Yesterday, in stellar reporting by the Washington City Paper’s Rachel Cohen, it was revealed that the DC Public Charter School Board knew almost a year ago that there were serious financial issues at Washington Math Science and Technology Public Charter School. Through a public records request of electronic messages to and from the PCSB’s executive director Scott Pearson on the issue of WMST’s balance sheet, she discovered the following:
“According to the emails, two PCSB school finance specialists, Mikayla Lytton and Mohammad Bashshiti, met with WMST’s head of school, N’Deye Diagne, and its business manager, Mark Addae, in May 2017 to discuss the school’s financial situation. Among other things, they talked about how between 2015 and 2017, WMST exceeded $704,000 in revenue loss as student enrollment declined, while their expenses grew by $440,000.
On June 15, 2017, Lytton, who no longer works with the PCSB, emailed Diagne and Addae writing, ‘As we discussed over the phone earlier today and as I hope you understood from our [May] meeting, we are very concerned with the school’s financial status and projections.’ Lytton wrote that the PCSB would like to work with the school to develop a ‘Financial Corrective Action Plan,’ which sets specific targets to improve a school’s financial health.”
The Financial Corrective Action Plan was never developed. This eventually led to the highly unusual emergency meeting on March 12th, which was only announced the evening before it took place. It was at this session that the charter revocation proceedings against the school were put in motion.
The board never mentioned that it was aware of the cash flow issues at the school as early as May 2017. In testimony before the D.C. Council’s Education Committee earlier this month, that I don’t honestly feel is unfair to now characterize as misleading, Mr. Pearson was asked by Chairman Grosso why the difficulties at the school were not uncovered earlier. The PCSB executive director replied that the board has early warning systems that have worked in the past but that his organization did not take a conservative enough approach to this charter’s financial reports. He added that a more conservative review of the fiduciary books of the schools it oversees has now been implemented. In her piece Ms. Cohen includes a communication Mr. Pearson sent to his senior staff and board members last March in which he admits, “I did not act on it aggressively enough because I believed that the school’s building had appreciated significantly and so in a worst case they could borrow against the building equity (as Ideal PCS just did).”
All of this speaks to a severe lack of transparency by the PCSB, something Mr. Pearson stated emphatically at the same hearing is a guiding value at his place of employment. This disregard for providing the public with information continues to this day. On Monday, April 23rd the board voted to close WMST at the end of the school year, a decision which would be reversed if a pending loan of $500,000 by United Bank to the charter was consummated within 24 hours and a valid financial corrective action plan was submitted within three days. We are now almost a week away from these proceedings and no update about the status of the school has been released.
However, while the manner in which the board is operating is highly troubling, the difficulties that this charter finds itself in are no one’s fault but its own. WMST should have been aware long ago that it was running out of money, which then would have led to actions to raise revenue and reduce expenses to correct the situation. The whole mess points to a tremendous governance failure by the charter’s board of directors. This is not the fault of the DC Public Charter School Board.
Charters love to talk about their strong desire for autonomy and defiantly rail against efforts by the PCSB to increase oversight and regulation. But if being left alone is something schools want, then they better be excellent stewards of public funding.