Gift by State School Board Chief Raises Questions

State Board of Education President Reed Hastings contributed $50,000 to a state senator one day after the lawmaker introduced legislation that would benefit a network of charter schools founded by Hastings.

The legislation, which Hastings says he helped write, would cut state funding to some charter schools that provide independent study programs while increasing the dollars that flow to those charter schools that are classroom-based and serve poor urban areas.

Among the potential beneficiaries of the bill (SB 740) are Aspire Public Schools, a network of classroom-based charter schools that Hastings co-founded in 1998 and helped finance. Hastings is still listed as a member of the nonprofit schools’ “management team.” Hastings said he does not, however, have any continuing financial interest in the Aspire schools.

The measure was proposed June 27 by Sen. Jack O’Connell (D-San Luis Obispo), who took legislation dealing with the Department of Pesticide Regulation and transformed it into the bill allocating money for charter schools. That allowed the charter bill to be introduced after the deadline for new legislation.

The next day, Hastings, a wealthy Silicon Valley businessman, wrote a $50,000 check to the campaign account of O’Connell, a candidate for state schools superintendent. The bill is pending in the Assembly.

That chain of events has angered critics of the proposal for several reasons. Some object to the substance of the legislation, saying it would hurt schools providing valuable programs. Others are annoyed by Hastings’ role in advocating a course that would benefit his favorite type of charter schools, and still others are troubled by the proximity between the campaign contribution and the introduction of the bill. Finally, O’Connell’s decision to insert the charter legislation into an existing pesticide bill struck some critics as subterfuge.

“I don’t know a lot about politics, but I know when something stinks and this smells really bad,” said Charlotte Austin-Jordan, founder of a charter school for ex-offenders that will open in South-Central Los Angeles in September. “Something stinks when you take a pesticide bill and turn it into a school bill.”

If signed into law, the measure would give the Board of Education that Hastings heads vast new powers over charter schools. Hastings was appointed to the post by Gov. Gray Davis. The bill also would significantly enhance the power of the schools superintendent in that area.

Hastings, who describes himself as having a “passionate” interest in establishing charter schools in the inner city, said his motive for founding and financing the Aspire schools was the same as his motive for pushing the legislation: a desire to help children.

“I donated to something that helps kids, and I don’t believe that is illegal or an ethical conflict of interest,” he said.

Hastings denied that the timing of his contribution to O’Connell had anything to do with the legislation they both were pushing. Rather, he said, he made the donation just before the reporting deadline so O’Connell, who has been his ally on several school initiatives, could make a “good showing” in the race to raise campaign dollars.

O’Connell also denied any link between the legislation and the contribution and said his bill “continues to promote the charter movement” because it would clean up abuses and help finance the construction and maintenance of charter school buildings in low-income areas.

“In order to allow the charter school movement to not only survive but continue to prosper, we need to weed out the few bad apples,” O’Connell said.

The bill would cut funding to independent study charter schools by up to 30% unless school officials can justify their costs to the Board of Education, which has authority to grant a waiver. To avoid the waiver requirement, a school must require its students to spend at least 80% of their instructional time in a classroom with a credentialed teacher. (Students in traditional public schools are required to spend 66% of their time in class.)

The measure also would establish a $10-million grant program to help classroom-based schools in low-income areas with rent and lease costs. One of the biggest hurdles that charter schools face is covering their “bricks and mortar” costs, meaning the expense of providing actual classroom space.

Despite the arguments advanced by Hastings and O’Connell, critics, including some charter school officials who could benefit from the grant program, complained about the legislation.

They argued that it was improper for Hastings, whose post requires him to represent the interests of all students, to push for laws that would benefit particular charter schools.

In addition, some of those same critics said it struck them as improper for one public official to contribute to another so soon after the introduction of legislation that the donor was promoting.

Richard Gann, president of the Gann Taxpayer Foundation, a watchdog group, said Hastings’ action had the appearance of a conflict of interest.

“It’s clear by looking at the legislation that it is designed to benefit the type of schools that Hastings has invested in to the exclusion of other types of schools,” he said.

A charter school is a public school that has been freed from most state and district rules in order to foster innovation; that innovation, in turn, is supposed to improve results. But there are sharp divisions among charter school advocates, who differ over the degree of appropriate regulation for the new schools.

O’Connell’s proposal has support from advocates such as Steve Barr, founder and president of the nonprofit corporation that operates Animo Leadership Charter High School. Barr said his school spends $120,000 on rent and desperately needs additional dollars from the state. “I’d be crazy not to support it,” he said.

But the California Network of Educational Charters, an association that represents about 80% of the charter schools in the state, bitterly opposes the bill.

The group believes O’Connell’s legislation would impede the charter movement by imposing new regulations, broadening the powers of the state board--a nonelected body--to regulate charter schools and by removing much of the flexibility the schools have to experiment.

“I believe that this law will inhibit the kind of creativity the charter school concept intended to allow,” said Joe Lucente, the group’s president. “I think if this bill passes, there will be charter schools that will set their charter aside and go back to being a district school because they will have more funding and less regulation.

“It’s really kind of ridiculous,” said Lucente, who also is principal of Fenton Avenue Charter School in Lake View Terrace. Lucente voiced the objections even though his school could be eligible for grant money if the bill becomes law.

Gloria O. Reyes, president of Abrazar Inc., a nonprofit group operating a community services and educational center in Westminster, said about 80% of her students are involved in independent study as defined by the bill. To avoid being hit with a financial penalty, she said, she would be forced to drop them from her school’s rolls. She said most of her students are dropouts, older, have children and work full time.

Her students work toward a high school diploma through a combination of classroom instruction and home study.

“We are required to make sure that these students conform and perform up to California standards just like any other public institution,” she said. “Why would you penalize the schools that are doing just that?”

In Los Angeles, a middle school called the California Academy for Liberal Studies provides a college preparatory program in liberal arts for low-income, minority students. Its director, Ref Rodriguez, said the legislation would force him to cut some of his most effective classes because they are taught by highly skilled artists who aren’t credentialed.

Hastings, however, dismissed those objections and said the position taken by the California Network of Educational Charters and others was really a “dramatic overreaction” to legislation that was designed to clean up the charter school system.

“The only charter schools that will be negatively impacted will be schools that are not spending the public dollars on their charter school students,” he said. “What I think [opponents] are under-appreciating is how much they are hurt politically by these bad apples.”