NC board revokes Raleigh school's charter, cites school leaders' 'self-dealing'

“This is not a decision that has been made lightly,” said Amy White, chairwoman of the board’s education innovation and charter schools committee. White cited “a thorough investigation from multiple investigators within the Department of Public Instruction.”

The revocation comes three days after the Charter School Advisory Board recommended revocation. The advisory board met for eight hours Monday after a few months of discussions on issues at Torchlight Academy.

While the school’s initial issues raised last year largely concerned the operation of its exceptional children program, most of the discussion Monday revolved around financial record-keeping and self-dealing. The state noted the school's executive director, Donnie McQueen, is also the owner of the school's for-profit management organization that has been paid nearly $3 million.

Monday's meeting featured tense questioning of the school’s board of directors, who largely claimed ignorance of either what was going on at the school or the extent to which school leaders’ actions could violate rules.

School officials largely deflected questions regarding school management and noted that the school has been posting "C" performance grades and student growth levels that exceed expectations. Academic performance was not a factor in the state's investigation.

The Charter School Advisory Board recommended the school’s charter be revoked for:

White cited those same reasons, as well as “a number of different issues that were shared with the board in close session,” in the making the recommendation Thursday to revoke the school’s charter.

The State Board of Education vote 10-1 to revoke the school’s charter, the third charter the board has revoked among Torchlight Academy Schools LLC-managed schools in the past year.

Only Lt. Gov. Mark Robinson voted no Thursday, but the vote covered several items unrelated to the revocation and it was not clear which item Robinson objected to and if it was Torchlight Academy’s charter revocation. Robinson did not speak during the two-day public session of the State Board of Education this month until casting his “no” vote.

EARLIER:

The North Carolina Charter School Advisory Board has recommended closing one of the state’s oldest charter schools because of financial and management concerns — including that school leadership is profiting from school contracts.

The board unanimously voted Monday to make the recommendation following nearly eight hours of presentations from both state officials and officials with Torchlight Academy. The State Board of Education plans to consider the recommendation Thursday.

Monday’s meeting featured new allegations against the school, passionate testimony from school officials and hesitancy from the school’s board of directors to act swiftly on making management or oversight changes.

The school serves roughly 600 students in Raleigh and has been operating nearly as long as the state’s 1997 law that established charter schools.

But school leadership — at the administrative and board of directors levels — lost the trust of state officials in recent years over concerns that the school was violating federal laws on special education and against financial self-dealing.

“At no point in the last two months or three months that we’ve been doing this has anybody suggested Torchlight Academy is not a good school,” Charter School Advisory Board Chairwoman Cheryl Turner said. But the school’s apparent violations of federal law have become a threat to federal oversight and funding for the state, Turner said. “That’s a big deal.”

School leaders felt the board’s decision was made before Monday and were frustrated that the school’s academic performance did not factor into it.

They left the meeting calmly Monday but fiercely defended the school afterward, exclaiming their frustration that the state would close a school that served almost exclusively Black and Hispanic students.

“It seems like there’s a rush to judgment,” said Donnie McQueen, the school’s executive director, who also owns the for-profit company than manages the school. McQueen’s role with both the charter school and its management organization, which has been paid nearly $3 million in management fees since 2016, was a central concern for state officials Monday.

McQueen said the school and the state should have entered a compliance agreement, rather than close down the school, considering the school’s academic success.

The school has been at the highest level of noncompliance since December and had 30 days to prove it was in compliance. But since then, the state has been asking for more information and raising more questions.

If the State Board of Education revokes the school’s charter, it would close this summer. Families would be forced to enroll their children in the Wake County Public School System or home school, if other charter school and private school application periods have closed.

School leaders largely did not address the state’s concerns about management and offered just one solution: McQueen would resign as the school’s director.

But that left Charter School Advisory Board members wondering if the school would continue working with McQueen’s company and continue employing McQueen’s wife as principal of the elementary grades.

Board of Directors Chairwoman Pamela Banks Lee said they had not determined those things yet.

“We do see there is a potential conflict of interest and we are planning o address that,” Banks Lee said.

Banks Lee told the advisory board Monday the conflict’s existence was partly the board’s fault, as members did not understand what an education management organization was when the board approved hiring McQueens’ management company.

The board was sold merely on the financial protection it could gain from having another layer of leadership that would keep it from “going in the red.”

School leaders deflected criticisms from the state by noting that the school, prior to the COVID-19 pandemic, had been exceeding student growth expectations.

They repeatedly noted the school’s status as a “C” school and a high-minority and economically disadvantaged student population. Data show the school serves almost exclusively Black and Hispanic students but not many more economically disadvantaged students than the state average (43.9%, compared to 38.9%).

But concerns brought by the state and Charter School Advisory Board members revolved around financial mismanagement, falsified records and a broader concern that school officials were enriching themselves with taxpayer-funded dollars meant for schools.

Torchlight Academy leaders additionally criticized the Charter School Advisory Board. Cynthia McQueen asserted it had “too much power” and Donnie McQueen facetiously called it “flawless.”

Donnie McQueen questioned the impact of closing the school on Black and Hispanic students, considering that the school may have been academic outcomes than the students’ neighborhood school and considering that the school hires mostly Black teachers, who are less common in other schools.

“How does our community benefit?” he asked. “How does our future benefit?”

On Monday, North Carolina Department of Public Instruction officials presented their latest findings from two years of visits, records requests, conversations, emails and even some employee turnover.

The state unveiled new findings Monday and alleged the school was likely violating laws and rules concerning conflicts of interest, as the school maintained contracts with relatives of school leaders and was managed by a company owned by the school’s own director.

The state briefly mentioned other potential conflicts of interest, noting that McQueen owns other companies and and properties where other companies are registered. The school had not documented board of director meeting minutes that disclosed the conflicts, either, including the appointment of the McQueens’ daughter, Shawntrice Adams, as the school exceptional children program director.

Other new findings include:

Previous findings, which are being addressed, include:

The state has not created a formal report on the school and updates have been delivered in the form of new findings that have resulted in temporary actions.

Monday’s meeting similarly provided a wealth of updates on information obtained and not obtained but included no official report on the school nor recommendations made for the board to consider.

School officials contested the state’s incremental approach to information gathering and action and disputed numerous allegations on whether the state has offered technical support to the school, when school officials were notified of concerns and whether certain budget line items reflected improper spending.

State officials described getting the run around from school officials during efforts to obtain more information. State officials would show up to the school to ask for records and be told no one was present who could provide them.

Torchlight Academy’s board of directors conceded being unaware of much of the state’s findings until the state uncovered them. One board member, in a statement drafted by the board, thanked the state for uncovering the issues so that the board could act on them.

But that acknowledgment wasn’t what the Charter School Advisory Board was waiting to hear.

“You guys have got to know more about what’s going on,” Turner said.

EARLIER:

A state advisory board will discuss Monday the fate of a 600-student Raleigh charter school that is under fire for for its handling of special education programming.

The meeting will take place just days after records show the state was still waiting for Torchlight Academy to produce financial and contractual records — including records that would be legally public for traditional public schools but that are not legally public for public charter schools.

The Charter School Advisory Board was scheduled to meet Feb. 8 on the matter. The meeting was moved after McQueen told the state he’d tested positive for COVID-19 the previous week. That was just after the school’s board of directors meeting, which school officials said forced board members, legal counsel and many staff into quarantine. Some of them later fell ill, the school said.

The State Board of Education asked the Charter School Advisory Board to review:

The board is also expected to make a recommendation on whether Torchlight Academy’s charter should be revoked.

The school opened in 1999, under the purview of nonprofit Northeast Raleigh Charter Academy. Its elementary school sits just outside of the I-440 Beltline, off of Atlantic Avenue on Bramer Drive. Its middle school is farther southeast, off of Old Poole Road.

In December, North Carolina’s public school districts and public charter schools reported about 13% of children as receiving exceptional children services.

In that same report, Torchlight Academy reported 18 of its 618 students — just 2.9% — were receiving exceptional children services. That’s after records show, earlier that fall, the school told state officials they had 42 of its 618 students enrolled in special education.

The school has posted average performance grades and academic growth in recent years.

Last year, the state found the school didn't properly implement the program as required by the federal Individuals with Disabilities in Education Act, altered and falsified student records, falsely reported training compliance, did not provide adequate access to student and finance records, and had unqualified staff.

The school protested being moved to the highest level of noncompliance, citing new training for staff and other changes the school was making to improve.

Officials complained of the voluminous records requested by the state and argued it was being treated differently than others schools.

Schools attorneys also noted the state had marked the school as “compliant” for exceptional children programming in its overall 2020 performance review.

According to documents posted with Monday’s agenda, the school provided most of the documents the state requested Jan. 10, following the State Board of Education decision to send the school’s issues back to the Charter School Advisory Board. The Jan. 10 request sought records related to the school’s board, board meetings and agreements with its education management organization.

On Feb. 16, the state requested a number of documents that concerned finances and contracts, including bank statements, employee compensation, and any contracts with companies created by school employees. As of Tuesday, the school has indicated that it is continuing to look into those requests.

Charter schools are public schools, but they are not subject to the same public disclosure laws as traditional public school districts. For example, charter schools don’t have to make employees’ salaries public. They also don’t need to disclose contracts, such as a lease contract.

The records the state sought related to financial documents included any records between the school or Torchlight Academy Schools and three organizations owned by other school officials.

Donnie McQueen owns Torchlight Academy Schools LLC.

School principal Cynthia McQueen incorporated a nonprofit, Legacy Charter Group, in North Carolina in 2014.

Shawntrice Andrews, the school’s exceptional children director until recently, owns Exceptional Scholars LLC, founded in 2020.

Aaron Andrews owns Luv Lee Sanitation, also founded in 2020 and incorporated at the same residential address.

Torchlight Academy Schools manages at least both Torchlight Academy and Three Rivers Academy in Bertie County. The State Board of Education revoked Three Rivers Academy’s charter in January after poor performance and numerous findings of violations.

Last year, the State Board of Education revoked another charter for a school managed by Torchlight Academy but did so before the school ever opened. The state determined the school was not ready to open because of building issues and a lack of tax-exempt status for the school, among other things.

In 2019, the State Board of Education approved Essie Mae Kiser Foxx Charter School’s request to terminate its agreement with Torchlight Academy Schools as its education management organization.

Around the same time, NC Policy Watch reported Torchlight Academy Schools was seeking to be the education management organization for five other charter schools.