El Paso’s 900-student Burnham Wood Charter School District, hit hard by a report from the Texas Education Agency, should know within a month whether it faces the loss of accreditation, probation or other sanctions.
The decision is in the hands of Robert Scott, Texas education commissioner. When it comes, his decision could be appealed through an internal administrative hearing process before returning to Scott for final determination.
At that point, Burnham Wood could challenge TEA’s findings and penalties in court.
“We feel like we’re going to be vindicated. The only problem is it’s going to cost a fortune,” said Iris Burnham, the district’s superintendent and co-founder with her late husband, Howard, of the city’s first charter school.
“We want the community to know these are complex issues, and we are saying we did not violate the law,” Burnham told El Paso Inc.
She estimates the district has spent $200,000 so far defending itself against TEA charges, but added that the legal battle has not affected the quality of education at its three charter schools, which are operated by the non-profit El Paso Educational Initiative Inc.
TEA spokeswoman Suzanne Marchman said Burnham Wood is unlikely to lose its accreditation. That would force the closure of Howard Burnham Elementary and Da Vinci School for Science and the Arts on the Westside, and the Eastside’s Vista del Futuro Charter School.
“Our agency isn’t the undertaker,” Marchman said. “Our intention is to help districts fix the problems so students are being educated and schools are running smoothly.”
Iris Burnham also owns and operates the private School for Educational Enrichment, which shares quarters with Howard Burnham Elementary School.
The highly regarded Burnham Wood District earned an exemplary academic rating in 2010, and a recognized rating in 2011.
The district came under intense scrutiny starting in late 2009 when TEA initiated a series of visits and hard audits that led to a special accreditation investigation.
For the past three school years, TEA has listed the district’s accreditation as “pending.”
Last year, TEA delivered a preliminary report to Burnham Wood containing dozens of adverse findings, some of them small and some serious.
Auditors alleged breaches of fiduciary responsibility by administrators and the board of trustees, poor recordkeeping and failure to provide services to non-English speaking students, among other things.
Burnham Wood officials and lawyers contend that TEA’s actions, prompted by complaints from former employees, have been unwarranted, over-reaching and punitive.
“To witness what’s going on is amazing to me – their accusations and slow response time,” said Eric Braham, a Burnham Wood board member, whose three children attended the charter schools. “I can’t wait until it’s all out in the open and all said and done.”
Although he said he doesn’t believe Burnham Wood could lose its accreditation, he can’t help but wonder about the final outcome.
“It’s not wise to assume nothing will happen, but I believe the evidence will speak for itself,” he said.
So far, however, the district’s evidence hasn’t spoken loudly enough.
Burnham Wood has objected point by point to nearly every one of the agency’s adverse findings, making few admissions and giving little ground.
In general, the district contends that TEA’s investigation has not adhered to professional auditing standards and that the state, in asserting conflicts of interest, is using the Internal Revenue Code when it has no authority to interpret or enforce federal rules.
TEA, however, has stood its ground and has brushed aside Burnham Wood’s carefully lawyered actions and arguments like pieces off a chessboard.
Of all the findings, the foremost criticizes the district’s $1.2-million purchase of the Howard Burnham Elementary School property at 7310 Bishop Flores from the Howard and Iris Burnham Family Trust.
Iris Burnham was the district’s superintendent at the time while her daughter, Esther Furrer, was the assistant superintendent. Both were – and still are – board members.
“The charter school’s governing board breached its fiduciary duty to use state funds solely for the benefit of its students,” TEA found. “This purchase was not an arm’s length transaction.
“It does not appear that the charter school considered any alternative properties.”
The purchase was made from funds raised by the issuance of $8.5 million in tax-free revenue bonds in 2006 to finance the district’s construction of two new schools and acquisition of property it had been leasing from Iris Burnham.
That is probably the most serious charge TEA’s audits have raised.
Burnham Wood contends it is also TEA’s biggest mistake and the transaction the agency seems to understand the least.
Burnham contends that the purchase was conducted carefully under the close supervision of an outside law firm to ensure that the search for other properties, the purchase price and the purchase itself were conducted properly.
“The bottom line is it was legal,” she said. “There was no violation of fiduciary responsibility because all the elements they wanted, that they’re accusing us of lacking – the independent appraisal and comparison of other properties – occurred.”
TEA raised similar issues in alleging that a conflict of interest existed in 2009 when the district leased property she owned on Bob Hope Drive to build the Vista del Futuro Charter School.
In both transactions, Burnham said, she and her daughter took pains to insulate themselves from the transactions, as advised by lawyers.
She added that neither federal nor state law prohibits such transactions as long as proper steps are taken to distance individuals with potential conflicts from transactions.
In both instances, however, TEA disagreed in its March 19 report.
The report also cites material weaknesses in Burnham Wood’s financial controls caused by related parties generating, reviewing and approving transactions and recommends changes to address those issues.
It also contains numerous other findings and alleged violations concerning the board’s adherence to the Texas Open Meetings Act; student recordkeeping; the commingling of public and private funds and school materials; and past problems in providing adequate bilingual education and English as a second language services to students.
Burnham Wood is one of 12 Texas school districts, including 10 charter districts, to have pending accreditations.
No charter school district has had its accreditation revoked since a new evaluation system was put in place in 2007, but a number of charter districts do carry a probation or warned status.
Public charter schools became legal in Texas in 1996 with the number of districts capped at 215. There are now 198 districts and 482 charter school campuses in Texas.
Charter schools are not supported by local property taxes but solely by state funds based on average daily attendance, the same funds public schools receive, augmented by local taxes.
E-mail El Paso Inc. reporter David Crowder at firstname.lastname@example.org or call (915) 534-4422, ext. 122 and (915) 630-6622.