Atlanta Classical Academy Charter Vote on Agenda for APS Board of Education

The fate of the proposed Buckhead charter school, Atlanta Classical Academy, will be decided Monday night when the Atlanta Public Schools Board of Education votes on its charter petition.

For the second time, APS Superintendent Erroll Davis has recommended the board not approve the charter application. Davis said his recommendation does not have to do with ACA's charter petition, but with unsettled legal matters regarding the funding of the school system's pensions.

According to the Buckhead Reporter, Davis said he would recommend denial of all charter petitions until this legal matter is resolved.

Davis initially recommended denial of ACA's charter petition because he said the school lacked leadership and a plan for adequate facilities.

Here is the full response from ACA to Davis' recommendation:

Dear Friends of ACA:

On Monday night, August 12, the Atlanta Board of Education will vote on Atlanta Classical Academy’s petition application.

APS’s charter school experts have found no fault with ACA’s academic and school plan; they have deemed it to be acceptable. This fact the Superintendent has made clear.

But the Superintendent has recommended to the Board of Education that it vote to deny our charter application on the grounds that he plans to oppose all charter school applications until there is resolution to the issue related to charter schools and the problem known as the “unfunded pension liability”.

We want Atlanta parents and taxpayers to be well-versed on this unfunded pension liability situation. It is a serious matter. But for the next 3.5 days, ACA supporters need to stay focused on our goal which is to be approved by a majority of APS board members next Monday night.

We ask you to focus your efforts here:

We have received a host of phone calls from supporters who have asked several common questions.

“What do you make of Mr. Davis’ recommendation?”

We are disappointed that he would jeopardize the opportunity to do something that could so clearly be good for kids and good for the district.

We see Mr. Davis gripping tightly to centralized control when we wish that he would open his hands and embrace choice, entrepreneurship, equity in school choice, and community-driven leadership.

ACA Board Members are for great public schools…traditional and charter…but we are clear that excellence and efficiency are most likely to germinate in an environment marked by local autonomy, flexibility in hiring practices, and the freedom to adhere to time-tested academic programs.

“What is this ‘unfunded pension liability’ issue, and how is it related to charter schools?”

APS has an unfunded pension liability of approximately $532M. In the budgeting process each year, APS must find dollars to meet annual payments related to this debt…$38M last year, $44M this year…and this figure rises to $85M annually before the debt is fully retired in 2027.

This debt was created decades ago when APS did not fully fund future obligations. Those future obligations are due to be paid now. Charter schools had absolutely nothing to do with creating this liability. As we understand it, this debt is not related to current APS employees’ retirement plans, but rather to a group of employees who worked for APS years ago.

The issue is essentially this: should charter schools pay a prorata share of these massive annual payments, or not? In 2012…for the first time ever…APS withheld $2.9M from charter schools, its “share” of a $38.6M pension liability expense.  APS charter schools came together, sued APS in Fulton County Superior Court, and won. The court ruled that APS had violated Georgia’s Charter School Act of 1998 when it subtracted the pension liabilities before making distributions to charter schools. APS is still holding the money pending an appeal of the verdict.

To put the $2.9M in context, it represents 0.4% of the total $719M budget. To charter schools, it represents about $700 per charter school student…a meaningful amount, particularly to smaller, independent schools.

To Mr. Davis, the Board, and Atlantans we would say this: We agree that if we are going to be a district that embraces equity in school choice, some compromise is in order. That said, we are opposed to this moratorium on high quality charter schools that would do much good for our kids and for our district. We must find a better way to work through this important, complex matter of finance and education policy.

But please, do not finish this section thinking that charter schools get a better financial deal…keep reading.

“I read Mr. Davis’ recommendation. Are traditional and charter schools really funded at ‘markedly different rates’?”

Yes. APS spends approximately $4,000 per student less for charter school students. The difference can be attributed to SPLOST dollars (facilities financing), some state revenue, and other administrative benefits that do not flow to charter schools. According to Bob Stockwell, APS finance expert and publisher of Financial Deconstruction, if there is no change of policy related to the unfunded pension liability, this gap will shrink to $3,000 per student. But Mr. Davis’ memo would lead the uninformed reader to think that charter school students are more costly to the district. This is not the case.

Financial considerations aside, parents and taxpayers should remember that charter schools are held to higher standards than traditional schools. If charter schools fail to perform, they are closed or reorganized. What the public gets in charter schools, quite literally, is more (accountability) for less (money).

Final thoughts

Mr. Stockwell has written about the unfunded pension liability challenge here. In this article, he poses marvelous questions to the APS Board related to our charter application. Mark Niesse has also written an informative piece in today’s AJC.

ACA invites you to join us by asking our elective officials to VOTE YES for Atlanta Classical Academy next Monday night. This may not be glamorous volunteer work, but it is what we need right now.

We welcome your feedback and will do our best to respond to your questions.  If you have offered to help, and we have not offered you an “assignment”, thank you! Please stay in touch, because we will need more help once we are approved!

Warmly,

Matthew Kirby and the ACA Board of Directors