press release AFT complained that “three exemplary teachers” were “named as ‘ineffective teachers’ by the plaintiffs’ lawyers” without negative evaluations or complaints on file, and expressed confidence of success on appeal.

Treu stayed his opinion, which does not apply to public universities, pending appeal.

Foes of teacher tenure immediately celebrated the protection’s possible judicial demise. Proposing modifications to teacher tenure has proven risky for elected politicians and appointed education officials in the past.

Bonnie Reiss, California’s secretary of education under former Republican Gov. Arnold Schwarzenegger, praised the ruling.

“Too often, it is nearly impossible to pass needed education reforms through the legislature,” said Reiss, global director of the USC Schwarzenegger Institute. “The broken tenure system unfairly hurts our state’s most vulnerable students and denies equal education for all.”

The Center for Education Reform, a pro-charter school group, called the decision “a tremendous victory” for students.

“Any framework that prioritizes hire date does a disservice to teachers, who deserve merit-based appreciation like other professionals, and does a disservice to students in need of a superior educator at the head of the classroom,” Center for Education Reform President Kara Kerwin said in a release.

The tenure fight in California, home to more than six million students, is unfolding across the country, and victories don’t belong exclusively to one side. In North Carolina, for example, a state judge ruled in May that legislators violated the state constitution by voting to repeal tenure.

U.S. Secretary of Education Arne Duncan addressed the California ruling in a Tuesday afternoon statement that avoided directly addressing the dispute.

“This decision presents an opportunity for a progressive state with a tradition of innovation to build a new framework for the teaching profession that protects students’ rights to equal educational opportunities while providing teachers the support, respect and rewarding careers they deserve,” Duncan said. “My hope is that today’s decision moves from the courtroom toward a collaborative process in California that is fair, thoughtful, practical and swift. Every state, every school district needs to have that kind of conversation.”

Bill Hetherman, Los Angeles Daily News

In a major blow to teachers’ unions, a Los Angeles judge ruled Tuesday that state laws governing tenure and the firing of teachers are unconstitutional, saying students and educators alike are “disadvantaged” by the statutes.

Los Angeles Superior Court Judge Rolf M. Treu issued an injunction blocking tenure laws for public school teachers but placed a stay on the ruling pending an appeal.

“This court finds that both students and teachers are unfairly, unnecessarily and, for no legally cognizable reason — let alone a compelling one — disadvantaged by the current permanent employment statute,” the judge wrote in his 16-page ruling.

Treu noted that teachers have a right to due process when they are being targeted for dismissal.

“However, based on the evidence before this court, it finds the current system required by the dismissal statutes to be so complex, time consuming and expensive as to make an effective, efficient yet fair dismissal of a grossly ineffective teacher illusory,” he wrote.

The lawsuit was filed in May 2012 by an advocacy group called Students Matter on behalf of nine young plaintiffs, alleging the laws violate students’ constitutional rights to an equal education. The suit named the state and two teachers’ unions that later intervened as defendants — the California Teachers Association and the California Federation of Teachers.

Plaintiffs’ attorney Theodore Boutrous argued during the trial that five laws should be deemed unconstitutional, saying tenure and other laws made it too time consuming and expensive to dismiss ineffective educators.

“Teaching is the one profession in the world where you cannot tell a person they are not doing a good job,” he said in his closing argument.

But lawyer James Finberg, representing the teachers’ unions, countered that the laws help prevent faculty from being hired and retained for reasons involving favoritism and politics. In as little as three months, he argued, an administrator can make a “well-informed decision” as to whether a probationary teacher should be retained.

“The statutes should not be struck down on the basis of a handful of anecdotes,” Finberg said.

Joshua Pechthalt, president of the California Federation of Teachers, condemned the ruling.

“We are clearly disappointed by the decision of this judge,” he said. “We’re disappointed, but not particularly surprised, given his comments during the trial. We believe the judge fell victim to the anti-union, anti-teacher rhetoric of one of America’s finest corporate law firms.”

Alex Caputo-Pearl, president-elect of United Teachers Los Angeles, the union representing Los Angeles Unified School District teachers, also blasted the decision. “This decision today is an attack on teachers, which is a socially acceptable way to attack students,” he told KABC (Channel 7).

Boutrous, however, hailed the decision as a “monumental day for California’s public-education system.”

“By striking down these irrational laws, the court has recognized that all students deserve a quality education,” he said. “Today’s ruling is a victory not only for our nine plaintiffs, it is a victory for students, parents and teachers across California.”

LAUSD Superintendent John Deasy called the ruling “historic,” adding, “Every day that these laws remain in effect is an opportunity denied. It’s unacceptable and a violation of our education system’s sacred pact with the public.”

Deasy said he’ll be calling on legislators to create new laws and “a more expedited way to dismiss folks who are either incompetent or committed egregious acts.”

Still, he opposes plans to appeal the ruling, which leaves existing tenure laws in place. “I think it’s a shame for students. We’re going to go down the route of an appeal and continue to watch unconstitutional laws remain on the books.”

School board member Tamar Galatzan also supported the judge’s decision. “The Vergara ruling is the first step toward being able to guarantee that we have great teachers in every LAUSD classroom — and classrooms around the state,” she said.

“It is now up to the Legislature to pass laws that provide equal opportunity and provide equal access to a high-quality education.”

Today’s ruling will not affect ongoing negotiations with the district’s teachers’ union, United Teachers Los Angeles, Deasy said.

One of the plaintiffs, high school freshman Julia Macias, said the ruling “means that kids like me will have a real chance to get a great education and succeed in life. With this case, we have shown that students have a voice and can demand change when we stand together.”

Finberg, the unions’ attorney, argued during the trial that the plaintiffs based much of their arguments on teacher tenure histories in Los Angeles and Oakland and did not take into sufficient consideration how their performances are overseen in the more than 1,000 other districts statewide.

He pointed to testimony of former El Monte Union High School District Superintendent Jeff Seymour, who said new teachers are carefully screened by administrators to ensure they are meeting the proper standards.

In his Jan. 27 opening statement, Deputy Attorney General Nimrod Elias said the laws protecting teacher tenure help school districts statewide attract educators who might otherwise be dissuaded by what they may consider low pay and difficult working conditions.

Elias said there is no evidence of a connection between the laws and the poor academic performances by students at some poor and minority schools.

In his ruling, Treu wrote that the plaintiffs proved the tenure statutes “impose a real and appreciable impact on students’ fundamental right to equality of education and that they impose a disproportionate burden on poor and minority students.”

Treu also lambasted “last-in, first-out,” the rules that govern seniority and teacher layoffs.

“The last-hired teacher is the statutorily mandated first-fired one when layoffs occur,” the judge wrote. “No matter how gifted the junior teacher, and no matter how grossly ineffective the senior teacher, the junior gifted one, who all parties agree is creating a positive atmosphere for his/her students, is separated from them,, and a senior, grossly ineffective one who all parties agree is harming the students entrusted to her/him is left in place.

“The result is a classroom disruption on two fronts — a lose-lose situation. Contrast this to the junior efficient teacher remaining and a senior incompetent teacher being removed — a win-win situation — and the point is clear.”

Daily News education reporter Thomas Himes contributed to this report.

Sean Higgins, Washington Examiner

A California Superior Court judge ruled Tuesday that the state’s teacher tenure laws were unconstitutional, dealing a severe blow to the public sector unions who had fought to keep the status quo intact.

Judge Rolf Treu ruled in favor of nine students who sued the state, saying the tenure policies undermined their education by making it almost impossible for bad teachers to be fired.

California law allows teachers to become eligible for tenure after less than two years on the job. Firing a teacher, on the other hand, could take as long as a decade and cost the state as much as $450,000 — when it even tries. In practice, dismissals are rare.

Teachers unions defended the laws as necessary for job security, persevering academic freedom and to attract talented educators.

The students countered that teachers often came to class poorly prepared and gave them little motivation.

Treu found the students’ case more compelling and noted that the current system hurts the disadvantaged the most: “Substantial evidence presented makes it clear to this court that the challenged statutes disproportionately affect poor and/or minority students.”

He relied heavily on this point, saying the evidence was not only clear but “shocks the conscience.” The decision even begins by citing Brown v. Board of Education, the landmark 1954 school desegregation case.

“There is also no dispute that there are a significant number of grossly ineffective teachers currently active in California classrooms,” Treu wrote. Citing the evidence presented in the case, he put the number at between 2,750 to 8,250, adding that this has a “direct, real, appreciable and negative impact” on students.

The case, named Vergara v. California, was filed in 2012. The state and the California Teachers Association, the state branch of the National Education Association, were the defendants.

The ruling orders that five state education code statutes relating to teacher tenure be stayed pending appeals court review.

California has one of the largest school systems in the nation with an estimated 275,000 active teachers and 6 million students.

The case has been closely watched, especially by the education community, state and local government officials and activists.

“It will encourage reformers and families in other states to file similar suits to end similar laws on the books,” said RiShawn Biddle, editor of the website Dropout Nation.

Kara Kerwin, president of the nonprofit Center for Education Reform, agreed, calling it a “monumental affirmation” but added that it will not mean overnight change, noting that the appeals process would have to play out first.

National Education Association President Dennis Van Roekel called the ruling “deeply flawed” and portrayed it as little more than an attack on teachers by conservative groups.

“Let’s be clear: This lawsuit was never about helping students, but is yet another attempt by millionaires and corporate special interests to undermine the teaching profession and push their own ideological agenda on public schools and students while working to privatize public education,” he said.

American Federation of Teachers President Randi Weingarten tweeted: “Sad day in Cali- but not unexpected that lower court would find that for students to win, teachers have to lose #Vegara”.