Skin in the Game: Questions About The Prop 39 Charter's Possible Conflicts of Financial Interest

We have recently discovered that several charter leaders have a direct, personal financial stake in the charter’s success and some stand to financially benefit from its operation[1]. Through a recent Public Records Act request, it was revealed that the charter received a total of $130,000 in unsecured, personal loans from charter board members, parents, and family members. Click here to read the email from Conn Hickey, the charter school CFO, explaining the sources of the loans and click here to see the list of people that loaned the charter school money. Additionally, two of the lenders have received payment from the charter for services provided. Click here to read the charter’s expenditures/payments records.

These unsecured, personal loans will presumably be repaid with our public tax dollars. This raises all sorts of ethical questions, which we encourage you to ask:

1)    Why did the charter not disclose the source of this revenue in their charter petition to the state? 

2)    Since three of five current board members (formerly four of eight) have a personal financial stake in the charter, does this create potential conflicts of interest?

3)    Due to its markedly low in-district enrollment (currently 104), the charter’s financial viability is now tied to their importation of out-of-district kids. Will the charter leaders’ personal financial stake impact their ability to make neighborly decisions with regards to White Hill students, teachers and classrooms?

4)    Not only is one board member also a teacher (raising interesting ethical and governance issues), but the same teacher has a personal financial stake in the charter as the lender of a low-interest loan.

5)    What is the significance of the co-lead petitioner’s father loaning the charter $60,000 with interest?  How might that family's relationships be impacted if the loan is not repaid, and how does this motivate that family (when advocating on behalf of the charter)?

6)    Despite the fact that the demand for this charter has clearly not materialized (the number of enrolled in-district students is lower than the district program upon which the charter is based), this monied group continues to assert its desires against the wishes of the overwhelming majority of our community. Is the repayment of these personal loans a higher priority than community well-being? Do the personal loans, and the charter proponents' possible desire to repay family members, have anything to do with this?

7)    What does it mean that two of the lenders (one current board member) have also received some monetary compensation from the charter and how might that impact board decisions?

8)    Why does the charter present these monies as cash positive reserves in their budget? This is akin to taking an equity line of credit out on your home, then putting it in the bank and calling it savings.

9)    Does this sound like the way a truly public school operates?

These are our tax dollars. These are our facilities. These are our teachers. This is our community.

Most importantly, these are ALL of our children. STAND for our excellent, truly public, neighborhood schools.  Click here to contact the California Department of Education and demand that they revoke this charter.  Follow up with a phone call to Cindy Chan's office at 916 322-6029

[1] Though the charter’s July 15, 2015 petition included an $85,000 unsecured loan in its budget, its source (personal loans) was not stated.