Gilbert’s Higley Unified School District will file papers with the state Department of Education to turn its two under-construction middle schools into charter schools this fall after a 4-1 vote by the governing board Thursday night.
School leaders brought the idea to the board in order to increase funding for the district, said Higley’s CFO Kevin Hegarty.
Under the plan, the two schools would receive charters from the district, with the employees, curriculum and leadership all remaining under Higley control.
The only difference, Hegarty said, is the district could receive an estimated $1.9 million in additional assistance each year from the state.
That’s because charter schools – as they are funded now – don’t receive any money specified for structures. Instead, they receive per student funding – like districts – and then they receive “additional assistance” money. Should a governing board in the future choose to revoke those charters, the district would be required to pay back all the additional assistance it ever received, he said.
Since the beginning of the charter school law more than 15 year ago, districts have had the ability to issue charters, just like the Arizona State Board for Charter Schools. In fact, at one point years ago, Higley did sponsor a charter school, though it was not one of its own.
There is one hiccup in the plan, though. The way the law reads, the district could face the loss of about $2.5 million in “growth” money it gets from the state as it continues to enroll more students. However, school lawyers looked at the matter and questioned whether or not it applies.
So the district put the question before the state Attorney General’s Office and is waiting for an opinion.
That, said board vice president Kim Anderson, is the only reason the district would not move forward with the idea.
“If the AG says, ‘You have to give up your growth money in order to get the money for the charters,’ we’re not going to give up $2.5 million to take $1.9 million. That doesn’t make any sense. We would tell the ADE (Arizona Department of Education), ‘Nevermind. Don’t continue to process the paperwork and we’re done,” she said. “Meanwhile we had to have the (charter school) paperwork in by June 30 in order to meet the deadline for next school year.”
The fact that a district can receive additional money just by converting its schools to charter schools was the reason Higley board member Jake Hoffman voted against the plan Thursday.
“The district's decision to consider chartering the middle schools is built on a funding gimmick that provides potential short-term upside with an inevitable long-term downside by handcuffing future governing boards and potentially putting district taxpayers on the hook for tens of millions in reimbursements to the State should the need to revoke the charters ever arise,” Hoffman told the Tribune in an email. “Chartering the middle schools would be an abuse of the intent of the charter school system, fiscally irresponsible for the long-term welfare of our district and a noose around the neck of all future Higley governing boards.”
Board president Denise Standage called Hoffman’s statement a “fallacy.”
“Actual our schools are very true to the model of charter schools. They are not built by bond money or SFB (School Facilities Board). They were built by private investors. The schools, we’re actually leasing. To say we’re not following the intent of charters is not true. This is a true model. The real intent on why we’re doing this at all is because we’re going to save the district money. … we’re able to get $1.9 million more for our programs. It’s not going to go to anything but the classroom,” Standage said.
While Higley voters approved funding years ago for the district to build new schools, because of the decline in housing values the district lost the ability to sell those bonds and the state froze school construction money during the recession.
That left the growing district to come up with an alternative plan. What it designed was having a nonprofit group build the schools, and then it asked voters to approve the lease of those buildings.
Voters gave that approval in November and by early 2013, Cooley Middle School and Sossaman Middle School were under construction. They will be the first middle schools for the district, which has until now offer kindergarten through eighth-grade elementary schools.
The district signed a 40-year lease for the two buildings and most of the furniture within their walls. The lease is $3.2 million annually, Hegarty said.
The district put a capital budget override on the November 2012 ballot to help fund that lease, but voters turned it down. They also turned down a first request to renew the current maintenance and operations budget override. Both issues will appear again on the ballot in November.
With the state not funding school construction, even as the district grows, Higley saw the chartering of its schools as the solution, Hegarty said.
“It’ll pay about two-thirds of the lease for these schools. It does help us avoid cuts in other areas to pay for an expense that should have been paid for by the state,” he told the Tribune prior to Thursday’s meeting.
Both schools will open in the fall with more than 900 seventh and eighth-graders, as well as room for 300 preschool students. The district is required to also offer an alternative option to parents who do not want their students in a charter school, Hegarty said. So a program would be set up at the high schools for those students. State statute prohibits school districts from making all their schools charter schools, Hegarty said.
If turned into charter schools, the middle schools would not have school boundaries. But the district expects to still offer transportation to students as originally planned.
Other school districts – Paradise Valley Unified, Cave Creek Unified and Vail near Tucson – have all taken this route in their districts, Hegarty said.
“Districts that can’t pass an override or a bond are all looking at this. It’s an opportunity or an option for districts depending on their individual situation. I don’t think we would be looking at this as an option if the state built these schools for us, but they didn’t,” he said.
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