Charter schools must take out loan to sever ties with management company
San Jose charter schools to end contract with Newpoint Education Partners
JACKSONVILLE, Fla. - The board of two local charter schools decided Thursday night it would take out a loan with their management company, Newpoint Education Partners, to cover a portion of the money the company said the schools owe.
The loan would allow San Jose Academy and San Jose Preparatory High School to officially end their contract with Newpoint, which was indicted last month on charges of grand theft, money laundering and aggravated white-collar crime.
Newpoint initially came up with the option, loaning the schools $100,000 and having them pay a 6 percent interest rate for the next three years, and in exchange, the management contract would be terminated. But the schools would also have to announce the agreement publicly per Newpoint's specific language.
It's money that's highly contested, yet board members said they aren't looking to fight.
"Why does the board want to enter into a $100,000 loan with a company that's accused of stealing money in another county? I would say, as you heard Gary say, not agree to do that. And then spend the next six months, two years in litigation over trying to end the arraignment and not have that. And in the end, the schools aren't going to make it through that," said Bonnie Arnold, board chair of San Jose Charter Schools.
According to WFLA-TV, two schools formally managed by Newpoint near St. Petersburg have struggled financially to keep their doors open after the company left them in such financial chaos that they could not keep a balanced budget. Thursday, they had to end their fight to keep the schools and will most likely close, WFLA-TV reported.
In Jacksonville, Newpoint claims San Jose owes about $500,000 in payroll, management and other fees. That's why the board said it has decided to take the loan.
"You know, in many issues around the state, there were expenses accruing and fees on that that had not come before boards to be approved. So those were forgiven in that document. And we agreed to $100,000 that will be paid over a 36-month or 3-year period at 6 percent," Arnold said.
As part of the agreement from June 30, the board will have to publicly address the termination per a certain script Newpoint has written up, which includes saying, "Newpoint provided our schools with financial support, including advancing cash to cover payroll when needed and deferring their management fees, all to ensure the school would survive and then thrive as we have done."
Arnold said she doesn't disagree with that statement.