State Superintendent Mike Flanagan recently announced he was putting 11 charter public school authorizers on notice for their rankings on the state “Top-to-Bottom” list. Excluded from the criteria was any requirement of charter school authorizers to operate in good faith, a noticeable oversight given what recently occurred with one such authorizer — Livonia Public Schools.
LPS is not on the list, but its actions bear scrutiny as it shut down its own successful charter in a grab for students and their foundation grants. The case raises the question whether public school districts should be in the authorization business in the first place, and if they are what safeguards are in place to prevent them from taking advantage of the system for financial gain.
About one month before the 2013-2014 school year ended, Livonia Public Schools notified its charter, Hinoki International, that it was not renewing the lease on its building for the 2014-2015 school year. Hinoki, a Japanese language immersion school, became homeless and while it was authorized to operate until June 2015, the loss of a facility would have the effect of putting the school out of business. Not coincidentally, LPS announced it was starting a carbon copy magnet school in the same building and taking steps to hire Hinoki staff and recruit its students.
Instead of guiding its charter school into the future and supporting a system for continued success, LPS engaged in a hostile takeover. The Hinoki school board asked LPS to postpone its decision on the lease so it could find better ways to manage its growing enrollment. Hinoki parents appealed to school board members and Superintendent Randy Liepa, but the decision was firm. Hinoki would lose its lease.
State regulators could do nothing to stop the move and instead of any penalty, LPS was actually rewarded for its actions. Every student who left Hinoki to join the competing magnet school would mean an additional $8,049 in foundation allowance for LPS, a district that has lost students and money over the years.
Hinoki School Board Director Anne Hoogart said the charter authorization required the school to operate within the boundaries of LPS and finding a building to accommodate more than180 students and staff in less than two months was next to impossible.
The school had no choice but to go on hiatus. Parents of Hinoki students were torn. Many of them, afraid that their children would have no place to go in the fall, signed up for the magnet school program. Hinoki moved all of its furniture, books and equipment into storage and worked furiously to find a new authorizer that would allow it to move beyond the boundaries of LPS. It has several interested parties, but none willing to start before 2015. With the rapid loss of its students, LPS claimed Hinoki was violating the terms of its authorization and cancelled the agreement.
Looking back over the school’s four-year history, charter school parents and board members say they wonder if a takeover wasn’t planned from day one. The school was the brainchild of Ted Delphia. Delphia was active with the area’s significant Japanese population and wanted to create a program where children could maintain their language skills in a public school setting. Eventually, he and Liepa decided on creating a charter school with LPS as the authorizer. LPS leased out space in a vacant school building for the new charter. Delphia, who was the Hinoki administrator, would also rent out space in the building for his private Japanese-focused preschool and those students would eventually feed Hinoki. He also served as the school’s administrator, but because of Hinoki’s growing needs its board was reconsidering his role.
Because it was to function as a charter, Hinoki received $560,000 in government grants for equipment, resources, operation and curriculum development. The investment was quickly paying off. Hinoki grew from a few dozen students to 183 enrolled for the 2014-2015 year. And it was drawing a wide mix of students. Many were from multi-cultural homes, but increasingly families seeking an independent and smaller school setting were coming on board. Hinoki developed a tight-knit community. It was not uncommon for parents to “hang out” in the school library after hours to meet with other families to do homework together.
Hooghart found one practice particularly troubling. As part of its lease agreement, LPS would charge Hinoki extra rent for students who lived in Livonia but chose to enroll in Hinoki. Hinoki could bypass this charge by getting families to sign an affidavit that they had no intention to send their child to LPS schools. Last year, Delphia neglected to collect all the affidavits and in late May Hinoki received a $75,000 bill from LPS. State law prohibits conventional public school districts that authorize charters from charging for “lost” students and Hooghart believes by putting this requirement in the lease, LPS was trying to bypass state law.
Liepa says all agreements were drafted by attorneys familiar with state law and felt the district was generous in providing added space to the program at “no cost.” When asked about the extra payments, he said the district collected $5,000 in 2012 and $10,000 in 2013. In an email response, he did not state what was billed.
Whatever the case, the story of Hinoki is not over. Its board is working closely with its attorney and auditor for questionable actions, including what role Delphia has with the magnet school today. He still operates his preschool in the former Hinoki building and, according to parents, is still a visible presence in the building. Parents are carefully evaluating the quality of the new magnet program. Some are lamenting the loss of family gathering time at the library after school because of the school’s strict drop off and pick-up policy.
Liepa insists the new school is running well and parents seem happy. He says the student count is about the same number as those registered but he was not aware of any adds or drops at the moment.
What Livonia Public Schools did raises the question whether conventional school districts should be in the charter school authorization business in the first place and, if they are, what is to prevent them from exploiting the system for their own financial gain.
Hinoki is still a nonprofit corporation and could very well reopen in 2015 with a new charter authorizer. Livonia had been one of 14 conventional school districts in Michigan serving as a charter school authorizer. Most charter school authorizers are universities, entities that don’t compete with K-12 charters for students.