Fixing a Mess at Charter Schools

This is a scary story about a Dallas-area charter school. The general picture is the following: "To date, the state Board of Education has granted 238 charters, although fewer than 200 are currently in business. The groups that hold charters run about 275 schools enrolling about 61,000 students. Collectively, the state's charter schools received an estimated $350 million in taxpayer money last school year." This specific case should give us all pause. -Angela
Family's campuses back on track with state help

02:06 PM CDT on Sunday, May 22, 2005
By KENT FISCHER / The Dallas Morning News

Their names conjure images of scholarship and hope in some of southern Dallas' most blighted neighborhoods: Inspired Vision. A+ Academy. Rylie Family Faith Academy.

NATALIE CAUDILL/DMN
From left: Students Na'omei Walker, Brittney Swinton and Kaylor Sanders, all 8, perform a dance routine in a play area behind A+ Academy, one of the charter schools run by Rylie Faith Family.

During their early years, the millions of state education dollars that flowed into these charter schools, all operated by one family, produced little student achievement. Meanwhile, former employees accused their bosses of misusing funds, according to state and court records.

As lawmakers in Austin consider rewriting Texas charter school laws – including one proposal that could close dozens of them – the Rylie Faith Family charter offers a sober lesson on what it takes to reform troubled charter schools.

In 2000, as problems escalated at the Rylie charter schools, the state dispatched a retired public school superintendent to sort it all out.

Jack Ammons found the schools $400,000 in debt and operating without a budget. Family members and friends of the founders populated the payroll. There was no coherent curriculum, and no urgency to improve.

"They were basically running a $5 million ... [business] with just a checkbook," Dr. Ammons said. "And they were spending [taxpayer] money like it was their own."

Charter schools are public schools open to any student, but they're operated by businesses, parents and community groups through state contracts, called charters. For each student they enroll, the charters receive about $5,700 in taxpayer money.

To date, the state Board of Education has granted 238 charters, although fewer than 200 are currently in business. The groups that hold charters run about 275 schools enrolling about 61,000 students. Collectively, the state's charter schools received an estimated $350 million in taxpayer money last school year.

Rylie Faith Family, the nonprofit organization that operates Inspired Vision, A+ Academy and two charter campuses in El Paso, received a little more than $8 million in public funds last year.

Rylie Faith Family co-founder Karen Lewis Belknap said recently that the schools' early mistakes were the result of inexperience in accounting for public money.

"Charter schools want to do it right," said Mrs. Belknap, who began the charter with her husband, Don. "We're not just out here trying to scrape the system. We're finally at the point now where we're getting the advice we need."

Today, the schools are ready to stand on their own again, Dr. Ammons said. Finances are stable, achievement is improving, and former public school administrators are in charge.

Part of third wave

The Belknaps obtained their first contract with the state in September 1998, during a fractious Board of Education meeting that saw members approve 89 charters in one fell swoop. Many of the schools approved that day, called Generation Three charters, have been among the lowest-performing charters in the state. Many have been entangled in financial scandals; 23 had their contracts with the state revoked.

The Belknaps acknowledge the early going was rocky. They struggled to get their first school started and got in over their heads when they leased a dilapidated facility and had trouble hiring qualified staff.

The Belknaps deny any intentional wrongdoing and blame the state for giving them contracts but no support or training.

"We had no idea what we were getting into," Mrs. Belknap said. "We were basically given three days of training from the state and then told, 'Go start a charter school.' We had nothing."

There were no purchase orders, and there was no way to track expenses, no monitoring of cash flow. As a result, the schools racked up more than $7,000 in overdraft charges in three years, records show. More than $28,200 in checks were simply written to cash between 2000 and 2002. The Belknaps failed to deduct income taxes and workman's compensation withholdings from paychecks. Payments into teacher retirement accounts were constantly delinquent.

"We had a budget, but we struggled to stay on it," Mr. Belknap said, adding that he and his wife personally borrowed nearly $3 million to cover start-up costs.

In the early days of Texas' charter schools, there was little regulation of how they were to be operated. In the Rylie schools, state records show, public funds were spent quickly and without much accountability. The Belknaps set up their daughter's chiropractic office in the original school, paying her utility bills and charging no rent. The daughter, Shala White, also earned $40,000 as one of the school's top administrators.

School records show that the Belknaps and their children collected $420,000 in pay and reimbursements from the schools between September 2000 and August 2002.

The Belknaps hired friends and family, they said, because they couldn't get anybody else to work for them.

"We hired the most educated people we could find, and that was family," Mr. Belknap said. "Why would we fire them just because they're kin?"

More than three dozen family members and parishioners of the Belknaps' church were on the payroll in 2002, including a cousin who was in charge of special education. Her previous work was as a cashier at Kmart and McDonald's, records show.

Despite all the problems, the Belknaps continued to apply to start new schools. In May 2000, state officials gave them permission to open two more schools.

State gets involved

State education officials launched an investigation of the charters' books in 2000 and installed Dr. Ammons in a position advising the Belknaps. The results of the investigation were turned over to the Dallas County district attorney's office, but no charges were ever filed. The management problems continued, however, and in 2003, the state shut down the original Dallas school, leaving the family with two schools on three campuses.

The state education commissioner also expanded Dr. Ammons' authority, empowering him to overrule virtually any decision made by the Belknaps. He ordered the budget slashed and returned hundreds of thousands of dollars in misspent taxpayer money to the state. New policies were drafted to end nepotism, and a system of financial checks and balances was put into place. Teachers and administrators began meeting regularly to discuss programs and improvement.

Among the most important changes at the Rylie schools has been the infusion of professional educators into the operation. The Belknaps hired a retired public school superintendent, Gerald "Rosie" Rosebure, to run the daily operation.

Overall scores are still lagging at A+ Academy but results have been improving.

A new principal replaced the Belknaps' son, Brenton, who for years ran the 870-student A+ Academy despite having no administrative or managerial experience. Dr. Rosebure has also hired a respected public school business manager to oversee the organization's finances.

"It's been hard progress," Dr. Ammons said of the school's improvement, "and it's taken years."

He says the changes came only when the Belknaps realized their state contacts would soon expire – they're up in June – and that their past performance might doom their hopes for a renewal. The Bel-knaps are hopeful the new blood at the schools and their willingness to turn over the reins to professionals will result in a new contract with the state worth an estimated $84 million over 10 years.

"There is no doubt we would not be here today if [the state] had not stepped in," said Barbara Gibson, principal at one of the schools, A+ Academy. "I have been here four years, and I saw what we went through, the questions that were raised."

While most of Dr. Ammons' recommendations have been adopted, others have been met with resistance. There was a dust-up when he ordered the elimination of the school's Navy ROTC program. In addition to costing the school $17,000 a year, the Belknaps had hired their future son-in-law to run the program. The program was cut.

Adding to the tension was the fact that the state ordered the Bel-knaps to pay Dr. Ammons for his counsel – $400 a day plus expenses. Dr. Ammons estimated that his work with the Belknap charters have cost the schools – and taxpayers – about $80,000.

It was not the first time that Dr. Ammons, 66, had been called upon to mend a dysfunctional system of public schools. In the early 1980s, he oversaw the consolidation of six rural, nearly broke districts into Northwest ISD. When the Brownsville schools lost their accreditation in the early 1990s, Dr. Ammons was hired to restore it. He also spent several years as the chief in Melissa ISD after superintendents there abruptly resigned – twice.

Dr. Ammons said he knew nothing about charter schools when the state asked him to oversee the Belknap schools as well as two other charters. He said his initial impression of Texas charters (he's now overseen six of them) sticks with him: They're well-intentioned, but woefully amateurish.

"Basically, there needs to be much better monitoring of charter schools," Dr. Ammons said. "It's so easy to run into problems, debts, because they get in over their heads."

Dr. Ammons said every charter school should be paired with a state-sanctioned monitor for the first year or two. That way, charters will have access to an expert in public school financing, curriculum and administration.
Balanced budget



Rylie Faith Family's budget is, for the first time, in the black, thanks in part to a massive budget cut that included laying off 13 employees. Karen and Don Belknap have moved into off-campus administrative jobs, although they have retained their salaries. The nonprofit has repaid more than $300,000 in debts to vendors and paid the Internal Revenue Service more than $100,000 in overdue payroll taxes. Additionally, 10 percent of the charter's budget is earmarked for a contingency fund and future needs, also a first, said Dr. Rosebure, the new superintendent.

"The nepotism has stopped," Dr. Rosebure said. "We're making every effort to get top-quality people in here."

In the classroom, improvements also are under way, said Mrs. Gibson, the principal of A+ Academy. Although the school's overall test scores still lag, students have shown improvement. For example, the percentage of third-graders meeting state standards increased from 57 percent in 2003 to 80 percent last year.

"We're here for the kids," Mrs. Gibson said. "There is a great need here, and our teachers really care about the students."

Recently, the school's color guard won first place in a statewide competition. Required tutoring sessions take place on Saturdays, and there's an after-school character-building program.

Despite the housecleaning and newfound optimism, questions remain over how the reorganized schools will operate in the long term. For instance, Don and Karen Belknap serve two roles under Dr. Ammons' reorganization. Not only do they report to Dr. Rosebure as employees, they also hired him as members of the schools' board of directors.

"Sometimes when we sit down for a meeting, we're not sure who's the boss," acknowledged Dr. Rosebure.

Dr. Ammons said the schools have come a long way, but their operation is not perfect. He said he may recommend releasing the schools from his supervision in the next couple of months.

"As a taxpayer and as a former school administrator, I'm still not completely satisfied. But the schools are getting better every day," he said.

E-mail kfischer@dallasnews.com
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