The Issue Whether Petitioner, Volusia County School Board, has good cause to non-renew Respondent?s charter for the Volusia Elementary Charter School as set forth in Petitioner?s Notice of Action to Not Renew the Charter for the Volusia Elementary Charter School Inc.
Findings Of Fact On June 24, 2008, the School Board and Boston Avenue entered into the School Board of Volusia County, Florida Charter for the Academies of Excellence, Inc. (the “Charter”). The Charter, which was a contract between the parties, was effective from July 1, 2008 through June 30, 2012. Pursuant to the Charter, Boston Avenue operates and maintains a pre-kindergarten through fifth grade charter school in DeLand, Florida. The school, which is a Florida public school, opened at the beginning of the Volusia County School District?s (“District”) 2008-2009 school year. The Charter provides that Boston Avenue is a unit of the District, is subject to the supervisory jurisdiction of the School Board, is accountable to the School Board for performance to the extent provided by law, and is subject to the laws of Florida and the rules of the State Board of Education. Florida public schools are subject to “a statewide program of educational assessment that provides information for the improvement of the operation and management of the public schools . . . .” School assessment is largely the result of student achievement assessment, including Florida Comprehensive Assessment Test (“FCAT”) scores, and measures of effective school management. § 1008.22(3), Fla. Stat. The Commissioner of Education is required to issue annual reports that describe student achievement in the state, each school district, and each school. The annual report assigns a grade to each school based on the results of the student achievement assessment scores, student learning gains, and improvement of the lowest 25th percentile of students in the school in reading and mathematics. Section 1008.34(1) establishes the grades and their meaning as follows: “A” - schools making excellent progress. “B” - schools making above average progress. “C” - schools making satisfactory progress. “D” - schools making less than satisfactory progress. “F” - schools failing to make adequate progress. Schools having an enrollment that is less than the minimum sample size do not receive a school grade. During its first year of operation in the 2008-2009 school year, Boston Avenue enrolled fewer than 100 students, which was less than the minimum sample size. It was therefore too small to receive a school grade. 7. For the 2009-2010 school year, Boston Avenue received a grade of “F.” For the 2010-2011 school year, Boston Avenue received a grade of “D.” For the 2011-2012 school year, Boston Avenue received a grade of “F.” Section XI.C.(1) of the Charter provides, in pertinent part, that “[t]his Contract may be renewed provided that a program review demonstrates that the criteria in section 1002.33(7)(a), Florida Statutes, have been successfully accomplished and that none of the grounds for non-renewal established by section 1002.33(8)(a), Florida Statutes, has been documented.” Dr. Parker took the position as the Board?s Coordinator of Accountability and Evaluation in January 2011. When she came to the job, the charter school program review process used a generic template that was applied to every charter school in the district, regardless of whether the areas of review listed on the template were applicable to a specific school?s charter. Dr. Parker modified the template to make it unique to each charter school, using the criteria of each charter to guide the language and structure of the template. Despite the change in the template, which is nothing more than a method of recording results, the charter review process remained essentially unchanged. In October 2011, the District conducted a program review of Boston Avenue to determine if the Charter should be renewed. On December 13, 2011, the Office of Program Accountability and Evaluation submitted its Boston Avenue Charter School Charter Review (“Review”) to the Superintendant of Schools. The Review covered the following topic areas: Curriculum and School Improvement Services, including the 2011 Annual Accountability Report; Facilities Services, Financial Services, including Finance, Budget and Insurance, and Food Services; Human Resources; Technology Services, including Student Accounting Services; Safety and Security; and Transportation Services. Each topic area had contract subtopics that were generally tied to specific Charter requirements and applicable statutory standards. The Review identified a number of areas in which Boston Avenue was deficient. Of the 80 individual contract subtopics, the Review identified 46 that were met, 19 that were partially met, 10 that were not met, and five that were not applicable. On March 22, 2012, Respondent submitted a Charter Review Response and Supplemental Appendix as its response to the December 13, 2012 Review. The evidence suggests that staff did not review or use the Charter Review Response and Supplemental Appendix in its deliberative process leading up to the decision to recommend non-renewal to the School Board. In March 2012, the School Board?s office of Curriculum and School Improvement Services and office of Student Transportation Services prepared supplemental reports to update the status of those subtopic areas that were previously determined to not meet the areas of review, and prepared revised charts that outlined their current status. It was suggested that the additional information set forth in the revised charts should not be considered in this proceeding, as it was generated after the normal review process was concluded. Given the de novo review afforded under the Administrative Procedures Act, the additional information and supplemental reports are pertinent to the consideration of whether the Charter should be renewed, and are considered herein. By its terms, the Charter expired on June 30, 2012. The vote to not renew the Charter was taken on March 30, 2012. A draft version of the Notice was provided as part of the agenda of the meeting. The meeting was attended by, among others, counsel for Boston Avenue and Boston Avenue Principal Nichole Gaw. After a short presentation by its staff and counsel, the School Board voted 5-0 to approve the school superintendant?s recommendation that the Boston Avenue Charter not be renewed. Counsel for Respondent understood the effect of the vote, and indicated to Petitioner that “[w]e will make a decision [whether to request a hearing] within the 14-day time.” The Notice was signed and executed on Friday, March 30, 2012. Petitioner made reasonable efforts to provide the signed Notice to Respondent on March 30, 2012, which efforts included an attempt to hand-deliver the Notice before 5:00 p.m., on that date to the Boston Avenue school building and to the law office of Respondent?s counsel. Both buildings were locked. In addition, efforts to electronically send the Notice to Petitioner were made over the weekend. Although reasonable efforts to effect delivery were made, the evidence is insufficient to prove that Respondent received actual written notice of Petitioner?s decision to not renew the Charter until an envelope containing the Notice was hand-delivered to an authorized agent of Respondent on Monday, April 2, 2012. Monday, April 2, 2012, was 89 days prior to the June 30, 2012, expiration of the Charter. Grounds for Non-Renewal 1. Failure to Meet the Requirements for Student Performance Stated in the Charter The Notice alleged that Respondent failed to meet the objectives for student performance established in the Charter. The Charter included the following measures of student performance: FCAT Testing - Academic Progress Section III.B.(2) of the Charter provides that: Student academic progress will be measured by a growth model as evidenced by standardized tests. Student academic progress will be measured by FCAT under the following standards. The student will have improved his or her FCAT Achievement level one year to the next; or The student will have maintained his or her achievement level as a 3, 4 or 5 from one year to the next; or The student will have remained within FCAT Achievement levels 1 or 2, but will have demonstrated more than one year?s growth on the FCAT developmental scale, applying the Department of Education?s measurement of growth.1/ Reading The evidence demonstrated that in 2011, Boston Avenue students performed in FCAT Reading as follows: Fourth Grade FCAT Reading 11.11 percent of fourth-grade students improved their FCAT reading achievement level one year to the next, and an additional 8.33 percent maintained a level five -- the highest level achievable. 80.56 percent of fourth-grade students failed to improve their FCAT reading achievement level one year to the next. 59% of fourth-grade students maintained their FCAT reading achievement level as a 3, 4, or 5 from one year to the next. 41% of fourth-grade students failed to maintain their FCAT reading achievement level as a 3, 4, or 5 from one year to the next. 42% of fourth-grade students at level one or two remained within FCAT reading achievement levels one or two, but demonstrated more than one-year?s growth on the FCAT developmental scale. 58% of fourth-grade students at level one or two remained within FCAT reading achievement levels one or two, but failed to demonstrate more than one-year?s growth on the FCAT developmental scale. Fifth Grade FCAT Reading 4.76% of fifth-grade students improved their FCAT reading achievement level one year to the next, and an additional 14.29% maintained a level five - the highest level achievable. 80.95% of fifth-grade students failed to improve their FCAT reading achievement level one year to the next. 90% of fifth-grade students maintained their FCAT reading achievement level as a three, four, or five from one year to the next. 10% of fifth-grade students failed to maintain their FCAT reading achievement level as a three, four, or five from one year to the next. 29% of fifth-grade students at level one or two remained within FCAT reading achievement levels one or two, but demonstrated more than one-year?s growth on the FCAT developmental scale. 71% of fifth-grade students at level one or two remained within FCAT reading achievement levels one or two, but failed to demonstrate more than one-year?s growth on the FCAT developmental scale. Math The evidence demonstrated that in 2011, Boston Avenue students performed in FCAT Math as follows: Fourth Grade FCAT Math 8.33% of fourth-grade students improved their FCAT math achievement level one year to the next, and an additional 5.56% maintained a level five -- the highest level achievable. 86.11% of fourth-grade students failed to improve their FCAT math achievement level one year to the next. 40% of fourth-grade students maintained their FCAT math achievement level as a three, four, or five from one year to the next. 60% of fourth-grade students failed to maintain their FCAT math achievement level as a three, four, or five from one year to the next. 44% of fourth-grade students at level one or two remained within FCAT math achievement levels one or two, but demonstrated more than one-year?s growth on the FCAT developmental scale. 56% of fourth-grade students at level one or two remained within FCAT math achievement levels one or two, but failed to demonstrate more than one-year?s growth on the FCAT developmental scale. Fifth Grade FCAT Math 4.76% of fifth-grade students improved their FCAT math achievement level one year to the next. 95.24% of fifth-grade students failed to improve their FCAT math achievement level one year to the next. 50% of fifth-grade students maintained their FCAT math achievement level as a three, four, or five from one year to the next. 50% of fifth-grade students failed to maintain their FCAT math achievement level as a three, four, or five from one year to the next. 60% of fifth-grade students at level one or two remained within FCAT math achievement levels one or two, but demonstrated more than one-year?s growth on the FCAT developmental scale. 40% of fifth-grade students at level one or two remained within FCAT math achievement levels one or two, but failed to demonstrate more than one-year?s growth on the FCAT developmental scale. FCAT Testing - Academic Progress Conclusion A substantial, and often overwhelming, number of students failed to meet the criteria for academic progress measured by FCAT as established in section III.B.(2) of the Charter. Based on the foregoing, the undersigned finds that the School Board demonstrated, by a preponderance of the evidence, that Respondent failed to meet the objectives for student academic progress established in section III.B.(2) of the Charter. FCAT Testing - Learning Gains In addition to the foregoing, section XIII.A. of the Charter provides, in pertinent part, that: The School shall be subject to the same accountability requirements as other public schools, including reports of student achievement information that links baseline student data to the School?s performance projections identified in the charter. The charter school shall identify reasons for any difference between projected and actual student performance. The “projections identified in this charter” shall be as follows: (1) Seventy-five percent (75%) of the students taking the FCAT will earn a learning gain on the reading portion of the FCAT; (2) Seventy-five percent (75%) of the students taking the FCAT will earn a learning gain on the math portion of the FCAT; (3) The average score for the students taking the science portion of the FCAT will meet or exceed the District average; and (4) The average score for the students taking the FCAT Writes will meet or exceed the District average. 54% of Boston Avenue students made learning gains on the reading portion of the FCAT in 2011. 44% of Boston Avenue students made learning gains on the math portion of the FCAT in 2011. Based on the foregoing, the undersigned finds that the School Board demonstrated, by a preponderance of the evidence, that Respondent failed to meet the objectives for student learning gains established in section XIII.A. of the Charter. Other Student Assessment Tests Section III.B.(4) of the Charter provides that: In addition to the State required achievement tests, the School will use a standardized test for assessing students in core subject areas (reading, math, and science) in the Fall in order to get baseline data. The students will then be assessed in the Spring to determine the amount of yearly academic gain. Section III.B.(4) of the Charter governs the administration of the standardized assessment tests, rather than the results of the testing. The Florida Assessment for Instruction in Reading (“FAIR”) is an assessment test for reading proficiency that is provided by the state of Florida. All schools in the District administer the FAIR test three times a year. Boston Avenue met section III.B.(4) for reading by administering the FAIR in grades one through five. The Differentiated Accountability Assessment (“DA Assessment”) is an assessment test for math and science proficiency that was developed by District specialists, and has been used for a number of years. All schools in the District administer the DA test twice per year, in the fall and in the middle of the year. Boston Avenue met section III.B.(4) for math by administering the DA Assessment in grades three through five. Boston Avenue met section III.B.(4) for science by administering the DA Assessment for science in the fifth grade. In contrast to section III.B.(4) of the Charter, section III.B.(6) is directed to the results of the testing, and provides, in pertinent part, that “[t]he academic progress of students and the School will be evaluated and compared to the rate of progress of the students in the Volusia County School District not enrolled in the School.” Thus, an analysis of the results of the FAIR testing for reading, and the DA Assessment testing for math and science, and their measurement of academic progress, is appropriate for determining whether Respondent met the Charter standards to warrant renewal. Standardized Test for Reading - FAIR The District has established that a student is “proficient” in reading if he or she correctly answers 80% of the questions on the FAIR for their grade level. A demonstration of proficiency in FAIR correlates to a high probability that a student can score at a level three or higher on the FCAT reading achievement test. The FAIR testing for first and second grade is predictive, since there is no corresponding FCAT test, but allows the school and the District to identify targeted areas of need before the students get to third grade where FCAT scores may require a repeat of grade. The Board created four categories of measuring student achievement based on performance on the FAIR testing performed during the year. A student was determined to have “decreased proficiency” if he or she went from proficient to below proficient in reading during the course of the year. A student was determined to have “maintained proficiency” if he or she scored above the 80% correct answer level during the course of the year. A student was determined to have “maintained below proficiency” if he or she scored below 80% correct answer level during the course of the year, but was not falling further behind. Finally, a student was determined to have “improved proficiency” if he or she scored went from below the 80% correct answer level to at or above the 80% correct answer level during the course of the year. First Grade FAIR Reading In first grade, 18% of students improved their proficiency in reading, 51% maintained proficiency, 23% of students maintained below proficiency, and 8% of students decreased in proficiency. With 69% of students reading at a level of proficiency by the end of the year, and with only 8% decreasing in proficiency, Dr. Parker indicated that “first grade isn?t necessarily a huge area of concern.” Second Grade FAIR Reading In second grade, 3% of students improved their proficiency in reading, 9% of students maintained proficiency, 77% of students maintained below proficiency, and 11% of students decreased in proficiency. Thus, 88% of Boston Avenue second grade students were reading below proficiency. Third Grade FAIR Reading In third grade, 11% of students improved their proficiency in reading, 5% maintained proficiency, 78% of students maintained below proficiency, and 5% of students decreased in proficiency. With a total of 83% of students reading below the level of proficiency, and with the FCAT test being administered at the end of the year, Dr. Parker characterized the FAIR results as “alarming.” Fourth Grade FAIR Reading In fourth grade, 3% of students improved their proficiency in reading, 41% of students maintained proficiency, and 56% of students maintained below proficiency. No fourth- grade students decreased in proficiency as assessed by FAIR. Fifth Grade FAIR Reading In fifth grade, 16% of students improved their proficiency in reading, 28% percent maintained proficiency, and 56% of students maintained below proficiency. No fifth-grade students decreased in proficiency as assessed by FAIR. Standardized Test for Math - DA Assessment The DA Assessment test uses the same proficiency standards and categories that were developed for the FAIR. As with the FAIR test for reading, the DA Assessment is designed to be predictive of how students will perform on the FCAT. Third Grade DA Math In third grade, 46% of students improved from below proficiency to proficiency in math, and 54% of students maintained below proficiency. No third-grade students decreased in proficiency in math as assessed by the DA Assessment. Fourth Grade DA Math In fourth grade, 41% of students improved from below proficiency to proficiency in math, and 59% of students maintained below proficiency. No fourth-grade students decreased in proficiency in math as assessed by the DA Assessment. Fifth Grade DA Math In fifth grade, 42% of students improved from below proficiency to proficiency in math, and 54% of students maintained below proficiency. One fifth-grade student (4%, as based on a fifth-grade enrollment of 25 students) decreased in proficiency in math as assessed by the DA Assessment. Standardized Test for Science - DA Assessment In fifth grade, 4% of students maintained proficiency in science, 30% of students improved from below proficiency to proficiency, and 65% of students maintained below proficiency. No fifth-grade students decreased in proficiency in science as assessed by the DA Assessment. Failure to Maintain an Acceptable Level of Student Achievement in the State?s Education Accountability System and Other Standardized Testing Paragraphs 1 and 2.a. of the Notice make the school grades earned by Boston Avenue, and the results of the standardized student assessment tests, basis for the non-renewal of the Charter. The FAIR and DA Assessment test results demonstrate that, while some students demonstrated proficiency, the majority of students at Boston Avenue who were administered the non-FCAT standardized assessment testing either maintained below the level of proficiency or decreased in proficiency. Boston Avenue?s receipt of a school grade of “F” in the 2009-2010 school year, “D” in the 2010-2011 school year, and “F” in the 2011-2012 school year, combined with the results of the standardized student assessment tests, demonstrated a lack of student improvement over the course of the past three years. For the 2010-2011 school year, Boston Avenue was one of only two of the 46 elementary schools in the District to receive a grade of “D.” There were no “F” schools for that year. The total scoring based on the results of the assessment testing for that year placed Boson Avenue last among the 46 elementary schools in Volusia County by a substantial margin. For the 2011-2012 school year, Boston Avenue was one of only two of the 52 elementary schools in the District to receive a grade of “F.” The total scoring based on the results of the assessment testing for that year placed Boson Avenue last among the 52 elementary schools in Volusia County by an even wider margin than the previous year. Section 1002.33(7)(a)12., which governs the standards for issuance of a school charter, provides that the charter may be cancelled during its term “if insufficient progress has been made in attaining the student achievement objectives of the charter and if it is not likely that such objectives can be achieved before expiration of the charter.” Section 1002.33(7)(b)1., provides, in pertinent part, that “[a] charter may be renewed provided that a program review demonstrates that the criteria in paragraph (a) have been successfully accomplished and that none of the grounds for nonrenewal established by paragraph (8)(a) has been documented.” The grade of “F” for the most current year -- meaning that students at the school are failing to make adequate progress -- is strong evidence that the standards for renewal of the Charter have not been met. Thus, in the course of renewing a charter, it was not an error for the School Board to give consideration to the student achievement objectives, even those of a general and non-numeric nature. The evidence in this case, taken as a whole, demonstrates that Boston Avenue failed to meet levels of academic progress that approached even the lowest performing District-operated elementary schools in Volusia County. Based on the foregoing, the undersigned finds that the School Board demonstrated, by a preponderance of the evidence, that Respondent failed to meet the objectives for student academic progress established in section III.B.(6) of the Charter, thus constituting a reasonable and valid basis for the non-renewal of the Charter. Comparison with Learning Gains of Similar District Schools Section III.B.(5) of the Charter provides that: To the greatest extent possible, a comparison of learning gains as defined by the State under the Florida A+ Accountability Plan will then be compared with the learning gains of similar district schools with comparable populations using demographic information obtained at www.myflorida.com. Learning gains will be examined as determined by the State based on the percentage of students in the lowest 25% of the School showing improvement of more than one year within level 1 or 2. The state minimum acceptable standard for performance in reading and mathematics by students in the lower quartile is 50% of these students will make a learning gain. The comparator elementary schools were determined by the percentage of students who were receiving free or reduced lunch and the percentage of students classified as a minority at each school. Those criteria are found to be adequate to represent schools with comparable demographic characteristics. Applying those criteria, 14 schools were determined to have “comparable populations” to Boston Avenue. In the 14 elementary schools having comparable populations, an average of 13.3% of students of lowest quartile within FCAT level one or two made learning gains in 2011. At Boston Avenue, 10.7% of students in the lowest quartile within FCAT level one or two made learning gains in 2011. Thus, neither Boston Avenue nor the average of the comparator schools came close to meeting the “state minimum acceptable standard” that 50% of the lower quartile of students within level one or two make more than one year of improvement. Although section III.B.(5) of the Charter set forth the state standard, it is not couched in language that would lend it to being applied as a Charter performance criterion. The fact that FCAT level one and two students at Boston Avenue and the comparative District schools were bunched closely in their levels of improvement, along with the incongruity of applying a standard of performance to Boston Avenue that is not being met by District schools, suggests that the 50% threshold is to be applied as an aspirational goal, rather than a standard for renewal. Thus, Boston Avenue?s failure to meet the “state minimum acceptable standard” set forth in section III.B.(5) of the Charter should not form a basis for non-renewal of the Charter. 3. Failure to Use State Approved Materials in Math Section III.A.(3) of the Charter provides that Boston Avenue?s “math curriculum will utilize a math series by Pearson/Scotts Foresman, or another math series approved by the State.” Paragraph 2.b. of the Notice provides, in pertinent part, that “[Boston Avenue] is using the Saxon math series, which has not been approved by the State. This fact was pointed out to the administration at [Boston Avenue], but they indicated that they did not intend to make any change.” Boston Avenue has used and continues to use the Saxon math series. The Saxon math series is not a math series by Pearson/Scotts Foresman. The State of Florida issues an annual list of approved publishers and materials. The Saxon math series is not on the state-approved list. Mr. Viecelli and Mr. Jackson testified as to their belief in the effectiveness of the Saxon math series, and the reasons for its purchase and use at Boston Avenue. Dr. Parker and others testified as to the Saxon math series incompatibility with the District?s math curriculum map. Regardless of the arguments that can be made for or against the Saxon math series, the Charter is specific as to the math series to be used at Boston Avenue. Based on the foregoing, it is found that the School Board demonstrated, by a preponderance of the evidence, that Respondent failed to use an approved math series in violation of Section III.A.(3) of the Charter. 4. Failure of the Student Transportation Service to Comply with State Regulations Student transportation services relevant to this proceeding are set forth in Section V.E. of the Charter. That section provides, in pertinent part, that: The transportation will be consistent with the requirements of section 1006.21 through 1006.27, Florida Statutes, as well as Florida State Board of Education Administrative Rules of Transportation section 6A-3.0001 [sic] through 6A-3.037, as may be amended from time to time. * * * All bus operators who have not obtained proper certification from the Sponsor shall not be allowed to transport any of the School's students. The School must also provide the Sponsor with documentation of the thirty (30) day bus inspection required by Florida Administrative Code Rule 6A- 3.0171. The Sponsor reserves the right to inspect the School's buses at any time, with reasonable advance notice (usually 24 hours) so as not to disrupt the School's operation, unless exigent circumstances exist. Failure to comply with these provisions shall constitute "good cause" and the basis for termination of this charter contract. Paragraph 2.c. of the Notice provides, in pertinent part, that: The student transportation service operated by BACS has persistently failed to comply with state regulations. Each year, the District conducts evaluations of the charter schools in the district to monitor compliance with the charter and the law. Each of the last three evaluations of BACS has noted serious violations in their student transportation service. Boston Avenue has provided transportation for its students since the 2009-2010 school year. It maintains a fleet of five buses, three of which operate on Boston Avenue?s three bus routes, and two of which were used as back-ups when needed. The evidence demonstrates that Petitioner provided reasonable advance notice of its inspections as set forth in the Charter. As a result of its October 2011 charter review, the School Board staff determined that Boston Avenue did not have medical emergency plans on its buses for five students who qualified as disabled under Section 504 of the Rehabilitation Act. A "504 Plan" describes the special conditions or non- medical care that a qualifying student may need while on the bus. Thus, the contract provision was determined to be “not met.” By March 15, 2012, prior to the vote on non-renewal, the compliance charts were revised to indicate that Boston Avenue did not transport any qualifying students. Therefore, the status of the contract provision was changed to “met.” The alleged failure to maintain medical emergency plans is not a sufficient basis for non-renewal of the Charter. As a result of its October 2011, charter review, the School Board staff determined that Boston Avenue?s Bus Stop Safety Check forms were not correctly or completely filled out. By March 15, 2012, prior to the vote on non-renewal, the compliance charts were revised to indicate that Boston Avenue?s Bus Stop Safety Check forms were inspected with no errors noted. Therefore, the status of the contract provision was changed to “met.” The alleged failure to maintain correct Bus Stop Safety Check forms is not a sufficient basis for non-renewal of the Charter. As a result of its October 2011, charter review, the School Board staff determined that Boston Avenue failed to meet contract provisions regarding its bus drivers, including requirements for current DHSMV driving history checks, verification of weekly DHSMV updates for one of its drivers, and timely completion of new Category IV driver clearance forms. In addition, the School Board?s School Bus Operator Qualifications Evaluation Worksheet indicated that two of Boston Avenue?s bus operators did not have at least 40 hours of pre-service training, that three of the operators had deficiencies in their otherwise current medical examination certificates, and that the results of the operators? dexterity tests were not noted on their medical examination certificates, resulting in a performance level of 50%. The Performance Determination Worksheet instructed Boston Avenue to submit “a Corrective Action Plan” to remedy the deficiencies. By March 15, 2012, prior to the vote on non-renewal, the compliance charts were revised to indicate that “[a]ll operator records are in order and all are qualified to operate a school bus. The rating for the operators licensure/Qualifications review is 100% where a minimum of 95% is expected.” Accordingly, the status of the contract provision was changed to “met.” The alleged failures set forth in this paragraph are not sufficient basis for non- renewal of the Charter. As a result of its October 2011, charter review, the School Board staff determined that Boston Avenue?s bus No. 9601 did not have a required seating chart onboard, and that bus No. 0356 did not have a required orange “No Students Left Onboard” sign in the back window. Mr. Viecelli indicated that the operator had taken the seating chart from the bus to update it on the day of the inspection, and had not yet returned it. He further indicated that the chart was always on the bus when in use. At the time the “no students” sign deficiency was noted, Bus 0356 was the spare, and was not being used to transport students. When Bus 0356 was taken out of service, the manual, including the emergency packet and all of the instructions and signs used to maintain compliance with state and charter requirements, was moved by the driver to the in-service bus. Boston Avenue has since created complete manuals for each of its five buses. By March 15, 2012, prior to the vote on non- renewal, the compliance charts were revised to indicate that “[s]chool buses were checked for a Route sheet, Student Listing, Seating Chart and Crash Management Packet. Each bus had the required documents.” Accordingly, the status of the contract provision was changed to “met.” The alleged failures set forth in this paragraph are not sufficient bases for non-renewal of the Charter. The School Board alleged that, in 2009, Boston Avenue did not use its designated bus loop, and that buses stopped on the roadway behind the school without extending the bus “stop arms” while unloading students. The evidence demonstrates that this alleged deficiency was resolved long before the March 2012 vote on non-renewal, and that the contract provision was “met” as of the December 2011, Charter Review report. The alleged failures set forth in this paragraph are not sufficient basis for non-renewal of the Charter. The December 2011, Charter Review report indicated that the Charter provisions regarding School Bus Inspection Records were “partially met.” However, the report indicated that “[t]he rating for this review is 96.6% where a minimum of 95% is expected. The report indicated no significant or unresolved deficiencies. By March 15, 2012, prior to the vote on non-renewal, the status of the contract provision was changed to “met.” The alleged failure set forth in this paragraph is not sufficient basis for non-renewal of the Charter. The School Board conducts “spot check inspections” of Boston Avenue?s buses to monitor compliance operations and ensure compliance with applicable laws and regulations. As a result of deficiencies found during a spot-check inspection on March 15, 2012, the District requested that Boston Avenue bring its buses to the District facility for full inspection. The inspection revealed 26 total deficiencies; 15 of those deficiencies were repaired on the spot. Of the remaining deficiencies, three were the result of fluid leaks of one kind or another. Each of the leaks was minor, and did not cause the fluid levels in the respective reservoirs to drop below normal, making them difficult to locate. Boston Avenue had previously contracted with a mechanic who was to have repaired the leaks, but was not successful. Boston Avenue changed mechanics, and the problems have been resolved. The evidence demonstrates that all of the operational deficiencies related to Boston Avenue?s transportation services noted in the October 2011, review were met before the School Board?s vote on the renewal of the Charter. The evidence demonstrates that Boston Avenue made substantial efforts to correct the fleet deficiencies, most of which were resolved before the School Board?s vote on the renewal of the Charter. Based on the foregoing, it is found that the School Board failed to demonstrate, by a preponderance of the evidence, that the deficiencies in Boston Avenue?s provision of transportation services were so persistent or pervasive as to constitute a basis for non-renewal under the terms of the Charter or the standards for non-renewal established in section 1002.33(8), Florida Statutes. 5. Failure of the Governing Board to Exercise Continuing Oversight Over the Operations of Boston Avenue Paragraph 2.d. of the Notice provides that: The governing Board for BACS has failed to exercise continuing oversight over the operations of the charter school. Section 1002.33(9)(i), Fla. Stat., requires that the “governing board of the charter school exercise continuing oversight over charter school operations.” Several instances establish that the governing board for BACS failed to meet its obligations under that section of the statute. The Charter contains no specific standards pertaining to the requisite degree of oversight necessary to establish compliance with section 1002.33(9)(i). Paragraphs VI.A.10. and of the Charter require that Boston Avenue provide information to the School Board, including internal financial control policies and procedures and copies of internal audits and financial audits prepared by Boston Avenue or on its behalf. Boston Avenue complied with those requirements. Failure to Properly Monitor Expenditures by the Management Company Paragraph 2.d., bullet point one, of the Notice provides, in pertinent part, that “[t]he governing body has failed to properly monitor expenditures by its management company, School Management Solutions, Inc.” School Management Solutions, Inc. ("SMS") is Boston Avenue's school management company. SMS is a contractor that provides payroll, finance, purchasing, human resources, and other services to Boston Avenue. The Financial Services section of the December 2011, Review indicated that two of the 13 financial factors were “partially met,” with the remainder being met or not applicable. As it pertains to the failure to properly monitor expenditures, the Notice cited the audit report, and noted the purchase of “large dollar purchases by SMS prior to Boston Avenue Board approval.” The evidence indicated the expenditure to be for a school bus purchased for $6,500, which exceeded the limit of $5,000 for expenditures by SMS without Board approval. The Boston Avenue Board subsequently approved the expenditure. The audit also noted an SMS employee salary that was billed to Boston Avenue in addition to the SMS management fee. The SMS employee was the food services director, who worked at the school but whose salary was not included in the management fee. The review report indicated that Boston Avenue responded to the School Board?s Summary of Findings, and stated that: The policy has been reviewed and reiterated with the school staff and management company. The Board has been advised to appoint a treasurer or liaison person to more thoroughly review the financial statements and monitor the budget. There was no suggestion that Boston Avenue?s response to the review report finding was determined to be inadequate, or that it would not resolve the issue. Based on the foregoing, it is found that the School Board failed to demonstrate, by a preponderance of the evidence, that Boston Avenue?s alleged failure to properly monitor expenditures by SMS was sufficient to constitute a basis for non-renewal under the terms of the Charter or the standards for non-renewal established in section 1002.33(8), Florida Statutes. Conflict of Interest Resulting from the Management Company Appointing and Recommending Members of the Boston Avenue Board of Directors. Paragraph 2.d., bullet point two, of the Notice provides, in pertinent part, that “[t]the governing board for BACS improperly permitted an official from [SMS] to appoint and recommend members of the Board of Directors, which represents a conflict of interest.” The report of the independent auditors made the statement that “the management company (School Management Solutions, Inc.) has expressed the authority to appoint and recommend members of the [Boston Avenue] Board of Directors, which represents a conflict of interest.” (emphasis added). The report did not provide any detail as to how that expression was made, or by whom. There was no other evidence to support the auditor?s statement, nor was there any evidence that SMS actually appointed or recommended members of the Boston Avenue Board of Directors. Based on the foregoing, it is found that the School Board failed to demonstrate, by a preponderance of the evidence, a conflict of interest as alleged. Failure to Conduct Employment History Checks. Paragraph 2.d., bullet point three, of the Notice provides, in pertinent part, that “[SMS] has not been conducting the employment history checks required by statute before hiring an individual.” The Notice specifically alleged, as the basis for non-renewal: . . . that the required employment history check had not been conducted in the majority of the files reviewed. In a recent site visit, it was found that while a review of the files showed that they now contain a standard reference form, a review of those forms revealed that the majority of the references listed were personal references as indicated on their application, not previous employers as required by the statute. Instead, there was a standard statement - “all references gave positive reviews of the employee and recommend the company hire the employee.” (emphasis added). The Notice did not allege other deficiencies in the employment screening process. Thus, deficiencies related to fingerprint records, criminal background checks, drug screening and the like were not pled as basis for the non-renewal of the Charter, and are not considered herein. Section 1002.33(12)(g)4., provides that: [b]efore employing instructional personnel or school administrators in any position that requires direct contact with students, a charter school shall conduct employment history checks of each of the personnel?s or administrators? previous employers . . . . If unable to contact a previous employer, the charter school must document efforts to contact the employer. Section 1002.33(12)(g)5. provides that “[t]he sponsor of a charter school that knowingly fails to comply with this paragraph shall terminate the charter under subsection(8).” During the October 2011, site visit, the School Board representatives noted that the employee references were not in employee files. Ms. Paige-Pender testified that “there were not the required two phone references, a minimum of two phone references to the last two employers for each employee on file, which is required by Florida Statute.”2/ Mr. Jackson attributed the deficiency to a change in the law, which he understood to previously allow either personal or professional references, but which he believed to have been changed after the opening of Boston Avenue. The Boston Avenue Charter was entered on June 24, 2008, and became effective on July 1, 2008. Section 1002.33(12)(g)4. was enacted in substantially its present form as chapter 2008-108, §14, Laws of Florida, and became effective on July 1, 2008. Thus, the suggestion that employment history checks were not required at the time the Charter was granted and the school was opened is unsupported and not accepted. Mr. Jackson testified that upon being advised of the employment history check deficiency, Boston Avenue and/or SMS contacted each employee?s professional references. Since there is no standard state form for documenting employment checks, SMS documented those checks on a form developed by SMS. Ms. Paige- Pender indicated that her review of the employment history forms demonstrated that many of the references were personal references, and that many employee files did not include information from past employers or documentation of efforts to contact the past employers. While the appearance of the form itself does violate the Charter or state law, Ms. Paige-Pender?s testimony that the forms did not contain the information required was credible, and is accepted. Based on the foregoing, it is found that the School Board demonstrated, by a preponderance of the evidence, that Respondent or its agent failed to conduct employment history checks before hiring personnel or administrators, as alleged, and failed to make its employment history records current after notice of the deficiency. 6. Failure to be in Good Corporate Standing Section X.A. of the Charter provides that Respondent “is a not for profit corporation formed and organized under the applicable laws of the state of Florida, and for the duration of this charter shall take all actions necessary to maintain that status in good standing.” Paragraph 2.e. of the Notice alleged that Boston Avenue failed to maintain its corporate standing under the laws of the state of Florida. At the time of the October 2011, review, Respondent had been administratively dissolved by the Secretary of State, Division of Corporations for failure to file its annual report and fees. On March 22, 2012, the corporate fees were paid, and Respondent was reinstated prior to the March 30, 2012, meeting of the Board at which the proposed non-renewal was considered and approved. Section 607.1422(3), provides that “[w]hen the reinstatement [of an administratively dissolved corporation] is effective, it relates back to and takes effect as of the effective date of the administrative dissolution and the corporation resumes carrying on its business as if the administrative dissolution had never occurred.” Based on the foregoing, it is found that the School Board failed to demonstrate by a preponderance of the evidence that Respondent?s corporate standing was a valid basis for the non-renewal of the Charter. 7. Violation of Law in the Operation of Boston Avenue Paragraph 3 of the Notice alleged that Respondent, or its agent, SMS, violated Florida law by failing to conduct employment history checks and by failing to maintain Boston Avenue in good-standing as a not-for-profit organization. Paragraph 3 of the Notice is a reiteration of the allegations contained in paragraph 2.d., bullet point three, and paragraph 2.e. of the Notice, and the findings as to this allegation are those set forth for those paragraphs above. School Board Actions Impairing Performance Respondent has argued that a history of “bad blood” existed between the Board and Boston Avenue that tainted the relationship, and potentially resulted in the artificial lowering of Boston Avenue?s school grades. The evidence indicates that the Board and the District followed established procedures with regard to its actions, which included providing notice prior to conducting transportation inspections, and placing FCAT monitors into all classrooms of school that had received a grade of “F” for the preceding year. The evidence that the monitors acted inappropriately during the testing was not convincing, and in any event was not sufficient to establish that the presence of the monitors was so disruptive as to result in a decline in student performance in their FCAT testing. Limitation on the Grounds for Non-Renewal Respondent?s argument that only items related to student safety may form the basis for non-renewal is not persuasive. The purpose of public schools, including charter schools, is to ensure the academic progress and achievement of their students. It was not outside of the scope of the School Board?s authority to base its decision as to whether to renew the charter on the extent to which the goals for student performance and achievement established by the Charter were met. Ultimate Findings of Fact The standards for academic performance set forth in the Charter were sufficient to allow the School Board to make a reasoned assessment as to whether criteria in the Charter regarding student performance and achievement were met during the period of operation. The evidence in this case demonstrates that Boston Avenue has failed, in virtually every measurable area, to keep pace with the educational standards of schools operated by the District. Respondent?s failure to meet the standards for academic performance and achievement as set forth herein forms a reasonable basis for non-renewal of the Charter. Except for Boston Avenue?s failure to conduct timely and complete employment history checks, the basis for non- renewal identified as “other good cause shown,” either were not proven or would not, standing alone, constitute sufficient grounds for non-renewal. As to the employment history checks, the School Board proved that violation of the charter and Florida statute, in combination with the other areas of non- compliance with the Charter, forms a reasonable basis for non- renewal of the Charter. Based on the evidence and testimony as a whole, the School Board proved, by a preponderance of the evidence, that Boston Avenue failed to meet the criteria for renewal of its Charter, and that its proposed action to deny the renewal of the Charter was not in error.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Volusia County School Board, enter a final order declining to renew the charter school agreement existing between it and Volusia Elementary Charter School, Inc., d/b/a Boston Avenue Charter School. DONE AND ENTERED this 14th day of December, 2012, in Tallahassee, Leon County, Florida. S E. GARY EARLY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of December, 2012.
The Issue Whether just cause exists for Petitioner to suspend without pay and terminate Respondent's employment.
Findings Of Fact Background The School Board is a duly-constituted school board charged with the duty to operate, control, and supervise the public schools within Miami-Dade County, Florida. Respondent began working for the School Board in August 2001. At all times material to this case, Respondent has been employed as a special education teacher at Homestead Senior High School, a public school in Miami-Dade County, Florida. Respondent teaches students with autism spectrum disorder. At all times material to this case, Respondent's employment with the School Board has been governed by Florida law, the School Board's policies, and the collective bargaining agreement ("CBA") between the School Board and the United Teachers of Dade ("UTD"). The Florida Alternative Assessment The School Board's first allegation against Respondent involves the Florida Alternative Assessment ("FAA"). The School Board alleges that Respondent is subject to suspension and termination because of "testing [ir]regularities involving Respondent and the Florida Alternative Assessment." As factual support of this contention, the School Board alleges in paragraph 11 of the Amended Notice of Specific Charges that "Respondent did not follow proper testing procedures since the testing booklets were submitted in blank." The FAA is the standardized test given to students with very significant cognitive disabilities, who are incapable of taking the "FCAT" standardized test or the Florida standards testing given by the school to regular education students. The scoring on the FAA is very different from traditional standardized tests. The test is divided into 20 items. Within each item, there are three separate questions. Depending on the students' performance, they may not be exposed to all of the questions. Whether or not a student has access to all three of the questions within an item depends upon whether the student correctly answers the previous question. For example, if a student correctly answers question one of item one, that student would then proceed to question two of item one. If the student answers question two correctly, the student would then proceed to question three of item one. The FAA can be administered over a number of days or weeks. The test must be completed, however, within a five-week testing period. In administering the test to students, the questions on the FAA are verbally read by the teacher to the student. The teacher gives a verbal prompt, and the student verbally responds with an answer. There is one correct answer out of three possible responses. After a student provides the teacher with a verbal answer to the question, the teacher should mark the student's answer in the test booklet. The student does not mark in the test booklet. Outside of the testing situation, the teacher should then transfer the scores from the test booklet into a separate student answer sheet, which is a "bubble sheet." Although a teacher's marking of students' answers to the questions on the test booklet is recommended, it is not mandatory. No test booklets involving Respondent's administration of the FAA to his students were offered into evidence. The evidence adduced at hearing does not establish that Respondent engaged in testing irregularities by submitting FAA test booklets in blank. In sum, the evidence at hearing fails to show that Respondent's conduct with regard to the submission of FAA test booklets constitutes misconduct in office, gross insubordination, or a violation of School Board policies. At hearing, the School Board did not argue that Respondent committed testing irregularities by submitting test booklets in blank. Rather, the School Board argued that Respondent committed testing irregularities because some students had identical responses to questions on the "bubble sheets." Despite the discussion at the hearing regarding the purported identical answers of some students on the "bubble sheets," that factual contention was not pled as a basis for Respondent's suspension and termination, and the School Board never sought to amend its Amended Notice of Specific Charges to assert this factual contention. Allegations Involving P.Z. The School Board alleges in paragraph 14 of the Amended Notice of Specific Charges that Respondent is subject to suspension and termination because he "held a student with his arm behind his back and allowed other students to hit him." At hearing, Respondent denied the allegation. At hearing, the School Board presented the testimony of P.Z., the alleged student victim. Without objection, P.Z. was accompanied by his mother at the hearing. P.Z. was a 10th-grade special education student in Respondent's class on the date of the alleged incident. P.Z. is a 15-year-old student with autism spectrum disorder. P.Z. has cognitive impairments which impact his ability to comprehend events and communicate with others. At hearing, the following exchange between the undersigned and P.Z. occurred after P.Z. was placed under oath by the court reporter at the hearing: THE ADMINISTRATIVE LAW JUDGE: Do you understand the difference between telling the truth and what would be considered a lie? Do you understand the difference? THE WITNESS: Sometimes I can't tell what the difference is of the truth or a lie. At hearing, counsel for the School Board asked questions of P.Z. with regard to the alleged incident, as follows: Q: P., I'm going to ask you about something that happened at the beginning of this school year. Do you remember getting into trouble with Mr. Adams. A: Yeah, kind of. Q: Can you tell me--do you remember why you got into trouble with Mr. Adams? A: Yeah. It was for many reasons. Well, the last time, the last one, was when he twisted my arm on my back like a military guy, and let everyone hit me to this shoulder where I hit the student. Sometimes he--and not only me, it's other kids who do that, twisting my arm on the military thing. And when the misbehaved student cries, Mr. Adams and Ms. Poser just laugh. Q: And that happened to you because you got into trouble for hitting another kid? A: Yeah, I got in trouble for many different reasons sometimes. Q: But that last time was because you had hit another student? A: Yes. MS. MARKEN: Your Honor, if I could have one moment. Judge, I don't have any other questions. On cross-examination, P.Z. testified, however, as follows: Q: I do lead you to the bathroom or accompany you. But P., let me ask you, when I told you to come apologize, did I twist your arm or did I take you by your hand? MS. MARKEN: Objection, asked and answered. THE ADMINISTRATIVE LAW JUDGE: Overruled. THE WITNESS: I don't think you twisted it. It's hard to remember. MR. ADAMS: Judge, I have no more questions. THE WITNESS: It's hard to remember after you left. Because he had to make me do my work, and you even made me cry once. And you just left. MS. MARKEN: One moment, Judge. THE ADMINISTRATIVE LAW JUDGE: Okay, P., you answered the questions. MS. MARKEN: No further questions, Judge. At hearing, P.Z. was happy to see Respondent, and they exchanged pleasantries following P.Z.'s testimony. As he was leaving the hearing room following his testimony, P.Z. told Respondent: "Bye. I hope I see you again." At hearing, no witnesses other than Respondent and P.Z. testified regarding the alleged incident. At hearing, the undersigned had the opportunity to observe the testimony and demeanor of both P.Z. and Respondent. The testimony of Respondent is credited and is more persuasive than the testimony of P.Z., which is not credited or persuasive. The evidence does not establish that Respondent held a student with his arm behind his back and allowed other students to hit him as alleged in the Amended Notice of Specific Charges. In sum, the evidence at hearing fails to show that Respondent's conduct with regard to the incident in the classroom involving P.Z. constitutes misconduct in office, gross insubordination, or a violation of School Board policies.3/ Allegations Involving Respondent's Teaching Certificate Finally, the School Board alleges in paragraph 22 of the Amended Notice of Specific Charges that Respondent is subject to suspension and termination because his teaching certificate was suspended on February 17, 2015, until further notice, making Respondent ineligible for employment as a teacher with the School Board. After the School Board suspended Respondent and initiated dismissal proceedings, the Education Practices Commission notified the School Board on February 17, 2015, that Respondent's teaching certificate had been suspended, until further notice, for failure to pay child support. The evidence presented at hearing establishes that Respondent's teaching certificate was suspended by the Florida Department of Education on February 17, 2015. On March 30, 2015, Respondent received a letter from the Florida Department of Revenue, Child Support Enforcement ("DOR"), indicating that DOR directed the Department of Education to reinstate Respondent's certificate because Respondent was paying child support as agreed or ordered by the circuit court, or he was otherwise entitled to have his certificate reinstated. Following the hearing, the School Board filed its post- hearing Exhibit 30 (mis-numbered by the School Board as Exhibit 29), which consists of a letter from the Department of Education. The letter from the Department of Education was directed to Respondent and is dated June 17, 2015. The letter indicates that Respondent's teaching certificate is reinstated because the "Department of Revenue (DOR) has directed our office to reinstate your certificate because you are paying child support as agreed or ordered, or are otherwise entitled based on DOR's findings." The evidence establishes that Respondent's teaching certificate was suspended from February 17, 2015, until June 17, 2015. In sum, the evidence fails to show that the suspension of Respondent's teaching certificate from February 17, 2015, until June 17, 2015, constitutes misconduct in office, gross insubordination, or a violation of School Board policies justifying his suspension since October 7, 2014, and termination.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Miami-Dade County School Board enter a final order rescinding the proposed termination and suspension, and provide Respondent with back pay, except for the period of February 17, 2015, to June 17, 2015. DONE AND ENTERED this 4th day of September, 2015, in Tallahassee, Leon County, Florida. S DARREN A. SCHWARTZ Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of September, 2015.
The Issue Whether the School Board lacked the delegated legislative authority to promulgate School Board Policy 2.57. Whether the challenged portions of School Board Policy 2.57 violate certain provisions of the charter school statute, section 1002.33, Florida Statutes, and State Board Rules, as outlined in Petitioner's Amended Rule Challenge Petitions. Whether the Innovative Rubric Policy 2.57 should be invalidated for enlarging, modifying, and/or contravening the charter statute and also the adopted State Board Education rule(s) and form(s). Whether the budget worksheet referenced in School Board Policy 2.57 is an unadopted rule because it was not attached or incorporated into School Board Policy 2.57 and/or was never specifically adopted by rule. Whether certain provisions of School Board Policy 2.57 violate section 1002.33(6)(h) as outlined in Petitioner's Amended Rule Challenge and Charter Petitions. Whether the prevailing party is entitled to attorneys' fees and costs pursuant to section 1002.33(6)(h) and/or section 120.595, Florida Statutes.
Findings Of Fact Renaissance is a not-for-profit Florida corporation. Renaissance currently operates six charter schools in the School District of Palm Beach County ("School District") pursuant to charters issued by the School Board: (1) Renaissance Charter School at Central Palm; (2) Renaissance Charter School at Cypress; (3) Renaissance Charter School at Palms West; (4) Renaissance Charter School at Summit; (5) Renaissance Charter School at Wellington; and (6) Renaissance Charter School at West Palm Beach. The School Board is the "sponsor" of the six schools operated by Renaissance in the School District for purposes of section 1002.33. The six schools operated by Renaissance are public schools, by virtue of their status as charter schools, under section 1002.33(1). Charter Schools USA serves as the education services provider or management company for all six of Renaissance's schools in the School District. On April 1, 2015, the School Board held a public workshop on the subject of charter schools, including proposed revisions to School Board Policy 2.57 ("Policy 2.57") entitled "Charter Schools." After the workshop, the School Board reviewed proposed revisions to the rule, Policy 2.57, at a noticed public meeting on April 22, 2015, and approved development of the policy. On May 27, 2015, at a noticed public meeting, the School Board approved adoption of revised Policy 2.57. The May 27, 2015, amendments to Policy 2.57 required, among other things, that charter schools meet a standard beyond the status quo for "innovative learning methods," mandated that every charter contract contain a provision requiring 51 percent of the charter school governing board members to reside within Palm Beach County, and mandated that every charter contract contain a provision precluding new charter schools from being located in the vicinity of a district-operated school that has the same grade levels and programs. The May 27, 2015, amendments to Policy 2.57 also included an attached Innovative Policy Rubric 2.57, which contained the innovative definition and additional standards of innovation which charter school applicants must satisfy. The May 27, 2015, amendments to Policy 2.57 also required a completed budget worksheet in the format prescribed by the School Board from each charter school applicant. The "budget worksheet" referenced in Policy 2.57 is the "Budget Template Tool" developed by the Florida Charter Support Unit. The "budget worksheet" referenced in Policy 2.57 was not specifically identified in Policy 2.57 or attached thereto when it was adopted. The School District requires use of the Budget Template Tool in order to provide charter school applicants notice about everything that is required to prepare a budget and to ensure that the budget includes all necessary information. Charter school applicants who do not use the Budget Template Tool often fail to provide all of the information required to be included in the budget. The School District will review an applicant's budget even if it is not submitted using the Budget Template Tool. Failure to use the Budget Template Tool, in and of itself, will not be a factor in the rating of the "Budget" section of an application or the overall recommendation on an application. On August 3, 2015, Renaissance submitted its application for Renaissance Charter High School of Palm Beach to the District's Charter Schools Department. The application for Renaissance Charter High School of Palm Beach is the only charter application Renaissance has filed in the School District since the revised Policy 2.57 was adopted on May 27, 2015. On or around August 18, 2015, Renaissance requested that the Florida Department of Education ("FDOE") mediate its dispute over the amendments to Policy 2.57. The School Board declined FDOE's request to mediate the dispute. On September 8, 2015, Commissioner of Education Pam Stewart issued a letter to both Renaissance and the School Board confirming that the dispute could not be settled through mediation and providing Renaissance with permission to bring its dispute to DOAH. The District Superintendent recommended that the application for Renaissance Charter High School of Palm Beach be denied and placed it on the consent agenda for the School Board's November 4, 2015, public meeting, with one of the reasons being that the application "failed to meet indicators of School Board Policy 2.57 innovative rubric." At the November 4, 2015, meeting, after deliberation, the School Board voted to deny the application. In its letter dated November 13, 2015, denying the charter application of the proposed Renaissance Charter High School of Palm Beach, the School Board relied, in part, on Policy 2.57 as grounds for denial. On September 7, 2016, Petitioner filed a consolidated challenge that was amended on December 20, 2016. Petitioner is challenging the School Board's adoption and amendments of May 27, 2015, to Policy 2.57 in the Rule Challenge and asserting a violation of the flexibility granted to charter schools for the amended provisions in the Charter Petition.
The Issue Whether Respondent Legacy Academy Charter, Inc.’s (Legacy) school charter for the Legacy Academy Charter School should be terminated for the reasons set forth in Petitioner the School Board of Brevard County’s (School Board or the Sponsor) November 20, 2019, 90-Day Notice of Proposed Termination of Charter, pursuant to section 1002.33(8)(b), Florida Statutes (2019).
Findings Of Fact Legacy operates Legacy Academy Charter School, a non-Title 1 public elementary charter school (grades K through 6), currently located at 1923 Knox McRae Drive in Titusville, Florida. It is currently in its third year of operations. Legacy represents itself as a STEAM (Science, Technology, Engineering, Arts, and Mathematics) charter school. Legacy and the School Board entered into a charter contract on April 12, 2016. Legacy chose to defer opening for one year, with the intent of opening at the beginning of the 2017-2018 school year. From the time of the original charter, the School District found numerous deficiencies and issues with Legacy’s attempt to open and operate a charter school. For example, in October 2016, it reviewed Legacy’s progress and prepared a “pre-opening checklist” that noted certain deficiencies. In April 2017, representatives from the School District and Legacy met to review the pre-opening checklist and discuss Legacy’s progress toward opening for the school year on August 10, 2017. Assistant Superintendent Archer testified that, based on this meeting, she felt that Legacy was not ready to open, and thought it was in Legacy’s best interest for the School District to offer an opportunity for a second deferral. The School District’s concerns were well-taken; Legacy had not yet secured a school site, had not ordered textbooks, had not hired a Principal, did not have a student enrollment or lottery process in place, did not have an approved and established bank account, did not have office staff in place, and had not hired teachers. Legacy declined the offer to defer another year. Legacy ultimately found a location for the 2017-2018 school year: a former preschool located at the First United Methodist Church in downtown Titusville. During a pre-opening site visit in July 2017, the School District found that the school site was not ADA compliant, that there were safety issues concerning the playground, that the school site lacked infrastructure for necessary technology, and that Legacy had not removed religious symbols. On July 31, 2017, when the School District learned that Legacy had not obtained a certificate of occupancy from the City of Titusville (the first day of school was August 10), the School District issued a recommendation for the immediate termination of the charter for health, safety, and welfare concerns. The School District ultimately rescinded that recommendation for immediate termination on August 8, 2017, after Legacy obtained a certificate of occupancy. Legacy opened for the 2017-2018 school year on August 10, 2017. The School District received various complaints soon after, concerning whether ESE and gifted students were receiving their services, whether Legacy was providing free and reduced lunch, and whether Legacy was providing the appropriate materials and curriculum to its teachers. During the 2017-2018 school year, the School Board issued 10 notices to Legacy for various concerns, defaults, and deficiencies, including concerns found during a new site checklist for Legacy’s November 2017 move into a second location in Port St. John, Florida, and information revealed in a specific review audit of Legacy’s fiscal management and financial position conducted by RSM US LLP (RSM) on March 12, 2018. On April 18, 2018, the School Board issued a “90 Day Notice of Termination,” which listed six grounds for termination: Evidence of the School’s failure to meet generally accepted standards of fiscal management and/or willfully or recklessly failing to manage public funds in accordance with the law as set forth in Rule 6A-1.0081, Florida Administrative Code, Section 218.503, F.S., Section 1002.33(9), F.S., Section 1002.33(7)(a)(9), F.S., Section 1002.345(1)(a), F.S., and Sections 4(G) and 9(A) of the Charter Contract; Evidence of the School’s failure to comply with laws related to public meetings and records as set forth in Section 286.011, F.S., Section 1002.33(16)(b)1, F.S., and Section 9(A_ of the Charter Contract; Evidence of the School’s failure to comply with laws related to teacher certification as set forth in Chapter 1012, F.S., Section 1002.33(12)(f), F.S., and Section 10(C) of the Charter Contract; Evidence of the School’s failure to cure the material breaches of terms or conditions of the Charter Contract after receiving the District’s written notice of noncompliance as set forth in Section 1002.33(7), F.S., 1002.33(9)(c), F.S., and Sections 1(D)(l)(iv)(a) and 12(F) of the Charter Contract; Evidence of the School’s failure to comply with background screening and other requirements set forth in Chapter 1012, F.S., Sections 1002.33(12)(g), F.S., 10132, F.S., 1012.465, F.S., and 1012.458, F.S. and Section 10(J) of the Charter Contract; and Evidence of the School’s failure to comply with all applicable laws, ordinances, and codes of federal, state, and local governance including, without limitation, the Individuals with Disabilities Education Act (IDEA) as referenced in Rule 6A-6.030191(4)(d) and Rule 6A-6.030191(7), Florida Administrative Code, Sections 1003.571(1)(a) and 1002.33(16)(a)(3), F.S., and Section 3(l) of the Charter Contract. Legacy contested the termination, and the School Board referred the matter to the Division, which assigned it DOAH Case No. 18-2778. Rather than proceed to a final hearing, the parties agreed to and executed an Amended Charter Agreement, dated September 11, 2018 (Amended Charter), and filed a Joint Notice of Voluntary Withdrawal. The Preamble to the Amended Charter sets forth, in pertinent part, the explicit agreement of the parties concerning the issues that resulted in the execution of the Amended Charter: By entering into this Amended Charter, the parties wish to address the areas of deficiencies identified in the 90-Day Termination Notice. In doing so, Sponsor agrees to withdraw its 90-Day Termination Notice, allowing the School a chance to address the areas of deficiency and come into compliance with the terms of the original Charter, as amended by this Amended Charter. In exchange, the School agrees to submit to the Division of Administrative Hearings for Case Number 18-2778 a notice of withdrawal of its request for hearing. Each party is responsible for its own attorneys’ fees and costs incurred related to this DOAH proceeding. Nothing herein shall prevent the Sponsor from, or waives the Sponsor’s right to, issue another 90- Day Termination Notice based on repeated instances of non-compliance with the six (6) areas set forth in the April 18, 2018 Termination Notice issued by the Sponsor, based on new areas of non- compliance, and/or to immediately terminate the Charter in the event of a health, safety, and welfare issue under section 1002.33(8), Florida Statutes. The School will be allowed to present evidence that it believes prior alleged breaches were cured, wherein the assigned DOAH judge will make the final decision regarding whether the Sponsor has met the burden of proof under then existing laws.[4] 4 As referenced previously, Legacy filed a Motion for [sic] Limine and Motion to Strike on April 6, 2020, which, inter alia, argued that the undersigned should not consider evidence or allegations related to the previous conduct that resulted in the April 18, 2018, 90-Day Notice of Termination, contending that the Joint Notice of Voluntary Withdrawal constituted a resolution of those issues, and additionally contending that the doctrine of equitable estoppel precludes the School Board from raising those issues in this proceeding. In the April 29, 2020, Order Denying Respondent’s Motion in Limine and Motion to Strike, the undersigned found that Legacy had not established that the Joint Notice of Voluntary Withdrawal constituted a resolution of those issues, and also concluded that consideration of equitable estoppel, which could constitute a defense to this action, requires an evidentiary record. See, e.g., Fewless v. Dep’t of Mgmt. Servs., Div. of Ret., Case No. 18-5787 (DOAH June 17, 2019, Fla. D.M.S. Oct. 24, 2019). The undersigned provided the parties with “the opportunity at the final hearing to address the terms of the Amended Charter Agreement, create a record, and argue, in the proposed final orders, whether such pre-Amended Charter Agreement issues should be considered in the instant proceeding.” At the final hearing, Legacy did not attempt to introduce evidence to establish that equitable estoppel would preclude the undersigned’s The Amended Charter also makes specific reference to the deficiencies enunciated in the April 18, 2018, 90-Day Notice of Termination, stating: In the event that a proceeding is requested before an Administrative Law Judge based on any of the six (6) identified areas set forth in the April 18, 2018 90-day Termination Notice issued by the Sponsor, the School agrees to an expedited hearing within forty-five (45) days of the Sponsor’s written notice based on the calendar availability of the Administrative Law Judge. All other provisions of law regarding a DOAH termination hearing will apply. The undersigned finds that consideration of evidence related to the six areas set forth in the April 18, 2018, 90 Day Notice of Termination, in addition to evidence related to those areas set forth in the Termination Notice is warranted.5 Legacy moved into its current location on or about July 11, 2018. After the filing of the Joint Notice of Voluntary Withdrawal, and shortly after the parties executed the Amended Charter, the School District, starting October 19, 2018, began issuing multiple official notices of default, insufficiency, and other notices, to Legacy, for a variety of reasons. Thereafter, the School Board issued the Termination Notice. Florida charter schools are generally governed by section 1002.33. Section 1002.33(8)(a) provides as follows: (8) CAUSES FOR NONRENEWAL OR TERMINATION OF CHARTER.— (a) The sponsor shall make student academic achievement for all students the most important consideration of these issues, and made no argument concerning equitable estoppel in its proposed final order. 5 The undersigned will also only consider those grounds raised in the Termination Notice in the ultimate determination of whether the School Board is entitled to terminate the Amended Charter. factor when determining whether to renew or terminate the charter. The sponsor may also choose not to renew or may terminate the charter if the sponsor finds that one of the grounds set forth below exists by clear and convincing evidence: Failure to participate in the state’s education accountability system created in s. 1008.31, as required in this section, or failure to meet the requirements for student performance stated in the charter. Failure to meet generally accepted standards of fiscal management. Material violation of law. Other good cause shown. ACADEMIC ACHIEVEMENT AND STUDENT PERFORMANCE The School Board contends that Legacy failed to meet academic achievement and requirements of student performance under sections 1002.33(2), 1002.33(7)(a)4., and, 1002.33(8)(a)1., and sections (2) and 9(C) of the Amended Charter. Within this first ground, the Termination Notice identifies the following three categories: (a) failure to demonstrate improvement in student learning and academic achievement; (b) failure to demonstrate accountability by analyzing student performance data and by evaluating the effectiveness and efficiency of its major educational programs; and (c) failure of the Charter Governing Board to demonstrate oversight of assessments and accountability procedures to assure that the School’s student performance standards are met or exceeded. Failure to demonstrate improvement in student learning and student achievement. The School Board contends that Legacy failed to demonstrate improvement in student learning and student achievement, and that there was actually a significant decline in student proficiency, as measured by student performance on the Florida State Assessment (FSA) in English Language Arts, Math, and Science. 17 At the elementary school level, the FSA is administered annually in the areas of English Language Arts (ELA) and Mathematics to students in grades 3 through 6. In addition, the FSA is administered in the area of Science to students in grade 5. See § 1008.22(3)(a), Fla. Stat. All FSA assessments use scaled scores and achievement levels. Achievement levels range from 1 through 5, with level 1 being the lowest achievement level, level 5 being the highest achievement level, and level 3 indicating satisfactory performance on an assessment. See § 1008.22(3)(e)1., Fla. Stat. Ms. Ward’s expert report further explained these achievement levels as follows: 1–inadequate, highly likely to need substantial support for the next grade; 2–below satisfactory, likely to need substantial support for the next grade; 3–adequate, may need additional support for the next grade; 4– proficient, likely to excel in the next grade; and 5–mastery, highly likely to excel in the next grade. School grades are calculated, in part, based on students’ FSA scores. See § 1008.34, Fla. Stat. The School Board presented evidence and testimony, including expert testimony, concerning Legacy’s student performance data for grades 3 through 6 in ELA and mathematics, and grade 5 in science, for its first two school years of existence—2017-2018 and 2018-2019.6 Ms. Ward, the School Board’s expert, ultimately opined that Legacy’s student performance significantly declined from the 2017-2018 to the 2018-2019 school year, as evidenced by an increase in students receiving achievement levels of 1 or 2 on the FSA, and, with one exception (to be discussed below), a percentage of 6 On March 23, 2020, Commissioner of Education Richard Corcoran issued DOE Order No. 2020-EO-01, an Emergency Order, that, inter alia, cancelled all assessments for the 2019-2020 school year, including the FSA Assessment, as well as school grades. students receiving achievement levels of 3 or higher being lower than the State or Brevard School District average. The School Board’s contention that Legacy’s student performance significantly declined over the two school years in question can be summarized in these charts: ELA Year Level 1 Level 2 Level 3 Level 4 Level 5 2017-2018 19.5% 22% 31.7% 22% 4.9% 2018-2019 34% 23.3% 28.2% 11.7% 2.9% Mathematics Year Level 1 Level 2 Level 3 Level 4 Level 5 2017-2018 34.1% 34.1% 17.1% 9.8% 4.9% 2018-2019 47% 26% 19% 6% 2% Science Year Level 1 Level 2 Level 3 Level 4 Level 5 2017-2018 18.2% 36.4% 18.2% 27.3% 0% 2018-2019 56.7% 30% 10% 3.3% 0% Legacy’s ELA performance in the 2017-2018 school year was higher than the School District average. However, the percentage of Legacy students performing at level 3 and above for the remaining assessments was lower than State and School District averages for all assessments. The School Board also presented evidence and testimony, including expert testimony, that analyzed students’ 2016-2017 school year assessment levels in ELA and mathematics prior to attending Legacy, and then traced those students’ assessment levels during their time at Legacy.7 The School Board presented evidence that the number of students whose assessment levels were 1 and 2 increased after attending Legacy, while the number of students whose assessment levels were 3 and above decreased. In its first school year (2017-2018), Legacy received a school grade of C, and in its second school year (2018-2019), Legacy received a school grade of D. Legacy was the only public school in the school district that received a D school grade for the 2018-2019 school year. Legacy argues that, based on the percentage of points earned for the calculation for school grades, it has averaged a C for the school years 2017- 2018, 2018-2019, and 2019-2020. Legacy notes that this grade is the same, or better, over this same period of time than two schools within its geographic proximity: Mims Elementary and Coquina Elementary. Legacy further noted that Mims and Coquina received D grades for the 2016-2017 school years. Legacy also introduced evidence that it received capital outlay funding for the school year 2019-2020, and that, according to the guidelines set forth in section 1013.62, Florida Statutes, as charter schools must have “satisfactory student achievement based on state accountability standards applicable to the charter school[]” to receive such funding, it must be found to have satisfactory student achievement. The School Board presented evidence that comparing Legacy’s “average” grade to other geographically-proximate schools is not persuasive. First, Coquina, Mims (and other schools Legacy compared itself to during the final hearing, such as Apollo and Oak Park Elementary Schools), are Title I public elementary schools. Legacy, as a charter school, should be considered a “high-performing” school. The other “comparator” schools contain higher subgroups of economically disadvantaged, minority, and ESE populations than Legacy. Second, as a charter school, Legacy can enroll students from 7 The School Board could not provide such an analysis with respect to science assessment levels, as the science FSA is administered only in fifth grade. anywhere in the district, and has no boundaries, so that a comparison to neighboring schools is not persuasive. Third, if Legacy is compared to other charters and schools that emphasize STEAM innovation, such as Sculptor Charter School, South Lake Elementary School, and Educational Horizons Charter, those schools are consistently “A” schools, and Legacy’s declining grades only emphasize its failure to demonstrate improvement. Assistant Superintendent Archer testified that to establish academic achievement, comparing one school to another is not ideal; rather, it is important to drill down to data on individual student achievement to determine whether each student displays the appropriate level of growth each school year. The School Board further contends that Legacy, with one exception, failed to achieve any of its self-identified academic goals listed in its Application (which is incorporated into the Amended Charter), academic goals submitted to the School Board, and those academic goals identified in a School Improvement Plan (SIP) that Legacy submitted annually to the School Board pursuant to the Amended Charter.8 With respect to Legacy’s goals listed in its application: Legacy Goal Student Achievement Performance Meet or exceed performance scores of District and State traditional public schools (based on percentage of students assessment levels 3 through 5 on FSA) 2017-2018 ELA: Legacy–58.5%; District 60.3%; State 55.9% (Note–Legacy met this goal) 8 Legacy contends that the annual SIP requirement imposed by the School Board runs afoul of section 1002.33(7), which provides that “[t]he sponsor may not impose unreasonable rules or regulations that violate the intent of giving charters greater flexibility to meet educational goals.” The undersigned notes that section 1001.42(18)(a), Florida Statutes, requires school boards to annually approve and require implementation of a new, amended, or continuation of an SIP for each school in a district which meets certain criteria, such as receiving a school grade of D or F, among others. Assistant Superintendent Archer testified that it requires an SIP for all of its charter schools. She further testified that Florida requires academic achievement goals, which the School District now includes in the SIP. Legacy agreed to the SIP process in its Amended Charter, and submitted an SIP to the School District for each year of its existence. Further, having received a D grade in 2018-2019, Legacy was obligated to submit an SIP under section 1001.42(18)(a). 2017-2018 Math: Legacy–31.7%; District 61.6%; State 57% 2017-2018 Science: Legacy–45.5%; District 60.8%; State 58.7% 2018-2019 ELA: Legacy–42.7%; District – 61.6%; State 57% 2018-2019 Math: Legacy–45.5%; District 59.9%; State–57.8% 2018-2019 Science: Legacy–13.3%; District 59.9%; State 57.8% Grades K through 2 reading: Mean growth from fall to spring will be at least one year, as evidenced by outcomes from fall, winter, and spring Florida Assessment for Instruction in Reading (FAIR) Legacy cannot meet this goal because it did not administer FAIR for grades K-2 students Grades 3 through 6 FSA ELA and Math: 86% level 3 or higher; 10% decrease in level 1 or 2 2017-2018 ELA: levels 3 through 5– 58.5%; levels 1 and 2 – 41.5% 2018-2019 ELA: levels 3 through 5– 42.7%; levels 1 and 2 – 57.3% 2017-2018 Math: levels 3 through 5– 31.8%; levels 1 and 2–68.2% 2018-2019 Math: levels 3 through 5– 27%; levels 1 and 2–73% Grade 5 Science: 50% level 3 or higher 2017-2018 Science: levels 3 through 5–45.5% 2018-2019 Science: levels 3 through 5–13.3% Growth/Performance: the longer a student stays at Legacy, as the student is promoted, the higher the performance of that student ELA: increase in levels 1 and 2 from 48% to 50%; decrease in levels 3 through 5 from 52% to 50% Math: increase in levels 1 and 2 from 49% to 53%; decrease in levels 3 through 5 from 51% to 47% School Grade: first year grade of “B”; second year grade at or above “B”; third year grade of “A” First year school grade of “C” Second year school grade of “D” No reported grade for year three With respect to Legacy’s goals identified in the 2017-2018 SIP: Legacy Goal Student Achievement Performance 75% grade level average will be achieved by students in grades 1-2 on the Quarterly Literary Assessment (QLA) spring assessment Legacy failed to administer the spring QLA for grades 1 and 2 70% average percentile rank will be achieved by students in grades 3 through 6 on the Reading Comprehension portion of the final FAIR assessment Legacy did not administer the FAIR assessment to grades 3 through 6 75% average proficiency rate (FSA levels 3 through 5) will be achieved by students in grades 3 through 6 on the 2018 FSA assessment in ELA 58.67% of Legacy students in grades 3 through 6 achieved levels 3 through 5 on the FSA ELA 65% average proficiency rate (FSA levels 3 through 5) will be achieved by students in grades 3 through 6 on the 2018 FSA assessment in Mathematics 31.8% of Legacy students in grades 3 through 6 achieved levels 3 through 5 on the FSA for Mathematics 70% average proficiency rate (FSA levels 3 through 5) will be achieved by students in grade 5 on the 2018 FSA assessment in Science 45.5% of Legacy students in grade 5 achieved levels 3 through 5 on the FSA for Science With respect to Legacy’s goals identified in the 2018-2019 SIP: Legacy Goal Student Achievement Performance Reduce the percentage of achievement at level 1 or 2 to 10% or below, and increase students at level 3 or above to 35% or greater for the FSA assessment in ELA 57.3% of students in grades 3 through 6 achieved proficiency rates of levels 3 through 5 (did not meet) Decrease the amount of students who fell to levels 1 and 2 range by at least 5% and increase level 3 and above by 10% for the FSA assessment in Mathematics Level 1 increased by 12.9%; Level 2 decreased by 8.1%; and Level 3 decreased by 4.8% (did not meet) Exceptional Education Students (ESE) increase to 35% at level 3 or higher for ELA, and 25% at level 3 or higher for Mathematics 19% of ESE students scored level 3 or higher on FSA for ELA, and 14.3% of ESE students scored level 3 or higher on FSA for Mathematics English Language Learners (ELL) students increase by 10% proficiency from the first diagnostic test to the last exam of the school year Legacy provided no data With respect to Legacy’s Academic Achievement Goals for 2018-2019, which were separate from its SIP, the School Board introduced evidence that: with respect to ELA, Legacy failed to reduce level 1 and 2 to 10% or below, or increase levels 3 through 5 to 35% or greater, as level 1 achievement increased from 19.5% to 34% over the previous year, and level 3 through 5 achievement decreased from 58.6% to 42.8% over the previous year; and, with respect to Mathematics, Legacy failed to decrease levels 1 and 2 by at least 5% each, and increase levels 3 through 5 by 10% overall, as levels 1 and 2 increased by 4.8% over the previous school year, and levels 3-5 decreased by 4.8%. Clear and convincing evidence establishes that, over the two school years of its existence, Legacy’s students, with little exception, have declined in the area of student achievement. Although Legacy’s ELA performance in the 2017-2018 school year was higher than the school district’s average, it declined in all other areas during this time period, and declined across-the- board the subsequent year. The School Board also established, by clear and convincing evidence, that Legacy, with one exception, failed to meet its self- identified goals in its application, SIPs, and academic achievement goals submitted to the School Board. Failure to demonstrate accountability by analyzing student performance data and by evaluating the effectiveness and efficiency of its major educational programs. Section 1002.33(7)(a)4. requires charter schools to address: The methods used to identify the educational strengths and needs of students and how well educational goals and performance standards are met by students attending the charter school. The methods shall provide a means for the charter school to ensure accountability to its constituents by analyzing student performance data and be evaluating the effectiveness and efficiency of its major educational programs. Students in charter schools shall, at a minimum, participate in the statewide assessment program created under s. 1008.22. Assistant Superintendent Archer testified and provided an expert report, concerning Legacy’s failure to analyze its student data, as required under governing law, the Amended Charter, and district requirements. Assistant Superintendent Archer testified: [Legacy’s] failure to implement any type of strategy to address and analyze data and establish methods to measure goals and make those data-informed decisions for instruction has negatively impacted the student achievement. Again, if you don’t know what your students need, how do you fill any gaps in their education or knowledge? If you don’t know what they know, and what to do if the student doesn’t understand, you cannot continue to support the children. Therefore, any kind of lack of analysis is the responsibility of the school. There are numerous progress monitoring tools available to Legacy that would document and permit analysis of individual student data and progress. Most notably, “Performance Matters” is a progress monitoring tool available to all schools within the school district. Assistant Superintendent Archer testified that Legacy did not consistently use Performance Matters or any other progress monitoring. On a site visit to Legacy, Assistant Superintendent Archer testified that she was unable to review any other documentation, notebooks, or other evidence that teachers were engaging in sufficient progress monitoring. Section 1008.25(4), Florida Statutes, provides that a student who does not achieve level 3 on an FSA assessment for ELA or mathematics, and who does not have an individualized education plan (IEP) in place, must be placed on an individualized progress monitoring plan (PMP). A PMP would be referenced in Performance Matters. Assistant Superintendent Archer testified that Legacy did not access Performance Matters during its first school year, and during their second year, only accessed it sporadically and inconsistently. Assistant Superintendent Archer further testified that during their third school year (2019-2020), Legacy had potentially 33 students that should have a PMP, but that Performance Matters indicated only 4 PMPs were in place. Legacy had previously indicated that it would utilize personalized academic plans (PAP) for its students, which were designed so that students and teachers would monitor an individual student’s progress. Assistant Superintendent Archer testified that Legacy never produced any evidence of a PAP for any of its students. Legacy contends that it reviewed performance data of its academic programs continuously, and that it submits its academic achievement goals to the School Board on an annual basis. Ms. Montford, Legacy’s current principal (who also served as its first principal in 2017-2018), testified that Legacy’s governing board provides oversight of assessments and accountability procedures for its school, but was unable to provide any evidence of this oversight. Despite Legacy’s contentions, the School Board established, by clear and convincing evidence, that Legacy failed to consistently and accurately utilize methods that identified the strengths and weaknesses of its students, and how well educational goals and performance standards were met by students attending Legacy. Failure of the Charter Governing Board (Governing Board) to demonstrate oversight of assessments and accountability procedures to assure that the Legacy’s student performance standards are met or exceeded. Similar to subsection I.B. above, the School Board contended, in its Termination Notice, that over the preceding two and one-half years, after reviewing the minutes of 35 meetings of Legacy’s Governing Board, there were only four instances in which Legacy’s Governing Board discussed an SIP. The School Board further contends that these minutes do not reflect input into the development of a plan, review of school and/or student performance data, or analysis of school needs. And, similarly, Legacy contends that its Governing Board conducted public meetings on a regular basis to discuss and invite public input concerning its student performance standards. As this contention is directly related to the findings in subsection I.B. above, the undersigned finds that the School Board has established, by clear and convincing evidence, that Legacy’s Governing Board failed to demonstrate oversight of assessment and accountability procedures to assure that Legacy’s student performance standards were met or exceeded. EXCEPTIONAL STUDENT EDUCATION The School Board contends that Legacy failed to comply with all applicable laws, ordinances, and codes of federal, state, and local governance including the Individuals with Disabilities Education Act (IDEA), as implemented by Florida through sections 1002.33(2), 1003.571(1)(a), and 1002.33(16)(a)3., Florida Statutes, Florida Administrative Code Rules 6A- 6.030191(4)(d) and 6A-6.030191(7) and adopted in section 3(j) of the Amended Charter. ESE concerns services required for students with disabilities. At the federal level, ESE is governed by the IDEA, which makes available a free appropriate public education (FAPE) to eligible children with disabilities. Florida law incorporates the IDEA in section 1003.571. Upon parental consent for an evaluation under IDEA, a child may be found eligible for ESE if the child has a disability that results in a need for special education services to make progress in school. If the child is eligible, the school is then required to develop an IEP, which is a document that details the individual child’s area(s) of need, educational goals, and support that the school will provide. The school must provide ESE services to the student at the duration and frequency indicated in the IEP. If a school fails to provide these services, the student may be owed compensatory education services, which are an equitable form of reimbursement when a school does not provide FAPE. Section 1002.33(16)(a)3. requires charter schools to comply with laws pertaining to ESE. Dr. Davis, the School Board’s fact and expert witness in charter school compliance, explained that each ESE student’s records are contained in an audit file, which is separate from that student’s cumulative student file. This audit file contains all meeting and conference notes, test results, meeting dates and notices, and the student’s IEP. And Ms. Gilman, the School Board’s fact and expert witness in ESE, stated that a school must provide services in accordance with the student’s IEP, and if it fails to do so, the student is owed compensatory education services. All ESE services must be reflected in lesson plans, and a school is required to report each student’s progress to the student’s parents a minimum of every nine weeks. Ms. Gilman further testified of the importance of documenting and monitoring ESE students, as progress monitoring determines whether a student is meeting his or her goals in a timely manner within the duration of the IEP. If the School District does not provide documentation that a student receives these services, then it determines that the student is owed compensatory education services. The School Board presented evidence that during Legacy’s first school year (2017-2018), it had not hired an ESE teacher within 15 days of the first day of class, and that student’s schedules did not provide any time for ESE services. The School District conducted a site visit after receiving complaints, and found the ESE teacher who was ultimately hired covering another classroom, and that Legacy could not produce ESE documentation when requested. Legacy received multiple official notices from the School Board regarding its ESE services and documentation, starting October 13, 2017, with a Notice of Deficiency. After receiving what it deemed an inadequate response from Legacy, on December 1, 2017, the School Board issued a Notice of Default, which stated that Legacy had not provided appropriate programs, strategies, and support services for ESE students. Legacy responded, and the School Board issued another Notice of Default. On February 22, 2018, the School District’s ESE department conducted one of many ESE audits of Legacy’s ESE services. The audit report showed four areas of noncompliance: (1) teachers need to document the accommodations they provide to each student in a user-friendly format; (2) ESE teachers need to have a well-documented lesson plan that details the services provided to the ESE students; (3) ESE teachers need to document attendance of ESE students and log of daily services provided; and (4) progress reports need to be provided to ESE students at the same time period as non-disabled peers. This audit included a corrective action plan, and the District additionally required Legacy to conduct an internal audit of its records to determine if any evidence existed that it actually provided ESE services. Legacy identified 27 students who were owed a total of 11,574 compensatory education service minutes, and proposed a compensatory education plan to provide those minutes. In March 2018, Legacy provided additional information in response to the December 1, 2017, Notice of Default. The School Board reviewed that information, finding that Legacy continued to be deficient in its documentation and provision of ESE services. On April 18, 2018, the School Board issued the first notice of termination, which included Legacy’s failure to comply with ESE laws. As discussed previously, the parties entered into an Amended Charter after this first notice of termination. The Amended Charter refers to previous ESE issues concerning Legacy: In the audit report dated February 22, 2018, the Sponsor cited four (4) findings of non-compliance regarding the ESE services provided by the School, including the School’s failure to document accommodations provided to each student in accordance with the student’s IEP, failure to provide well-developed lesson plans that detail the services provided to ESE students as documented on each student’s IEP, failure to provide documentation of attendance of ESE students and log of daily services provided, and failure to provide evidence that the School generated Annual Goals Progress Reports and EP Goals Progress Reports (Gifted) with data driven comments for parents. It has since adopted the District’s attendance logs, has adopted standardized lesson plans, and will continue to follow the District’s Corrective Action Plan as contained in the audit report dated February 22, 2018. The School has conducted an internal audit to determine what students may be owed compensatory education. By September 30, 2018, the School shall work with District ESE staff to ensure that all students have been properly identified and submit a plan to the District setting forth compliance with the deficiencies mentioned above and a plan to provide compensatory education to all students who did not receive the proper ESE services. Said plan shall include the methods by which each affected student will be receiving compensatory education, including the School’s plan for students who may no longer be enrolled at the School. All expenses related to compensatory education shall be borne by the School and all compensatory services shall be provided to the affected students by November 15, 2018, with supporting documentation of compliance provided to the District by December 1, 2018. Said plan shall be approved by the Sponsor. Upon a showing of good cause, the School may request an extension of any of these dates, and the Sponsor’s consent to such request shall not be unreasonably withheld. There was no persuasive evidence presented at the final hearing that Legacy has ever provided the 11,574 compensatory education service minutes owed from the 2017-2018 school year. Legacy contends that it responded to every notice received from the School District, as provided in the Amended Charter, and that an April 2019 ESE audit conducted by the School District, which identified numerous deficiencies and corrective measures, did not mention these minutes. However, the School Board had no record of, and Legacy presented no evidence that, these compensatory education minutes were provided to eligible students. After the execution of the Amended Charter, which included the requirement that Legacy submit a compensatory education plan to the School District by September 30, 2018, Legacy requested an extension for the deadlines contained in this provision of the Amended Charter, to be completed by January 15, 2019, with supporting documentation to the School District by February 1, 2019. In that time period, Legacy engaged in a familiar pattern of submitting a draft plan that the School District considered insufficient, but, on December 7, 2018, the School District contingently accepted Legacy’s following of a draft plan pending minor revisions. However, Legacy never submitted a revised document, and on January 18, 2019, the School District issued a Notice of Non-Satisfaction for failing to submit an acceptable compensatory education plan (which, at that point, would be the third amended compensatory education plan). Thereafter, on February 4, 2019, the School District issued a Notice of Default, and provided Legacy a February 19, 2019, deadline to come into compliance by submitting an acceptable compensatory education plan. Instead, Legacy requested an extension of the February 19, 2019, deadline, which, in a letter dated February 27, 2019, the School District denied. On April 4, 2019, the School District issued another Notice of Non- Satisfaction, for Legacy’s failure to comply with the February 4, 2019, Notice of Default. Following this April 4, 2019, Notice of Non-Satisfaction, the School District met with Legacy, and on April 16, 2019, issued a Notice of Deadlines, which outlined information and new deadlines that the School District and Legacy agreed to comply with concerning compensatory education services. The School District’s Division of ESE conducted follow-up audits on April 16 and 22, 2019, to ensure that Legacy was in compliance with ESE requirements. The report from these audits cited seven areas of noncompliance: (1) documentation of accommodations and strategies; (2) documentation of services; (3) documentation of daily attendance and services; (4) documentation of student progress reports; (5) documentation of parent notification; (6) documentation of written IEPs; and (7) documentation of supplemental aids and services. Three of these areas of noncompliance (documentation of accommodations and strategies, services, and daily attendance) were repeat deficiencies from the previous February 22, 2018, audit. Ms. Gilman testified that the findings of these follow-up audits raised concerns of whether Legacy’s ESE students were actually receiving the services that the law requires. Ms. Gilman’s expert testimony is credited. As a result of the April 2019 audit, Legacy was required to provide 1,305 compensatory education service minutes for the six sample students identified. Legacy completed these compensatory education service minutes, which were for the 2018-2019 school year, at the beginning of the summer between the 2018-2019 and 2019-2020 school years. At the beginning of the 2019-2020 school year, Legacy had completed the compensatory education service minutes (1,305) owed to those six students, but had not completed the compensatory education service minutes (11,574) owed to the 27 students from the 2017-2018 school year. The School District presented evidence that Legacy experienced ESE staff turnover during its three years of operation. Legacy presented evidence of an ESE teacher shortage for several weeks, making it difficult to hire and retain such teachers. During the 2019-2020 school year, Legacy lost its only ESE teacher for a period from September through October 2019, when Legacy hired a new ESE teacher. During these weeks without an ESE teacher, additional compensatory education minutes accrued because none of Legacy’s ESE students received services during this time. As a result, the compensatory education services minutes owed for 2019-2020 was 16,200 minutes. At subsequent parent meetings, some of the parents of Legacy’s ESE students waived some of the compensatory education minutes owed, resulting in a total of 9,990 minutes owed. Ms. Luna, one of Legacy’s current ESE teachers and who worked as an ESE teacher for Legacy during the 2019-2020 school year, testified that Legacy worked to fulfill ESE compliance issues. Ms. Luna testified that all regular and compensatory ESE services for the 2019-2020 school year have been provided during remote learning caused by the COVID-19 pandemic, and documented through the Google Classroom platform. However, because Legacy failed to produce progress monitoring reports related to ESE students during discovery, and failed to timely disclose its desire to introduce these progress monitoring reports as exhibits at the final hearing, the undersigned excluded such evidence. The School Board has established, by clear and convincing evidence, that Legacy failed to provide 11,574 compensatory education service minutes to 27 ESE students from the 2017-2018 school year. The School Board also established, by clear and convincing evidence, that Legacy failed to properly provide ESE services to its ESE students in the 2018-2019 school year, despite numerous notices. Although Ms. Luna’s testimony that Legacy has completed regular and compensatory ESE services for the 2019-2020 school year was persuasive, it is not clear, because of the lack of admissible progress monitoring reports, that Legacy’s ESE students received the services required under their IEPs. FINANCIAL MANAGEMENT The School Board contends that Legacy failed to meet generally accepted standards of fiscal management and/or willfully or recklessly failed to manage public funds in accordance with the law and promote enhanced academic success and financial efficiency by aligning responsibility with accountability as set forth in sections 218.503, 1002.33(9), 1002.33(7)(a)9., 1002.33(2)(a), and 1002.345(1)(a)3., Florida Statutes, Florida Administrative Code Rule 6A-1.0081, and sections 4(H), 4(G)(3)(a), and 9(A) of the Amended Charter. Section 1002.33(8)(a)2. provides that a sponsor may terminate a charter if it finds, by clear and convincing evidence, a “[f]ailure to meet generally accepted standards of fiscal management.” The School District administers the public funds that Legacy receives for its operations. Pursuant to section 1002.33(9)(g), Legacy is responsible for its finances, with various reporting requirements to the School District. Legacy’s Governing Board is responsible for the operation and fiscal management of the school, and shall provide oversight over the school’s operations. Legacy’s Governing Board must submit a monthly financial statement to the School District no later than the last day of the month following the month being reported. Section 1002.33(9)(g)1.a. requires Legacy to use the accounts and codes prescribed in the most recent issuance of the “Financial and Program Cost Accounting and Reporting for Florida Schools,” a publication, for all financial transactions and maintenance of public records. The primary source for revenue for a charter school is the Florida Education Finance Program (FEFP), which is based on a weighted calculation of the enrollment of the school (also known as full-time equivalent (FTE)). See § 1002.33(17) Fla. Stat. Legacy also qualified for a $500,000.00 Charter School Program grant (CSP), in which Florida provides start-up and implementation funds for new charter schools. CSP is a reimbursement grant, in which a charter school first purchases items, and upon submission of appropriate documentation, receives a reimbursement of the funds spent. The School District acts as a pass-through for the CSP funds, and reviews documents for proper documentation and adherence to the Governing Board policy before authorizing reimbursement. CSP funds are to be distributed in two phases: start-up (prior to opening, $25,000.00) and implementation (after opening, $475,000.00). Legacy failed to receive full reimbursement from CSP at either phase because it did not properly document purchases and failed to follow its Governing Board purchasing policies. This failure caused financial issues with Legacy, to be discussed further below. On November 19, 2018, Legacy took out a short-term loan from Legacy Funding Services, LLC, evidenced by a promissory note, in the original principal amount of $112,505.00.9 Legacy agreed to repay the promissory note by March 15, 2019, and accrue interest. The purpose of this loan was to provide funds to purchase items, to be reimbursed by the CSP grant. The School Board presented evidence that, in early 2018, it had various concerns about Legacy’s financial situation. The School District requested its internal auditor, RSM, to conduct a review of Legacy’s financial condition, and report whether financial emergency indicators, as defined in section 1002.345, were present. After meeting with School District staff, and Ms. Montford, RSM provided a “Specific Review” audit dated March 12, 2018. This Specific Review formed part of the basis for the April 18, 2018, 90-Day Notice of Termination. The 2018 RSM Specific Review found that Legacy made no payments on this short-term loan before the maturity date. Legacy had not paid the promissory note by the maturity date because it did not receive CSP funds. According to section 218.503(1)(a), one condition of a “financial emergency” is “[f]ailure within the same fiscal year in which due to pay short-term loans . . . as a result of a lack of funds.” Legacy made a payment on the promissory note after the maturity date. Then, it renegotiated the loan into a new promissory note dated September 20, 2019, in the principal amount of $88,322.11, with a maturity date of August 1, 2021. That promissory note included a security agreement, by which Legacy agreed to pledge all of its furniture, fixtures, equipment, and 9 Legacy Funding Services, LLC, is not connected to or otherwise affiliated with Legacy Academy Charter, Inc., or any of its principals. the like as collateral; however, as the school’s assets are purchased with public funds, it was improper to enter into this security agreement. Legacy provided evidence, in a Uniform Commercial Code (UCC) filing, that this security agreement was removed from the promissory note. The 2018 RSM Specific Review also found that Legacy listed this loan as revenue on its monthly financial report, as opposed to a liability, which is problematic. By standard accounting principles, revenue is income that an entity generates; a loan, such as the Legacy loan, obviously does not qualify as revenue. Legacy has engaged an external third-party auditor, King & Walker, CPA, P.L. (King & Walker) to conduct an annual financial statement audit. This annual financial statement audit is a review of the balances of Legacy’s financial statements, and the auditor ultimately issues an opinion on whether those balances are reasonable and accurate in all material respects. These audits are reported in accordance with generally accepted accounting principles (GAAP), which are standards set by the American Institute of Certified Public Accountants. GAAP is an all-encompassing version of the financial statements that includes every long-term item, pension, long-term capital assets, long-term payables, and the like. In all of its previous annual audits from King & Walker, Legacy has received a “clean” audit, that is, that the financial statements “present fairly, in all material respects[,]” with no adverse findings. Although Legacy contends that this is sufficient to establish that it has met accepted standards of financial management, the evidence presented at the final hearing indicated otherwise. The King & Walker audit report provides exceptions. For example, it states that the audit is “not for the purpose of expressing an opinion on the effectiveness of the school’s internal control.” It also states that “consideration of internal control . . . was not designed to identify all deficiencies in internal control that might contain material weaknesses or significant deficiencies . . . material weaknesses may exist that have not been identified.” Ms. Manlove, who was an auditor for RSM and was accepted as an expert in the field of auditing, explained that government entities commonly report their funds on a “fund balance” or “modified accrual basis,” which does not include every long-term asset or liability, but only includes short-term items. Ms. Manlove stated that this differs from GAAP. In 2019, the School District again engaged RSM to conduct a review to analyze Legacy’s compliance with the Amended Charter, fiscal management and controls, compliance with Florida law (focusing on indicators of a deteriorating financial condition or financial emergency), and compliance with Florida law concerning background screenings of Legacy employees. The 2019 RSM Review differed from the King & Walker audits, as it looked for compliance with what the Florida Department of Education requires of charter schools to report to sponsors, which means a “fund balance” approach that includes short-term items that are normally found in monthly financial statements. RSM met with Ms. Montford and performed field work on site at Legacy in August and September 2019, and additionally contacted Kevin Lugar of Building Hope, which Legacy had contracted with to support accounting support. Ms. Manlove testified that Ms. Montford, who was then serving as Principal, had possession of the documents, and that many of the requested financial documents were not kept at the school. The 2019 RSM Review, in analyzing whether any indicators of a financial emergency existed, looked for evidence of failure to pay uncontested claims from creditors within 90 days after the claim is presented, as required by section 218.503(1)(b), and found: A December 27, 2018, debit card payment in the amount of $323.12 to IC Systems, which was supported by a demand for payment that stated that IC Systems was a debt collection agency for Parrish Medical Group. Legacy could not provide a copy of the original invoice, and contended that this was a payment to AT&T, but could provide no evidence to support this contention. Based on this lack of documentation, it is not clear whether this payment aged over 90 days; A March 8, 2019, debit card payment in the amount of $843.96 to Florida Power & Light (FPL), which was supported by a document that indicated that this was a “final notice before power is turned off,” with a due date of March 7, 2019. Legacy did not respond to RSM’s inquiries as to whether FPL shut off Legacy’s power; Ms. Manlove testified that there was a pattern of FPL shut-off and past- due notices. The School Board presented evidence of four additional shut-off notices from FPL–July 10, 2018, November 27, 2018, February 26, 2019, and March 26, 2019—as well as four past due notices from FPL—April 2, 2019, June 3, 2019, November 2, 2019, and March 3, 2020. The Governing Board was not aware of these FPL shut-off and past-due notices. The 2019 RSM Review also analyzed a sampling of expenditures. Legacy’s segregation of financial duty policies provides that the Principal may authorize payments of $5,000.00 or less, and the Principal and Treasurer must jointly authorize (i) payments greater than $5,000, and (ii) payments of $1,500 or more that utilize CSP funds. The 2019 RSM Review found a December 5, 2018, check for $67,635.00 to CFL Alarms, LLC (CFL Alarms), for the purchase of computers and related equipment. The records provided to RSM indicated that Ms. Montford, as Principal, and Mr. Carroll, as Treasurer, approved of this expenditure. However, Ms. Montford was not the Principal of Legacy at that time, and Mr. Carroll had never served as Treasurer, but rather as Governing Board Vice Chair. Legacy submitted a CSP reimbursement request to the School District for the CFL Alarms purchase, but provided invoices from CFL Alarms that did not contain details such as types of equipment purchased or serial numbers of computers. Mr. Pulchan, the owner of CFL Alarms, testified that, in response to the School Board’s subpoena for its records, he added serial numbers and modified the invoices per Ms. Montford’s request. It also became apparent during the final hearing that CFL Alarms was not a licensed reseller of the Lenovo or Dell computers that it sold to Legacy. In fact, the evidence showed that CFL Alarms purchased computer equipment directly from Dell and Amazon, and then resold the equipment to Legacy at a substantial mark-up of between 45 and 60 percent. While Mr. Pulchan testified that he delivered and installed this equipment, Legacy provided no evidence or testimony why it could not have purchased this equipment directly, or in a more cost-effective manner. Legacy provided bank records that reflected a refund from CFL Alarms to Legacy in the amount of $33,131.50. CFL Alarms provided records from Mr. Pulchan’s Amazon account that reflected the return of Lenovo laptops. The undersigned finds that the evidence was unclear as to what Legacy purchased from CFL Alarms for $67,645.00, or what Legacy returned to CFL Alarms for $33,131.50. The payment to CFL Alarms, evidenced by a check signed by Ms. Montford, is also evidence that Legacy did not follow its segregation of financial duties policies. The School Board presented additional evidence that Legacy lacked a formal monitoring process for debit card purchases. It presented evidence that Legacy’s December 2019 bank statement reflects four payments to FPL, only one of which by check. Legacy made the other three payments with a debit card in the amounts of $948.31, $74.31, and $485.60, which were unsupported by other documentation. The School Board also presented evidence that it was, at best, unclear whether Legacy’s Governing Board properly monitors, performs due diligence, and exercises fiduciary responsibility over the school, as required under section 1002.33(9)(i) and (j). Part of the reason for this was that Legacy did not produce complete board packets for its monthly Governing Board meetings. An additional reason is that Mr. Carroll, the Governing Board vice chair, who has extensive background in finance and who previously served as the chief financial officer for NASA, provided inconsistent testimony about past-due bills and oversight. The School Board also presented evidence of Legacy’s monthly financial statements, which reflected a negative cash position for each month between October 2019 and March 2020. The negative cash position classified Legacy as being in a “deteriorating financial condition” under section 1002.345, and required Legacy to submit a Corrective Action Plan (CAP). The School District provided Legacy with notice about the submission of a CAP in November 2019. Legacy prepared a CAP, but the School District determined it was insufficient because it did not identify the specific actions needed to recover from this negative cash position. Legacy did not provide an updated CAP, and the School District forwarded Legacy’s CAP to the Department of Education on December 19, 2019. The Department of Education directed Legacy to prepare a CAP, with a deadline of May 1, 2020, which Legacy timely submitted, with assistance of the School District. As part of the CAP, Legacy plans to reduce salaries over a period of a year, and renegotiate its lease to reduce payments.10 With respect to the lease, which Legacy entered into with Legacy Charter Holdings, LLC, on April 21, 2017, the renegotiation resulted in a temporary reduction of the monthly rent from $41,483.67 per month, to 10 Legacy presented evidence at the final hearing that another charter school in Brevard County, Emma Jewel Charter Academy in Cocoa, Florida, has been required to submit a CAP for the 2014-2015 and 2015-2016 school years, but has never received a notice of termination from the School Board, while Legacy, who is undergoing the CAP process for the first time, received a notice of termination. Legacy contends that this disparate treatment is discriminatory. The undersigned finds that such evidence related to Emma Jewel does not alter the undersigned’s ultimate findings concerning whether Legacy has failed to meet generally accepted standards of fiscal management. $10,000.00 per month, for April, May, and June 2020. Thereafter, in July 2020, the rent increased to $37,941.98 per month.11 Mr. Moreno, the chief financial officer of Building Hope Services, testified, since fall 2018, that Building Hope Services provides back office accounting services for Legacy. His staff assists in the preparation of Legacy’s monthly financial statements, which he reviews. He testified that based on his review of Legacy’s financial statements, its revenues will exceed its expenditures at the end of the fiscal year. Mr. Moreno based this conclusion on the lease adjustment, and that Legacy received through the Small Business Administration (SBA) and USA CARES Act, see 15 U.S.C. § 636, et seq., a Paycheck Protection Program (PPP) loan in the amount of $198,810.00. The PPP loan could be forgivable if the funds received are used for: payroll costs; costs related to the continuation of group healthcare benefits; mortgage interest payments (but not mortgage prepayments or principal payments); rent payments; utility payments; interest payments on any other debt obligations that were incurred before February 15, 2020; and/or refinancing another specific SBA loan. If not, the PPP loan must be repaid monthly in the amount of $8,370.15, commencing November 1, 2020. Mr. Carroll testified that Legacy intends to use the PPP loan proceeds for salaries. It is unclear at best how Legacy needs funds to pay the salaries of its employees as a result of the COVID-19 pandemic, as those funds are derived from FEFP. It is also unclear if Legacy has done so, or whether it will be required to repay the loan beginning in November 1, 2020. Apparently, Legacy’s belief is that the PPP loan operates as a deus ex machina that solves all of its financial problems, and thus should convince the undersigned that the PPP loan cures and excuses the clear and convincing evidence presented 11 The lease originally tied the rent amount to enrollment of students at Legacy. Legacy’s year one enrollment was 165, year two was 235, and year three was 246. Pursuant to an addendum to the lease, the monthly rent was $1,100 per student, but no less than $200,000 in year two, and no less than $449,000 in year three. by the School Board that Legacy, time and time again, failed to meet generally accepted standards of fiscal management. It does not. The undersigned finds that the School Board presented clear and convincing evidence that Legacy failed to meet generally accepted standards of fiscal management. Additionally, the School Board presented clear and convincing evidence that Legacy did not manage public funds in a responsible manner. BACKGROUND SCREENING The School Board contends that Legacy failed to comply with requirements for background screening of its employees and Governing Board members, as set forth in chapter 1012, sections 1002.33(12)(g), 1012.32, 1012.465, 1012.467, and 1012.468, Florida Statutes, and sections 10(I) and (J) of the Amended Charter. As part of the 2019 RSM Review, RSM reviewed a sample of employees and Governing Board members for proper background screening. RSM found that two Governing Board members began their positions on the Governing Board prior to obtaining the required background clearance, two substitute teachers had either inaccurate employment records or did not receive the proper background screening before beginning employment at Legacy, and one teacher was not fingerprinted in a timely manner. Dr. Davis then reviewed all payroll, clearance, and database records for Legacy, and concluded that there were other issues concerning Legacy’s failure to conduct background screening. However, the Termination Notice, which forms the basis of this proceeding, only identifies the five persons analyzed in the 2019 RSM Review, as evidence that Legacy failed to comply with background screening laws. Legacy presented evidence that the School District had accidentally deleted a Governing Board member’s background screening information, but that RSM identified this Governing Board member as not obtaining the appropriate background screening. With respect to the other Governing Board member, the Governing Board approved of this member, and he received his clearance, during the summer months, when students are not normally on campus. Legacy also presented evidence that, with respect to the other four individuals identified in the 2019 RSM Review as not having obtained the required background clearance, the School District had issued a Notice of Default, as required under the section 12(F) of the Amended Charter, and Legacy had cured that default within the time prescribed in the Notice of Default. In fact, the School District issued written notices of satisfaction with respect to these issues. The undersigned finds that the School District has not established, by clear and convincing evidence, that Legacy failed to comply with background screening requirements for its employees and Governing Board members. VIOLATION OF LAW AND BREACH OF CONTRACT The School Board contends Legacy failed to comply with law and/or cure material breaches of terms or conditions of the Amended Charter after receiving the School District’s written notice of noncompliance, and that Legacy failed to promote enhanced success and financial efficiency by aligning responsibility with accountability as set forth in sections 286.011, 1002.33(2), 1002.33(7), 1002.33(9)(c), 1002.33(12)(f), 1002.33(16)(b)1., 1012, Florida Statutes, and sections 1(D)(1)(d)(i), 10(C), and 12(F) of the Amended Charter. Many of the School Board’s contentions made under this sub-category are repetitive of issues raised with respect to the other four sub-categories, such as: Legacy’s pledging its assets as collateral for a short-term loan; Legacy’s untimely submission of monthly financial reports; Legacy’s not providing proper minutes of its Governing Board meetings; the Governing Board’s failure to exercise oversight; and the Governing Board’s failure to implement policies and procedures. The undersigned previously found that the School Board presented clear and convincing evidence to establish these contentions, and further finds that these also constitute a violation of the provisions of the Amended Charter. Section 10(C) of the Amended Charter states that “teachers employed or under contract to the School shall be certified as required by Chapter 1012.” The School Board presented evidence that Legacy employed two teachers who were not certified, and two who worked out-of-field, but not approved by the Governing Board.12 Legacy presented evidence that the two teachers who lacked certification were substitute teachers, who were not required under Florida law to possess a certification. See § 1012.35, Fla. Stat. The School Board presented clear and convincing evidence that two teachers—Jane Anne Burnett and Vilma Perez—taught out-of-field without the Governing Board’s approval. See Fla. Admin. Code R. 6A-1.503(3). Section 1002.33(9)(p)2. provides that each charter school’s governing board must appoint a parent representative “to facilitate parental involvement, provide access to information, assist parents and others with questions and concerns, and resolve disputes.” Section 1002.33(9)(p)3. provides that this parent representative, or his or her designee, must be physically present at each meeting. The School Board presented clear and convincing evidence that Legacy’s appointed parent representative did not attend four meetings in the 2016-2017 school year, 13 of 15 meetings in the 2017-2018 school year, and six of 13 meetings in the 2018-2019 school year, in derogation of section 1002.33(9)(p). Section 1002.33(9)(p)3. also provides that all governing board meetings “must be noticed, open, and accessible to the public.” The School Board presented evidence, as found in the 2019 RSM Review, that between July 2018 and August 2019, Legacy posted 11 public notices on its website, but that four public meeting notices were not available, one meeting notice 12 An out-of-field teacher is one who is certified in a certain area, but teaches in an area outside of his or her certification. See Fla. Admin. Code R. 6A-1.503(1)(c). was “corrupted,” and three meeting notices were not posted on Legacy’s website. The 2019 RSM Review also revealed that of these 11 public notices on Legacy’s website, four were not timely noticed under Legacy’s April 2018 Notice of Meeting Policy, which provided that for all regular meetings, “notice should be given to the public at least seven (7) days prior to the meeting.” The School Board presented clear and convincing evidence that Legacy failed to provide notice of its Governing Board meetings, in derogation of section 1002.33(9)(p)3., and its Notice of Meeting Policy. Section 1002.33(9)(p)1. provides that “[e]ach charter school shall maintain a website that enables the public to obtain information regarding the school … and, on a quarterly basis, the minutes of the governing board meetings.” The School Board presented evidence, as found in the 2019 RSM Review, that two of the 15 meeting minutes sampled between July 2018 and August 2019 did not have any minutes posted to Legacy’s website. The School Board presented clear and convincing evidence that Legacy failed on two occasions to post required meeting minutes of its Governing Board, in derogation of section 1002.33(9)(p)1. Finally, the School District introduced evidence that it had issued 26 notices of deficiency between the date of the Amended Charter and the date of the 2019 RSM Review. The School District found that Legacy had not cured 14 of these notices. The undersigned’s review of these 14 uncured notices reveals that they are duplicative of School Board contentions that the undersigned has already found to be established by clear and convincing evidence. The undersigned further finds that the School Board has established, by clear and convincing evidence, that Legacy has defaulted under section 1(D)(1)(d)(i) of the Amended Charter, which provides that good cause for termination includes the failure to cure a material breach of any term or condition after written notice of noncompliance. The undersigned has not overlooked evidence that, after the April 18, 2018, “90 Day Notice of Termination,” and as the parties executed the Amended Charter, members of the School District, including Assistant Superintendent Archer, requested that Ms. Montford and Mr. Carroll be removed from their positions as principal and Governing Board Member. While the undersigned may agree with Legacy that such a request was an inappropriate invasion of Legacy’s autonomy, the undersigned cannot overlook the overwhelming evidence presented by the School Board of Legacy’s numerous, well-documented issues that support termination of the Amended Charter, or somehow reason away that these numerous, well- documented issues are actually evidence that the School District has a vendetta against Legacy, which Legacy contends.
The Issue The first issue in this case is whether, as the district school board alleges, a teacher called her students "tonto" or stupid, threw books to the ground and forced students to pick them up, and put her feet and shoes in students' faces; if these allegations are proved to be true, than it will be necessary to decide whether the school board has just cause to suspend the teacher for 10 workdays, without pay.
Findings Of Fact The Miami-Dade County School Board ("School Board"), Petitioner in this case, is the constitutional entity authorized to operate, control, and supervise the Miami-Dade County Public School System. As of the final hearing, Respondent Walkyria Dolz ("Dolz") had been a teacher for more than 40 years. Having begun her career in Cuba, Dolz emigrated in 1974 from her native country to the United States, where she continued to teach in New York City and Miami. An employee of the Miami-Dade County Public School System for the preceding 15 years, Dolz worked as a music teacher at Riverside Elementary School during the 2008- 09 school year, which is the period relevant to this case. Dolz did not have a classroom of her own at Riverside. Rather, she traveled from room to room, using a cart to transport books and musical instruments. Dolz visited each class to which she was assigned once per week for one hour. In this way, in a given year, she taught hundreds of Riverside students in grades one through five. In her long career, Dolz had never been the subject of a disciplinary proceeding until this matter began. Indeed, she had been (and as of the hearing continued to be) a respected member of Riverside's teaching staff. Much evidence supports this finding, but the following statement, which was written on May 21, 2009, by Riverside's principal, Sharon López, is instructive: Ms. Dolz has been under my supervision as school principal since December 12, 2002. She has always exhibited professional behavior as a classroom teacher and properly represented Riverside Elementary in all school functions off-campus. Ms. Dolz has met standards for classroom observations since her employment as a music teacher at Riverside Elementary in 1998. The allegations [at issue here] are out of character for Ms. Walkyria Dolz. The alleged misconduct primarily giving rise to this case allegedly occurred in November 2008, in a fifth-grade classroom. Based on the stories of several students, the School Board avers that Dolz: (a) attempted to kick a student in the face; (b) waived a sandal in (or at) another student's face; (c) dropped a book to quiet the students; and (d) called the students "tonto," a Spanish word the School Board contends means "stupid." Dolz consistently has denied having done any of these things and testified to that effect at hearing. The young children who testified against Dolz did not impress the undersigned as being accurate and reliable witnesses. The account of R. S.——who claimed that Dolz silently had approached his desk, removed her sandal (while balancing on one foot), and swung the footwear at his face as he sat there in fear, all without saying a single word during the entire event, which lasted at least three minutes (according to R. S.)——was incredible on its face. While it is not inconceivable that Dolz (or any teacher) could snap in the face of some provocation or incitement, the undersigned can neither believe nor find (on this evidence at any rate) that a veteran teacher with a clean disciplinary record suddenly became a bizarre, zombie-like creature for several minutes out of an otherwise ordinary workday and wordlessly set upon a well-behaved student for no reason. Similarly implausible was A. L.'s testimony about the foregoing alleged incident and another where Dolz supposedly nearly kicked a student named L. J. in the face with her foot, while standing on one leg, because L. J. was not playing his instrument properly. A. L.'s testimony in this regard is rejected not only because Dolz, 67, appeared to be physically incapable of kickboxing a child, but also because the undersigned is skeptical that a teacher who has taught for decades without incident——and who has always behaved professionally except, allegedly, in this one instance——would lose control of herself to such a degree merely because of a student's poor musical performance.1 A third student, A. W., testified that Dolz hit R. S. and L. J. on their arms. The School Board itself did not accept this testimony as credible, and neither does the undersigned. A. W.'s lack of credibility on this significant matter undermined his credibility in general. On balance, Dolz was a more credible witness than R. S., A. L., or A. W. The undersigned accepts her denial of wrongdoing as truthful and finds that, more likely than not, Dolz did not attempt to kick or strike any student. The remaining charges are much less serious. Several children testified that, when the students were talkative or inattentive, Dolz threw a textbook on the floor or a table to make a loud noise, which would get the class's attention. Dolz denies ever having done this. The undersigned finds that the evidence is insufficient to prove that Dolz used a textbook to threaten, embarrass, or humiliate a student, or otherwise in a manner that was objectively unseemly, untoward, or unreasonable under the circumstances. Some children testified that Dolz referred to her students as "tonto," an allegation which she denies. There is conflicting evidence concerning the meaning of the word "tonto" in Spanish. While the word can mean "stupid," as the School Board maintains, it also means "silly," as Dolz points out, and, depending on the context, can be used to suggest that someone is acting like a clown or fooling around. Based solely on the evidence presented, the undersigned cannot find that the Spanish term "tonto" is insulting per se, and the absence of any proof regarding the context in which Dolz allegedly uttered the word precludes a finding that she used it in a hurtful manner, if she used it at all. Determinations of Ultimate Fact The greater weight of the evidence fails to establish that Dolz is guilty of the offense of misconduct in office as defined in Florida Administrative Code Rule 6B-4.009(3).2 The greater weight of the evidence fails to establish that Dolz is guilty of the offense of unseemly conduct, which is prohibited under School Board Rule 6Gx13-4A-1.21.3 The greater weight of the evidence fails to establish that Dolz is guilty of violating the School Board's Code of Ethics, which is set forth in School Board Rule 6Gx13-4A-1.213.4
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the School Board enter a final order exonerating Dolz of all charges brought against her in this proceeding and awarding her the back pay, plus benefits if any, which accrued while she served the previously imposed suspension of 10 workdays. DONE AND ENTERED this 8th day of January, 2010, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 8th day of January, 2010.
Findings Of Fact White Swan is a corporation registered and doing business in the State of Florida. White Swan is engaged in the sale of wholesale food supplies to Florida public entities. A sampling of the Florida public entities White Swan has transacted business with, include: Tampa General Hospital, Charlotte County Sheriff's Department, County Jails in West and Central Tampa, Pasco County Detention Center, Polk County Sheriff's Department and the Duval County School System. White Swan entered a plea of guilty and was convicted on June 10, 1993, of an offense constituting a public entity crime as defined within Section 287.133(1)(g), Florida Statutes. White Swan pled guilty and was convicted in the U.S. District Court for the Southern District of Texas, Houston Division, of a one count information for violation of the Sherman Antitrust Act, 15 U.S.C. S. 1. The count for which White Swan pled guilty and was convicted was brought by information filed April 28, 1993, pursuant to a plea agreement. It charged a conspiracy to rig bids for contracts to supply wholesale grocery products to certain public school districts and other public entities located in southeastern Texas. On June 10, 1993, White Swan, pursuant to its plea, was sentenced to pay a fine in the amount of $650,000. The amount of $200,000 was paid on the date of sentencing and $90,000 was to be paid each month thereafter. White Swan has paid the fine in full. On July 30, 1993, White Swan entered into a settlement agreement with the State of Texas. In connection with the settlement, the State of Texas filed an original petition, and a consent judgement and agreed permanent injunction. The settlement resulted in White Swan paying a civil fine in the amount of $35,000 and attorney's fees in the amount of $25,000. Mr. James Maurice Johnson, a former employee of White Swan, also pled guilty to an offense arising from the same transaction for which White Swan entered a plea. On March 12, 1991, a one count information was filed by the United States against Mr. Johnson (a former employee of White Swan's Houston Division Office involved in the preparation and submission of bids for the supply of wholesale grocery products to certain public school districts located in southeastern Texas) for violation of Section 1 of the Sherman Antitrust Act, 15 U.S.C. S. 1. Pursuant to Plea Agreement entered into between Mr. Johnson and the United States pursuant to Fed. R. Crim. P. 7(b), as well as a settlement agreement, Mr. Johnson entered a plea of guilty to the one count information, constituting commission of a public entity crime as defined within Section 287.133(1)(g), Florida Statutes. The information to which Mr. Johnson entered a plea of guilty detailed participation by him in a conspiracy to rig bids for the award and performance of contracts to supply wholesale grocery products to certain public school districts in Southeastern Texas in late 1986 through May 1990. The activities of Mr. Johnson did not involve any business conducted by White Swan within the State of Florida, by its Florida division. Pursuant to Sections 287.133(3)(a) and (b), Florida Statutes, White Swan timely notified DMS of its guilty plea resulting in conviction through submission of a Public Entity Crime Sworn Statement, dated January 20, 1992. By letter dated January 28, 1992, DMS corresponded with a representative of White Swan's Lakeland, Florida division requesting additional information regarding said conviction. By letter dated February 7, 1992, counsel for White Swan responded to the January 28, 1992, letter from DMS providing additional information and documentation regarding the conviction of Mr. Johnson. By letter dated March 9, 1992, DMS corresponded with counsel for White Swan requesting to be provided with additional information and documentation and, by letter of April 3, 1992, the requested information and documentation was forwarded to the Department. On April 21, 1994, DMS issued a Notice of Intent pursuant to Subsection 287.133(3)(e)1., Florida Statutes. The Notice of Intent was based on the June 10, 1993 conviction of White Swan of a public entity crime as defined by Section 287.133(1)(g), Florida Statutes. On May 10, 1994, pursuant to Subsection 287.133(3)(e)2., Florida Statutes, White Swan timely filed a petition for formal administrative hearing pursuant to section 120.57(1), Florida Statutes, to determine whether it is in the public interest for White Swan to be placed on the State of Florida convicted vendor list. Subsection 287.133(3)(e)3., Florida Statutes, establishes factors which, if applicable to a convicted vendor, will mitigate against placement of that vendor upon the convicted vendor list. Subsection 287.133(3)(e)3.d, Florida Statutes, establishes "[p]rompt or voluntary payment of any damages or penalty as a result of the conviction" as a factor mitigating against placement on the convicted vendor list. On August 5, 1991, Mr. Johnson was sentenced to five years probation (as well as service of four months confinement via electronic monitoring), and he was fined $10,000 payable at $200 per month over the five years' probation. Mr. Johnson is in full compliance with the terms of the sentence. White Swan has made full restitution to all of the school districts potentially involved in or affected by any of the subject activities of Mr. Johnson in southeastern Texas, and the potential claims against White Swan have been released. The subject school districts include: Alvin Independent School District; Alief Independent School District; Brazosport Independent School District; Clear Creek Independent School District; Columbia- Brazoria Independent School District; Channelview Independent School District; East Chambers Independent School District; Fort Bend Independent School District; Goose Creek Independent School District; Galveston Independent School District; Huntsville Independent School District; Katy Independent School District; Klein Independent School District; Sheldon Independent School District; Spring Branch Independent School District; Stafford Municipal School District; and Houston Independent School District. In total, White Swan has paid to these school districts the sum of $185,086.22. In each instance, the schools have agreed to utilize the amounts paid for restitution in conjunction with their nutritional programs, exclusive of those portions of the payments representing attorneys' fees and administrative expenses. White Swan commenced discussions with the Department of Justice on July 30, 1990, for the purpose of acceptance of responsibility for Mr. Johnson's actions, as well as for negotiations of a criminal fine in conjunction with the entry of a plea to a one count information. Upon finalization of the matter with the U.S. Department of Justice, White Swan paid a civil penalty to the State of Texas in the amount of $60,000. Subsection 287.133(3)(e)3.e, Florida Statutes, establishes "[c]ooperation with state or federal investigation or prosecution of any public entity crime" as a mitigating factor. Upon learning of the Grand Jury investigation and the possible violation of antitrust laws in connection with bids submitted to public schools in Southeastern Texas, in early June of 1990, White Swan fully cooperated with the Department of Justice. It encouraged the full cooperation of Mr. Johnson (and any and all other employees) in the investigation. White Swan immediately took affirmative steps to ensure a complete cessation of any activities of the nature alleged to have occurred, and it commenced its own internal investigation of the matter. Mr. Johnson was reprimanded and relieved from his responsibilities as bid manager for the Houston division. Separate counsel was engaged for Mr. Johnson. Through the cooperative efforts of White Swan, Mr. Johnson entered into a plea agreement and voluntarily entered a plea of guilty to the one count information. Pursuant to the negotiations with the Department of Justice, White Swan has submitted detailed information regarding the volume of commerce affected by the activities of Mr. Johnson (including detailed sales documentation regarding all items sold to the various entities during the relevant bid period). White Swan offered to provide any additional information or documentation which might be desired by the Department of Justice in conjunction with its investigation and plea negotiations. White Swan has fully cooperated with DMS in connection with its investigation initiated pursuant to section 287.133, Florida Statutes. Subsection 287.133(3)(e)3.f, Florida Statutes, establishes "[d]isassociation form any other person or affiliates convicted of the public entity crime" as a mitigating factor. White Swan reprimanded Mr. Johnson and removed him as bid manager for the Houston division, arranged for the institution of new procedures for handling bids by the Houston division and, in addition, appointed a new Houston division president. Mr. Johnson's employment has been subsequently terminated. The former Houston division president (Mr. John Cogniglio) was transferred to White Swan's Euless, Texas, office in the early fall of 1990. He currently holds the title of Director of Sales -- Coffees and Chemicals, and he does not have any supervisory responsibility over any management personnel located in the other divisions of White Swan. Subsection 287.133(3)(e)3.g, Florida Statutes, establishes "[p]rior or future self-policing by the person or affiliate to prevent public entity crimes" as a mitigating factor. White Swan has established an extensive antitrust compliance program (including adoption and distribution of written policies and guidelines) to educate all employees in position of authority in connection with the sales of any products (including but not limited to all those involved in the submission of bids to any public entity). White Swan, in late 1990, adopted for dissemination within the corporation and all divisional offices a comprehensive "Antitrust Policy and Compliance Guide" setting forth in detail the corporation's policy regarding strict compliance with any and all antitrust laws (state and federal), explaining the types and nature of activities prohibited and proscribed by those laws (including specific "do's and don't's"), covering commonly asked questions, etc. The Policy and Compliance Guide sets forth disciplinary actions the corporation may take against any employee violating the antitrust laws, including possible termination. The Policy and Compliance Guide addresses in detail the types of activities in connection with bidding on public entity contracts which are prohibited. White Swan has conducted educational sessions for all employees having responsibilities encompassed by the antitrust laws. A copy of the Policy and Compliance Guide was distributed to all management, sales, office, and clerical employees of the Florida division, and each of those employees signed acknowledgments of receipt and understanding of the information set forth therein. Training sessions were held at the Florida division on July 19- 20, 1991, and White Swan will continue to engage in periodic training sessions in each of its division offices. All supervisory personnel of the White Swan corporation have been advised of their responsibility to review the conduct of all employees under their supervision for adherence with all applicable antitrust laws, as well as other related laws applicable to the corporation's business, and each employee has been instructed to promptly notify corporate management in the event of the occurrence of any activity potentially violative of the antitrust laws or the corporate policy statement. Subsection 287.133(3)(e)3.h, Florida Statutes, establishes "[r]einstatement or clemency in any jurisdiction in relation to the public entity crime at issue in the proceeding" as a mitigating factor. To date, White Swan has not been advised of any limitation placed upon its engaging in business with any public or private entities in any location throughout the United States including the school districts of Texas. Subsection 287.133(3)(e)3.i, Florida Statutes, establishes "[c]ompliance by the person or affiliate with the notification provisions of paragraph (a) or paragraph (b)" as a mitigating factor. White Swan has fully complied in providing notification to DMS with regard to the guilty pleas and resulting convictions of White Swan and Mr. Johnson. It has also promptly supplied to DMS all information and documentation requested in conjunction with the investigation by DMS. Subsection 287.133(3)(e)3.j, Florida Statutes, establishes "[t]he needs of public entities for additional competition in the procurement of goods and services in their respective markets" as a mitigating factor. White Swan is engaged in the sale of wholesale food supplies to various public entities within the State of Florida. As part of its April 3, 1992 response to the inquiry letter of DMS of March 9, 1992, White Swan provided a copy of the computer printout reflecting the names and addresses of all entities within the State of Florida to whom White Swan has sold products during the fiscal years 1989 through 1990, as well as a similar customer listing for the fiscal years 1991 through March 25, 1992. White Swan is a supplier of significant goods and services to public entities within the State of Florida through its Florida division office. The inability of White Swan's Florida division office to bid for the supply of wholesale health food products would have an impact on competition for the supply of those goods to public entities in the State of Florida. Subsection 287.133(3)(e)3.k, Florida Statutes, establishes "any demonstration of good citizenship" as a mitigating factor. The Florida division office of White Swan (like all other division offices) has been an active supporter of the activities of the public school districts located within its market area, including periodic donations of food preparation equipment and other supplies for school activities and charitable fund-raising functions. The Joint Stipulation filed in this case on June 1, 1994, provides a full and complete factual basis for determining whether White Swan should be placed on the convicted vendor list in light of the facts and criteria set forth in Subsection 287.133(3)(e)3.a. through k., Florida Statutes. There are no other disputed issues of material fact between DMS and White Swan which would require a formal hearing.
The Issue The issue is whether, pursuant to section 1002.33(8)(a)2., 3., and 4., and (c), Florida Statutes (2019), Petitioner has proved violations of law and other good cause to immediately terminate a charter school agreement with Respondent dated February 27, 2018, due to the immediate and serious danger to the health, safety, and/or welfare of the students of Lincoln Memorial Academy, Inc. ("LMA" or "Respondent").
Findings Of Fact LMA converted to a charter school from Lincoln Memorial Middle School by receiving a majority vote of the parents and a majority vote of the teachers by an election pursuant to Florida Administrative Code Rule 6A-6.0787 (Ballot Process for Teacher and Parent Voting for Charter School Conversion Status). On August 22, 2017, the School Board approved Lincoln Memorial Middle School's application for conversion charter school status, which allowed Lincoln Memorial Middle School to become LMA. In February 2018, the School Board and LMA entered into a charter school contract memorializing the agreed-upon terms between the School Board and LMA with the School Board acting as LMA's sponsor. Then Governing Board Chair Edward Viltz and Governing Board Secretary Cornelle Maxfield signed the Contract on LMA's behalf. LMA officially began its operations on July 1, 2018, with the 2018-2019 school year being LMA's first year as a conversion charter school. As a conversion charter school, LMA technically remained a public school within the School District, but LMA's day-to-day operations ran independently from the School District. LMA had its own Governing Board completely separate from the School Board. Pursuant to the Contract (discussed in more detail below) and applicable statutes, LMA's Governing Board was dominantly and/or solely responsible for LMA's operations—-not the School District or School Board. In fact, according to LMA Founder and CEO Eddie Cantrel Hundley, this level of autonomy afforded to charter schools was one of the benefits of converting. Further, although LMA could have opted into several of the School District's services, including, but not limited to, the School District's food services program and transportation, LMA chose to independently render such services. The Contract under which LMA operated is a model state contract that Florida school districts and charter schools must use per Florida law. It sets forth LMA's obligations with respect to various topics, including, but not limited to, governance, hiring and screening of employees, financial management, federal funding, and other matters of compliance, in addition to circumstances upon which either party may choose not to renew or terminate the contract. Pursuant to the Contract, LMA's governance was regarded to be in accordance with its by-laws. Therefore, the general direction and management of LMA's affairs was required to be vested in the Governing Board. All meetings and communications involving members of the Governing Board were to be held in compliance with Florida's Sunshine Law. The Governing Board and principal were charged with specific duties and responsibilities: The Governing Board's primary role will be to set policy, provide financial oversight, annually adopt and maintain an operating budget, exercise continuing oversight over the school's operations, and communicate the vision of the school to community members. It shall be the Governing Board's duty to keep a complete record of all its actions and corporate affairs and supervise all officers and agents of the school and to see that their duties are properly formed. The Governing Board will serve as the sole responsible fiscal agent for setting the policies guiding finance and operation. School policies are decided by the Governing Board, and the principal ensures that those policies are implemented. The Governing Board shall exercise continuing oversight over school operations and will be held accountable to its students, parents/guardians, and the community at large, through a continuous cycle of planning, evaluation, and reporting as set forth in section 1002.33. The Governing Board will be responsible for the over-all policy decision making of the school, including the annual approval of the budget. The Governing Board shall perform the duties set forth in section 1002.345, including monitoring any financial corrective action plan or financial recovery plan. Additionally, the Contract stated that LMA would be a public employer and would participate in the FRS, that upon nomination and "prior to appointment to the Governing Board," a member must undergo a background screening in accordance with section 1002.33(12)(g), and that LMA must allow reasonable access to its facilities and records to duly authorized School District representatives. Regarding the employment of teachers and other staff, LMA was responsible for selecting its own personnel. However, in selecting its own personnel, LMA was required to employ only teachers certified pursuant to chapter 1012. LMA was to (1) refrain from employing any individual to provide instructional services or to serve as a teacher's aide whose certification or licensure as an educator is suspended or revoked by the State of Florida or any other state; and (2) refrain from knowingly employing an individual who has resigned from a school or school district in lieu of disciplinary action with respect to child welfare or safety or who has been dismissed for just cause by any school or school district with respect to child welfare or safety or who is under current suspension from any school or school district. Further, the Contract states that the school shall implement policies and procedures for background screening of all prospective employees, volunteers, and mentors and the school shall require all employees and members of the Governing Board to be fingerprinted. The results of all background investigations and fingerprinting "will be reported in writing to the Superintendent and/or his/her designee[;] . . . [n]o school employee or member of the Governing Board may be on campus with students until his/her fingerprints are processed and cleared"; and "the School shall ensure that it complies with all fingerprinting and background check requirements." Regarding financial management, the Governing Board shall be responsible for the operation and fiscal management of LMA, and the school must submit a monthly financial statement to the Sponsor (the School District) no later than the last day of the month being reported. LMA agreed to provide the School District, upon request, proof of sufficient funds or a letter of credit to assure prompt payment of operating expenses associated with the school, including, but not limited to, teacher and other staff salaries and benefits. Regarding federal funding, the School Board agreed to reimburse LMA on a monthly basis "for all invoices submitted by the School for federal funds." Regarding the renewal or termination of the Contract, the Contract's terms closely mimic terms of the applicable statute, section 1002.33. Specifically, the School Board may choose not to renew or terminate the charter for reasons set forth in section 1002.33(8) including, but not limited to, failure to meet generally accepted standards of fiscal management, violation of law, and other good cause shown. The Contract further provides that the School shall have 30 days from written notice of default to cure, "absent any circumstances permitting immediate termination." There is no requirement that the Sponsor issue written notice to the school before it immediately terminates a charter for reasons that pose a serious and immediate danger to the health, safety, and welfare of the students. LMA's Fiscal Mismanagement was an Immediate and Serious Danger to the Students' Health, Safety, and Welfare Pursuant to the Contract and applicable statute, LMA was responsible for submitting monthly financial reports. On or about May 15, 2019, School District Chief Financial Officer ("CFO") Heather Jenkins learned that LMA's January, February, and March 2019 financials showed a negative fund balance—meaning that LMA's expenditures exceeded their revenues. When the School District received LMA's monthly fund balance for April 2019, it again showed a negative fund balance. By this time, LMA's net deficit totaled $235,438.00. LMA's negative fund balance triggered LMA and the School District's statutory obligation to report LMA's financial situation to the Florida Department of Education, pursuant to section 1002.345(b). Pursuant to statute, if the School District and LMA were unable to reach a consensus on a corrective action plan within 30 days, intervention would be necessary by the Florida Commissioner of Education. § 1002.345(1)(d), Fla. Stat. LMA and the School District had until June 28, 2019, to reach a consensus on a corrective action plan. As the School District began receiving monthly financials showing LMA's negative fund balance, the School District also began receiving notices from various sources reporting that LMA was delinquent on certain payments, including, but not limited to, the Florida Department of Management Services regarding LMA's failure to make payments on behalf of its employees to the FRS; LMA employees reporting LMA's failure to make payroll; and LMA's failure to pay Best and Brightest bonuses to teachers, who had been awarded those bonuses by the State. The School District made repeated attempts to reach a consensus on a corrective action plan with LMA by having numerous meetings with LMA's CFO Cornelle Maxfield and providing feedback on LMA's proposed corrective action plan. Each time, Ms. Jenkins identified numerous issues with LMA's proposed corrective action plan, including, but not limited to LMA's failure to segregate federal funds because such funds cannot be used to balance the budget. Each time, Ms. Jenkins also requested the documentation and information necessary to develop a corrective action plan, including requests for a detailed budget, support for revenue increases estimated by LMA, documentation supporting LMA's cash flow analysis and documentation evidencing payment of payroll taxes, workers' compensation, FRS, all utilities, and Best and Brightest bonus payments. Each time, LMA failed to provide the requested documentation or correct the issues identified. The School District also continued to remind LMA that the next School Board meeting was scheduled for July 23, 2019, and that the School District hoped to have a recommendation for LMA's solvency at that time. Even so, LMA repeatedly failed or refused to respond to these requests. As a result, LMA and the School District were unable to reach a consensus on a corrective action plan. LMA's financial mismanagement and the danger this mismanagement posed to the students' health, safety, and/or welfare rendered it unable to adequately provide the most basic services for its students, including food and water. The testimony and evidence presented by the School Board on this issue remains undisputed that LMA could not pay the invoices and debts identified below, as they came due. Further, LMA offered no evidence to rebut the severity of LMA's financial mismanagement and its inability to protect the health, safety, and welfare of its students. Given LMA's inability to protect student health, safety, and welfare, the School Board had substantial bases to immediately terminate the Contract pursuant to section 1002.33(8)(c). Within two days of the issuance of the initial Notice of Immediate Termination, the School Board requested the assistance of Carr, Riggs, & Ingram, LLC ("CRI"), to complete a forensic audit of LMA's documents, data, and other information. Although the School Board already possessed significant information at the time of termination showing that LMA's financial mismanagement posed an immediate and serious danger to student health, safety, and/or welfare, LMA's refusal to cooperate and produce financial records resulted in the School Board not knowing the full extent of LMA's debt. CRI's task was to fully review the revenues and expenses of LMA to determine whether all funds due to LMA had been received and properly spent by the charter school. CRI completed its Forensic Investigation Report ("CRI Report"), dated August 23, 2019. However, although LMA attempted to justify why documents had not been provided to CRI, as will be discussed at length later in this Final Order, at the time of the hearing, the School Board still could not fathom the true extent of LMA's debt, since LMA had not produced the required financial records despite numerous requests from the School Board and Orders from the undersigned. Therefore, CRI explained that the CRI Report was based on findings as of August 23, 2019, because they still lacked information to paint a complete picture of LMA's finances. As of August 23, 2019, LMA's outstanding liabilities totaled $1,539,476.29. This amount includes $780,127.43 in unpaid invoices/liabilities, $499,636.23 in debt funding, and $259,712.63 in payroll owed. As of August 3, 2019, LMA's operating account had a negative balance of $526.97. Of the $780,127.43 owed in unpaid invoices and liabilities, LMA owed $373,852.01 to the IRS. A review of available employee payroll records showed that taxes were deducted from employee gross pay, but were not always remitted to the IRS. When asked about these payments at deposition, both Ms. Maxfield and Mr. Hundley chose to assert their Fifth Amendment rights and refused to answer the questions. Mr. Hundley did not attempt to offer testimony at hearing regarding the unpaid payroll taxes. Ms. Maxfield was not called by LMA to testify at hearing. The CRI Report also revealed that LMA owes $81,917.45 to the FRS. Beginning as early as March 2019, the Florida Department of Management notified both LMA and the School Board of LMA's failure to pay statutory dues pursuant to section 121.78, Florida Statutes, which requires that contributions made to FRS shall be paid by the employer, including the employee contributions, to the Division of Retirement by electronic funds transfer no later than the fifth working day of the month immediately following the month during which the payroll period ended. The statute further provides that employers, who fail to timely provide contributions and accompanying payroll data, shall be assessed a delinquent fee and/or be required to reimburse each member's account for market losses resulting from late contributions. § 121.78(3)(a)-(c), Fla. Stat. Despite LMA's failure to remit FRS payments, FRS contributions were deducted from employee gross pay throughout the 2018-2019 school year. When asked about these payments at deposition, both Ms. Maxfield and Mr. Hundley chose to assert their Fifth Amendment rights. As of August 23, 2019, LMA owed $76,118.88 to Humana for employee's health insurance coverage. Although payments to Humana remained unpaid at the time of the hearing, LMA did deduct contributions for Humana insurance coverage from employee gross pay throughout the 2018-2019 school year. When asked about these payments at deposition, both Ms. Maxfield and Mr. Hundley chose to assert their Fifth Amendment rights. At the time of hearing, LMA also owed a total of $74,306.76 to various technology service vendors that LMA relied upon for the provision of internet, voice services, and support for equipment used by students. For example, LMA owed $43,542.00 to Indian River Networks for various services, including, but not limited to, webhosting; network management site support; helpdesk services for faculty, staff, and board members; technology support services for student computers; monthly site visits; and onsite emergency services. LMA owed Spectrum Business a total of $539.90 for internet and voice services. When asked about Indian River Networks at deposition, Ms. Maxfield chose to assert her Fifth Amendment right. With respect to educational services for its students, LMA owes $35,895.00 to Children's Therapy Solutions, Inc. Child Therapy Solutions, Inc., provided speech language pathology services to LMA students. Because LMA was not eligible for any direct funding pursuant to the Individuals with Disabilities Education Act ("IDEA") for the 2018-2019 school year, LMA's Exceptional Student Education ("ESE") funding came through its monthly Florida Education Finance Program ("FEFP") payments from the School District. As evidenced by the unpaid invoices from Children's Therapy Solutions, Inc., LMA did not properly allocate these funds. In addition to the foregoing vendors, LMA failed to pay teacher recruitment and retention awards earned in the form of Best and Brightest bonuses. On or about March 26, 2019, LMA received $19,531.74 from the State of Florida pursuant to the Best and Brightest program. LMA possessed a list of the employees, who were entitled to receive these funds. In fact, on May 30, 2019, Ms. Jenkins e-mailed Ms. Maxfield, notifying her that two Best and Brightest recipients contacted the School District because they had not received their Best and Brightest checks. When asked about these payments at deposition, both Ms. Maxfield and Mr. Hundley chose to assert their Fifth Amendment rights. LMA failed to properly pay its employees. It owes approximately $259,712.63 in unpaid salaries. When asked about these payments at deposition, Ms. Maxfield and Mr. Hundley chose to assert their Fifth Amendment rights. When asked at that same deposition whether she continued to be paid when LMA was unable to pay their other employees, Ms. Maxfield chose to assert her Fifth Amendment right. Payroll records show that LMA paid Ms. Maxfield through July 15, 2019. Payroll records show that Mr. Hundley received a salary of $175,000.00, while Ms. Maxfield received a salary of $92,500.00 for the 2018-2019 school year. In addition to their base salaries, Mr. Hundley was paid an additional $32,150.00 and Ms. Maxfield was paid an additional $31,300.00 prior to LMA's opening on July 1, 2018, ostensibly for work performed in advance of the school year. LMA also paid Mr. Hundley an additional $2,450 per month and Ms. Maxfield an additional $1,150 per month for expenses during the 2018-2019 school year and 2019 summer. Neither of these additional monthly payments, allegedly for "expenses," required documentation of how the additional compensation was spent. This equates to $29,400.00 annually in addition to Mr. Hundley's $175,000.00, and $13,800.00 annually in addition to Ms. Maxfield's $92,500.00. Mr. Hundley's salary was nearly double what he previously received as principal of Lincoln Memorial Middle School, where he earned $105,560.00. When asked at their depositions about these salaries and expenses and the purposes of the additional compensation labeled "expenses," Mr. Hundley and Ms. Maxfield asserted their Fifth Amendment rights. To obtain additional funding to continue operations, LMA was issued promissory notes by third parties and employees and sold receivables prior to and throughout the 2018-2019 school year to raise additional capital. As of August 23, 2019, LMA owed approximately $499,636.26 to numerous promissory note holders in addition to the $780,127.43 owed in unpaid invoices and liabilities. With respect to its sales of receivables, LMA entered into purchase agreements with several holders, including Charter School Capital, Pearl Capital Funding, CFG Merchant Solutions, and ROC Funding Group. By entering into these agreements, LMA authorized some of these holders to make daily deductions from LMA's bank account. For example, bank statements show that there was a daily debit of $1,479.00 by CFG Merchant Solutions, a daily debit of $725.00 by ROC Funding Group, and a daily debit of $1,499.00 by Pearl Capital Funding. This equates to $18,515.00 each Monday through Friday workweek. Further, on July 15, 2019, Mr. Hundley signed an ACH Debit form, additionally allowing Pearl Capital to debit $7,495.00 from LMA's operating checking account. When asked about these promissory notes and loans at their depositions, Ms. Maxfield and Mr. Hundley chose to assert their Fifth Amendment rights. These facts went unrebutted by LMA at hearing. LMA also allowed its insurance for student athletes to lapse while LMA students were on campus participating in student athletics. Although outrage was expressed by Mr. Hundley that such an accusation was made, no credible evidence was offered into the record to rebut this fact. Instead, at his deposition, Mr. Hundley asserted his Fifth Amendment right, when asked whether Ms. Maxfield kept him apprised of outstanding invoices related to student health, safety, and welfare. As a school within the School District, LMA was required to offer insurance to its student athletes. Maintenance of insurance for student athletes ensures that the student athletes are able to pay any necessary medical bills and, therefore, furthers the health, safety, and welfare of LMA's student athletes. As such, this failure to maintain coverage alone constitutes a danger to student health, safety, and/or welfare. The School Board disbursed all funds owed to LMA, which amounted to a total of $4,095,973.08 in federal, state, and local funding. Funding disbursed by the School Board to LMA included $150,256.00 for Title I, $133,067.16 for the 21st Century program, and $19,531.74 for Best and Brightest bonuses. When asked at her deposition whether the School Board paid all FEFP payments to LMA in a timely manner, rather than responding to such a direct and verifiable question as that, Ms. Maxfield asserted her Fifth Amendment right. When asked whether LMA timely received Title I funds, Ms. Maxfield asserted her Fifth Amendment right. When asked whether LMA timely received all allocations from the School Board, she asserted her Fifth Amendment right. When asked whether the School Board ever withheld funds from LMA to which LMA was entitled, she asserted her Fifth Amendment right. When asked if LMA timely received all 21st Century program funding owed, she asserted her Fifth Amendment right. When asked whether LMA timely received all federal, state, and local funding distributed through the School Board, Ms. Maxfield asserted her Fifth Amendment right. Ms. Maxfield, as LMA's highly compensated CFO, was in the best position to know what the state of the finances were of LMA, yet refused throughout the hearing process to provide documentation or testimony to clarify the issues raised by the School Board in its Notice of Immediate Termination. After the close of the hearing, the School Board received for the first time a copy of an agreement signed on July 1, 2019, by Mr. Hundley on behalf of Total Life Prep, LLC ("TLP"), and Ms. Dawson on behalf of LMA. In the agreement, LMA agrees to pay TLP an annual fee of $275,000.00 in year one, the greater of $500 per student or $280,000.00 in year two, $285,000.000 in year three, $290,000.000 in year four, and $295,000.00 in year five to pay for TLP products. Mr. Hundley is TLP's registered agent. Although this document was clearly responsive to discovery requests, it was never produced to the School Board by LMA. The School Board filed a Motion for Leave to Submit Supplemental Evidence Supporting Petitioner's Proposed Order on September 18, 2019 (a subsequent amended and second amended motion were filed on September 19, 2019, but changed only the paragraph concerning conferring with opposing counsel), including an affidavit from School Board General Counsel Mitchell Teitelbaum, as to when and how he received the document. The School Board was deprived of the opportunity to cross-examine Mr. Hundley, Ms. Maxfield, and Ms. Dawson about this agreement, because it was not produced in discovery. Based upon these facts, and the fact that LMA either concealed or refused to produce such a substantive piece of evidence, the undersigned hereby accepts the document and grants the School Board's motion to include the additional evidence in the record as Petitioner's Exhibit 52 in Binder 3-3. Although LMA, based upon the verified $4 million in state, federal, and local funds it actually received, should have been able to meet its employees' payroll, insurance, and FRS benefits, as well as pay for its students' food deliveries and the water utility bill, LMA decided to enter into an agreement that would require it to pay TLP (and/or Mr. Hundley) approximately $1,425,000.00 over a five-year period. Since the document was not produced, no explanation was given by LMA as to why it sought this additional funding or whether TLP was a company-owned or controlled by Mr. Hundley or any employees of LMA. This contract is indicative of a pattern of behavior by LMA leaders, who continuously made decisions that presented a serious and immediate danger to the health, safety, and/or welfare of LMA students for self-gain. Further, it appears that this agreement was entered into in an attempt to circumvent section 1012.795, by paying Mr. Hundley as TLP rather than as CEO of LMA. Regardless of the fact that LMA could not pay its employees' payroll, insurance, or FRS benefits and could not pay for its students' food deliveries or the water utility bill, the charter school decided to enter into an agreement that would require it to pay TLP (and/or Mr. Hundley) approximately $1,425,000.00 over a five-year period. Regardless of how this agreement is characterized, Mr. Hundley and the Governing Board acted in direct violation of the EPC Order revoking Mr. Hundley's certification as an educator, and were dismissive of the Commissioner of Education's clear warnings to LMA, the EPC's Final Order, the ALJ, and, most recently, the School Board throughout the discovery period. This put the School Board at a distinct disadvantage in preparation for and presenting its case at hearing. Ultimately, by the limited testimony they chose to offer at hearing, LMA has not disputed the fact that it has a debt of at least $1,539,476.29. By invoking their Fifth Amendment rights, Ms. Maxfield, the CFO of LMA, and Mr. Hundley, the CEO of LMA, have not denied their knowledge of the shortfall in funds for the first-year operations of LMA. LMA's actions in seeking outside funding, issuing promissory notes, and withholding payments to teachers and staff, speak far louder than two individuals' refusal under the Fifth Amendment to answer any pertinent questions about LMA's financial picture. LMA has not offered any evidence challenging the fact that its financial mismanagement was a consequence of poor decision-making and inadequate oversight by LMA's Governing Board, CEO and Principal Hundley, and CFO Maxfield. A lengthy discussion will follow below concerning LMA's contention that all their woes were the result of the School Board not directly intervening in the day-to-day operations of LMA, an independent charter school. However, regardless of such a claim by LMA, the poor decision-making by the leaders of LMA directly interfered with LMA's ability to ensure student health, safety, and welfare. Accordingly, and in the absence of any evidence to the contrary, the School Board had substantial basis to immediately terminate LMA's charter pursuant to section 1002.33(8)(c). LMA's Failure to Adequately Comply with Nutritional and Recordkeeping Requirements and Inability to Pay Invoices for Food Services was a Danger to Student Health, Welfare and/or Safety The Contract requires LMA to provide food services to its students consistent with applicable law and to comply with federal requirements for free and reduced meal service. If the charter school chooses to participate in the NFSP, the Contract additionally requires that the charter school follow all applicable federal rules and regulations. Records of all property acquired with federal funds must be maintained. Although the Contract expressly states that the school is entitled to receive all funds provided by the federal and state government for its food service program, it also expressly states that the School Board "shall provide no administrative support for the School's food service program." LMA chose to independently run its food services program. LMA also chose to participate in the NFSP and had its own agreement with the Florida Department of Agriculture and Consumer Services ("Florida Department of Agriculture") regarding implementation of the NFSP. Because LMA had its own agreement with the Florida Department of Agriculture, it would have been inappropriate for the School Board to become involved unless LMA specifically requested the School Board's involvement. By participating in the NFSP, LMA was able to serve 100 percent of its students a free breakfast, lunch, and snack on a daily basis. The NFSP provides federal funding in the form of reimbursement to schools for the purpose of providing free and/or reduced priced lunches for students. As a reimbursement program, funding is issued based on the content of the meals served. To be reimbursable, the meals must comply with certain nutritional standards. Such standards include the meal pattern requirements issued by the United States Department of Agriculture. For example, according to the meal pattern, a reimbursable lunch must include two full components and a fruit or vegetable. Additionally, during the 2018-2019 school year, all grains served had to be whole grain. If a meal does not meet these requirements, it is not reimbursable. Unlike other sources of federal, state, and local funding that is disbursed by the School Board, the Florida Department of Agriculture directly issued reimbursement to LMA. During the 2018-2019 school year, LMA received $390,277.46 in NFSP reimbursements. Of the $390,277.46, approximately $173,381.93 was spent on food-related expenses. Of the food related expenses, $162,828.90 was paid to U.S. Foods, Inc., and Borden Dairy, while $10,553.03 was spent at local grocery stores, such as Sam's Club, Publix, and Aldi. Of the total $390,277.46 received, CRI was able to account for $268,339.71 spent on food services expenses, leaving $121,937.75 in excess reimbursement. When asked at deposition whether he knew where NFSP funds were deposited, Mr. Hundley asserted his Fifth Amendment right. When asked whether he had any knowledge regarding how NFSP funds were utilized, Mr. Hundley asserted his Fifth Amendment right. When asked whether he had knowledge regarding how LMA spent the excess reimbursement from NFSP, Mr. Hundley asserted his Fifth Amendment right. LMA received another $40,402.01 in NFSP funding for May 2019 and $17,250.43 for June 2019. As of August 3, 2019, LMA's operating account was $526.97 in the negative. LMA currently owes U.S. Foods, Inc., $18,900.59 and Borden Dairy $3,704.59. How LMA spent this excess $121,937.75 remains unknown. To receive this reimbursement, LMA was required to send the number of reimbursable meals served to the Florida Department of Agriculture on a monthly basis. All reimbursable meals must be accounted for. One way to account for and substantiate the reimbursable meals served is through the maintenance of food production records. Production records detail what is served on a particular day and serve as backup documentation showing that the school followed the U.S. Department of Agriculture's meal pattern with respect to meals claimed for reimbursement. The Florida Department of Agriculture conducts an administrative review of records belonging to schools participating in the NFSP every three years. When such a review is done, the Florida Department of Agriculture generally reviews the production records to substantiate the meals claimed for reimbursement and to ensure that the meals claimed followed the meal patterns. Copies of any child nutritional labels or other nutritional information for products served may also be required. In light of these administrative reviews, participating schools are required to maintain these records for a period of five years. If a school's claims for reimbursement cannot be substantiated, the Florida Department of Agriculture may request repayments of the funds previously distributed. The Florida Department of Agriculture may also suspend or terminate its services pursuant to the NFSP. Despite numerous requests by the School Board, LMA has not produced any food production records. And following its termination of LMA's charter, the School Board (with the assistance of CRI) was only able to recover one week's worth of LMA's production records for the 2018-2019 school year. Director of Food and Nutrition for the School District, Regina Thoma, explained that LMA's Cafeteria Manager, Angela Enrisma, told her that she no longer had access to the production records or the software that held the production records. Ms. Enrisma also told Ms. Thoma that CFO Maxfield took the paper production records. Ms. Enrisma similarly testified during her deposition that she kept the production records in a box in her office, and that Ms. Enrisma gave Ms. Maxfield the box of productions on the last day of school. Ms. Enrisma additionally testified that she did not make electronic copies of the production records and that she did not know where the production records were presently located. Despite the fact that LMA's qualified representative Christopher Norwood advised the undersigned that he would ask Ms. Maxfield to produce the box of production records, neither Ms. Maxfield nor anyone else at LMA has produced those records. The location of LMA's production records remains unknown, as is whether these records remain accessible digitally, or even exist. LMA has also failed to rebut the fact that, in the absence of such records, LMA would be liable for penalties for failing to preserve these records, including, but not limited to, repaying funds already received totaling $390,277.46 and suspension or termination of the NFSP program. During the hearing, the School Board requested that the undersigned apply an adverse inference with respect to LMA's failure to comply with the law if LMA failed to produce the requested production records. In response, the undersigned stated that "either these records exist, or they have been destroyed or misplaced or lost. And if they're destroyed, misplaced, or lost, then the inference will be that no such records exist." The undersigned further advised that "there have to be records . . . [a]nd if there aren't records, the inference I make is that the records have been destroyed or hidden." In the conclusions of law to follow, a ruling on the use of adverse or negative inferences will be made concerning both this issue and the invoking of the Fifth Amendment by the CEO and CFO of LMA on all questions relating to the fact and location of LMA funds that remain unaccounted for. The location of these records--aside from the one week CRI (not LMA) was able to find--remains unknown. As will be discussed below, the defense from LMA that the School Board took over the school and had access to all records that existed on the day control was assumed, does not absolve LMA from protecting records either electronically or with back-up copies. Concerning the food service program at LMA, the undersigned must infer that the production records do not exist, were hidden, destroyed and/or were lost and that, consequently, LMA failed to comply with applicable law, rules, and regulations pursuant to the NFSP. As noted previously, LMA served 100 percent of its students a free breakfast, lunch, and snack on a daily basis using funds received from the NFSP. Many students were dependent upon these meals as their only daily nourishment. To the extent that students relied upon the provision of free meals given pursuant to the NFSP, discontinuation of this service would clearly pose a danger to the students' health, safety, and/or welfare. Given LMA's failure to comply with NFSP's requirements, the School Board had substantial basis to immediately terminate the Contract pursuant to section 1002.33(8)(c). Moreover, school was scheduled to start within just a few weeks of the July 23, 2019, School Board meeting. As proof of another lack of attention to detail, LMA has not produced any records showing that it properly screened student meals for allergens. For example, the School District uses software that notifies cafeteria employees when a student has an allergy. Once the software notifies the cafeteria employee of a student's allergy, the employee checks the student's tray to make sure the student does not have any products containing the allergen. Such precautions are implemented because food allergies can be life threatening. LMA refused or failed to produce any records showing that it implemented a similar process or otherwise screened for allergens when serving student meals. LMA also did not offer any rebuttal evidence during the course of discovery or during the hearing showing that LMA screened for allergens. As already noted, the undersigned acknowledged during the hearing that in the absence of records or rational explanation, LMA would be unable to rebut issues raised by the School Board in its Notices of Immediate Termination. The undersigned further advised that, in the absence of requested records or rebuttal evidence, the undersigned would infer that these records did not exist or were hidden and/or destroyed. Accordingly, in the absence of any records or rebuttal evidence, the undersigned finds that LMA failed to properly screen student meals for allergens. Given the serious and potentially life-threatening nature of allergies, any failure to screen student meals for allergens clearly poses a danger to student health, safety, and/or welfare. In the case of a school that boldly claims it was formed to do better by its community, such lack of institutional control is disheartening at best. Accordingly, LMA had substantial basis to immediately terminate LMA's charter pursuant to section 1002.33(8)(c). LMA was not able to pay for its food deliveries. A case in point involves U.S. Foods, a mainline food distributor that provides food service, food, and related supplies to restaurants, schools, and other institutions. Schools, especially those that participate in the NFSP, use mainline distributors, such as U.S. Foods, Inc., because their products include child nutrition labels. Child nutrition labels contain information specifically used to assist in complying with the U.S. Department of Agriculture's meal patterns. Without child nutrition labels, it is much more difficult, although not impossible, to ensure that meals meet the meal pattern and are, therefore, reimbursable. Throughout the 2018-2019 school year, LMA had issues paying U.S. Foods, Inc., for its food deliveries. On May 8, 2019, U.S. Foods, Inc., stopped making deliveries to LMA altogether due to nonpayment. LMA currently owes U.S. Foods, Inc., $18,900.59. Borden Dairy was LMA's milk provider. Borden Dairy stopped delivering to LMA on May 24, 2019, due to nonpayment. LMA currently owes Borden Dairy $3,704.59. After U.S. Foods, Inc., and Borden Dairy stopped making these deliveries, Ms. Enrisma, began purchasing foods from local grocery stores, including, but not limited to, Sam's Club, Aldi, Winn Dixie, and Publix. Products purchased from Sam's Club, Aldi, Winn Dixie, and Publix do not have child nutrition labels. At least three receipts, one for purchases made at Sam's Club and two for purchases made at Winn Dixie, contained food items that do not meet the U.S. Department of Agriculture's meal patterns. If LMA served students any items that did not meet meal pattern requirements, such meals would not be reimbursable pursuant to the NFSP. Notably, LMA sought reimbursement for meals pursuant to the NFSP after U.S. Foods, Inc., stopped making deliveries to LMA. When asked at deposition whether he was aware that LMA purchased food from Publix and Aldi to be served to LMA students, Mr. Hundley asserted his Fifth Amendment right. Ms. Thoma visited LMA for the first time since the July 23, 2019, termination of LMA's charter on July 29, 2019. When she arrived, Ms. Enrisma expressed relief because school was starting in two weeks and she was not sure how they were going to feed the students. LMA failed to offer any rebuttal to the following: (1) LMA's financial mismanagement resulted in U.S. Foods, Inc., ceasing services due to nonpayment; (2) the discontinuation of these deliveries resulted in LMA's cafeteria manager purchasing products from local grocery stores that did not have child nutrition labels; (3) products purchased from these local grocery stores did not meet NFSP's meal patterns; (4) these products were not screened for allergens; and (5) despite all of this, the food was served to students. Further, LMA has failed to offer any evidence or rebut the fact that LMA's inability to provide free and nutritional meals to its students posed a serious and immediate danger to student health, safety, and/or welfare. For example, it remains undisputed that upon Ms. Thoma's arrival at the school, LMA's own cafeteria manager expressed that she was unsure how she was going to feed the students moving forward. It is also undisputed that LMA students depended upon LMA's provision of these meals. In light of the foregoing, the School Board had substantial basis to immediately terminate the Contract pursuant to section 1002.33(8)(c). Perhaps the most inexplicable failure to pay issue in this case involved LMA's water utility bill. On or about July 22, 2019, LMA received a water shut-off notification from the City of Palmetto, Florida ("City"), due to an unpaid balance of $3,216.67. In the notice, the City indicated that LMA's payment was 45 days past due and that the payment must be made by 5:00 p.m. on July 29, 2019. The City further indicated that it would shut off LMA's water on July 30, 2019, if LMA failed to make this payment. On July 10, 2019, just twelve days earlier, LMA had received $281,229.85 in FEFP funds. By August 3, 2019, LMA's operating account had a negative balance of $526.97. Notably, this was not LMA's first water shut-off notice from the City. On or about June 17, 2019, LMA received a water shut-off notification due to an unpaid balance of $12,439.23. The notice advised that the City would turn off LMA's water if payment was not made. Mr. Hundley testified that he was aware that LMA received water shut-off notices in both June and July. Accordingly, it is undisputed that LMA received notices from the City threatening to turn off LMA's water due to nonpayment. Further, LMA began receiving notices from the City regarding their failure to pay the water bill as far back as April 2019. For example, the City records state that on April 1, 2019, Ms. Maxfield admitted to a City representative that LMA has not paid "in a while" and that she would make payment that day. However, she did not pay that day. The City representative called her three more times and left a voicemail. The following day, the City representative again attempted to contact Ms. Maxfield. Ms. Maxfield indicated that "state funds are slow coming in." When the City representative attempted to follow up later that day, the City representative was informed that Ms. Maxfield was gone for the day. On April 3, 2019, the City representative was unable to reach Ms. Maxfield, but did speak with Mr. Hundley. Mr. Hundley informed the City representative that, "Lincoln Memorial have exhausted their reserves and that is why they haven't paid for the last four months." The City representative subsequently made numerous attempts to create a payment plan, but Mr. Hundley and Ms. Maxfield--"the only ones that can help"--were consistently unavailable. It is undisputed that a school cannot operate without running water. It is also undisputed that LMA's failure to have running water would pose a serious and immediate danger to the students' health, safety, and welfare. Even Christine Dawson, chair of LMA's Governing Board, admitted that protecting student safety means ensuring students have adequate access to water. The failure of LMA to ensure the school was able to provide such a basic necessity as running water further demonstrates that the School Board had substantial basis to immediately terminate the Contract pursuant to section 1002.33(8)(c). LMA's Failure to Background Screen Employees was an Immediate and Serious Danger to the Health, Safety, and Welfare of Charter School Students The Contract sets forth the processes that LMA must follow with respect to background screening and fingerprinting its employees. As discussed previously, the Contract expressly states that the school shall implement policies and procedures for background screening of all prospective employees, volunteers, and mentors, and the school shall require all employees to be fingerprinted. The Contract further provides that the results of all background investigations and fingerprinting "will be reported in writing to the Superintendent and/or his/her designee"; that "[n]o school employee or member of the Governing Board may be on campus with students until his/her fingerprints are processed and cleared"; and that "the School shall ensure that it complies with all fingerprinting and background check requirements." "Cleared" means that any criminal history that shows up as a result of such background screening is reviewed. LMA was solely responsible for hiring and background screening its personnel. The School Board was not responsible for interviewing, hiring, selecting, or background screening LMA employees. The terms of the Contract mimic Florida statutory law requiring that instructional personnel, non-instructional personnel, and governing board members undergo a Level 2 background screening prior to hire, pursuant to section 1012.32(2). If the results of a background screening reveal that an individual has been arrested for and/or charged with certain offenses, the law forbids the school from employing the individual. Examples of such offenses include felony theft in excess of $3,000.00. See §§ 1012.315(1)(z) and 435.04(2)(cc), Fla. Stat. LMA contracted with DeAnna King and her company, King HR Services, LLC ("King"), to operate LMA's human resources ("HR") department. Pursuant to King's contract with LMA, the company was hired to provide "complete employee support," recruit employees, and implement policies and procedures for background screening of employees, volunteers, and mentors. The School Board was not a party to LMA's contract with King. Despite King's contractual duties to properly background screen and fingerprint employees prior to hire, LMA never shared the Contract with Ms. King. Despite this, Ms. King testified that she was familiar with Florida statutory law and legal requirements regarding employment of school employees, including sections 453.04 and 1012.32, Florida Statutes. Ms. King also testified that she understood that employees must undergo a Level 2 background screening before setting foot on campus, that she needed to submit fingerprints to the Florida Department of Law Enforcement ("FDLE") to adequately complete a Level 2 background screening, and that an offer of employment at a school is conditional pending the results of a Level 2 background screening. Following the School Board's immediate termination of LMA's charter, the School District was required to validate that LMA had properly subjected LMA employees to a Level 2 background screening. During the validation process, the School District discovered that LMA did not have fingerprint results or clearance letters on file for 13 of LMA's employees. Pursuant to the Contract, clearance letters should have been on file for each of these individuals prior to their beginning employment with LMA. Among the individuals listed were CFO Maxfield and a "security official" named John Walker. LMA initially hired John Walker on July 30, 2018. Once properly screened by the School District, Mr. Walker's background results revealed that he was arrested for felony grand theft in the third degree in February 2016, and was re-arrested for violating his probation for grand theft on July 10, 2018, less than two weeks before LMA hired him. Based on these results, the School District would not have cleared him to work at LMA. In fact, absent any evidence of disposition, the statute forbids it. See §§ 435.04(2)(cc) and 1012.315(1)(z), Fla. Stat. Ms. King admitted that she never received the fingerprinting results for any LMA employees. Ms. King also admitted that she allowed the 13 employees identified by the School District to start working at LMA, but never reviewed their background screening results. When asked at deposition whether she understood the background screening process, Ms. Maxfield, who supervised Ms. King, asserted her Fifth Amendment right. When asked whether she was aware that LMA allowed employees to work that did not pass their background screening, Ms. Maxfield asserted her Fifth Amendment right. When asked to describe LMA's hiring process, Ms. Maxfield asserted her Fifth Amendment right. When asked whether Ms. Maxfield was responsible for overseeing the background clearance process, Ms. Maxfield asserted her Fifth Amendment right. As evidenced by the foregoing, LMA has failed to offer any evidence rebutting the fact that LMA allowed individuals to start working at the school prior to reviewing their background screening results or receiving clearance letters from the School District; that Ms. King never reviewed the fingerprint results for any employees, including the 13 employees identified by the School District, before allowing them to work at LMA; that the School District would not have cleared at least one of these individuals, John Walker, to work at LMA; and that failure to subject individuals to a Level 2 background screening prior to employment poses an immediate and serious danger to student health, safety, and welfare. The very purpose of background screening is to protect students and ensure their safety. LMA's failure to adequately protect its students and ensure their safety further supports the fact that the School Board had substantial basis to immediately terminate the Contract pursuant to section 1002.33(8)(c). Eddie Cantrel Hundley's Presence on Campus, with Permission of LMA's Governing Board, Constituted an Immediate and Serious Danger to the Student's Health, Safety, and Welfare Eddie Cantrel Hundley served as LMA's founder, principal, and CEO for the 2018-2019 school year. Mr. Hundley's employment agreement described his responsibilities as principal to include managing and overseeing all of the day-to-day operations of the school, which encompassed effective management of all functions, including, but not limited to: facilities, transportation, staff, faculty, food service, safety and security. With respect to his role as CEO, Mr. Hundley described his job responsibilities to include maintaining a "visible and accessible presence to the school's families and the local communities"; "supervising and directing the corporation's day- to-day activities and affairs"; and executing all decisions approved by the Governing Board. According to Mr. Hundley, he was "always" CEO. Although he appeared to be reluctant to admit this when testifying at hearing, as CEO, "the buck stopped" with Mr. Hundley. No others supervised Mr. Hundley, except for LMA's Governing Board. Also, no other individuals directly reported to the Governing Board, except Mr. Hundley. According to Mr. Hundley, as both CEO and principal, he was responsible for ensuring that the appropriate people were hired for the appropriate roles. LMA Governing Board Chair, Christine Dawson, testified that Mr. Hundley only acted as principal "when necessary" since the role of principal was not required. Ms. Dawson further explained that Mr. Hundley's role as principal was only necessary when "the district needed to require that a principal be at their meetings" or when the district, media, school, and board "recognized and noted" Mr. Hundley as principal. When asked about Mr. Hundley's duties as principal, Ms. Maxfield asserted her Fifth Amendment right. When asked about Mr. Hundley's duties as CEO, Ms. Maxfield asserted her Fifth Amendment right. When asked whether Mr. Hundley worked at the school each day when he was not CEO or principal, Ms. Maxfield asserted her Fifth Amendment right. When asked whether Mr. Hundley came to school each day, Ms. Maxfield asserted her Fifth Amendment right. On March 8, 2019, ALJ Lynne A. Quimby-Pennock issued a Recommended Order to the EPC (DOAH Case No. 18-5733PL), recommending that Mr. Hundley's educator's certificate be revoked for a period of five years pursuant to section 1012.795(1), thereby denying him the right to teach or otherwise be employed by a district school board or public school in any capacity requiring direct contact with students. Judge Quimby-Pennock recommended revocation due to Mr. Hundley's decision to give a positive reference in his official capacity as principal to another school district in support of a former employee, who was under investigation for having an inappropriate relationship with a minor. With respect to her findings of fact, Judge Quimby- Pennock concluded that, at the time Mr. Hundley gave the reference, which included Mr. Hundley answering "no" to the question of whether he had any reason to believe that the individual should not work with children, Mr. Hundley was aware of three different investigations into the employee, all involving allegations of inappropriate conduct with a student. Ms. Dawson testified that in response to the Recommended Order, the Governing Board decided on April 24, 2019, to remove Mr. Hundley's title as principal. The Governing Board also allegedly decided that Mr. Hundley would only have "supervised access" to students moving forward, meaning that Mr. Hundley would "not be alone with students." However, no one exceeded Mr. Hundley's rank at the school, and no one was assigned to accompany or supervise Mr. Hundley's interactions with students. The Governing Board placed no real restrictions on Mr. Hundley. Although Mr. Hundley's title as principal was eliminated, he remained CEO. The Governing Board did not remove or change Mr. Hundley's duties or restrict Mr. Hundley's ability to walk around campus or speak with students. Mr. Hundley also continued to use his same office on campus. Mr. Hundley found no reason to move his office. On May 13, 2019, the EPC issued a Final Order adopting Judge Quimby-Pennock's Recommended Order, including the revocation of Mr. Hundley's educator's certificate for a period of five years pursuant to section 1012.795(1). Even though the Governing Board members received the EPC's Final Order, they did not take any additional action with respect to Mr. Hundley's role as CEO or with respect to Mr. Hundley's presence on campus with students. On or about May 30, 2019, Ms. Dawson received a letter from Chief Randy Kosec, Jr., of the Florida Department of Education's Office of Professional Practices Services. In that letter, Chief Kosec notified Ms. Dawson of the EPC's revocation of Mr. Hundley's educator's certificate and asked if Mr. Hundley was still employed by or working on behalf of LMA. In the event that the answer was yes, Chief Kosec asked Ms. Dawson to explain Mr. Hundley's duties and how those duties could be carried out without Mr. Hundley having direct contact with students. Ms. Dawson waited until nearly a month later to respond to Chief Kosec's May 30 letter. When Ms. Dawson did finally respond on June 25, 2019, she explained that the Governing Board decided at its last board meeting that Mr. Hundley would no longer serve as principal, but would continue to serve as CEO/Founder of LMA. According to Ms. Dawson, LMA's last board meeting was held on April 24, 2019. Ms. Dawson further explained that Mr. Hundley's "executive functions," included "senior level leadership and oversight, strategic planning, program selection, and development of partnerships and resources beneficial to LMA." Mr. Hundley did not limit his future activities to these designated areas of responsibility. Subsequent to April 24, 2019, and throughout the month of June, Mr. Hundley continued to go to LMA's campus approximately three-four days per week to perform his duties as CEO. Video surveillance introduced into evidence shows Mr. Hundley in the cafeteria, while students are present, on June 18, 2019, throwing a ball with students in the cafeteria on June 20, 2019, and speaking with students in the gym on June 24, 2019. When asked whether LMA paid Mr. Hundley in June for work performed at LMA, Mr. Hundley asserted his Fifth Amendment right. LMA students were present on LMA's campus in both June and July of 2019 to take classes for credit recovery and as a part of the 21st Century Community Learning Centers Program ("21st Century"). The 21st Century is a program that supports the creation of community learning centers to provide academic enrichment opportunities, "particularly students who attend high- poverty and low-performing schools." Programs must include remedial educational activities and academic enrichment learning programs, mathematics and science education activities, tutoring services, and recreational activities. The state awards eligible entities funds to carry out 21st Century programing. LMA was the recipient of such funds, and had over 100 students enrolled during the 2019 summer months. On or about July 2, 2019, Chief Kosec responded to Ms. Dawson's June 25 letter, stating that he understood that Mr. Hundley would be serving as CEO/Founder of LMA, but that Ms. Dawson's response failed to explain how Mr. Hundley could carry out his duties without direct contact with students "which would mean that he would not be on campus at times when students are present, especially the function of 'senior level leadership and oversight.'" Ms. Dawson never responded. On July 16, 2019, Florida Commissioner of Education Richard Corcoran e-mailed Ms. Dawson and others, including, but not limited to, Governing Board members James Ward, C.J. Czaia, School District Superintendent Cynthia Saunders, and School Board General Counsel Mitchell Teitelbaum, to discuss his concerns regarding Mr. Hundley's ongoing presence on LMA's campus. In that letter, Commissioner Corcoran summarized the ruling of the EPC and the restrictions imposed upon Mr. Hundley as the result of the five-year revocation received by Mr. Hundley. The Commissioner stated that Mr. Hundley's actions giving rise to the revocation "had in fact jeopardized the healthy [sic], safety, and welfare of students. . . . As a result of the actions taken by the EPC, Mr. Hundley cannot legally perform the duties of a school administrator." If he cared as much about LMA and its students as he professes to, this language alone should have resulted in Mr. Hundley removing himself from any active administrative duties with LMA. When asked what action, if any, was taken in response to Commissioner Corcoran's July 16 correspondence, Ms. Dawson testified that "[t]he action taken happened on April 24th," when the Governing Board removed Mr. Hundley's title as principal and "addressed the direct contact with students, our interpretation of it, through our research and the law." The School Board argued that, notwithstanding the Governing Board's alleged interpretation of law, the plain meaning of the applicable statute is clear. An administrator whose educator's license is revoked cannot be employed in any capacity requiring direct contact with students for the duration of the revocation period, pursuant to section 1012.795. The Florida Department of Education has additionally interpreted this statute to mean that an individual cannot be employed in a position that would require him to be on campus while students are present. Despite the law's clear language and the Commissioner of Education's letter quoting the same, Mr. Hundley was back on campus the following day, July 17, 2019. In fact, video surveillance on this date shows Mr. Hundley speaking with students and hugging a student in the cafeteria. When asked at his deposition in what capacity he worked in July 2019, Mr. Hundley asserted his Fifth Amendment right. On July 16, 2019, Commissioner Corcoran also e-mailed Superintendent Cynthia Saunders and School Board Chair Dave Miner. Analogous to his July 16 correspondence to the LMA Governing Board, Commissioner Corcoran expressed extreme concern regarding Mr. Hundley's presence on campus. After receiving Commissioner Corcoran's detailed letter expressing his concerns with Mr. Hundley being on the LMA campus following the revocation of his certification, Superintendent Cynthia Saunders, School Board Member Reverend James Golden, and School Board General Counsel Mitchell Teitelbaum met with two of LMA's Governing Board members, individually, to ask that they remove Mr. Hundley from campus. The Governing Board did not cooperate. On July 22, 2019, Mr. Hundley sent an e-mail to LMA staff with the subject title, "moving forward." The e-mail included an attachment, which stated: After careful consideration and appreciation for the events of the past several years and with specific interest in obtaining the peaceful resolution of the issue of my leadership at LMA, I am stepping down from my position as Principal, effective immediately. . . . The revocation of my licensee [sic] was an action taken by an overreaching law judge that is being exploited by a biased school district and misinformed commissioner of education. Our own LMA Board disagreed with their erroneous findings in consideration of a state statute and kept their confidence in me as I remained in place in my role at LMA. . . . Rest assured, I will continue to provide the needed guidance and direction to the school leadership to ensure the progress of our mission of providing the best possible teaching and learning experience for all students . . . . Prior to that date, despite the testimony that the Governing Board had removed Mr. Hundley as principal of LMA on April 24, 2019, LMA staff was unaware of any changes with respect to Mr. Hundley's role as CEO or principal. Mr. Hundley's last day on campus was July 24, 2019, the same day that the School Board issued its Notice of Immediate Termination pursuant to section 1002.33(8)(c). It is undisputed that Mr. Hundley continued to come to campus until the School Board terminated the charter. It is undisputed that Mr. Hundley remained CEO even after issuance of the May 13, 2019, EPC Order, since even his e-mail of July 22, 2019, "stepping down" as principal after having been removed from the post by the Governing Board on April 24, 2019, did not include a statement that he was stepping down as CEO. It is undisputed that students were on campus for the 21st Century program and for credit recovery during the summer months. It is undisputed that Mr. Hundley continued to have direct contact with students while on campus. Finally, even if Mr. Hundley did nothing to harm any student while on campus after his certification was revoked by the EPC, it is undisputed that his presence on campus, by operation of law, posed a danger to the students' health, safety, and/or welfare, due to the revocation of his educator's certificate. This evidence remains unrebutted due primarily to his refusal to testify to the essential elements leading to the Notice of Immediate Termination. Respondent Failed to Rebut Any of the Foregoing Evidence and Failed to Otherwise Prove Any of the Allegations Asserted in its Defense On July 23, 2019, the School Board held its regularly scheduled School Board Workshop ("Workshop"). The Workshop had an agenda item for the discussion of the financial condition of LMA. During the Workshop, Mitchell Teitelbaum addressed the School Board regarding the immediate and serious danger to the health, safety, and welfare of LMA students, including the concern related to Mr. Hundley's continued presence on campus despite the Final Order of the EPC revoking his educator's certificate pursuant to section 1012.795. Tammy Taylor, director of finance, and CFO Heather Jenkins addressed the dire financial condition of LMA. During the Workshop, Mr. Teitelbaum presented multiple documents to the School Board regarding LMA's continuous failure to cooperate with the School Board and refusal to provide essential information necessary to ensure that the health, safety, and welfare of its students were being met. During the Workshop, 13 members of the public signed up for the public comment portion of the meeting, and approximately 12 community members spoke in support of LMA. At the end of the Workshop, School Board Member Scott Hopes requested that Chairman Dave Miner amend that evening's School Board meeting agenda to address whether the School Board should assume the responsibility of the continuing operation of LMA and immediately terminate its charter. Later that same day, July 23, 2019, the School Board hosted its regularly scheduled meeting. At the beginning of the meeting, School Board Member Hopes moved to amend the agenda to include the issue of LMA. School Board Member Golden seconded the motion. The amended agenda was adopted unanimously. During the public comment portion of the School Board meeting, 41 members of the public signed up to participate, including a teacher from LMA who spoke about her 2018-2019 employment contract and unpaid wages. Approximately 23 members of the public spoke in support of LMA. Notably, Ms. Maxfield spoke in support of LMA, and Mr. Hundley was in the audience. At the conclusion of the public comments, Chairman Miner opened the discussion on the LMA topic. The School Board discussed the immediate and serious danger to the health, safety, and welfare of LMA students. School Board Member Hopes made the following motion: Approval of the Manatee County School Board to: Terminate the Charter of Lincoln Memorial Academy immediately in accordance with section 1002.33(8)(c), Florida Statutes, and section 1(d) of the Charter between the School Board of Manatee County and Lincoln Memorial Academy, Inc., d/b/a Lincoln Memorial Academy; Take over the operational control of Lincoln Memorial Academy Charter School and assume and continue the operation of the Charter School; Forthwith appoint an appropriate person to act as Interim Principal of the Charter School after requesting the School District administration to provide, if available, the names of appropriate candidates with their qualifications who are willing to serve as Principal; Direct the School District Administration to take steps to immediately secure all Lincoln Memorial Academy Charter School property; Take steps to prepare the Charter School to timely open for the 2019-2020 school year with appropriate staff, supplies and equipment; Authorize a forensic audit of the finances and property of the school. The School Board voted on the motion made by School Board Member Hopes, adopting the motion four to one, with James Golden, Scott Hopes, Gina Messenger, and Dave Miner approving the motion, and Charles Kennedy rejecting the motion. The day after the School Board meeting, on July 24, 2019, the School Board issued a written Notice of Immediate Termination. The School Board then issued an Amended Notice of Immediate Termination on August 5, 2019. As previously addressed, the Contract only allows LMA 30 days from written notice of a breach to cure "absent any circumstances permitting immediate termination." Under circumstances presenting grounds for immediate termination, such as a serious and immediate danger to the health, safety, and/or welfare of the students, the Contract does not require the Sponsor to issue written notice to the school before it immediately terminates a charter. However, even if Petitioner had an obligation to provide LMA notice and an opportunity to cure, as LMA argued at hearing, Petitioner adequately provided such notice. For example, following numerous meetings with Ms. Maxfield and unfulfilled requests for documentation and information, School District CFO Heather Jenkins notified Ms. Maxfield on May 29, 2019, that LMA was in a deteriorating financial condition pursuant to section 1002.345 and as a result, both LMA and the School District had a statutory obligation to reach a consensus on a corrective action plan by June 28, 2019. Ms. Jenkins followed up on both June 10, 2019, and June 21, 2019, with additional requests for information and documentation and proposed revisions to LMA's corrective action plan. LMA failed to adequately respond or otherwise address the issues identified by Ms. Jenkins. On or about July 8, 2019, Ms. Jenkins summarized her numerous attempts to work with LMA in a Notice of Non-Compliance addressed to LMA's Governing Board. This notice included a copy of each attempt by the School Board to work with LMA to reach a consensus on a corrective action plan, demonstrating that LMA knew long before receipt of this July 8, 2019, notice that it had a statutory obligation to develop a corrective action plan with the School Board. Regardless, however, and consistent with Petitioner's overall contention that additional notice was not required prior to immediate termination, section 1002.345(5) provides that "[t]his subsection does not affect a sponsor's authority to terminate or not renew a charter pursuant to s. 1002.33(8)." During this same time frame, the School District also issued LMA numerous notices of noncompliance and/or contractual breach regarding a variety of other related topics. For example, on April 1, 2019, Director of District Support Frank Pistella notified Ms. Maxfield that the School District had received a letter from the Florida Department of Management Services, Division of Retirement, stating that LMA had not paid FRS contributions for two months. On June 25, 2019, Ms. Jenkins e-mailed Ms. Maxfield to notify her that the School District received an alert that LMA failed to make payroll despite the fact that LMA cashed its final 2019 Referendum Disbursement in the amount of $61,288.75 and its June FEFP disbursement in the amount of $261,009.97. Ms. Jenkins requested confirmation and documentation that LMA fully paid all employment contracts and confirmation that LMA fully paid FRS payments due to employees. Ms. Jenkins also sent this e-mail to Mr. Hundley, Ms. Dawson, and other members of the Governing Board. On or about July 3, 2019, Dr. Pistella notified LMA's Governing Board members of their failure to comply with sections 121.78 and 1002.33(9)(k)2. Specifically, section 1002.33(9)(k) requires the governing body of a charter school to annually report its progress to the Sponsor and the Commissioner of Education. Section 1002.33(9)(k) additionally requires the charter school to report its financial status, "which must include revenues and expenditures at a level of detail that allows for analysis of the charter school's ability to meet financial obligations and timely repayment of debt. In the July 3, 2019, letter, Dr. Pistella not only quoted the statutory language, but also listed every single time that the School District requested proof of LMA's FRS payments and included attachments evidencing the same. On or about July 16, 2019, Dr. Pistella sent the LMA Governing Board and Mr. Hundley a letter summarizing each and every time the School District attempted to notify LMA of statutory and contractual breach and/or requested unfulfilled requests for information between April 1, 2019, and July 12, 2019. This July 16, 2019, correspondence served as a cumulative notice and summary of all prior correspondence with LMA regarding these issues. This letter also included every prior notice cited therein as an attachment. The School Board again sent this correspondence, and all of its attachments, to LMA as an exhibit to the Notice of Immediate Termination sent to LMA on July 24, 2019. LMA received this correspondence and was notified of all prior attempts by the School Board to notify LMA of its statutory and contractual violations not once, not twice, but at least three times. LMA does not dispute that it received the foregoing notices. And more importantly, LMA has not offered any evidence rebutting the fact that the circumstances identified above as grounds for Petitioner's immediate termination of LMA, i.e., Mr. Hundley's ongoing presence on campus, LMA's financial mismanagement, LMA's inability to pay for food deliveries, LMA's inability to pay the water bill, and LMA's failure to properly background screen employees, posed an immediate and serious danger to LMA students. Regardless of whether notice was issued, substantial basis existed to terminate LMA's charter pursuant to section 1002.33(8)(c). As evidenced by the plain terms of section 1002.33(8)(c) and the Contract, opportunity to cure is not afforded under these circumstances. During the hearing and his deposition, Mr. Hundley did not dispute the fact that LMA is in significant debt, but suggested that Petitioner was to blame with respect to LMA's current financial state and current inability to ensure the health, safety, and welfare of its students. For example, Mr. Hundley testified that LMA did not receive Title I funds when it should have and that LMA should have received "at least" $283,000.00 in Title I funds, with a per pupil allocation of at least $800. According to Mr. Hundley, this alleged delay of LMA's receipt of Title I funds and receipt of less Title I funds than initially projected, impacted LMA because "[w]hen you need to extend [sic] funds before you can get them back, if you don't have a sizeable reserve, that can become problematic if those funds are not being reimbursed on [sic] a timely manner and you're having to pay them out continuously.” Mr. Hundley's contentions that LMA's current financial state and current inability to ensure the health, safety, and welfare of its students is a result of any act or omission by the School Board, are not supported by any evidence in the record. To the contrary, the undisputed evidence shows that the School District paid LMA a total of $4,095,973.08 in federal, state, and local funding. Included in the $4,095,973.08 is the $3,096,731.26 in FEFP funding that LMA received between July 2018 and July 2019, with the last payment of $281,229.85 being issued on or about July 10, 2019. The $4,095,973.08 total also includes $150,256.00 in Title I funds. Title I is a federal program designed to mitigate the impact of poverty on students. The application for Title I funds is district-wide, meaning one application is submitted on behalf of the entire School District. Poverty rankings are based on a school's Community Eligibility Provision ("CEP") classification or free and reduced lunch applications. The amount of funds distributed to each school depends upon two factors: (1) the number of enrolled students and (2) the school's poverty level pursuant to a "rank and serve" system. "Rank and serve" means that the School District cannot give a school with a lower poverty level more funds than a school with a higher poverty level. As such, it is not only the school's poverty that matters, but also the school's poverty level in relation to the poverty of other schools. Accordingly, the amount of Title I funds issued may fluctuate from year to year. While FEFP funds, and other state and local funding, can be used to run a school's core program, federal funding, such as Title I funds can only be used "to supplement, not supplant." As such, Title I funds can be used for supplemental materials, supplemental positions, parent involvement, and after-school programs. Whether a school is properly using Title I funds for supplementing, rather than supplanting, depends upon whether the school can operate without relying on the Title I funds. The school must be able to run its program even in the absence of Title I funds. As a result of the charter school conversion, LMA was considered a new school; it was no longer Lincoln Memorial Middle School. As a new school, the Department of Education assigned LMA a master school ID number. Because LMA was a new school, it had to establish its eligibility as a Title I school, despite any prior history as Lincoln Memorial Middle School. As a new school, the allocation set forth in LMA's application was based upon projections for the 2018-2019 school year. Accordingly, the School District assigned LMA a "K Code," signifying that LMA was projected to be a Title I school, but that LMA's eligibility could not be proven until their receipt of Survey 2 data in October 2018. Once received, the Survey 2 data would then replace the initial projections with actual numbers. Title I applications are generally approved between September and December. In the meantime, LMA was permitted to submit requests for reimbursement to the School District based upon the projected allocation. The School District worked with LMA on an individual basis to assist in planning, purchasing, and reimbursement with respect to Title I funds. In correspondence and meetings with LMA, the School District repeatedly reminded LMA that its initial application for Title I funds was based on projections and that LMA's projections would be updated with the October 2018 Survey 2 data. In September 2018, the Department of Education notified the School District and LMA that LMA must revise its application by removing the 1.6 multiplier generally assigned to CEP schools because it was a new school. The School District admitted its error in previously informing LMA that the multiplier would apply. With the multiplier removed, LMA's per pupil allocation changed from a projection of $283,000.00 to $117,000.00. Despite the $117,000.00 allocation, the School District used other funds to increase LMA's total allocation to $150,256.00, the most the School District could give pursuant to the rank and serve system. Although Mr. Hundley disagreed with the amount of Title I funds LMA was entitled to receive, he did not disagree with the fact that Title I funds can only supplement, not supplant. When asked how Title I funds can be used during his deposition, Mr. Hundley answered: "It can be used to supplement. It cannot be used to supplant. It can be used for certain materials." When asked a similar question during the hearing, Mr. Hundley again admitted that LMA could not rely on Title I funds for core costs and expenses, yet his testimony consisted in part of the statement that "I was absolutely relying on Title I funds to run my school." As evidenced by the foregoing testimony, Mr. Hundley admits that LMA could not use Title I funds for core costs and expenses while also admitting that he was relying on Title I funds to do just that. Yet, Mr. Hundley, who has 20 years of experience working in Title I schools and is "the most senior Title I principal in Manatee County," continues to suggest that LMA's receipt of $150,256.00 versus the $283,000.00 initially projected in Title I funds caused LMA's financial woes and related failure to ensure student health, safety, and welfare. While the difference between $283,000.00 and $150,256.00 is a significant amount ($132,744.00), it is less than 10 percent of the LMA shortfall discovered by CRI of more than $1.5 million. This suggestion that the reduced amount of Title I funds caused the downfall of LMA is both completely unreasonable and completely unsupported by any evidence or facts. Neither Mr. Hundley nor anyone else at LMA has explained, or even attempted to explain, how LMA could prevent the serious and immediate danger posed to the health, safety, and welfare of its students by being unable to meet its financial obligations for its utilities, food, insurance, and salaries of its teachers by such a large amount. LMA's CFO, Ms. Maxfield, the individual charged with overseeing LMA's budget and financials, also failed to provide any evidence in support of Mr. Hundley's suggestion that LMA's current financial situation is a result of any failure by the School District to properly disburse funds to LMA. Rather, when asked a series of financial questions on her deposition, Ms. Maxfield, in every instance, asserted her Fifth Amendment right. When asked whether LMA timely received Title I funds, Ms. Maxfield asserted her Fifth Amendment right. When asked whether LMA timely received all allocations from the School District, she asserted her Fifth Amendment right. When asked whether the School District ever withheld funds from LMA to which LMA was entitled, Ms. Maxfield asserted her Fifth Amendment right. When asked whether LMA timely received all federal, state, and local funding distributed through Manatee County, Ms. Maxfield asserted her Fifth Amendment right. When Mr. Hundley further contends that the School District's alleged rezoning of LMA impacted LMA's funding, such contention also misses the mark. During the hearing, Mr. Hundley testified that "zoning changes, as well as other actions" negatively impacted LMA's enrollment, and that this enrollment, in turn, impacted LMA's financial viability. However, when asked whether it was Mr. Hundley's testimony that he could zone children to LMA as a school of choice, he answered, "no." When asked whether Mr. Hundley understood that students who desire to go to LMA would affirmatively have to choose to go there as a school of choice, Mr. Hundley answered, "[a]s a charter school, yes, they can choose to go to LMA." As admitted by Mr. Hundley, enrollment by students at LMA is based on the affirmative choice of students and parents, not upon zoning. Mr. Hundley's contention regarding zoning restrictions is without merit. As evidenced by the foregoing, LMA has received all funds to which it is entitled. LMA's financial deterioration and the debilitating effects of that deterioration on LMA's ability to ensure student health, safety, and welfare are the result of poor decision making, large payments to its administrators, and misuse of funds by LMA leadership, not the result of any failure by the School District or any other entity to disburse funds. These facts remain unrebutted. LMA Attempted to Paint a Wholly Different Picture of the Events Leading to the Notice of Immediate Termination of the Charter School With its CEO/principal, Mr. Hundley, and its CFO, Ms. Maxfield, invoking their Fifth Amendment rights against self- incrimination hundreds of times in their depositions, LMA was left with an impaired case in trying to give its defense to the immediate termination of the charter. By invoking the Fifth Amendment on any matters regarding LMA's expenditures, payment of payroll taxes, FRS contributions, unpaid invoices to food and educational vendors, payment of earned Best and Brightest awards by hard-working teachers, and even payment of the water utility bill, LMA focused only on its position of the reason LMA was created. LMA attempted repeatedly to place blame for any issues raised in the Notice of Immediate Termination on the School District, accepting no responsibility whatsoever. The hearing room was filled throughout the proceedings with concerned LMA parents, teachers, and staff, none of whom were identified by name or called to testify on any issues, let alone those relevant to whether LMA should lose its charter. Ostensibly, the respectful and close-listening audience was there to support the fact that the charter school was created by a groundswell of concerned parents and community members, who wanted a better education for their children and neighbors than they believed was previously being offered at Lincoln Memorial Middle School. The undersigned has no reason to doubt their sincerity and desire to want the best possible education for the students, but LMA did not take advantage of this resource to support its case. None of the parents, teachers or staff, with the exception of LMA's head custodian, Mr. Saul Johnson, its HR vendor through its leader Ms. King, and Mr. Hundley testified. With the limitations on their knowledge of the essential facts leading to the immediate termination (Mr. Johnson and Ms. King) and the limitation of what Mr. Hundley would testify about once he repeatedly invoked his Fifth Amendment right, the picture of a high-functioning charter school painted by LMA was incomplete, at best. The substance of Mr. Johnson's testimony was that the School District, prior to the creation of LMA, allowed persons having "no contact with students" restrictions to be in buildings where students could be found during the school day. This testimony was offered, presumably, to support the fact that Mr. Hundley should be allowed on campus during the 21st Century program, regardless of the fact his certification as an educator had been revoked by the EPC. The testimony offered by Mr. Johnson, while earnest and factual to the best of his knowledge, is not relevant to the issues in this matter. Mr. Hundley's contact appeared, via video and photographs admitted into evidence, to be direct and substantial when he entered LMA while the summer program was underway. Mr. Johnson's testimony that a staff member may have been on some part of campus where students could be present was based wholly on hearsay and without knowledge of the restrictions, if any, imposed on that specific individual. Even if true and accurate, the staff member discussed by Mr. Johnson was neither in a supervisory role, nor in a role that required direct contact with students. The gentleman described was a custodian. The testimony is discredited as inadmissible hearsay. Further, testimony offered by Mr. Hundley, although limited by his asserting his Fifth Amendment right, conflicted with that given by LMA's Governing Board chair, Ms. Christine Dawson. Ms. Dawson and Mr. Hundley contradicted each other and themselves when attempting to answer simple questions, such as when the Governing Board removed Mr. Hundley's title as principal. Specifically, Ms. Dawson testified that Mr. Hundley's job title changed following a Governing Board meeting on April 24, 2019, while Mr. Hundley testified that his job title changed in mid-June. As found previously, Mr. Hundley notified the staff at LMA that he was "stepping down" as principal on July 16, 2019. To further compound the lack of consistent testimony regarding when Mr. Hundley's responsibilities as principal ceased, Ms. Maxfield simply asserted her Fifth Amendment right when asked about the subject at deposition. Even when Mr. Hundley "formally" renounced his title as principal, he notified the LMA staff that he would "continue to provide the needed guidance and direction to the school leadership." When asked at her deposition about Mr. Hundley's responsibilities as CEO as opposed to principal, Ms. Maxfield again asserted her Fifth Amendment right. The facts presented by Mr. Hundley, Ms. Dawson, and the reasonable inferences drawn from Ms. Maxfield's asserting the Fifth Amendment when asked about Mr. Hundley's duties compel the undersigned to conclude that Mr. Hundley acted dishonestly towards LMA's staff, the very parents he testified stood behind him as the individual to bring Lincoln Memorial Middle School to a place of prominence in the educational system of Manatee County as LMA, School District personnel, and in these proceedings. One fact rings true here regarding Mr. Hundley: the undersigned believes that the parents, staff, and community served by LMA put their faith in him to lead them to better educational opportunities for their children and neighbors. His actions in more than doubling his salary and expense account when compared with his previous experience in Manatee County, in hiring Ms. Maxfield at a high salary and with an expense account, in hiring an HR vendor with whom he has a personal relationship, and in not taking any responsibility for the whereabouts of more than a $1.5 million shortfall out of an annual allocation of slightly more than $4 million, as significantly proven by the CRI Report, leave the undersigned with only one conclusion. Namely, while Mr. Hundley's motives in helping found LMA may have started as pure, they quickly became about the riches he could accumulate at the expense of the education, health, safety, and welfare of LMA's students and their families, as well as the staff, who bought into the college preparatory program he promised to provide them. At the center of LMA's case at hearing lies the pointing of fingers at the School District. Repeatedly throughout LMA's presentation of its case, their Qualified Representative, Mr. Norwood, asked School District personnel how many times they had visited LMA during the first year of its operations; why had they not visited more frequently, especially those who testified they had never visited the campus since that was not part of their job duties; and, above all, why the School District did not intervene and attempt to take over or counsel LMA's staff on the School District's concerns. Moreover, Mr. Norwood asked witnesses for the School District why they did not send more "Notice Letters of Breach of Contract," every time a real or perceived shortcoming on the part of LMA was made known to the School District. The response was invariably from the School District witnesses was that they repeatedly attempted to have serious questions answered concerning payroll taxes, FRS contributions, payment of allocated funds for Best and Brightest award winners, and why the water utility bills were constantly in arrears. LMA refused every request to respond to these issues, leading, ultimately, to the School District, after the vote by the School Board, to proceed with the most drastic measure (and the only one remaining) imaginable, issuing a Notice of Immediate Termination of LMA's charter. The testimony presented by both parties to this proceeding leads the undersigned to the conclusion that no tools were left for the School District in dealing with a charter school that failed to address their repeated efforts at gathering information. Another factor that has not gone unnoticed by the undersigned in the course of these expedited proceedings is that LMA's pattern of refusing to respond to requests for information made by the School District during discovery has continued into these proceedings. The undersigned can only imagine Petitioner's frustration with the constant refusal of LMA to provide the documents requested during discovery, with the common refrain of "you already have the documents because you (the School District) seized all of LMA's records, computers and laptops, leaving us (the former staff) with nothing to provide you." However, this cry by LMA fails to ring true. No HR company, CFO, school principal, or school CEO, in this 21st century digital age, can continuously be deemed credible when asserting that no backup, whether hard copy, DVD, thumb drives, or in the Cloud, exists. When forensic accountants and long-time public officials cannot find all of the necessary records to continue the operation of the school, just two days after being taken over by the School District, to answer the questions about payroll taxes, FRS contributions, Best and Brightest awards, food service menus and purchases, and utilities payments, someone is hiding the ball. No evidence was presented through testimony, and certainly not through documentation, that LMA provided the complete records of their activities in this first year of the charter school's operations. The presumption here must be that the complete records were destroyed, lost, or intentionally withheld from production by LMA to the School District. Even with limited records available, however, the School District has made a strong case for immediately terminating the charter. When the two principal leaders of LMA refused to answer most of the questions posed to them in deposition on the grounds their answers might tend to incriminate them, no conclusion can be reached by the undersigned other than that those records have been kept from the view of the School District intentionally and improperly. Therefore, following the issuance of this Final Order, the undersigned will reserve jurisdiction on the issue of sanctions for refusal or failure by LMA to provide all the documents in its or its vendors' possession. A hearing will be held solely on the issue of the appropriate sanctions to be imposed. The parties will be given the opportunity to state they intend to rely on the previous motions and responses filed regarding sanctions, or, in the case of LMA, to offer additional reasons for not complying with the reasonable discovery requests, even when given the opportunity to continue to do so after the hearing. LMA will also be permitted to provide any defenses and mitigating factors, as permitted by law, concerning their ability to pay any monetary sanctions that might be awarded by the undersigned. To summarize, the facts, corroborating evidence, and corroborating testimony offered by Petitioner in support of its decision to immediately terminate LMA's charter remain unrebutted and undisputed. Testimony by itself without any records is not sufficient. Moreover, the testimony provided by LMA is, largely, not credible. LMA has failed to produce any records or documentation corroborating or supporting the inconsistent, evasive, and ultimately non-credible testimony of its witnesses.
