My Lee T I'm the director of Grassroot Development and Public Relations for the North Carolina Charter school association. Thank you for coming today. Lately Charter Schools there's been a pretty steady [xx] the Childer Schools have not the good Stewards of tax payer dollars. I have heard seen one commentator say that it goes into a black hole. We are here today to address that issue, we'll hear from Eli Garal and Marcus friend. On the subject, Eli Garal the Executive Director, the North Carolina public Child School Sensation. Am going to first thank represantative Yaba of the big yesterday, and Senator Turk, we appreciate your support for chatter school. Well, it's National Chatter schools' week, but and we should be celebrating, but as you guys know, there's so much going on here, and in the schools with assessments coming up that is it's kind more work than assessment probably for some of you, but we do want to acknowledge the successes of the charter schools in North Carolina over the last almost 20 years. House Bill 955 was filled about 19 years to go on April 12, yes it was, which later became the Charter School Act so we're almost 20 years old, and again the charter schools have done well, it was proficiency as well as the percentage of our schools reaching growth. We've exceeded the district schools, the years that I've been involved, the last year of this business and we're very proud of that. But you know some other things, some things have come about with some closings recently that have caused the public to question accountability in charter schools and even though we might look at this session here and realize that it might be on count of the back banner right now with so many important issues, our association and our charter schools we want to face that issue, we want to address it and be part of the intelligent solutions to that and by the way, when we talk about having 147 charity schools and the growth we've had, that's from our perspective in the office of charity schools if you look at parents out there let me remind you that in 1996 we had seven and a half million people in the state, today we've 10 million, sO 100 schools then is the equivalent adjusted for population to 133 schools now, so parents actually have seen only about 16 or 17 more schools in the state, again adjusted for population, so that explosive growth has it looks that explosive to all the parents across the state. 58 schools have been authorized since the cup was lifted, as far as I know three of those 58 opened and then failed but it was kind of interesting they were all in the three were in Charlotte that I'm thinking of, I think that the only three were in Charlotte and that happened in fairly short time frame, so we need to look at that, again that 3% out of 58 is only 5% that we care about the exact percent, we want to know what happened there that we can do about it. So, the question is all Charlotte schools are financially accountable I said the answer is yes. But certainly, there are improvement can't be made. I think the first thing that the public needs to do is being more aware of what oversight exist know, and to make intelligent improvements. We got to know what exist now and I think there is point good at the end of reporting that were probably blamed. We haven't talk about the thing that we passed out some talking points and I wont go over all those but you see there's ten or twelve there that apply to chattered schools, some of which been added in the last year, for example this year, actually today, the state board will look at a recommendation by the Chattered school advisory board to authorize seventeen ratings school to operate next year, that vote will come next month in June which would be 14 months before those schools open, students first as you remember in Charlotte was approved in March at the year it opened, so it was approved five months before it opened. I'm not apologizing for
student first, their board failed but I'm just saying some of the solutions we've already seen so, one of the things I would like to point out also is that, I think in the reporting by the media, I think tax payers and the public has understood and gotten the impression that they're on the hook for these charter schools when they closed, I kept seeing $600, 000 got by students first, over and over again and the impression you would get would be that that was going to be borne by the taxpayers. What happens is, most of you know, is state funds are charters and the Local Education Agencies fund the charters based on the students there and then that's it, the [xx] is cut off. If schools keep accumulating that like the $600, 000 that the students first did, that's borne by the Board of Directors so the state doesn't guarantee the Charter desk I think that's important. We think there can be improvements in the system though, I owned and managed to see the CPA firm for several decades actually and I have that background and it care about this and try to see what I can find out it maybe failed what protocols failed? What protocols and standards we need our recommendations would be for one thing that we try to determine earlier what the debt is of the charter school that I say is management system reports basically the cash transactions so received the bank statement I'm not sure we see the credit card statement if you will early enough so debt can accumulate be reported on budgets and we could be discovered upon an audit or a visit to the charter school. That may have happened at Kingston. I'm not sure but that type thing can happen if there is no way to account for the debt accumulating within a school. Another thing I think we can improve on especially with the new schools is to change our polices. Some of it we so the students have to demonstrate that they either have applications or they have enrollment, for the money they are going to get. I think the way we do it now if Concrete Roses for example in Charlotte, I think their first year enrollment was supposed to be about 400. I believe they're funded there in their first year and that adjustment comes with a second charter schools get three state allotments three big chunks, 34%, 33 and 33. I think Concrete Roses got that chunk of money as it opened didn't have the kids there and then it was adjusted with the second installment in November but it was too late, they had already again accumulated so, my recommendation again is just that the state make sure that we know people are going to be in those seats before they're paid and thirdly I'll close by saying I think the state board ought to be given the authority to do that if it needs it legislatively and I haven't seen that on the bill but I think that's something they've talked about and may need and we certainly support that, so, let me just summarize by saying charter schools, again, we have most vested interest in this whole issue of financial accountability, we care, the high quality education is our goal and we know that financial stress and high quality education have a direct relationship, the schools have to be financially stable to keep having a good education outcome, so we want to again be part of that, we want intelligent recruitment made and certainly we're willing to work with any groups to make sure that happens, so again thank you for coming. This is Marcus Brandon, I'll introduce him former representative, and is Executive Director your titles Marcus? That's what they say. Executive Director of Carolina Can, I guess most of you folks have heard that, thanks Mark. Well, it's good to be back and I just wanted to make some brief comments about the fix that we tried to do for
our financial accountability, and accountability period. I really want to state that, just because you have accountability measures it does not mean that people are actually been held accountable. I would say that charter schools have been held more accountable than any other institution there is, we actually get our schools shut down. I have schools in my district who have not been accountable to the same standards for 28, 30 years that will re-open next August and all 600 of those kids will continue to go to that school, and that's not necessarily the case with your other schools. So I do want to make it clear about accountability, just because you have accountability standards doesn't mean that people are actually being held accountable, but the fix that we use for this, for the particular financial accountability piece is someone stuck in a budget, they didn't get it through a committee or a bill or a stand alone bill a $50, 000 escrow account that charter schools must have, and I understand the purpose of it, but the unintended consequences of this is that schools like, I'm a founding board member of the Point Leadership Academy in High point. That school would never have been able to get off the ground if we would have had that provision. We did not have $50, 000 of capital, or any capital at all ought to be able to secure a $50, 000 bond. This potentially, the unintended consequence is that This will eliminate the small innovative charter schools that we all attended for charter schools to be, and it does pave a way for other charter schools that can absorb those cost more than bigger charter schools, more of the corporate charter schools that can absorb that cost to be able to pave the way through and we can create separate systems if the general assembly and the public are not aware of policies that come down that really, and I don't think it's intentional, but it does present a huge problem. Because when you're in chatter school, you can't just go to the bank, because your chatter is only for so many years. You can't just go to the bank and say, hey, I need this loan you've to able to prove that you're going to be able to be stay in business long enough to get the loan. Now for example, my chatter school was able to own their own, we own our own building, within four years. So yes, now we can be able to get that $50, 000 requirement. But when we first started we would've never been able to do that, there wasn't a bank in the world that would give us the time of the day and these are the problems you'll have with small innovative charters that are trying to to do the things that when we enacted these laws which is to be able to deal with issues that in the community that normally not being able to be dealt with and so when we eliminate that, we eliminate the very meaning of why we do that why we charges we started charges and it's not because teachers are bad in the public school or students in the public it's not because principals It's because different issues have different ways for dealing with it and charges are for that are for that we can pick five schools that fail but I can sell you So it's one of those numbers games that people play to try to pawn out failing schools or three failing schools that get bad in financial accountability but I can tell you that chartered schools have two hands tied behind their back when it comes to finances. Whenever my hit a break I have to write a cheque out for $ 8000 to hit a man and I only need to call the county and somebody comes and fixes it so we have a lot of issues that come before us it does not come in. And much as school provides food and transportation for everyone, we don't get a dollar for that. And so it really deserves a fair conversation about just because you have 1, 2 % of people that fail and we could see that in any industry and across the board that you're going to have some good once and you're going to have some bad ones. But in the charter schools, I think if you look at the percentages people are doing extremely well. But we cannot allow public policy to dictate what type of charters that we have. And we certainly don't want over regulation of the charter industry that prevents the little innovative charter school to it be able produce the results that we and many of the charters for the better part 20 years I've been producing, so I appreciate you time, and if anybody has questions glad to do. That provision is in that series of charter school Statutes in 14A and it was put in the budget last year but it was also a House Bill 1178 last year, filed by a full democrats that wasn't heard, that same language got in the budget again, I don't know how either Marcus, but as I said the speakers' cut off, once you get four people funding you don't get anymore, so the money that
would be in esco that will come from this people's pockets would go to pay creditors unnecessarily, that's a business transaction or risk creditors might have taken by giving them credit, so almost came to having your son getting to a stage where he can have an allowance and mow the grass, and say before you start mowing the grass you need to put up an esco to fund a lawn mower in case this is broken or something, it just doesn't make any sense what we should do is be more judicious in that funding up front instead of creating this back end reserve or something won't actually be a reserve, but if anybody closes down and only have 50, 000 worth of debt then I would like to see how in the world they were closing anyway so most of the cases that you've seen where charity schools have closed down, that $50, 000 would have helped them when we were with the others, so this is really something that's hurting on the front-end and not the back-end. There are lots of things like Eddy said, that we can do to make sure that people don't get there and I would ask not only the General Assembly but the BPI spend more time figuring those things now than tying to figuring out other ways that we can cut people and then start figuring out because you know especially urban charter schools which are charter schools that led by African Americans these are very difficult things we don't have $50, 000 that we can just go pick up, but we're on average urban childish schools educate about 28% more African- American than others the schools are very diverse and doing incredible work and we can't take that away. Sometimes you need people in the community to do the community work if not about the education if this is about the wrap around services about English as a second is about teenage pregnancy is about HIV/AIDs is about crime drugs an poverty and of the things that we have to deal a lot kids don't come to school ready to learn and those are the things that we offer them those people in the community are going to be able to do that we can't knock the bill out for many of them. We've got to be able to create environment worth all charter schools include the big ones and the smaller ones are able to thrive in the state of North Carolina. Before we take your questions we have a couple of leaders at Charle schools here with us today Don McQueen from Torchlight in Durham and Stephen Gay from East Wake in Zebulon, I'd like them to step forward, and help Eli Marcus answer your questions. $50, 000 with the accountability or any other part of charging questions. I swear [xx] and I was in the budget last year it was put in the budget last year. It was put in the budget last year it is there it calls for a cash or other type of escroll[sp?] that could be a bond purchase any type of collateral debt would be again a reserve or a [xx] to pay the cost of I think it's awarded like to pay the cost of maybe the administrative cost of closing down the school. I can tell you that all the schools that have heard about this have gotten very excited they don't they're going to have to put up actually an equivalent of representative Hauls house bill 96 it's what it is that bill requires charter offices a head any influence of the budget to be liable for the school debts this's basically doing the same thing in advance it's saying put up your personal resources to guarantee, we'll have $50, 000 to do something and if go out in business. The better part as Marcus had said is to work with DBI, division of business and finance and come up with accounting methods to have better oversight over this. Is it for new child schools or all child schools? It's applicable for schools applying after a certain date and my understanding is from schools that opening now, they applied before the date but they have been told by the officer in charge it's on and they're ready to open schedule they're suppose to do it and its been, they've been told by Doctor Medley that he recommends they go ahead and do it and exhaust fund for existing schools that applies upon their renewal close to 10 or 12 schools will find this. I don't think many of our members know about it yet. Well, I have more questions.
you're trying to get that taken out. We would like to have it removed, yes. What's the new progress with the [xx], you talked to them at the reception. Well there's difference in opinion within the chatter community, unfortunately there is another organization that disagrees for the song and understandably, representative Jabra and others when they get different messages I understand that the confusion you might have and so what I think we've just got inaction on this because there have been two messages from two different groups, but ours are certainly that the $50000 not only won't help anything, it will actually shut down new chatters as Marcus said. There will not be any non-EMO chatters, follow any applications do this. Anyone else? Going once, going twice? Thank you for coming. You think all of you will really appreciate it.