The third-party financing system used by some charter schools in Minnesota to secure building space should be scrapped, and the schools should be allowed to purchase buildings outright, charter directors told state lawmakers Thursday.
The hearing of the Senate Education Committee's charter-school subcommittee was the third of four such meetings planned to gather recommendations for the upcoming legislative session about whether to amend state law regarding facilities for charters.
Lawmakers tightened rules regarding oversight of charters during last year's session. This year's focus is bricks and mortar.
Charters are state-funded public schools but they are prohibited from purchasing land or buildings with state money.
That has led some to set up "affiliated or related nonprofit building companies," which finance construction and then collect payment from the schools in state lease aid.
Some say these entities add unnecessary complexity and cost.
"The whole building company business has been hard for me to get my head around," said Terry Tofte, a longtime administrator in traditional public schools who runs a charter in downtown St. Paul called the St. Paul Conservatory for Performing Artists.
At the conservatory, a nonprofit building corporation was set up to receive tax-exempt contributions to renovate space in Landmark Center, Tofte said. The corporation also negotiates leases for other space the school uses downtown and then subleases it to the school.
"It's not particularly efficient," Tofte said.
Nor is there enough separation, he said, between the building company and the school.
"It's a fairly cozy relationship and one that I am not entirely comfortable with," Tofte said.
The subcommittee also heard from Khalid Elmasry, a former board member with the Minnesota Education Trust, which he described as the landlord for the Tarek ibn Ziyad Academy, also known as TiZA.
Elmasry said the leadership of the school is too closely tied with the leadership both of the building company and the Muslim American Society of Minnesota. He also claimed his daughter was made to feel so unwelcome at the school as a result of his questioning of its operations that he had to transfer her to a different school.
"This is a disgruntled former board member," said Blois Olson of Tunheim Partners, a spokesman for TiZA. "The school's in compliance with all state laws. I think it's hyperbole and I wouldn't respond to unfounded allegations," Olson said.
TiZA is defending itself in an ongoing federal lawsuit filed by the American Civil Liberties Union of Minnesota, which alleges the school is blurring the line between religion and public education by promoting Islam. The state Department of Education also is named in the suit.
The Senate subcommittee meets again Jan. 25. Kathy Saltzman, the Woodbury DFLer who chairs the subcommittee, said she's hoping to focus on proposals at that meeting, with an eye toward having recommendations ready in early February.
"I think we all know we need to address a problem," she said.
Maricella Miranda contributed to this report.
Doug Belden can be reached at 651-228-5136.