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Friday, February 7, 2014

John King uses WSJ to threaten NYC on charter rent: are Amplify losses so great Rupert can't afford to pay fact-checkers anymore?


Today the Wall St. Journal carried one of the worst articles I have ever read, carrying baseless threats by the State Education Department that they are considering cutting school construction aid to NYC if the de Blasio charges charter schools rent.  

It would be an outrageous abuse of power to penalize NYC for failing to submit to the Commissioner's personal privatization agenda.  Remember that before being appointed to SED, King used to run a chain of charters called Uncommon charters, that benefit from free space in DOE buildings. The reporter failed to mention that fact.

Not only would cutting school construction aid be illegal-- as the state capital funding reimbursement formula is written into law -- but essentially the Commissioner would be punishing NYC for complying with state law.

Yet the reporter, Lisa Fleisher,  misstated the law, by erroneously writing that "school districts "may" contract with charter schools "at cost."

Section 2853 of state education law clearly says that if districts choose to contract with charters for space and services, "any such contract shall provide such services or facilities at cost.”


This is a huge legal difference between “may” and “shall" of course. 

Perhaps Rupert Murdoch is losing so much money with Amplify he can't afford fact-checkers at the WSJ anymore. 
The reporter also omitted mentioning that as part of their applications to be authorized, charters have to submit a financial plan that covers rent. 


I have written to the Wall St. Journal, asking them to retract this egregious error; perhaps others could too at wsjcontact@wsj.com  Let's see if they respond.  Below is the letter Arthur Schwartz of Advocates for Justice sent John King today.


February 7, 2014

Commissioner John King
New York State Education Department
89 Washington Avenue
Albany, New York 12234

                                Re:         Penalizing NYC if It Charges Rent to Charter Schools

Dear Commissioner King:

                We are counsel to petitioners in two lawsuits which challenge the current policy of the NYC Department of Education not to charge rent to charter schools co-located in NYC public school buildings.  Both suits, one titled NYC Parents Union v. NYC Board of Education and the second titled Leticia James, et al. v. NYC Board of Education, are based on Section 2853 of the Education Law, which clearly says that if districts choose to contract with charters for space and services, “any such contract shall provide such services and facilities at cost.”

                We have always read this statute as excusing school districts from the requirements of Education Law § 403-a, which requires that rentals not be less than “fair market rental value.”  “At cost,” however, does not mean “for free,” and NYC’s Independent Budget Office has calculated a “cost,” for the space allocated to co-located charter schools, of more than $2,000 per student.  This sum, we have contended, is an unlawful subsidization of charter schools that co-locate (money not given to charter schools that rent).

                There is an article in the Wall Street Journal today that reports that the New York State Education Department is “studying how the pledge [by Mayor De Blasio] to charge rent [to charters] could affect the amount of funding the City receives for facilities.”

                We are dismayed to hear this.  It is our understanding that the State reimbursement rate for City spending on school construction is set in law and cannot be abrogated because of the policy preferences of the State Education Department.

                Moreover, the Wall Street Journal reporter misstates the State law.  The law does not say that “school districts may contract with charter schools ‘at cost’”; it says “shall.”  We fear that the reporter got this version of the law from your office.

                The article quotes your office as being concerned about the City “making a profit” by charging rent to charters.  Charging rent at cost does not cause a district to “make a profit,” nor has a school district charging market rent for space (far more than “cost”) ever resulted in a penalty.  In fact, under Section 403-1, your office penalizes districts that fail to rent space at market rates.  See Appeal of Robert A. Forrest, No. 14501 (July 15, 2013, aff’d ___ Misc. 3d ____ (Sup. Ct. Albany County, January 2014); Ross v. Wilson, 308 N.Y. 605; Yeshiva of Spring Valley, Inc. v. Board of Education of East Ramapo Central School District, 132 A.D.2d 27.

                We wish to know whether the discussions reported in the Journal are truly taking place, and what possible legal basis the Commissioner could have for withholding state aid to a district charging rent to a charter “at cost.”  Such a move could only lead to unpleasant litigation.

                                                                                                                Very truly yours,
                                                                                                                Arthur Z. Schwartz


AZS:dr

cc:           Hon. Bill De Blasio
                Richard Trautwein, General Counsel, State Education Department
                Hon. Leticia James
                Hon. Melissa Mark-Viverito
                Leonie Haimson
                Jonathan Westin
                Mona Davids

3 comments:

David C. Bloomfield said...

I don't read the WSJ quote as misstating the law. I think the quote means that "districts may contract" but, if so, must do so at cost, reflecting exactly this blog's interpretation:

"Section 2853 of state education law clearly says that if districts choose to contract with charters for space and services, "any such contract shall provide such services or facilities at cost.”

David C. Bloomfield said...

I don't read the WSJ quote as misstating the law. I think the quote means that "districts may contract" but, if so, must do so at cost, reflecting exactly this blog's interpretation:

"Section 2853 of state education law clearly says that if districts choose to contract with charters for space and services, "any such contract shall provide such services or facilities at cost.”

Lisa said...

Leonie, you are misrepresenting the story. The piece does not say that state ed is "considering cutting school construction aid to NYC if the de Blasio charges charter schools rent." Actually, it says it is considering what the impact would be if rent is set so high that it starts overlapping with state building aid.