A California charter school chain threatened by the Los Angeles United School District (LAUSD) with closing may have two of its schools saved in court, as concurrently parents protested in front of a downtown Los Angeles courthouse.
Standing near a crowd of protesters chanting, “Save our school,” near a downtown Los Angeles courthouse, Alfredo Rubalcavna, a principal of the Magnolia Science academies, told KCAL Los Angeles, “People believe that LAUSD did not follow the legal process required of closing down a charter school; we certainly don’t agree with their decision at all, and from a legal standpoint, they did not follow the law.” He said he walked out of court “positive” science academy 7 in Van Nuys and academy 6 in Los Angeles would not be closed and would open on schedule, Aug. 12.
Meanwhile, Los Angeles Superior Court Judge Luis Lavin, who said he would issue a final decision on Friday, commented that it did not seem “right to me or very fair” that the school district employees could close the schools without making public the data that supported their claims of fiscal problems with them. Lavin said, “I certainly think the school board would like to have some oversight. I think it would be an abdication of their duties to simply whole-sale delegate their authority to an investigator or staff.”
The Los Angeles Times reported that LAUSD told the Magnolia Educational and Research Foundation in June that two schools it supported, one in Northridge and one in the Palms area of Los Angeles, would have to be closed because of some financial problems that were found in an audit.
Magnolia denied the charges, and sued the district to keep the schools open. Although the district allows that the schools are doing well academically, Jose Cole-Gutierrez, the district’s charter school division director, wrote a June 27 letter to the foundation stating the audit found the money issues “rise to a level of severity that seriously questions [Magnolia’s] ability to operate the school let alone support itself.”
The audit was executed by an outside firm for the district’s Office of Inspector General, and Cole-Gutierrez said it showed that the foundation was $1.66 million over its budget, and owed $2.8 million to the schools, thus considered insolvent by the federal government. The audit also stated that the Palms academy was insolvent.
The audit also stated that there was evidence of fiscal mismanagement, abuse of debit cards by the principals, questionable payments made for immigration fees and services, and unnecessary academic and business services farmed out to a related nonprofit organization.
Yet Inspector General Ken Bramlett wrote a June 23 confidential letter to the Board of Education and L.A. schools Supt. John Deasy, in which he argued, according to the LA Times, that “no clear evidence of fraud has been disclosed.” Bramlett said the June 30 deadline for the audit had left “significant open areas of inquiry that still must be pursued … to determine their propriety.” Deasy only asserted that the investigation had applied to all eight Magnolia campuses.
The Magnolia Foundation’s chief executive officer, Mehmet Argin, responded on July 3 that the foundation had $4.8 million in net assets in 2013, and the foundation believed that those assets would ascend to more than $7 million by June 2014. He said the other charges of the audit were false.
The district’s contract attorney, Sue Ann Evans, had told Lavin that school board members gave district employees the authority to close the school if the audit showed any improprieties. But Lavin responded that he wanted to know what Superintendent John Deasy meant when he threatened board members at the March 4 meeting that if there were any improprieties at all, “it should come back for revocation, period.”
The LAUSD will not show the audit to Magnolia, and when asked by the Los Angeles Daily News as a public records act request it also rebuffed the request. Magnolia’s lawyer, Lisa Corr, wanted to know whether the privacy of the audit was a way for the LAUSD to flout public records laws.
The audit had been requested by LAUSD’s charter school division of the school’s Office of the Inspector General. The Inspector General’s office then farmed out the audit to a private firm. Corr stated according to the Daily News, “By using the Office of Inspector General I think you can circumvent the public records requirement.”
Evans responded that the audits are only made available with permission of the Office of Inspector General, adding that there is a “potential” criminal investigation. But the Los Angeles District Attorney’s office said there is no record of a complaint regarding Magnolia.