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Flurry of new charter approvals raises questions over state funding priorities in an era of budget shortfalls

East County Magazine Special Report

By Miriam Raftery


August 5, 2010 (San Diego’s East County) – In the 2009-2010 school year, California approved more than 88 new charter schools at a cost of tens of millions of dollars. Recent charters approved include middle schools opening in districts that already have schools with high academic achievements--new charters with oversight provided by a district with middle school test scores that rank in the bottom 10% statewide.

These findings, discovered by East County Magazine, raise serious questions about budget priorities at a time when the state faces a $20 billion deficit.  What are the long-range consequences of approving numerous charters, all entitled to a portion of public education funds? 

Charter schools, which are tuition-free and receive public funds for providing alternatives to traditional schools, have drawn mixed reviews.

Some have won praise from educators and parents for offering innovative learning environments and high academic achievements, while others have faced serious troubles.  Notable successes include High Tech High, a string of nine schools spanning grades K-12, focused on math and science skills.  Negative examples include charters shut down for failing to meet state or federal academic standards, as well as charges of criminal embezzlement of taxpayer funds.

College Prep Middle School, a new state-funded charter school opening in La Mesa this September in a Church of Christ basement, has drawn praise from some but raised concerns among others. The school is founded by a former school principal and school psychologist with high hopes and solid administartive experience, but no track record running a charter school.  CPMS obtained its charter not through the La Mesa-Spring Valley District in which it is located—a district with high-performing schools. Instead, oversight will be provided by Mountain Empire School District—a district that is closing down its only middle school due to standardized achievement test scores that ranked in the lowest 10% statewide. Mountain Empire is opening several additional charter schools – only one of which will be within its district boundaries, ECM has learned.

Questions raised by our investigation of charter schools include:

• Should a school district that is closing its middle school due to poor test score be allowed to provide oversight of multiple new charter schools in other districts?

• Should the state approve a new charter run by educators with no track records in operating a charter school--in a district where the public schools have high scores on standardized achievement tests?

• Is it wrong for taxpayers to fund millions of dollars for numerous new charter schools at a time when California budget cuts have slashed funds for public schools and cut services for the elderly, poor and disabled?

• Are state budget cuts encouraging cash-strapped districts to approve charters for financial reasons?

• Is it appropriate for a publicly funded charter school to operate in a church?

• Should parents of public school students be concerned about a trend toward privatizing public education?

• What are the implications for teachers’ unions and are standards for teachers in charter schools adequate to protect students?


California has 860 charter schools in operation—more than any state in the U.S., with tens of thousands of students enrolled. Only about half (51%) of new California charters that opened in fall 2009 were modeled after already-success charters. The rest are untested models, all striving to provide innovative alternatives to traditional schools.

Nationally, the number of charter schools mushroomed from 1,297 in 1999 to 5,043 a decade later, in 2009.  As states vie for a share of federal "Race to the Top" funds, many states are changing their laws and making it easier to open charter schools.

At hundreds of thousands of dollars for each new charter school to cover start-up costs alone, plus more funds to be allocated for each successful school in the future, that adds up to a lot of money being diverted from education budgets for public schools in California and across the nation. 


College Prep Middle School  is the brainchild of co-directors Christina Callaway and Mitchell Miller. Both are former school administrators with “years of educational experience and a proven track record of increasing student achievement and dramatically increasing schools API,” according to the school’s website. The school emphasizes literacy and aspires to provide an “academically demanding program with a strong literacy base” as well as a “positive college bound focus” with class sizes limited to 20 students. Goals also include “development of good character and positive citizenship.”

Callaway was principal at Oak Grove Middle School in Jamul, where she met Miller, a school psychologist and administrator. “I’m proud to say some of the changes we made weighed heavily on our 24-point gain in API (Academic Performance Index) scores,” she told East County Magazine. But when the district was hit with the “double whammy” of budget cuts and declining enrollment, a fiscal emergency was declared and Callaway found herself laid off, along with two other administrators and nine additional personnel. Also a former biology teacher, she and Mitchell teamed up to create a charter school proposal that draws inspiration from the work of Kate Kinsella, an adjunct faculty member at San Francisco State.

“It’s a hurdle for charters to find a place,” said Callaway, who first applied to the Lemon Grove School District, which denied the charter application on February 9. Lemon Grove Superintendent Ernest Anastos said he had concerns about “how special education students would be served” as well as how needs of English as a second Language students would be met.

Callaway says she was not told of Lemon Grove’s concerns until the night that a 30-day period for dialogue ran out and was not given an opportunity to amend her application. “The districts really do see us as competition,” she said. Instead of appealing, she then went to other districts.

La Mesa-Spring Valley School Board president Emma Turner expressed surprise to learn that a charter school was opening in her district, though she supports schools “wherever children can learn.”

That’s because Callaway and Miller never submitted an application to the LMSV Board for consideration. Instead, Callaway spoke with LMSV Superintendent Brian Marshall, who recommended that she approach the Mountain Empire School District, which has sponsored other charters. Mountain Empire approved the charter application, then obtained permission from Marshall for Mountain Empire to provide oversight for the charter in the LMSV district (as required by California law when a district seeks to sponsor a charter outside of its district boundaries).

Why didn’t Mountain Empire open the school within its own boundaries? Callaway says no suitable location could be found. Applying for a major use permit is also an expensive process that can cost over $40,000, with no guarantee that the location will be approved by the County, she said. Ultimately, she and Miller learned that Church of Christ in La Mesa already had obtained zoning to operate a school, but had never opened one. So teaming up with church leaders and Mountain Empire seemed a match made in heaven.

“We are very grateful to Mountain Empire,” Callaway said in a meeting with parents of prospective students held at the Church of Christ on Jackson Drive in late July. Nine classrooms will be located in the church basement, which is undergoing remodeling. In accordance with state law, no religious symbols will be displayed in classrooms.

The school will begin with sixth and seventh graders, adding eight grade later on, and aims to sign up 100 students for each grade level. Teachers will have laptop computers and ultimately, the school hopes to receive grant funds to provide laptops for students. Arts and enrichment programs will be offered. College Prep Middle will have no sports teams initially, though Mountain Empire’s Red Hawks may assist in forming a team down the road. Students will wear uniforms to “keep focus on learning,” Callaway said.

P.E. will be held in the parking lot, weather permitting. “Our intention is to be a blessing to the community, said Pastor Troy Wagner. He said more modifications are planned for the sanctuary, or main church facility, “to make it less churchy” so that “if it’s raining out and they need a place, they can have P.E. in here.” The pastor also offered partnerships with dance and cheer groups that could offer services for a fee. The school will be 100% funded with taxpayer money, Callaway confirmed, starting with a $600,000 grant approved by the California Department of Education. Once open, the school will also be eligible for average daily attendance (ADA) funds as well as a share of lottery revenues.

While the church is paying $200,000 for the building remodel, State law does allow taxpayer money to be used for remodeling church properties to accommodate charter schools, the California Education Department confirmed. Moreover, the practice is not uncommon; some high-performing charters had their roots in churches.

Even if the new charter school ultimately proves successful, however, the question remains: should funding new charter schools in districts that already have strong public schools be a lesser priority than funding in-home care for seniors, benefits for the disabled, the Cal-Works program providing job training and childcare to the poor, fire safety, or education in public schools that are facing budget cuts, teacher layoffs and increased class sizes statewide?


“Mountain Empire has wonderful people,” Callaway said at the parents’ meeting, assuring families that the District will provide oversight and an audit.

But the Mountain Empire Unified School District’s academic record is troubling--with middle score test scores failing to meet state standards.

Statewide, schools are required to aim for scores of at least 800 on the Academic Performance Index (API) exams. Mountain Empire Middle School, however, scored a dismal 629 in 2009, ranking in the lowest 10% among all middle schools statewide. By contrast, Parkway Middle School in the LMSV district scored 816.

A comparison of California Standardized Testing (CST) scores also showed troubling disparities. Mountain Empire Middle School’s seventh graders scored 24% in math and 34% in English. Parkway Middle School, by contrast, fared far better—including a whopping 93% score in Algebra 1 scores and 73% on English language arts among 7th graders in 2009.

The website www.greatschools.org ranked Mountain Empire a “2” on a 1-10 scale, 10 being the highest, while Parkway scored an 8. Parkway also had stronger ratings among parents, according to the site.

Oak Grove Middle, where the co-founders of College Prep Middle were formerly administrators, scored 793 on the API, just under the state goal of 800. Oak Grove’s 7th graders scored 60% in English language arts and 53% for math, better than Mountain Empire but still below Parkway Middle School, the top-rated among LMSV’s four public middle schools—all of which ranked far higher than Mountain Empire.

Mountain Empire Middle School’s performance was so poor that it’s been reduced from three grades to one and will be shut down entirely this school year, Superintendent Steve Van Zant told East County Magazine. Grades 6-8 will be combined with existing elementary schools in the district, some of which had strong test score results.

“The bottom line is that our middle school wasn’t a success and our elementary schools are successful, so we needed to move students where we had the best chance of success,” Superintendent Steve Van Zant, who joined the district three years ago, told East County Magazine. “We haven’t been the highest performing district, so we’ve had to put some elbow grease in to make it better.”

The district stands to raise around $400,000 through fees of 1 to 3% to provide oversight of multiple charter schools, of which about half goes to services to supporter charters. The other half can be used to benefit children in the Mountain Empire District, a rural District that includes Boulevard, Campo, Clover Flat, Descanso, Jacumba, Pine Valley, and Potrero. Poverty is high in some of those rural communities. “Some of it’s almost heartbreaking,” said Van Zant, adding that state budget cuts forced his district to make over a million dollars in cuts including loss of some administrators and early retirements for some teachers and classified personnel.

“I don’t want to cut things that are important to kids in schools,” Van Zant said. “If I can enhance this by opening up charter schools, as long as it’s not taking a focus away, I think it’s a good thing.” Charter revenues have helped Mountain Empire avoid lay-offs and work furloughs—important factors in a rural area where jobs are scarce.

“To me, it’s very important to keep people working and have them have a wage that’s livable and fair,” Van Zant noted. Charter funds have also enabled the district to invest in technology upgrades—upgrades Van Zant hopes will result in improvements in academic performances.

Mountain Empire currently operates several charter schools, all outside its district boundaries, with more slated to open soon. The District shut down another charter, Mountain Empire Applied Sciences and Tech Academy, in 2002. An August 13, 2005 article in the San Diego Union-Tribune cited “strained relations between the school and the district” over the charter’s direction and management, including concerns about admission and expulsion policies, irregularities with its home-school attendance accounting, and financial viability.


Van Zant recounts the history of charters supported by the District. “The first one was California Virtual (now called Kaplan Academy). “They are an online school. So we took them on to be honest because we want to access some of their programs.” He hopes to begin accessing those programs this year for students at very small schools where AP courses could not otherwise be available to classes with only a handful of students. Kaplan also helps the District qualify for federal funding to improve infrastructure.


“Then there was a charter called Eagle’s Peak. That didn’t fare so well so they came to us,” he said. Eagle’s Peak was being shut down by the Julian School District. The school split apart and Mountain Empire took on around 150 independent study students. Eagle’s Peak received $250,000 in state funds for the 2009-2010 school year.


Van Zant knew Callaway and Miller from his days as an educator at Dehesa. “I believed in both of them,” he said. Asked if the concerns raised by Lemon Grove District over special education and English as a second language students had been addressed, he noted that Miller has taught special education “so it made us feel a lot more comfortable with that.” (A search of the charter application submitted by College Preparatory Middle School to Mountain Empire turned up zero hits for the terms “special education,” “disabled”, or “English as a second language.” Callaway said the school aims to hire bilingual instructors and that Mountain Empire’s special education department will assist in making sure that her school is compliant with all requirements.) The new school is set to open in early September.

Excel Charter, propsed by Antonette Sims of Vista, was slated to open September 7 after being approved for a $600,000 state grant. But Van Zant disclosed, “Excel wanted to do some things we weren’t comfortable with, so we’ve put the brakes on that.” Asked for specifics, he said backers wanted to open in a building that was not appropriate and are seeking an alternative location.

Excel also persuaded Mountain Empire to takeover back office services (but not academic oversight, since state law requires that oversight be provided within the same County) of a sister charter school by the same name in San Bernadino County.

San Diego Neighborhood Charter, also overseen by Mountain Empire, provides independent study for low-income children and received $250,000 for the 2009-2010 school year. “Most of them come out of Oceanside,” Van Zant said.

The District didn’t break any rules approving a charter outside their boundaries,” Tina Jung, Information Officer for the California Department of Education, told ECM, calling the strategy “unusual, but legal.”

Jennifer Cauzzo, head of Julian Charter School, had this to say when asked why a district would want to oversee a charter outside its boundaries. “A lot of motivation for them is that it generates money for their district.”

Charter schools have gained popularity in California over the past decade as alternatives to public schools. Charters may qualify for federal as well as state funding. “Charters in general were freed from a megawaiver in the Ed Code that traditional public schools have to adhere to,” Cauzzo said. The goal is to allow more creativity and innovation, while requiring that schools adhere to State standards.

Van Zant is confident that investment of charter school funds will prove beneficial for his district. It takes a little time, but we are making real improvements,” he said.


While no one disputes the benefits that charters are providing to the Mountain Empire district, some question the impact on students in charters overseen by a District with a less-than-impressive academic record for middle school students.

Mark Hanson, candidate for the 77th Assembly District, is a former administrator of the Grossmont Union-High School District who was twice named teacher of the year. “It’s an absolute travesty, almost unimaginable,” he said upon learning that Mountain Empire is opening charter schools in other districts. “The district has a long history of poor standards and poor oversight.”

Hanson was quick to note that not all charters are troubled. “There are exceptions. River Valley in Lakeside is a very good school. I was on the planning committee years ago.”

Dennis Richardson, whose son, Trever, attended River Valley, praise the school’s teachers as “very motivational” and said the curriculum made his son “hands-down, more prepared for college” than public school would have done. River Valley was started by educators who had not formerly run a charter, much like the founders of College Preparatory Middle School. River Valley students attend class two days a week and complete school work at home on other days.

But some other charters have yielded disastrous results. In June, criminal charges including felony embezzlement of public funds and money laundering were filed against the founders of Ivy Academia Charter School in San Fernando Valley. Defendants are accused of diverted nearly a quarter million dollars into their own pockets.

Assemblywoman Julia Brownley, chair of the Assembly Education Committee, has introduced two bills to protect public education funds. AB 572 would hold charter school boards to the same conflict-of-interest laws and open meeting laws as public school district boards, require disclosure of key participants’ economic interests and prohibit conflicts of interest by charter school board members. AB 1950 would tighten audit procedures and prohibit for-profit corporations from running charters.

Hanson believes those reforms don’t go far enough and suggest the state needs to take a harder look before approving charter applications. “Where’s the academic standard?” he asked. “We’ve had all kinds open up where they want kids to like them, so they don’t give any homework.” Some charters have also been “used to disguise voucher systems and do away with public schools.”

He also voiced concern over taxpayer funds being used, in some cases, to fund renovations of churches. “I would make sure that they can’t improve a church with taxpayer dollars,” he said, adding that if elected he would also seek to tighten standards for new charter schools. Hanson also voiced concern over the lack of requirements for teachers to be credentialed. “This could be a refuge for people who have been laid off,” he said. “Helix teachers laid off could start a charter school someplace else with no credential,” he suggested. Helix, a charter high school in the Grossmont Union High School District, has high academic scores but faced serious questions of administrative oversight including threat of charter revocation after four teachers were convicted of having sex with students.

Mike Naple, spokesman for Assemblyman Marty Block, a former dean at San Diego State University, told ECM that Block “is considering legislation for next year’s session that would seek to strengthen charter schools and hold them more accountable for success.”

Ray Lutz, candidate for the 52nd Congressional district, has a background in education as co-operator of a private Montessori preschool, along with his wife. “I’m worried about the explosion of charter schools,” he said. “Some of them are very good. But I think there are opportunists out there seeing this as a way to suck money out of the taxpayer general fund and into their own pockets.”

Teacher’s unions have voiced concern over lower wages paid by some charter schools and lack of requirements that teachers be certified. “The question is, are people being drawn to charter schools who perhaps couldn’t meet the higher standards of the public schools?” Lutz asked.

He also questioned whether charter schools may attract “a certain segment of parents who may want a certain curriculum, such as a Creationist curriculum…I absolutely know that with homeschooling, parents can use a different set of books.”

Cauzzo said that while schools receiving public funds must include teaching of Darwin’s theory of evolution, other theories may be presented and that issues such as homosexuality or sex education may receive less emphasis. She said parents in Julian Charter Schools tend to be “more value-based” with “real strong Christian philosophies” but assured that state Education Code requirements are met.

Lutz said the new charter school opening in a La Mesa church basement raises numerous “red flags” including being too far from the district for sufficient oversight. The Congressional candidate also took issue with the argument that the free market system will ultimately result in poor charter schools closing and strong ones thriving. “The trouble with this is you will wind up with a few horrible schools, and some people’s kids will be in those horrible schools until everyone determines that they want to avoid them,” he said.

Is it time to consider a moratorium on funding proposals for new charter schools run by poorly-performing districts, particularly outside their own boundaries in districts with high-performing public schools?

“You can have good quality charter schools that are alternatives to public schools, but I think when you offer people a way to get taxpayer money into their pockets, you have to be really careful about what you’re approving,” Lutz concluded.


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Mountain Empire School District

This school district has been an abject failure, rife with corruption for decades. I'm not surprised to hear the district figured out how to milk the charter system, how else would it remain solvent? Maybe it is time to focus on reading, writing and arithmetic. Teach the kids how to learn, instead of how to test. The rest of this is just more sound bytes from a school district that has failed to do its job for decades.

Wolves in Sheeps' Clothing

Don't be mislead by the fanfare. These two "directors" were summarily booted out of Jamul, and for good reason. Underhanded, unprofessional and self serving, as just a start. Hero status? Care about kids? Not. Sounds like building secure jobs for themselves... not securing an education for our youth. Beware.