Failed charter school paid principal's husband $460K in Florida

From OrlandoSentinel.com

The failed Orange County charter school that gave its principal a payout of $519,000 in taxpayer dollars after closing in June also paid her husband more than $460,000 during a five-year period, audits show.
The payments to Steven A. Young, which averaged more than $80,000 a year, were for performing "certain management services," according to annual audits paid for by the school. The total included about $41,000 for services to be performed after the school closed, according to one of the audits.Young, husband of NorthStar High School Principal Kelly Young, helped establish the charter school 11 years ago and was its first board president. He resigned from the NorthStar board in August 2008, the same month he was arraigned on charges of soliciting prostitutes while on duty as an Orange County sheriff's commander. He was ultimately adjudicated guilty of three charges and lost his law-enforcement job. He is now a divorce attorney.
The payments to Steven Young appear to violate state law prohibiting public officers and employees from doing business with family members, according to legal and charter-school experts. The law states that no employee or officer may purchase services "from any business entity of which the officer or employee or the officer's or employee's spouse or child is an officer, partner, director, or proprietor."
Reached Friday at his law office on Curry Ford Road, Young would not comment.
Between 2010 and 2012, the school also paid at least two of its five board members a total of $48,000 to do clerical and administrative work for the school. Those payments also appear to violate state law and conflict with NorthStar's contract with Orange County schools, district officials say.
"I don't believe we have to stand by idly and watch this abuse," said state Sen. David Simmons, who sits on two state education committees and is also a lawyer. "Those are monies that should come back to the people of Central Florida."
Simmons, who weeks ago expressed outrage over the half-million-dollar payout and hundreds of thousands in compensation that Kelly Young had received from the school, said he would push for changes in state law that would give local school boards more oversight of charter-school spending.
After inquiries by the Orlando Sentinel, officials with Orange County Public Schools are looking into the legality of the payments. But the investigation may eventually fall to the state Commission on Ethics, which can levy penalties or order restitution if it finds a violation of the law.
Under Florida law, charter schools are run by independent governing boards. Although the schools use public money, state and district officials have little to no control over how the money is spent. According to an August report by the state auditor general, a third of state charter schools had accounting problems, legal violations or other problems in their 2011 audits.
Rebekah Benson, a member of the NorthStar charter board, said the school district should have known about the large sums that were paid to Kelly Young for years.
Forms that NorthStar submitted to the Internal Revenue Service indicate that Kelly Young was paid $144,903 in "reportable compensation" in 2008-09, $208,746 in 2009-10 and $219,372 in 2010-11. The IRS filings, which also reflect payments for management services, conflict with records the school submitted to the state that showed it was not using a management company and was paying Kelly Young $72,000 a year.Both sets of documents, in turn, conflict with Young's final contract, which entitled her to $305,000 a year in salary and bonuses during her final two years. Along with her $519,000 bonus, her total compensation package in her last year added up to $824,000.
"It's so academic," Benson said of the furor over the payouts, which were made with taxpayer money. "We have a government that spends $17 trillion at the drop of a hat."
Board member David Barszcz, an attorney, would not comment, and board members Amy Harmon and Tracy Curp could not be reached. Kelly Young was the board president for the past several years.
Neither Kelly Young nor her lawyer returned calls for comment.
Kelly and Steve Young were among a group connected with Passport Charter School who helped establish NorthStar 11 years ago. An administrator from the charter elementary and middle school joined several parents of disabled children who wanted to create an inclusive charter high school.
Kelly Young, a carpet saleswoman, made it clear that she wanted to be principal. The board, led by Steve Young at the time, hired her, and the Passport administrator left in displeasure, said Judy Grimsley, one of the original board members.
"She had no credentials as principal. She wasn't even a teacher. She had a good marketing background, we thought," said Grimsley, who formerly ran the Orlando Sentinel's research department. "Maybe we were just stupid. She had me fooled for a long time."
Within about a year, Grimsley and the other board members who were connected with Passport were "systematically weeded out" and replaced, Grimsley said.
Most of the current board was in place by 2005, according to incorporation paperwork filed with the state.
In 2010, the NorthStar board approved the contract with Kelly Young that provided for $305,000 in pay a year and set the stage for her $519,000 payout after the school closed. The vast majority of charter-school principals in Central Florida earn less than $80,000 a year.
This summer, Steve Young was also paid about $41,000 for services expected to be performed after the school closed. That information was contained in the school's final audit.
Those audits are supposed to be reviewed by the district, the state auditor general and the state Department of Education. District officials missed the payments to Steve Young, though a blogger with the Fordham Foundation's Education Gadfly Weekly spotted them in early November.
Orange County schools are in the process of hiring a financial expert to review future audits. A representative with the state auditor general's office said it reviews audits to see if they meet financial reporting standards, not to see if they comply with state law. Officials with the state Department of Education did not respond to questions about how they handle the audits.
According to former teachers, the school should have been shut down years ago.
Some classes were taught by uncertified teachers, several former staffers said. Scott Simmons, who taught history and art at the school from 2002 to 2007, provided a document showing that the school submitted class schedules that made it appear that only certified teachers were being used. It showed Simmons teaching health, a class he never taught.
The school had inadequate books, overcrowded classrooms, no library and a cafeteria without food service.
Simmons also said the principal routinely forced out troublesome students after they were counted for funding purposes.
"Those kids had zero chances of making it," he said.
Simmons said he reported problems, including cheating on a Stanford Achievement standardized test, to the administrator who oversaw charter schools for Orange County in 2006, but the complaints never led anywhere. The school's charter was renewed in 2007. The Orange County school district was poised to close down the school for poor academic performance and other issues when the NorthStar board voluntarily closed the school this year.
In 2006, the Orlando Sentinel published a story about students being forced out of the school. District officials required Kelly Young to reinstate at least one student.
"We probably made a big mistake," said founding board member Grimsley. "My heart is broken that she did this."