Charter Alliance Owes $400,000 to District; Accountability, Oversight, Responsibility Lacking

A charter school alliance representing two schools in North Clackamas, Oregon currently owes the North Clackamas School District over $400,000 - and no one is quite sure when/how the money will be paid back. Lack of financial accountability on the part of the charter alliance? Check. Missing funding despite the "regular" public schools cutting 60 teaching positions this year? Check. Any clear way to recoup the funding? Nope. In what certainly looks like a case of mismanagement and overly ambitious projections, those pesky "regular" public schools will suffer because of the boondoggle of a few charters. From Oregonian reporter Su-jin Yim:

North Clackamas seeks money owned by charter schools

by Su-jin Yim, The Oregonian

Friday August 07, 2009, 4:01 PM

The North Clackamas School District is trying to recoup about $400,000 from a charter school alliance that has owed the district hundreds of thousands of dollars since 2004.

The dispute highlights questions about financial oversight of charter schools, which operate with public money but appoint their own boards and are permitted to experiment with creative approaches to education.

Until last year, the Clackamas Charter Alliance included New Urban High School, Clackamas Web Academy and Clackamas Middle College.

Its debt, which grew to as much as $550,000, stemmed from unpaid loans and failing to meet enrollment projections -- for which the schools are paid in advance -- for at least two years.

The money is an especially keen issue in light of tough budget decisions by the suburban district to cut 60 teaching positions.

Although the debt started in 2004, the district has never had a formal, written repayment schedule for the money, according to district chief financial officer Jim Langstraat.

Complicating matters, the district took over New Urban High School last year, turning it into an alternative school.

In June, the school board renewed the middle college's charter and emphasized that the alliance should pay back the money, but didn't make it a condition of the renewal, said board member Joan Smith, who was the board chair at the time.

"There was no threat," Smith said. "It was just made very clear that we were going to hold them responsible for that repayment."

She said she was surprised to learn that in the past, the district had only verbal agreements from the alliance to pay back the money.

"I would say maybe the district has been a little lenient through this process," she said.

In part, that's because it's unclear to the board and the district how much power they have over the charter schools, Smith said. Ideally, she said, the state would write clear rules, she said.

"It's a lot of money, and by no means should the board and/or the district be writing this off, but garnering it back is not an easy process either," Smith said.

In the past, the Oregon Department of Education has said that a district can add specific conditions to a school's charter agreement.

The district is negotiating with the charter alliance over how long it will have to pay back the money. Former superintendent Ron Naso, who retired after 14 years in June, decided to give the schools 10 years to repay the debt, Langstraat said.

Negotiations, which started in the spring, continue in part because the remaining two alliance schools are unsure who owes what and they want to be sure new superintendent Tim Mills signs off, said web academy principal Brad Linn.

Langstraat said Mills, who started July 1, hasn't been briefed about the debt.

"At the district level, I don't care if it's 50-50 between the middle college and the web academy," said Langstraat, who joined the district three years ago. "What I do care about is that the Clackamas Charter Alliance pays off the debt they owe the district."

The district loaned the initial $240,000 to New Urban during early days in the history of charter schools, which the Legislature approved in 1999.

But times have changed, Langstraat said.

"It's not what a charter school should expect," he said. "I wouldn't recommend the district probably doing that again."