Charter Schools Education Industry Funding New Jersey Privatization

Jersey Jazzman on Impoverished Camden, Where Charters Always Have Money

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Camden, New Jersey, is one of the poorest cities in the state of New Jersey. The public schools are dilapidated. But charter schools are not dilapidated. Jersey Jazzman tells how one entrepreneur in Camden was able to raise $10 million through a bond issue to build a state-of-the-art facility, with a new cafeteria, science labs, a fitness center, and a health clinic.


He writes:


If you know anything about Camden and its schools, you’ll know that this is quite a story — a story that shows, once again, that charter schools play by a completely different set of rules, often to the detriment of public schools.


Let’s start with some background: I spent a lot of time last year telling the story of Camden’s LEAP Academy University Charter School and its founder, Gloria Bonilla-Santiago. The tale is long and twisted, but let me give the quick highlights:
Despite a track record of regularly missing Adequate Yearly Progress (and academic outcomes that even today lag compared to schools across New Jersey), LEAP was always a favorite of then-Acting Education Commissioner and school privatizing guru Chris Cerf:


*LEAP actually lost its tax-exempt status for a while in 2013 because it failed to file its tax returns. This was serious because $8.5 million in bonds had been issued from the Delaware River Port Authority for the school’s expansion. LEAP eventually got its tax-exempt status back, but not before blaming the debacle on the IRS.
*But the failure to file taxes for three years was the least of the questionable behaviors surrounding LEAP. The school illegally recruited athletes back in 2005, leading to a severe sanction from the NJISAA. The school engaged in unfair labor practices, leading to extraordinary levels of teacher turnover. LEAP had to repay the NJDOE when it used federal funds for non-allowable expenses. A LEAP employee filed a lawsuit, claiming he had been forced to do personal work for Bonilla-Santiago at her home (I can’t find any follow-up reporting on the status of this suit).
*But perhaps the biggest scandal coming from LEAP came from the Philadelphia Inquirer’s reporting on Bonilla-Santiago’s live-in boyfriend, Michele Pastorello:
When Camden’s LEAP Academy University Charter School compelled its new food-service management company to retain the school’s executive chef and give him a $24,000 raise, LEAP also had to pay a $151,428 penalty to its previous vendor, documents show.
Including Michele Pastorello’s new $95,000 salary, LEAP has spent nearly $250,000 this school year to keep him employed as executive chef. The position typically pays about $40,000, according to industry experts.
Pastorello is the live-in boyfriend of LEAP founder and board chairwoman Gloria Bonilla-Santiago. His raise, as well as the fee paid to the previous management company, Aramark, now are under review by the school’s board of trustees. [emphasis JJ]
Not surprisingly, a subcommittee of LEAP’s board found that nothing was wrong with this deal.


JJ adds, with careful documentation, comparing LEAP charter school to the Camden public schools:


LEAP serves a substantially different student body than the Camden Public Schools. We can argue about whether that’s acceptable or not, certainly acknowledging that LEAP’s student body has far more children in economic disadvantage than its suburban neighbors. But let’s get back to those bonds…

Because what I don’t understand is why there is plenty of money ready and available for charter schools like LEAP — which serves fewer children with special needs — to expand, while its neighboring public schools in Camden have to wait years just to get enough funding to keep from falling apart.

Why is Wall Street so eager to give a school like LEAP — a school with a history of not filing taxes, engaging in unfair labor practices, and paying favored employees far more than market wages — money with which to expand? So eager that, according to this Wall Street Journal story, LEAP is getting a remarkably good deal?
The school is paying a rate of 6.3% on longer-term debt. Comparable borrowing costs in 2009 were about 7.6%, according to the Local Initiatives Support Corp., which advises charter schools on finances.
Do you think that maybe the street came to a conclusion about LEAP? That maybe it doesn’t need to jack up interest rates for their bonds, because — as the school’s history shows time and again — it simply can do no wrong? – See more at:



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