The Massachusetts Board of Elementary and Secondary Education

Gloucester Community Arts Charter School - Report on Conditions

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On October 1, 2010, the Board of Elementary and Secondary Education (Board) placed the Gloucester Community Arts Charter School (GCACS) on probation through December 2010. At the December 21, 2010 Board meeting, the Board determined that GCACS had substantially complied with the 12 probationary conditions. The Board also determined, however, that the school still faced significant challenges and required further conditions. The Board removed GCACS from probation but imposed a further set of eight conditions. At the May 20, 2011 Board meeting, I provided the Board with a status report on the school's compliance with the conditions and recommended that no action be taken by the Board at that time, thus allowing the school to open for a second year. This memorandum provides an updated report on the school's compliance with the eight conditions and additional information and analysis. I again am recommending that no action be taken by the Board at this time.

I have voiced my concerns about GCACS since the school's inception, and many of those concerns still exist. The GCACS is far from an exemplary institution at this point, midway through its second year of operation. Not least of my concerns is the low academic performance of the school in its first year of operation.

There are promising developments at GCACS, however - improvements that are representative of a maturing institution that takes seriously the issues that were identified by the Board through the conditions imposed in December 2010. GCACS has employed an experienced head of school, an arts integration director, and a special education administrator for the current school year, providing much needed additional management capacity. The special education program has significantly expanded its capacity and has improved its overall program.

Of the eight conditions, GCACS has met six fully - four within the time identified and two others after the deadline identified in the condition. One condition has not been met and a final condition is ongoing. While the school has demonstrated progress in many areas, the Department will continue to closely monitor GCACS's performance and compliance with the conditions imposed last December, as well as other areas of concern, including academic performance and financial viability.

I am recommending that no action be taken by the Board at this time. This will allow the school to plan for opening for a third year in September 2012. One of the basic tenets of our charter school accountability program is that new schools are given a reasonable amount of time to establish themselves and create a program that aligns with Department expectations.

Report on Conditions

Condition 1: The school's executive director shall attend the Office of the Inspector General's training program on Supplies and Services Contracting at the first available opportunity in 2011.

Status: Condition met.
The school's executive director attended and completed the Office of the Inspector General's Supplies and Services Contracting training held on February 15-17, 2011. The executive director supplied the Department with a certificate documenting his successful completion of the training.

Condition 2: By February 1, 2011, the school shall have hired a qualified individual for the position of Director of Education.

Status: Condition not met by the deadline
In March 2011, the school informed the DESE that it did not meet the February 1, 2011 deadline due to budgetary constraints. GCACS advertised the position of Director of Education in January 2011, but did not receive resumes with the desired credentials. In order to recruit a candidate with experience to manage an elementary and middle school academic program, the school created a new job posting for a head of school and began advertising on April 1, 2011. As of May 2011, the school hired a new head of school, who started working at the school on July 1, 2011. The new head of school is Jody Ziebarth, former principal of Cambridge Friends School.

Condition 3: By April 1, 2011, the board of trustees shall recruit and submit to the Charter School Office for approval at least one new member with experience and expertise in public sector management.

Status: Condition not met.
An individual with the required public sector background has not joined the GCACS Board of Trustees. Since May 2011, the GCACS board has added two members who have worked in public schools, but without experience and expertise in public sector management. In May 2011, Susan Hoague joined the GCACS board. Ms. Hoague is a retired school psychologist, coordinator of special needs, and teacher with experience in counseling. On October 7, 2011, the GCACS submitted the nomination of Ira Yavner to serve on the board and the commissioner approved the appointment. For the past 30 years, Mr. Yavner has worked in life and health insurance sales, management and financial planning. Prior to his current career, Mr. Yavner was a teacher, coach, and athletic director. While each new board member has experience working in public education, neither has expertise with the management of a public sector entity.

Condition 4: By April 1, 2011, the school shall submit a financial plan demonstrating viability based on pre-enrollment data for the 2011-12 school year.

Status: Condition met.
On April 1, 2011 the school submitted a financial plan for the 2011-12 school year based on an expected student enrollment of 200. At the time, the Department determined that the school's proposed financial plan provided adequate resources for the school based upon the school's April 2011 pre-enrollment count of 196 students. In September 2011, student enrollment was 139, significantly below the pre-enrollment number. Based on the actual enrollment, GCACS was asked to create a new financial plan for an enrollment of 135. This budget, and the school's current financial condition, is discussed later in this memorandum.

Condition 5: By February 1, 2011, the school shall have submitted for Department approval a corrective action plan to address deficiencies in special education programs as noted in the Department's December 10 site visit, and by April 1, 2011, the school shall have demonstrated substantial progress in completing the corrective action plan.

Condition 6: GCACS must comply with the Attorney General's December 17, 2010, Open Meeting Order ("OML 2010-6") and any other such orders issued by the Attorney General's Office.

Status: Ongoing.
Compliance with the Attorney General's order dated December 17, 2010 is ongoing, due to the nature of the order. On November 1, 2011, the Attorney General's Office issued a decision on one OML complaint which pertained to a November 2010 meeting of the GCACS board of trustees. The Attorney General's Office determined that the GCACS board of trustees had violated the OML by convening an emergency meeting on November 20, 2010, under conditions that did not qualify as an emergency and by failing to adequately post notice of a meeting. As a result, the Attorney General's Office issued an order ("OML 2011-45") requiring GCACS's continued compliance with OML. With respect to the public construction and bidding laws, again, compliance with the consent judgment is ongoing due to the nature of the order.

Condition 7: GCACS promptly and effectively must communicate with the Charter School Office regarding any and all significant matters within a reasonable period of time but in any event no later than 48 hours after the occurrence. GCACS must report to the Charter School Office any and all communications made or received by or on behalf of the school with any government audit, investigative, or law enforcement agency within a reasonable period of time of that communication but in any event no later than 48 hours after the communication. GCACS must copy the Charter School Office on such written communications sent by or on behalf of the school and send a copy of all such written communications received by or on behalf of the school within a reasonable period of time but in any event no later than 48 hours after the communication. GCACS must provide a report and copies to the Charter School Office of all such communications that occurred prior to its probation no later than October 8, 2010.

Status: Condition met.
The charter school office has received updates on legal matters which fall under the condition. This includes resolution letters from the Attorney General's Office regarding Open Meeting Law complaints and correspondence between the school's legal counsel and the Office of the Inspector General.

Condition 8: GCACS must report all changes in staff to the Charter School Office within a reasonable period of time of knowledge of the change but in any event no later than 48 hours after knowledge of the change.

Status: Condition met.
During the school's Year One Site Visit, the team determined that GCACS had not met this condition. Since that report, the school's executive director has informed CSO staff of all changes to the staff at GCACS within 48 hours.

Other Information

Site visit findings

The Department's Charter School Office conducted site visits on September 16, 2011, and November 1, 2011. The September 16 visit was conducted in order to gather evidence about the school's enrollment numbers and the implementation of special education. The November 1 visit was a year two charter school accountability site visit, which examined school performance in the three areas of charter school accountability.

The site visit report notes many challenges that the school currently faces in terms of establishing systems and structures to evaluate and oversee the school's program, improving academic results, and maintaining financial viability. Many areas of concern noted in the site visit report are common issues found at charter schools in their second year of operation. GCACS's low MCAS scores, partial implementation of the charter vision, lack of clarity around management and governance of the school, creation of the school's curriculum, and limited use of data to inform instruction are areas typically under development at a new charter school. The site visit team also noted many positive elements at GCACS. Site visitors found evidence of a safe and orderly school environment, highly engaged students, implementation of a teacher evaluation system, an experienced administrative team, and a common understanding of the school's mission and vision among all stakeholders. These elements are not consistently present at charter schools in their second year, and their existence was noteworthy. The site visit report is attached to this memo.

Enrollment data and financial status

In March 2011, GCACS reported a pre-enrollment count of 202 students to the Department. In April 2011, as part of a review of enrollment processes and documentation, CSO staff were able to verify documentation for 196 students, and that was the number that was used by the Department to calculate a first quarter tuition payment for school year 2011-12. The school developed a budget for FY12 based on enrollment of 196 students.

On the first day of school, GCACS's actual enrollment was at 135. On September 16, 2011, CSO staff visited GCACS to verify the school's enrollment numbers and determined that enrollment was at 139. At that point, the CSO asked the school to create a new FY12 budget based on the enrollment of 135 students. As of the day of the November 1 site visit, GCACS's enrollment was at 136.

In September 2011, the school submitted a new budget based on enrollment of 135 students. In response to the reduced revenue projections, the school eliminated one administrative position, reduced two other administrators to part time, asked all staff to take a five percent pay reduction, and obtained agreement from several vendors to reduce or defer payments owed. GCACS also decided to delay scheduled leasehold improvements until their enrollment increased, and the landlord has agreed to a revised lease payment schedule that effectively reduces their rent for the current fiscal year.

The school received an unqualified opinion on its FY11 audit. However, GCACS ended FY11 with a deficit of approximately $132,000 due to the lower than expected enrollment. The FY11 management letter included one material weakness regarding the calculation and submission of MTRS funds. The school has remedied this finding. There were several other FY11 non-material weaknesses noted that the school is addressing (e.g., missing invoice or receipt). The auditors reported that all of findings from the FY10 audit have been or are in the process of being addressed. The school has engaged an accounting consultant with expertise in charter school accounting.

Although the school's finances have improved from year one, it is still in a difficult fiscal situation. The reduction in expected revenues and the lack of any significant cash reserves has left the school with little or no margin to deal with unexpected circumstances. The school will need to demonstrate continued growth in enrollment and tuition revenues, possibly supplemented with private fundraising, to reach the level of long-term financial viability.

MCAS performance

2011 was the first year in which GCACS administered the MCAS exams to students. In 2011, GCACS students had the following median student growth percentiles: 33.0 for English language arts (ELA) and 17.0 for mathematics. The data show that, in 2011, GCACS students' academic gains lagged behind 67 percent of students statewide in ELA and lagged behind 83 percent of students statewide in mathematics. These data demonstrate low growth.

GCACS Median Student Growth Percentiles (SGP)

Year	2011
ELA (all grades)	33.0
Mathematics (all grades)	17.0

In 2011, GCACS did not make AYP in mathematics or ELA. GCACS had a CPI of 73.3 in ELA, with 48 percent of students reaching proficiency. In mathematics, GCACS had a CPI of 49.7 with 15 percent of students reaching proficiency.

Recommendation

In terms of the eight conditions imposed last December, GCACS has met six and not met one of the conditions. Compliance with a last condition is ongoing. The school has worked to ameliorate the Board's concerns in many areas; however, as noted above, GCACS still faces substantial challenges to its ability to implement a viable and effective school program. While some challenges are unique to GCACS, others are typically faced by charter schools in their second year.

Last May, I stated that a major indicator for the school's potential viability would be the enrollment numbers for the 2011-12 school year. This year's enrollment is double that of last year. Nonetheless, the school's current enrollment is far below projected numbers and continues to impact the school's financial viability. Additionally, MCAS data do not demonstrate that the school has instituted an effective academic program during its first year. In its second year, the school has added additional administrative capacity, improved its special education program, and began providing more supports to teachers in order to improve instruction.

As I stated in my May 2011 report on GCACS's progress, it has been the Board's practice over the years, when dealing with struggling charter schools, to give those schools opportunity to improve. Many charter schools exhibit difficulties during the start-up phase and continue on to provide excellent academic programs and safe environments for students. The charter school statute provides for a five year charter term, during which charter schools are monitored closely through a rigorous accountability system. Our ability to assess GCACS's faithfulness to its charter, academic performance, and organizational viability over a five year period will allow the Department to examine data trends and overall performance. It is my judgment that GCACS should be afforded this opportunity.

Accordingly, I am recommending that no action be taken by the Board at this time. This will allow the school to plan for opening for a third year in September 2012. The conditions that the Board imposed last December will remain in effect, and I will continue to monitor the school's progress and report back to you periodically.

If you have any questions or require additional information, please contact Marlon Davis, Director of Charter Schools, Innovation, and School Redesign; Jeff Wulfson, Deputy Commissioner; or me.

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