HOW NJ BOOSTS PROFITS FOR CHARTER SCHOOL DEVELOPERS
The collapse of Newark’s Lady Liberty Academy Charter School hurt the nearly 500 inner-city children who attended the privately-run, publicly-funded school–but the debacle also exposed a reckless financing scheme used by former Gov. Chris Christie to help political allies in the charter school movement.
The scheme–known as “conduit bonds”– is so complicated even the spokeswoman for the New Jersey Economic Development Authority (NJEDA), the agency that devised it, conceded she doesn’t understand it.
But the scheme’s fiscally unhinged methods are easy to describe: The Republican Christie administration loaned $10 million to a private real estate estate developer. The developer–BWP School Partners LLC of Metuchen–formed a partnership with a trouble-plagued but politically connected charter school, Lady Liberty Academy, to create a new facility at the site of a closed religious school in the Vailsburg section of Newark.
BWP–a for profit spin-off of a non-profit called Build With Purpose–promised to pay the $10 million from the state back to the state with the funds generated by the annual rent it charged to Lady Liberty. In 2016, the annual rent reached more than $871,000.
That’s $871,000 in public money that would otherwise have gone to Newark’s resource-starved public schools.
The money kept rolling in despite clear indications the school was in academic trouble. A Rutgers report in 2003 warned of “challenges.” The school was twice put on academic probation by the state. Despite the red flags, Christie loaned the money to Lady Liberty and its private real estate developer partner.
Now that the school has been closed by the state under a new political administration, the money for rent is no longer available–not to the school and not to BWP, a company headed by Brian Keenan of Metuchen. And not to the state that loaned it out.
The disaster gets even gets worse: The Christie scheme, explained in a detailed Continue reading: HOW NJ BOOSTS PROFITS FOR CHARTER SCHOOL DEVELOPERS |