Thursday, December 22, 2011

Management Companies and the State Board of Education

You'll notice that I've always been objective in writing about charter school appeal hearings before the State Board of Education when I was an employee of CDE. Now that I'm no longer an employee, I feel compelled to write about the appeal hearing heard by the State Board earlier this month.

Disclosure: I have organized a company, Charter School Solutions, LLC, with Brad Miller, the Falcon School District attorney and Dave Martin, the former Board President of the Falcon 49 School Board. I did not participate in the appeal case, however; Brad has his own law practice.

I was at both appeal hearings. The first appeal hearing was largely about management company issues, specifically:
  • has the charter school governing board done due diligence in selecting a management company based on their merits;
  • does the charter school board have their own legal counsel, separate from the management company's legal counsel;
  • are there any "poisonous pills" in the management agreement, for example a provision that the board is left with a "charter in name only" if the two parties separated; and
  • does the charter board have say in the selection, evaluation or termination of the principal.
The second appeal wasn't heard within the statutory timeline as both parties agreed to waive the deadlines. The Falcon board didn't ever hold a public hearing and vote on the State Board's remand order because they contended there was never a party to negotiate with, meaning the charter school board wasn't credible since they didn't have their own legal counsel and were still operating under the auspices of Imagine, Inc.

I thought Ed News' Todd Engdahl, who was also at the hearing, had a shallow understanding of the dynamics of what transpired during the appeal hearing. In his article, he wondered why the Falcon school board was taking issue with Imagine, Inc. when they already had one Imagine charter school in the district and had previously approved Pioneer Imagine. What changed within that time period?

Everything! Colorado now has a Standard Application, Checklist for Completeness and Review Rubric and Sample Contract Language, both documents shed a wealth of information on management company issues that weren't available even two years ago. In particular, the sample contract language publication has an "ESP Guidelines" (Education Service Provider, the generic term for all management companies) that details what should, and should not, be in management company contracts with the charter school board. Both of these documents were created through a collaboration of the state Charter School Institute, Colorado League of Charter Schools and the Colorado Department of Education.

The world of charter schools is ever-evolving. Another important factor in the case was that the charter school board wanted to also govern the new school, Pioneer Imagine. Since they're also the governing board for Imagine Classical at Indigo Ranch (the other Imagine charter school in Falcon) the plan was to govern both simultaneously.

A number of charter school governing boards in the state have multiple charters: Denver School of Science and Technology, West Denver Prep, SOAR, KIPP, James Irwin Charter Schools, Jefferson Academy Charter Schools, and Compass Montessori, just to name a few. But during the Pioneer Imagine appeal hearing, State Board member Elaine Berman said she'd never heard of a charter school board overseeing more than one charter. Interesting question, given that Denver (her district) has numerous situations where a single governing board oversees multiple charters. Moreover, having multiple charters has become increasingly common because school district authorizers can approve a "known commodity" when they know the educational program and the charter school's leaders.

Colorado is truly in a different place in regard to charter schools. Two years ago the state was dealing with the Cesar Chavez Academy fiasco and the charter school community responded with improving its own systems. Now charter school authorizers routinely ask for information about management companies in charter school applications. Because this application component was absent in the statute, many districts had to go back and ask for information or simply do without, in making a decision on the charter school application. Now authorizers are encouraged to fully research the company's financial standing, operations and academic accomplishments before a charter school application is approved. Further, the Sample Contract Language and ESP Guidelines stipulate that the authorizer needs to approve of the management company's performance agreement before the charter contract is executed and that the provisions must be in alignment with the state-recommended ESP provisions.

Yes, Colorado is in a different place now that we have state-level model documents that establish a standard for what is acceptable in charter school applications and contracts. Since these documents were created through a variety of expertise and representing a variety of interests, it's time the State Board translates these new standards to their appeal hearing decision-making.

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