Arizona charter schools file suit to regain $5.8M - East Valley Tribune: East Valley Education News

Arizona charter schools file suit to regain $5.8M

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Posted: Sunday, July 28, 2013 9:43 am | Updated: 10:53 pm, Wed Jul 31, 2013.

Charter schools in Arizona filed suit Friday to block the state Department of Education from taking $5.8 million from them, they say illegally.

Legal papers filed in Maricopa County Superior Court contend School Superintendent John Huppenthal is ignoring state laws which determine how to compute repayment of funds which schools did not get during the state's budget crunch. Attorney Kory Langhofer said Huppenthal and his agency cannot simply decide as a matter of policy to reinterpret the law.

But even if he can, Langhofer said Huppenthal can do that only prospectively. More to the point, the lawsuit asks a judge to immediately block the state from taking back the ``make up'' money it now contends it overpaid.

``What they're not allowed to do is apply those changes retroactively.'' he said.

He said it would be like having an employee who was promised and paid $50,000 for a year of work.

The following year, Langhofer said, the employer might want to pay just $45,000. What the employer cannot do is, at the same time, demand repayment of the $5,000 difference.

But Langhofer said that's exactly what the state is doing, planning to recoup what it says was an overpayment to charter schools of $5.8 million from now through 2018.

Most immediately, Langhofer wants a judge to block the first deduction, scheduled to take place this coming week. He said that would take $1.4 million from about 100 charter schools.

``We've got to pay our teachers,'' he said.

Ultimately, however, he wants a ruling that the original payment plan is legal -- and Huppenthal is powerless to change it himself.

But Stacey Morley, the education department's director of policy development and government affairs, said it is clear that some schools, both traditional public and charter, were overpaid. She said the revamped formula now accurately reflects what is required by state law.

Morley also said that allowing the complaining charter schools to keep the excess dollars based on an errant formula, both retroactively and into the future, will be less cash to be divided up for all the rest of the schools. And that, she said, would not be fair to them.

``I believe we have an obligation to the taxpayers,'' Morley said.

The fight stems from 2000 voter-approved Proposition 301 which hiked the state sales tax by six-tenths of a cent, in part to give more money to public schools for teacher pay which would be divided up on a per-pupil basis. That includes charter schools.

Beginning in 2006, the recession caused the amount of revenue flowing into that ``classroom site fund'' to be less than legislative budget staffers projected. Then, two years ago, lawmakers altered the formula to essentially make up for the difference.

For the last two years the Department of Education distributed the money on the number of students currently attending a school. But Morley said the money should have been divided up based on the number of students who were in each school at the time the shortages occurred.

Morley said that means schools which are much larger now than they were last decade, when they were shorted, got far more money in reimbursement than they should have received.

In fact, she said, there are some charter schools getting reimbursement on current enrollment that were not even in existence during the lean years and therefore were not shorted at all. She said it's not fair to now give them ``make up'' funds.

Langhofer disagreed, saying what the Department of Education is doing means some charter schools will get more per-student money than others simply because they were around longer.

``That's not a fair and equal approach to education funding,'' he said. ``And a more fair and equal education system was one of the fundamental goals of Proposition 301.''

The regular public schools who were overpaid and are not having deduction made have not made an issue of it.

Chuck Essigs, lobbyists for the Arizona Association of School Business Officials, said most realize this was a legitimate error on the state's part. Anyway, he said, the amounts involved -- some overpayments and some underpayments -- probably are not as consequential to those schools.

Morley said allowing the complaining charter schools to keep the excess dollars, both retroactively and

At this point no date has been set for a hearing on Langhofer's request for the injunction.

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