|
Minutes note:
|
Staff Report - David Montes de Oca.
Mr. Montes de Oca read a letter from Superintendent Tony Smith that talks about the recommendation Dr. Smith is making to the Board of Education. He said the quality academic experience parents value and their children are benefiting from is a community asset. The students, teachers, school site staff and families deserve recognition for their considerable work and their outstanding academic achievement. The District is committed to ensuring every child in Oakland has access to a high quality public school in their neighborhood and they are on a clear path to a successful future. Dr. Smith made a commitment to parents to work with their children to continue to benefit from a school community similar to where they are and continue on the pathway to success they are currently on. Due to the serious issues, the letter states Dr. Smith is recommending to the Governing Board of District it approve a Notice to Revoke the Charter of American Model Schools. Those responsible for governance and management for the charter school have broken the law, a conclusion reached after investigations by three separate government agencies. The letter further states that Dr. Smith believes this action is necessary to ensure public dollars are used legally to the maximum benefit of students. To educate every child in Oakland the City must have high quality, socially responsibly, public organizations that the citizens can trust. Dr. Smith said the District will work over the next several months to make sure parents maintain access to high quality schools.
Mr. Montes de Oca said on behalf of the Superintendent, the Governing Board is being presented with a recommendation to issue a Notice of Intent to Revoke the Charters held by the American Indian Model Schools. The Notice of Intent to Revoke, if approved, will permit the schools to continue to operate through the remainder of the current school year. The Notice of Intent is one step in a multi-step process in which a decision will not be made by the Governing Board until March 2013. He said it is the view of the Superintendent and staff that AIMS is a very high achieving school that has provided its families a quality academic program that has been in most cases, what families have enrolled their students in the school for and the schools have wished for. A year long process has determined that the AIMS Management and Governance failed to remedy violations under charter law. The District as the school’s authorizer is required under law to take certain actions to protect the public’s trust and the proper use of public funds. Charter Law provides for due process and it allows for opportunities to remedy the violations. AIMS has filed to remedy the violations.
A year ago in January 2012 an Audit by FMACT begun at the request of Alameda County Superintendent, Sheila Jordan. In June 2012 the final report identified a lack of fiscal oversight, a lack of adequate governance and controls and a conflict of interest dealings between the school and its founder that amounted to approximately $3.8 million. County Superintendent Jordan issued a notice to the District requesting it take action based on these findings as well as submitted the findings to the Alameda County District Attorney’s Office. The District issued a Notice of Violation in September 2012. In November 2012 the District received a response from AIMS regarding the Notice of Violation. District staff and Legal Counsel has evaluated the responses and determined that almost a year has passed since the audit and little has been done to overhaul the governance and management of the organization or its practices. A large portion of the response submitted by AIMS intended to outline remedies to the violations, instead focused on defending the conflict of interest dealings the school repeatedly entered into.
Mr. Montes asked the question “If the school is providing a quality education, why should the District consider revoking their charter?" He responded by saying charter law is clear, charter schools are given unprecedented autonomy and freedom in exchange for substantial accountability. This freedom and autonomy of self-governance is required of the charter operators. Given this freedom and autonomy from regulations applied to school districts, there are specific grounds under which revocation is the only response available to the District to address violations that are not cured; Fiscal mismanagement and the lack of acceptable accountable practices. The improper use of public funds is one of a few grounds for revocation. While the majority of charter schools in California and in Oakland have operated within the law with respect to the use of public funds, AIMS Schools have not and when put on notice failed to remedy the root causes that would lead to the continued misuse.
Why doesn’t the District just force the schools to make the necessary changes?
The legislative intent of charter law is clear. Charter schools are to operate independently of the school district system. If the school fails to remedy violations under charter law, the school district is left with no other authority to act except to initiate revocation of the charter or risk the continued violations that have occurred to date. Because the District under law cannot mandate specific actions because charter schools must self-govern and operate independent of the school district, it must rely on the integrity of their practices and the remedy set forth by the schools themselves.
Jacqueline Minor, District General Counsel provided an overview to the OUSD Board of Education of its legal obligation and made a presentation around the facts of the Notice of Violation.
The authorizing school board has the responsibility to make certain charter schools fulfill the promises in their charters, comply with generally accepted accounting principles, that public funds are used with integrity and the charters authorized by the Board follow the law. Ms. Minor said the recommendation from the Superintendent is a Notice of Intent to Revoke. The Board has only three choices; 1) Issue the Notice of Intent; 2) Accept the remedies as proposed by AIMS; or 3) Do nothing. The law provides for four bases for revocation of a charter. The recommendation from the Superintendent found there is substantial evidence to support a revocation based on three of the four grounds found in statue. The three bases for a Notice of Intent to Revoke are; 1) The school has committed a material violation of its charter; 2) Has failed to meet generally acceptable accounting principles and 3) Has violated the law. Prior to the Notice of Intent being filed, the County Superintendent requested the FCMAT Report which showed a number of violations with the most significant being a conflict of interest. The County Superintendent has referred the FCMAT Report to the Alameda County District Attorney and the California Department of Education and (based on the FCMAT Audit) has terminated the school’s ACES funding. The California Finance Authority (based on the FCMAT Audit)) has found AIMS in violation of its facilities grant agreement.
Legal Process
The school will have many due process opportunities.
Ms. Minor requested John Yeh with Burke, Williamson and Sorenson to walk the Board through the key violations which are the basis for the Notice of Intent.
Mr. Yeh said in September the Board approved at a Board Meeting in Public Session, the Notice of Violation which contained a number of violations against AIMS Schools. The primary violation involves conflict of interest violations in the form of contracts entered into between AIMS and companies owned by its founder and/or his spouse. They include contracts for construction, leases for the use of the AIM School sites, after school and summer programs and administrative services. Under these contracts the founder and his spouse personally profited approximately $3.8 million. In the response, AIMS admits the existence of these contracts but denied they violated the law. The proposed Notice of Intent to Revoke is based on AIMS response which incorrectly characterizes and applies the Conflict of Interest Law. AIMS provides a number of justifications for the contracts, none of which provide a legal justification for the violations of the Conflict of Interest Law.
One of AIMS primary defenses to the Notice of Violations is under the contracts with the founder. AIMS committed an error in one of its examples when comparing the per square foot rate paid by charter schools occupying Oakland Unified School District facilities to the per square foot rate paid by AIMS, it uses the per square foot rate and miscalculates it as a monthly rate when it is an annual rate. AIMS claims over a one year period it saved approximately $1.1 million in public funds by entering into leases with the founder instead of other sources and over a two year period saved approximately $2.2 million in public education funds. Those calculations are based on the erroneous use of the District square footage rate as a monthly as opposed to an annual rate. When applying the correct District rate as an annual rate as opposed to a monthly rate, AIMS is paying to the founder approximately $688,000 more than it would be paying a District Charter School occupying District facilities of the same square footage. Over a two year period paying approximately $1.3 million more than a District charter school occupying District facilities.
The Notice of Intent to Revoke is based on a number of findings with respect to AIMS response.
• The District found that the AIMS Board allowed the founder to personally profit by violating conflict of interest laws.
• AIMS response provides no legal or factual justification for those transactions which violated the law. AIMS response does acknowledge wrong doing, but attempts to justify those contracts.
• AIMS response provides insufficient evidence that the governance of financial oversight of the organization has meaningfully improved.
The Notice of Violation that is being proposed contains an evaluation of AIMS proposed remedies. The primary findings on which the Notice of Intent to Revoke is based on, AIMS presented the same two page Conflict of Interest Policy that existed prior to the Board’s issuance of the Notice of Violation. AIMS does have a revised fiscal policy with a new fiscal administrator and a three person financial specialist committee. Those individuals have experience that is more in the private sector and not in the specialized area of public school finance. AIMS does not propose any significant institutional or organizational change in its fiscal agent and has not called for the introduction of a charter management organization to oversee its daily operations. AIMS has instituted a new handbook for Board Members and had three training sessions for Board Members, but no significant overhaul in the procedures for Board operation or for continuing Board education and training. AIMS response has not addressed sufficiently the status of the school’s relationship with its founder. The Notice of Violation asked AIMS to implement and identify remedies in five specific areas shown in the PowerPoint Presentation. The Notice of Intent to Revoked is based on the conclusion that AIMS has not remedied the violations in any of the five areas.
Procedure and Due Process
The Revocation process involves granting AIMS due process to respond to the violations. The District reached out to the organization a number of times during this process.
In September 2012 the then Director of Charter Schools met with two AIMS Board Members and Legal Counsel to present the Notice of Violations in person. During that meeting it was emphasized that the channels of communications between the two parties remain open with respect to the remedies that AIMS was proposing in response to the Notice of Violation.
In September 2012 after the OUSD Board approved the Notice of Violation in Public Session of a Regular Board Meeting, the Director of Charter Schools communicated with AIMS Counsel. At that time the District was open to communicating with AIMS during the 60 day remedy period and was open to having an open dialogue about AIMS proposed remedies.
At the end of the 60 day remedy period, the Office of General Counsel of the District reach out to AIMS and invited AIMS to set up a meeting with AIMS Board Members to discuss the response to the Notice of Violation. AIMS did not request a meeting in response to that overture.
A new provision was added to the Education Code, specifically the revocation procedure. That provision reads “the authority that granted the charter shall consider increases in pupil academic achievement for all groups of people served by the charter school as the most important factor in determining whether to revoke a charter”. Staff considered AIMS academic achievement in recommending the Notice of Violation and conducted a balance between AIMS academic track record and its violations of law and fiscal mismanagement and has concluded on balance the violation of laws and fiscal mismanagement are sufficiently egregious to warrant proceeding with the Notice of Intent to Revoke.
Procedure
Step I –November 2012 the Board approves the Notice of Violation.
The next step is whether the Board will approve a Notice of Intent to Revoke. If the Board does approve the Notice of Intent to Revoke, there are further due process protections for the charter school. Within 30 days a Public Hearing will be held in Public Session of a Board Meeting to gage the level of public support and to receive public input on the issue of revocation. By the end of March the OUSD Board will make a final determination on Revocation in Public Session of a Board Meeting. If the Board does revoke, the charter school does have the option of appealing the final decision to the Alameda County Board of Education and the State Board of Education, if necessary.
Final Comments – Support for Students and Families
David Montes de Oca said given the failure to remedy, the violations have provided the Board with few alternatives. The Superintendent and staff recognizes that if the Board approves the Revocation in March, students and families will require special attention to support the impact this will have on their learning opportunities.
Key priorities have been set.
1. To work with diverse providers and other charter operators to the best of the District’s ability to secure proposals to provide alternate management and operation of the existing programs.
2. To work with diverse providers and other charter operators to provide as many available seats and expanded seats in existing high quality program options for students. Because the current enrollment period for the District has ended, if the Board approves the Notice of Intent to Revoke, the District will immediately open a special enrollment period for AIMS students to occur between January 24th and February 4th. If the Board approves the Notice of Intent to Revoke, the District has scheduled two events next week near the campuses of each school to provide information with the process.
The first priority is to work with diverse providers and quality charter school management to secure proposals to provide as much consistency and continuance of the quality program experience the students have had to date in AIMS Schools. More information regarding enrollment will be available through the Office of Charter Schools, the District’s Website, community based organizations that work in these school communities.
Board Member Comments
Director Dobbins requested the names of the three governmental entities that agreed with the findings.
Ms. Minor said the State of California Department of Finance as it relates to the Facility Grant, California Department of Education, and Alameda County with FCMAT and the referral to the District Attorney.
Director Dobbins wanted to know about how the District Attorney has weighed in on this matter.
Ms. Minor said the referral to the District Attorney was done by Alameda County Superintendent Shelia Jordan. She said she believes the District Attorney will communicate directly with Ms. Jordan because she did make the referral.
Vice President Hinton Hodge said of the last 60 days she asked staff for cures and remedies regardless of a District Attorney report or regardless of a FCMAT report.
Public Comments
Board Secretary Rakestraw said he received a request form the AIMS Board of Directors to address the OUSD Board. Mr. Rakestraw introduced Jean Martinez, Chair, who will lead the response from the AIMS Board.
Ms. Martinez said the scores the students have attained at AIMS are outstanding, not a fluke. It is a success and asked that the District be a partner with AIMS giving Oakland the notoriety it deserves in a positive way. Ms. Martinez said the school has received calls from various groups throughout the State wanting to replicate their success. Ms. Martinez asked the Board to support AIMS to correct their previous problems and to continue to give the students a fantastic education. Ms. Martinez noted AIMS has a strong Board with new members all who reside locally.
Tanya Kappner said she supports revoking the AIMS Charter. She said the abuse of students has been well known for years. Ms. Kappner talked about the open segregation policies of AIMS. Which schools were feeder schools and what groups of students were admitted versus not admitted based on the founder’s and administration of AIMS trying to make sure they only admit students that will test well, kicking out students who do not test well.
Mark Airgood spoke in support of revoking AIMS Charter. He said this is a case of two things: The impact of charter schools and the lack of public oversight over charter schools and Standardized Test Scores as the be all and end all of everything. Mr. Airgood said he believes charter schools are an attack on the right of every child to a public education.
Diane Hatcher, Financial Administrator for AIMS, said she wanted the Board to know that she and her team are qualified accountants and have made lots of inroads in providing changes for AIMS. Ms. Hatcher cited the revision of the financial policies and procedures approved by the AIMS Board. The revision provided an extra review of contracts by the financial administrator and the director before a contract can be approved. A Financial Advisory Committee meets quarterly reviewing AIMS financial statements and providing suggestions for improvements. Ms. Hatcher said AIMS engaged new auditors from Pleasanton and had a successful audit.
Jim Mordecai said this has gone on for years and the District’s Board has done nothing. Mr. Mordecai noted it has taken a lot of time, money and skill from District staff to prepare the report to the Board. He said proper oversight of charter schools cost a lot of money and the District cannot afford charter schools. He said in terms of the Conflict of Interest of the founder and his wife, AIMS Board did nothing since there is no document to indicate so.
Jennifer Avalino said as a newly appointed Site Administrator for AIPCS II she has learned a lot in the past four months.
1. She and staff have worked hard to make sure 100% of their teachers are credentialed.
2. They have worked to ensure each year improves upon the previous year.
3. Regardless of the obstacles thrown at the school, the teachers continue to provide Oakland students with a top notch education.
4. There is a lot more work to be done.
Ms. Avalino invited the Board to visit the school.
David Chew talked about AIPCS disciplinary measures. He said the most commonly used is detention for not returning homework, negative attitudes, foul language, etc. He said if the administrators don’t believe and have hope for the students, detention becomes punitive. He said giving detention becomes a measure to build up the students. He said the goal of detention is to foster the growth of the students.
Hoang said only strict parents can make better kids and only a strict schools can make better students. She said her family picked this school for a better future for her child.
Kevin Sparks said he is in solidary with his students who show up to school on-time daily, prepared to work, focused, and conduct themselves with the utmost professionalism in the classroom. He said the teachers and administrators have given their lives to their students. They come in early, stay late, surrender their weekends to supervise and teach Saturday School and push their students to take control of their own learning. He said the parents and grandparents have many schools to choose from in the area and they chose AIPCS.
Ms. Savala said the reason the AIMS Board has not taken any steps to remedy the situation is because Mr. Chavis is still there. She said she asked him to walk away and he wouldn’t. She said the OUSD Board now has the evidence. She said after there was evidence of fraud in September, his wife went from being the Accountant to being the Scholarship Chair.
Shannon Bennett said the students don’t need AIPCS to succeed, they have other options. She said when looking at whether to revoke the charter, it is not about punishing the students. We are saying if the school remains open it is okay to lie, cheat and steal. She said while she worked at AIMS, Mr. Chavis said things like: “We need to create a paper trail so they don’t suspect” and “I’ll step back but I’m not leaving”. She said Mr. Chavis has no intention of leaving AIMS.
Kimberly Palmore said her child is not one of the high achieving students. She said along with her daughter and adoptive students, she asked the Board to allow AIMS the opportunity to excel in academics and to continue on with the high school’s 100% graduation rate.
Mike Hutchinson said the District has a lack of oversight over charter schools. He said he finds it troubling one of the conditions the schools need to meet is increased enrollment. The only place students can come from is public schools. He said he would love to see AIMS back under the public school umbrella. He said if $3.8 million is not enough to revoke a charter, the District will never revoke a charter.
Joel Valesquez said the victims are the children. Mr. Valesquez said he stands with the students and the parents, but the District cannot let this go on any longer. He said he supports the Superintendent’s recommendation and encourages the Board to set an example. He said no entity should make a profit off of children and tax payer dollars.
Daniel Tresmore said many children in Oakland were not given the same educational opportunities he was given. If the schools follow the model and successfully graduate, all students will have the opportunity to pursue higher education. He said OUSD still faces one of the lowest graduation rate. He wanted to know should the education of hundreds of student be compromised due to the mistakes of its founder”.
Jose Guzman said General Motors filed for bankruptcy and were helped out. He said he is asking for the District to help out AIMS. Mr. Guzman said he recognizes the schools made mistakes. He said if the Board closes the school, a lot of hopes and dreams of the students will be shattered. He said if they go to an Oakland Public School it is not the same. Mr. Guzman asked the Board to keep the AIMS open.
Bernadette DeVille said she did her research on AIMS on their rigorous academics and strict discipline. When you are a parent you choose where you want your child to get the best education. Ms. DeVille said this is an adult issue and it should not be charged to the children.
Secretary Rakestraw announced there was a request from five additional members of the AIMS Board to address the OUSD Board. Sylvester Hodges, Ron Grant, Nedar Bey, Toni Cook and Jose Guzman.
Toni Cook noted she served eight years on the Oakland Unified School District’s Board and cited the things that she fought for then is what attracted her to the AIMS Board now. Ms. Cooke Cited SB 1290 - the principle reason a charter school should be closed is based on student performance. She said to close the school is to say to the faculty they have done a poor job. Ms. Cook asked the Board to continue to work with the AIMS Board as they find resolve to infrastructure issues. She said no accusation has been made about student performance or employee performance.
Nedra Bey said in April AIMS was asked to change its Board and it did. He said no institution is perfect and AIMS acknowledge there were mistakes it has made institutionally. He said it has a Financial Oversight Committee and Board Members who have experience. He said Ben Chavis is no longer associated with the school. He is the landlord of the building. He asked the Board not to get rid of the school.
Ron Grant said he joined the AIMS Board six months ago. He said every high school student graduates from AIMS and gets accepted into four-year institutions. He said AIMS has the best educational program he has seen in his forty years in education. Mr. Grant said AIMS is number one in the State academically.
Sylvester Hodges asked President Kakishiba for a professional courtesy because he is the present Executive Director for AIMS and feels he needs more time to explain some of the accusations that have been made about the lack of responses.
President Kakishiba said there would have to be a time limit, but he will allow Mr. Hodges four minutes to speak.
Mr. Hodges said he came to share with the Board what has occurred with AIMS since he has been involved as the Director. He said initially he was an advisor and was later placed in the position he has now. Mr. Hodges said he would not have taken the position if Mr. Ben Chavis was running the school. He said if Mr. Chavis, his wife or anyone else that has done anything wrong they should be placed in jail, not the school being chastised. Mr. Hodges said the Board will direct him and he will advise the Board to monitor staff. In place is an Advisory Committee and a Financial Advisory Committee monitoring the process.
Mr. Hodges said he does not approve contracts or payment to anyone until the contract has been presented to the finance committee, him and the Board. He said it takes time for changes but it will not take him much time because he believes in moving immediately on the remedies that are being alleged. He said he is sure that it will occur and he would like to meet with the persons who made the charges and recommendations to talk about the things AIMS is doing and to get some other ideas from them if they have other ideas. Mr. Hodges asked the Board to table the item and not move on it at this time and give AIMS a chance to work with District administration.
Board Member Comments
Director London said from the first time the Board heard about the issue with AIMS in April she was clear that when you are given the opportunity to manage a charter school, you are entrusted with the public’s money and you become a guardian of the public’s trust. She said this school has violated that public trust. She said if this was a school performing poorly and the same allegations were raised, the Board would be a laughing stock for not considering the motion they are about to consider. Director London said she is not swayed by the fact that the school has great test scores. She said it does change for her the fact that the people that operate the school have violated the public’s trust. She said she will not support continuing the school.
Director Yee said when Mr. Chavis started AIMS on Magee Avenue, he took a failing charter school and significantly turned it around by going back to the basics. Director Yee said he applies a consistent standard around all charter schools. He said he is very critical of the academic programs, but more so with the fiscal responsibility. Director Yee said the evidence is clear to him that three of the four standards against which the District evaluates charters for revocation were seriously breeched. He said he holds not only Dr. Chavis responsible but he holds the Board that existed at the time. Director Yee said he is sadden that members of his Chinatown Community had to encounter these violations of charter school laws and were asked to come and defend practices that are in violation of the State. Director Yee said he feels shamed, embarrassed, and humiliated this would happen in his community. Director Yee urged his colleagues on the Board to stand with him and say “This community largely of immigrants who only want the best for their kids deserve the opportunity to send their kids to a high quality school that is run by appropriate standards of practice in the California School System”. Director Yee urged his colleagues to support the Superintendent’s strong recommendation to revoke the charter.
Director Dobbins said the Oakland Schools get so maligned for mis-management, the District goes under State Administration. He said the process is genuine and it is important that the District go forward with the process. He said if there was actually fraud/theft, throw the book at them. He said the fact is the District Attorney has not jumped in. He said while the OUSD Board may not approve of the contract for rent and someone getting rich at the public’s expense is a fair conversation. He said AIMS are the ones to deal with that. He said AIMS has some of the highest test scores in the State. He said the Board has the authority to revoke the charter and he thinks it is being done for the wrong reasons. He said you have to look at the broader picture and look at what’s really going on and that is why he will not support the Superintendent’s recommendation.
Director Harris said he talked to a lot of people on both sides. He said if you are human like him, you have violated somebody’s trust, you have done something you were not supposed to do. When it comes time to be accountable, you have to stand up and take all the bad with the wrong you did. Director Harris said what he did when talking to persons at AIMS was to beg of them to give him something; tell him something that he can share with his colleagues; something that makes this right. He said there is no way around it, there is no way the District can reverse the charges and talk to the District Attorney to throw the book at Mr. Chavis. Director Harris said the Board has a role of oversight, it cannot extend the olive branch and say we are going to extend our staff and resources to help you get in line. He said there was sixty days of quite. Director Harris said it is difficult for him to vote "No."
Director Torres said taking from children is never okay and what kind of message does it send if her child is in the school and she is turning a blind eye? Director Torres said as a Board Member, how are we going to do a better job of oversight of all the charters that have been allowed to open? She said she and Director Harris are new Board Members and feel they should not be in this position because these kinds of oversights should be caught sooner. She said when looking at the chart for rent, if she paid exorbitant rent compared to other people in the building, she would be shocked. She said the oversight is another issue she asks her fellow Board Members to help her understand; how this got by for two years and no one caught it. She said it is not a minimal amount of a difference between $13,500 and $70,000 a month. Director Torres said if this is truly an issue it should have been caught in two months.
Vice President Jumoke Hinton Hodge said for sixty days there was a bit of silence. She said she kept saying you can cure it, you can fix it. She said she believes in Restorative Justice, not just talk about it. She said harm happens and we have opportunities to repair the harm. She said this is not about Dr. Chavis personally. She said for her this is about his legacy as a man of color in this community that was a superior educator. She said he is doing common sense, back to the basics education and the District should be replicating it. She said Charter Law gave an opportunity to AIMS to step out of the Education Code, be innovative, have autonomy, have authority over their curriculum, and do what they needed to do to seek high student achievement. She said with that privilege comes certain responsibilities. She said in sixty days AIMS was supposed to get it together. She said instead the District received thirteen binders that refuted and argued something. She said she did not need an argument, she needed a remedy, a cure. She said she heard about the new accounting and the audit. She said the remedy was not brought forward in this area.
President Kakishiba stated there is a sixty day period for getting the remedies together. He said the Public Hearing will be held on February 13, 2013 and the Board will probably hold a Special Board Meeting on March 20, 2013 to act on the Revocation. President Kakishiba said he fully expects the AIMS Board and District staff will be working together to get those remedies in place and to avoid any unnecessary drama.
|