Mike Fedewa, Chair

Alfred Bryant

Sandy Carmany

Betty Huskins

Randy Dow

Bill Troutman

Ben Currin

Roger Gerber

Kathryn Meyers

JoAnne Woodard

John Geil

Hank Hurd, Associate Superintendent Financial & Business Services

Jane Worsham, Executive Director, State Board of Education

Otho Tucker, Director, Office of Charter Schools

Jennifer Bennett, Director, School Business

Kathy Taft, State Board of Education

Laura Crumpler, Attorney, State Attorney General’s Office

Gail Scott Taylor, Consultant, Office of Charter Schools

Jackie W. Jenkins, Consultant, Office of Charter Schools

Harry Wilson, Legal Assistant, State Board of Education

Carl F. Pridgen, Consultant, Office of Charter Schools

O’Linda Williams, Admin. Assistant, Office of Charter Schools

Andrea Millington, Chief,

Compliance, Auditing & Policy

Linda Ivy, Compliance, Auditing, & Policy

Deanna Carter, Accountant, Compliance, Auditing & Policy

Scott Douglass, SIMS Auditor, Compliance, Auditing & Policy

Mike Fedewa, Chairman, called the meeting to order and extended the welcome to everyone. The motion was made to approve the minutes of the April meeting. The minutes were approved.

Updates

SBE

Renewal Training for 1999 Schools

Otho Tucker presented the following updates:

There are no new items going to the SBE in June. The information regarding the Tar Heel Charter School relinquishment of its charter will be forwarded by way of a Friday update.

Due to budgetary constraints, the training scheduled for May 16, 2002 was cancelled. A notebook of all the critical items necessary to complete the Renewal Self-Study Report was mailed to each of the schools eligible for renewal. Schools were also contacted via e-mail and regular mail regarding the status of the renewal training. Schools were invited and encouraged to contact the Office of Charter Schools staff and schools that have already completed the renewal review for technical assistance. Sandy Carmany, CSAC Member was listed as a contact from the Committee.

Tar Heel Charter School in Bladen County submitted its letter of relinquishment dated May 1, 2002. The school’s Board voted to relinquishment the charter and cited lack of suitable facility in Bladen County as a barrier. This creates a vacant slot to be filled in the next application cycle.

Chairman Fedewa inquired about the dollars the schools receive during the planning year. Dr. Tucker explained that the schools receive a planning allotment from the federal charter schools funds but these schools receive no state and local dollars. Schools that receive these planning and program development funds are required to submit to the Office of Charter Schools a summary of how the federal funds are spent during the planning year. The same applies for schools that request and are approved for a one year delay.

Attorney Laura Crumpler reviewed for the Committee aspects of the Francine Delaney Charter School versus the Asheville/Buncombe County School System. The dispute between the charter school and the local board is that the charter school is entitled to get its share of the fines and forfeitures the school system receives. The judge ruled in favor of the charter school. Attorney Crumpler indicated that she does not know if the Asheville/Buncombe County School System will appeal the judge’s decision.

Hank Hurd, Associate Superintendent, Financial and Business Services reported that the state budget deficit continues to escalate. For the first time in the state’s history, the public school funds have been frozen. A special notice from the State Budget Office directs the freezing of any resources other than those that directly relate to instruction of students. Anything that does not relate to the classroom will be frozen. According to Mr. Hurd, the freeze will affect charter schools the same as LEAs.

Compliance Interview

Turning Point/Success Academy

Representatives from Turning Point/Success Academy were :

Phil Adkins, Attorney, Judas Best, Executive Director, Turning Point and Success Academy and Denise Best, Board Chair, Turning Point and Success Academy

Hank Hurd introduced the nature of the interview by reviewing for the Committee the State Board of Education Policy regarding Financial and Governance Compliance approved in 2000. He reviewed the purpose of the policy and DPI’s response to noncompliance issues related to this policy. As a matter of sound business practices, Mr. Hurd emphasized the need for schools to show transactions that reflect its activities; internal control safeguards in the accounting system are designed to protect the accounting system.

Compliance Report

Turning Point/Success Academy Response

Jennifer Bennett, Director, School Business reminded the Committee that Turning Point/Success Academy have been placed on Financial Probationary status by the DPI for various business related issues. The schools were given until May 15, 2002 to respond to inquiries regarding the business related concerns and invited to present this information to the Committee at the May 23, 2002 meeting. The schools provided responses to issues related to the organizational and employee structure of the school, internal control issues, health insurance and payroll issues and asset issues along with numerous other items of concern.

Ms. Bennett reported that the responses the schools submitted have alleviated some of the Department’s concerns. She added that there remain some serious inconsistencies in their financial situation. The School Business Division will continue to work with the schools and their attorney to resolve any outstanding issues needing further clarifications.

Attorney Phil Adkins representing Turning Point and Success Academy, Judas Best, Executive Director, Turning Point/Success Academy and Denise Best, Board Chair, Turning Point/Success Academy were present to respond to inquiries raised by DPI and the CSAC.

Attorney Adkins acknowledged that the difficulty in this case involving the two schools is delineating what charges should go to Turning Point and what charges to Success Academy. He noted the major problem seemed to have been how Executive Director Judas Best was paid. To address this problem, Judas Best has been made an employee of the Harvest Management Group and not an employee of the schools. Other issues addressed dealt with conflict of interests policies, clarification of duties involving Jennifer Best and Denise Best, insurance, and the schools’ lease agreement with the church where the schools are located in which Judas and Denise Best serve as Pastor and Co-Pastor.

Mr. Judas Best spoke to the concerns raised by DPI regarding the buses owned by Turning Point/Success Academy that are used to transport children and the 1995 Ford E350 Van. Mr. Best explained that the van is used exclusively to transport children although the name of the nonprofit, Shepherd’s Mission Inc. is written across the side of the van. The school has been advised to transfer the title of the van to the schools.

Attorney Adkins expressed concern regarding the manner in which DPI has publicly responded to questions regarding TPA/SA.

In response, Chairman Fedewa reminded Attorney Adkins and Turning Point/Success Academy representatives that the issues the schools have been asked to address were not a result of DPI initiated actions. The issues in question are due to actions from the schools that were brought on by the dismissal of teachers, which created the media attention.

The members of the Committee were given opportunity to respond to the presentation from Ms. Bennett and Turning Point/Success Academy representatives. Randy Dow questioned the ability of the schools to make "arms length transactions" due to the number of family members associated with the schools and the nonprofits under the Shepherd’s Mission umbrella. He emphasized the need for the Board of Directors for the two schools to have a system of checks and balances and to bring new and diverse leadership to the schools and the board.

Kathryn Meyers differed with Attorney Adkins in that the issues before the Committee are not issues of fairness but accountability and legality. She further added that she would like to be able to have confidence that someone affiliated with the schools understands how children are being served and with what dollars.

Kate Alice Dunaway questioned the results of the Turning Point Academy renewal report. The school is on a one-year delay due to ABCs Accountability issue, a result of 2 years of low performing status.

John Geil questioned the frequency at which the True Life Worship church uses the facility and the cost to the church to run the facility. In response, Mr. Best explained that the church is used on Thursday night and Sunday mornings. With regards to the cost to run the church, Mr. Best affirmed that it does cost the church out-of-pocket expenses to operate.

JoAnne Woodard sought clarification on the letter to Mr. Best dated 5/22/02. This letter as explained by Jennifer Bennett addresses only the schools correction of discrepancies related to Average Daily Membership (ADM) issues.

1998 Renewal Schools on One-Year Delay

Otho Tucker presented the Committee with a list of schools currently on a one-year delay pending the outcome to their ABCs Accountability scores. The list also included schools in the current renewal cycle, schools approved in 1999, that already have already been identified as low-performing for one year and have been receiving assistance from Coaches contracted through the Principal’s Executive Program. These schools may potentially be in the position of receiving their 2-year of low-performing status based on ABCs results.

Committee members were encouraged to attend any of the charter school graduations that their schedules permit.

Two charter school teachers were recognized for their accomplishments. Leah Perry-Lawless, Exploris Middle School was honored to being selected as the first place winner in the North Carolina Character Educator of the Year Award. Ms. Perry-Lawless is described as being the motivating force behind the service-learning program of the school.

Marni Silverberg, Evergreen Community Charter School received the Sam’s Club Teacher of the Year Award. Ms. Silverberg teaches a multi-age 4-5 grade combination class and is in her third year at Evergreen. This award makes her eligible to be a candidate for the state and national Sam’s Club Teacher of the Year Award.