The Lehigh Valley Charter High School for the Arts did nothing illegal during the bidding process for its $25 million facility, but it may have benefited from a loophole in state law that allows charters to conduct construction business in private, the state auditor general said Tuesday.
At a news conference at Northeast Middle School in Bethlehem, Auditor General Eugene DePasquale released results of his audit on the Bethlehem charter school’s construction of its South Side building, which opened in 2015.
DePasquale said the building is owned not by the charter school itself, but by the charter school’s foundation, which is not subject to the state’s Right-to-Know Law.
Lehigh Valley Charter High School for the Arts provided its foundation’s records related to the construction project, DePasquale said. But he also said that foundations do not have to follow the same transparency rules as charters and public schools, so when it comes to construction projects, charter schools could use that loophole to keep the public in a dark.
“You either are a public school or you’re not,” he said.
“The charter school did not do anything against the law,” DePasquale said. “But the law needs to be changed.”
DePasquale found that the charter school violated the Sunshine Act when it went into executive session at 30 out of 31 meetings and never announced the reason for each executive session, which is required. The board also failed to document when members abstained from votes, as required by the Ethics Act, according to the audit.
DePasquale conducted his audit because of a letter he received from the Bethlehem Area School District in 2016 alleging the charter school did not follow Pennsylvania Charter School Law when it constructed a building at 321 E. Third St.
“Our review of this objective did not disclose any noncompliance or other reportable issues,” the audit states.
DePasquale was complimentary toward the charter school, acknowledging its above-average standardized test scores.
“This is a good charter school,” he said. “And I believe they’re performing significantly higher than most other charter schools.”
But the issue is that the charter school law needs to be reformed, he said.
When the Lehigh Valley Charter High School for the Arts wanted to build a new school, it created a foundation that would own the facility. Unlike the charter school, the foundation would be able to raise money to pay for the building. Other area charter schools have used foundations tied to their charter schools to buy their facilities because charters themselves often don’t have the ability to buy real estate.
By using this arrangement, some charter schools pay rent to their foundations and then can still legally apply for lease reimbursements from the state. The Lehigh Valley Charter High School for the Arts does not receive lease reimbursements from the state, Chief Executive Officer Diane LaBelle said.
LaBelle said the foundation conducted a competitive bidding process. Concerning the violations of the Sunshine and Ethics acts, the charter school board corrected its mistakes as soon as it was notified it was violating the law, she said.
Bethlehem Area School District Superintendent Joseph Roy, a vocal opponent of charter schools, used the news conference to criticize their costs.
The school district is budgeting almost $30 million in charter tuition this school year. In June, the school board raised taxes by 2.5 percent.
“Charter schools in Bethlehem are the cause for the tax increase,” Roy said Tuesday.
