New York’s Charter School Movement Built on Legislative Pay Raises

An excerpt from the solutions-based book “Why We Failed: 40 Years of Education Reform.” To buy it click here.

Within hours of the announcement that the SUNY Charter School Institute had approved New Covenant Charter School for a September 1999 start I was on the phone with anyone who would return my calls: the New York State Governor, Education Commissioner, Comptroller, the school district attorney, etc. explaining the impossibility of this school’s establishment on the approved timetable.

Educator/author Lonnie Palmer was the Superintendent of the Albany City School District when New York State’s First Charter School opened.

Educator/author Lonnie Palmer was the Superintendent of the City School District of Albany when New York State’s first Charter School opened in September of 1999.

My conversations were usually brief and concluded when I was told basically to, “Suck it up and make it happen.” Why? “Because Republican Governor George Pataki engineered the charter school approval process as a concession from the state legislators who received a pay raise in return and they are not going back to change it now.”

One conversation stands out in my mind with a fellow named Scott Steffey who was, according to articles in the local newspaper, the Chairman of the SUNY Charter School Institute that had approved the New Covenant Charter School and the timetable for its initiation. When I explained to Mr. Steffey the impossibility of finding $3.2 million in our already approved and very tight budget and effectively completing all the last minute busing and other changes the new charter school would require his response was: “If it hurts you that’s even better.”

The state legislators who voted for the charter school approval process in order to get pay raises did not envision the intention by folks in Scott Steffey’s role to inflict harm on me and indirectly on the 10,000+ students I did my best to serve every day.

I’m certain the legislators were thinking of a more gentlemanly type of competition where we all did our best to serve the students in our schools without, by design, hurting any students, parents, taxpayers or employees. Unfortunately the system they unleashed hurt lots of these folks and as it turned out for little gain of any kind. By the way, Mr. Steffey’s impolitic approach with me and others reflected badly on his politician friends and soon cost him his job. He was replaced by a more careful and soft spoken representative who did a much better job of hiding some of the uglier motivations behind the charter school movement.

In July 1999 soon after the approval of the charter school my assistant superintendents and I met with a few members of the New Covenant Charter School Board including their president Aaron Dare. Aaron was a likeable young African American man whose wife was a teacher in one of our elementary schools. He was an active leader in Albany’s largely poor African American Arbor Hill community. Aaron was in the process of starting a real estate development business primarily focused in the Arbor Hill area and he played a leadership role in the city’s active Urban League. He was well over six feet tall nearly 300 pounds and a former high school basketball player at Albany High School.

Aaron’s stepfather, Sam Walton, had left the position I now occupied as superintendent of the Albany City School District a little over one year earlier after numerous public squabbles with the school board. My leadership team and I did our best to explain our concerns about the overly large size and abrupt initiation of the New Covenant Charter School. But Aaron and his board members were adamant, the school would open as planned with the full contingent of students assuming they could successfully recruit these students during the summer.

New Covenant opened its doors in old used trailers on a dusty lot in the Arbor Hill section of Albany on schedule in September 1999 and operated under a contract with Advantage Schools, a private school management company from Boston, MA.

New Covenant had undisclosed financial backing from conservatives who were loyal to the Republican Governor Pataki. As we predicted the busing and other supports were a mess despite our best efforts to reorganize and reschedule everything they needed during the summer. The extremely late and inaccurate student list caused much of the confusion. And our own school district budget was a disaster with a new $3.2 million expense we hadn’t planned for.

An excerpt from the solutions-based book “Why We Failed: 40 Years of Education Reform.” To buy it click here.

A reasonable assumption would be that the Albany City School District could just close one of its elementary schools and create savings to offset this new charter school expense. But which school would we close? The students New Covenant recruited came from all over the city. If we closed the existing Arbor Hill Elementary School which still had over 400 students after New Covenant opened we would need to bus those existing Arbor Hill students all over the city to the vacant slots in the other elementary schools created by New Covenant’s arrival.

Not only would this potential school closure create a second school busing nightmare (we already had one busing nightmare with the new bus routes required to get New Covenant kids to their new school site from all over the city) but the parents of the Arbor Hill students, who had not enrolled their children in New Covenant and who had supported the public schools by staying put would predictably arrive at the next school board meeting armed with pitchforks aimed at me and our school board.

They hadn’t brought this charter school to our doorstep and they certainly didn’t want their kids to pay for it with long bus rides to schools where they would be strangers.

We considered laying off teachers and consolidating classes when the smoke cleared after the list of New Covenant students finally arrived in late August. But the savings would have been tiny compared to the tuition payments we were sending to New Covenant and the last minute chaos of disrupting classes in elementary schools throughout the city to make these few last minute teacher cuts did not justify the cost of the disruption. Besides we would be laying off cheaper, last hired teachers who we had worked hard to recruit to improve the quality of our teaching force. We decided to wait on looking for the potential savings from consolidating classes and eliminating teaching slots in the following year’s budget.

After several years of New Covenant Charter School’s operation we came to understand that even with our best efforts at class consolidation and teacher layoffs in our existing elementary schools and the most efficient bus routing (which added a whole new extra expense our district had not faced before) we could only save about $.25 for every $1.00 in tuition we sent to the charter school.

If you think about it this isn’t hard to understand. With kids going to New Covenant from all over the city none of our elementary schools ever lost enough enrollment to be closed even when we considered neighborhood school boundary changes.

New Covenant had a principal, teachers, custodians, secretaries and school monitors. It required heat and lights. It paid a trailer rental fee. The Albany City School District paid all these bills with our tuition payments.

The city of Albany had in essence added an expensive new elementary school with no clear way to pay for it. The few teachers we laid off or did not hire due to class consolidation in the years after that first year of New Covenant’s existence were all at the beginning of the salary scale and so over time our teaching staff just got older and more expensive per teacher as all the newer and cheaper teaching positions shifted to New Covenant.

So charter schools work out to be a big money waster for the communities that have them – unintended consequence number one of the NY State charter school law.

However, the bigger story at New Covenant was that Advantage Schools had trouble with the school from the start.

The principal, as reported in the newspaper, was an experienced school administrator from Texas. When I met him I was struck by his unwillingness to make eye contact, his volatile mood with an immediate aggressive angry burst about late buses followed with no pause by a syrupy used car salesman pitch for more special education services and his 1.5 inch fingernails that would scare kids to death.

New Covenant’s enrollment claims, which this principal processed for payments, were wildly inflated and based on flawed enrollment and attendance lists. Over 70 students listed in the initial enrollment of 423 turned out to be students who were in the district’s regular public schools daily and had never attended New Covenant and another 30+ students flowed back and forth between our schools and New Covenant during the initial months. According to our careful student attendance research each of the first four bimonthly claims for payment to Advantage Schools from New Covenant was overstated by over $100,000.

Of course we appealed this over-billing to the NY State Education Commissioner and were denied just as we were denied in our appeal to the Commissioner requesting a delay in New Covenant’s implementation schedule due to their late approval date. The political fix was in. The Governor had made certain this school would start in September 1999 and get all the funding (even the funding it didn’t deserve due to inflated enrollment numbers). Political statements can’t wait and this school was a political statement by our Governor.

With Advantage Schools’ problems in Albany it was no surprise to me when Aaron Dare telephoned me in early November to report that his charter school board had decided to switch to a new management company. He said they were interviewing potential management companies now and should have a new partner identified shortly. However, his next request was a surprise. He said, “Make the December check out to Aaron Dare and send it to me directly.”

Now I don’t pretend to be the sharpest knife in the drawer but even I could see that this was a bad idea. I called the Education Commissioner’s office, the Governor’s office, the New York State Comptroller’s office and our own school attorney’s office to say, “This can’t be right. What should I do?” They all had their representatives tell me to do exactly what Aaron had requested. And I did as I was told despite the fact that to this day I regret this error immensely.

We ended up sending out two checks for over $450,000 each, one in December 1999 and a second in February 2000, made out to Aaron Dare personally. Then the rumors started to fly. Aaron had not spent the $900,000 on the charter school he had instead invested this money in a failed real estate venture in Arbor Hill. Reports in the newspaper indicated Aaron had built a new business center in Arbor Hill and he expected to rent this facility to an outside business. But the rental contract evaporated after the construction was completed and the construction bill had to be paid.

Within months the golden boy had become the public goat in a huge political failure for the Governor who had pushed hard to get New Covenant approved. Aaron also was tagged as the goat for a huge financial failure that left the New Covenant Charter School short on funding in its first year of operation. We all expected Aaron Dare to go to jail and for New Covenant to close its doors.

But politicians, especially governors with presidential ambitions, don’t go so quietly into the good night. Strings were pulled and Aaron (temporarily) stayed out of jail after resigning from the charter school board and his leadership role in the Urban League. Local business and community benefactors (probably at Governor Pataki’s urging) rushed in to save New Covenant from financial disaster. The Albany mayor had a running feud with me and several school board members who had disrupted the old ways of pay-to-play in the city.

Rumors were rampant about previous school district contracts tied to kickbacks and campaign contributions and school system jobs awarded on the basis of patronage and nepotism with whoever occupied the superintendent role. It was no surprise when the Mayor stepped in to take over the mortgage payments of the business center “built” by Aaron Dare and used it as a place to house the Albany Police Department.

Aaron Dare went to jail a few years later on charges relating to a different real estate scam. New Covenant limped along with terrible test scores, a series of management companies and repeated financial issues until 2010 when it finally closed its doors for good after its charter was yanked by the SUNY Charter School Committee.

The SUNY Charter School Committee had changed its name during this 11 year period and with a Democrat now in the role of Governor the Committee apparently felt comfortable deciding that New Covenant had been given more than enough time and warnings to improve. New Covenant was ended just as it began on a political note. The local newspaper noticed and reported that during the intervening 11 years the school had moved out of the trailers and into a new home with a $16 million mortgage and that the public (now the City of Albany not the school district) would be stuck paying off the loan over the next couple of decades despite the school’s demise.

I’m certain you can see why my experience in Albany with charter schools left a bad taste in my mouth. So when I took a position as an interim superintendent in Sarandon, NY a medium sized urban district near Syracuse that had been blessed with two charter schools I was more than a little wary.

For more info call Guaranteed Press (518) 366-6148.

An excerpt from the solutions-based book “Why We Failed: 40 Years of Education Reform.” To buy it click here.

About Lonnie Palmer
In 1970, Lonnie Palmer graduated from Union College in Schenectady, NY, with a Bachelor’s Degree in Physics and planned to continue on to a Ph.D. program but was interrupted by a notice from the U.S. Government – a draft notice. Knowing his low number would preempt plans to continue his education, Palmer took a temporary position teaching high school science — and a reluctant education reformer was born. read more