New Charter Application: ASPIRA Eugenio Maria de Hostos Preparatory Charter School

by Deborah Grill

On February 15, after years of hearings at both the District and state level, the state Charter Appeal Board (CAB) voted 4-1 to uphold the School District of Philadelphia’s ruling not to renew the charters at two Aspira Renaissance charter schools, Olney High School and Stetson Middle School. Both schools have been in non-renewal status since 2016. Last year, after extensive legal hearings, the Board of Education took a final vote not to renew either charter, citing ASPIRA’s failure to meet basic academic, organizational, and financial standards. The Charter Schools Office (CSO) had cited ASPIRA’s questionable, if not fraudulent, misappropriation of the the state and local funding it receives for the two Renaissance charters to guarantee over $15 million in loans ASPIRA incurred for the purchase of the former Cardinal Dougherty High School building, which now houses two of its other charter schools.

Both Olney and Stetson have remained open since the beginning of the non-renewal process in 2016 during ASPIRA’s many appeals, thus continuing to cost the District and taxpayers for student tuition, building rent and the legal expenses incurred by ASPIRA as well as those incurred by the District in the appeals process. ASPIRA Inc. PA operates four brick-and-mortar charter schools in Philadelphia and a cyber charter school authorized by the state. In 2018, then-PA Auditor General Eugene Pasquale cited ASPIRA Inc.’s financial irregularities and lack of accountability as a prime example of why the state’s charter school law needs reform.
Yet ASPIRA continues to apply for more charter schools. This is the second year ASPIRA has tendered an application both ASPIRA Bilingual Business, Finance and Technology Charter High School and for ASPIRA Eugenio Maria de Hostos Prep, as last year’s applications were denied due to many academic, organizational compliance and financial management deficiencies.  This year’s applications are very similar to last year’s with the Charter School Office (CSO) citing most of the same deficiencies. The Board should again deny these applications.

[The Charter School Office Evaluation of de Hostos Prep can be found here. ]

Eugenio Maria de Hostos Preparatory Charter School

Proposed Location:  4222 N. 5th Street , 19120 (building houses Aspira, Inc. headquarters)
Target Neighborhoods:  Kensington and Olney; zip codes 19134, 19140, 19120
Management Company:  ASPIRA, Inc. PA
Real Estate Manager:  ACE/Dougherty
Projected Enrollment at scale: 1035 students in grades K-8
To open: 2021/22 SY, with projected enrollment of 1035 students in grades K to 8
Proposed School Leader: Glenda Marrero, currently assistant principal at Stetson (now in non-renewal)
Estimated cost to District:  $72, 277, 926 (estimate based on last year’s application) over 5 years.
Estimated stranded costs:  $22,440,600  (estimate based on last year’s application)

For the first two years (start-up and year 1), de Hostos would be located in the Olney neighborhood in a building owned by ASPIRA’s real estate management company, ACE/Dougherty.  De Hostos would pay rent in a circular real estate relationship that allows the school to collect state subsidies for the rent paid to ASPIRA’s real estate company – an arrangement common to many charter schools.  After Year 1, ASPIRA proposes to move de Hostos to an unspecified location.  During the application hearing, ASPIRA representatives initially indicated both that ASPIRA would seek to rent another building, and that ASPIRA would purchase another building in a location yet to be decided. If the school relocates to another building owned by ASPIRA, the school would again receive state subsidies for the rent that de Hostos would pay to ASPIRA. During the hearing, representatives from ASPIRA admitted that parents who submitted intent-to-enroll forms were not advised of the intended move. This move would be destabilizing to the students and their families, especially since it would occur so soon after the school opens. It also raises the question of whether the school will still target students in the stated zip codes once the school moves.

Founding Coalition                                                                                                  
Walter V. Yakabosky
is the Training Director for the Energy Coordinating Agency of Philadelphia (ECA).  Daisy D. Rosa is Vice President at Congresso VP Family/Housing Services. Former Quality Assurance Director at Asociación Puertorriqueños en Marcha, listed as a Partner Organization on the application raising a potential financial conflict of interest.  Ana Benitez is the Vice Chair of ASPIRA, Inc. Board  Alfredo Calderón is the President and CEO of ASPIRA, Inc.
The appearance of both Alfred Calderon and Ana Benitez raises questions of conflict of interest.  ASPIRA, Inc. is listed as the management company of ASPIRA schools and would benefit financially from management fees and reimbursements from the schools,  as well as rent from de Hostos.  Calderón was specifically cited throughout former Auditor General de Pasquale’s investigation into the finances of Aspira, Inc. and its charter schools.  In 2016, Calderon and ASPIRA settled a major sexual harassment lawsuit with a $350,000 settlement to the victim, who alleged that she was demoted for rejecting Calderon’s sexual advances and for refusing to listen to him about his ongoing sexual conquests of teachers, students and parents at ASPIRA schools.

Proposed Board Members
Rachel L. Duprey  is the office manager of Dental Dreams. 
Kevin C. Glover is a Mortgage Underwriter for Wells Fargo Home Mortgage and works for Aspira of PA Schools, Inc. as a personal finance teacher in the accelerated program. He is also a proposed Board member in ASPIRA’s current application for ASPIRA’s Bilingual High School.  Both his current employment with ASPIRA, Inc. and his position on another ASPIRA school board would present a conflict of interest.
Joanna Otero-Cruz has worked at City of Philadelphia Deputy Managing Director for Community Service, and is Director of Concilio, a Partner Organization, posing another  potential financial conflict of interest. 
Angelica Martinez is the Assistant Director of First Year Experience at Cabrini University.
Andy Banas is listed in the application, but not included in the CSO evaluation which lists only the first four.  He is, however, listed as a proposed Board member in the current application for ASPIRA’s Bilingual High School.

Board Governance
The application states that “de Hostos Prep will be associated with ASPIRA Inc. of Pennsylvania (“ASPIRA”). ASPIRA has no power of appointment to the de Hostos Prep School Board and no board members of the two entities are common to both boards.”  That statement cannot be verified as of this writing. The ASPIRA, Inc. PA website does not list the current board members, only this statement: “A list of the ASPIRA of PA Board Members will be posted soon. Thanks for your patience.”  
The CSO evaluation concludes: The Charter School’s governance approach is described in a manner that is misaligned across various documents. The evaluation also cites many problems with the board and its governance including non-compliance with the PA Charter School Law and the state’s Sunshine Act. For example, while the submitted board by-laws require five to nine members in order to conduct business, the resumes of only four proposed members have been submitted with the application. Also, one parent would be appointed to the board, bringing the number up to five, but only after the school opens for students. Because there would be only four board members during the planning year, when major decisions have to be made, the CSO finds that  “…the Applicant does not adequately explain how the Board of Trustees for the proposed Charter School would be able, independently from ASPIRA, to make decisions, authorize all of the required actions and approve the lease, management and other necessary contracts to properly establish and start-up an independent charter school as required under the Charter School Law.”  In addition, the by-laws do not require the de Hostos Board “to hold its public meetings in locations that are accessible to the proposed Charter School community”.  The by-laws contain a provision stating that “the mere presence of a Board member at a meeting amounts to assent to an action unless the Board member objects to the action which is not in compliance with the Sunshine Act”.  The CSO also points out that the Boards of the existing ASPIRA managed schools are “consistently out of compliance with applicable laws”. [bold added]

The de Hostos application does not make clear who would actually manage the school and make major decisions. The application states that “the Board will provide the management of Hostos Preparatory through its engagement of ASPIRA’s management company, ASPIRA Educational.” (p.47)  The CSO notes that ASPIRA’s Master Service Level Agreement (MSLA) gives  ASPIRA “significant control of the day-to-day operations” of the school and questions how that would benefit the school. The agreement is renewed every year; however, the CSO notes that the MSLA can be terminated by the school only “for cause or a change in circumstances or applicable law”.  Nor can the school terminate the agreement “if there is an issue with the services provided by ASPIRA which cannot be resolved by the parties (pp.314, Attachment 11)”.
The Staffing Agreement has a similar provision in which the school cannot terminate the Agreement, but ASPIRA can “reduce or terminate the MSLA if here is a reduction in funding received by the proposed Charter School, if there is an increase in special education students, or if there is a change in funding or other circumstances which would impact ASPIRA’s own financial condition (p.7 and p.14, Attachment 11).” [bold added]
ASPIRA’s 10.5% management fee is one of the highest charged by a Charter Management Organization (CMO)–so high that ASPIRA felt the need to deny that they were making a profit in their application:
“Although some might raise concerns regarding Aspira potentially benefiting financially from the fees and reimbursement costs that Hostos Prep would pay to ASPIRA for management services, it is important to note that ASPIRA is a private-nonprofit entity and has operated successfully in service to its nonprofit mission for over 50 years. The management fee, lease payments (which have been vetted by independent third-party lease-comp studies of fair value) and any reimbursable expenses that Hostos Prep would pay to ASPIRA are consistent with what ASPIRA charges to its existing charter schools. These fees and expenses are set to cover ASPIRA’s delivery of its services and direct expenses, not to make a profit… any suggestion that ASPIRA attempts to benefit unfairly from its arrangements with its schools is both unwarranted and incorrect as demonstrated by the numerous independent third party audits, inspections and reviews of these arrangements.” (p.48)

ASPIRA’s MSLA includes the management of every aspect of the school’s non-instructional functions: Academics, Administration, Human Resources, Finance and Accounting, Information Technology, Custodial and Maintenance, Safety, Nutritional Services, and Transportation. While ASPIRA would provide the services, the personnel and the needed equipment, De Hostos would pay for the  equipment and the salaries of any of the ASPIRA employees servicing the school from the school budget.  For example, regarding Technology Services, the CSO evaluation states: “Although the proposed Charter School would be required to pay for technology, the equipment will belong to ASPIRA, not the school… Title to any and all equipment (“Equipment”) provided by ASPIRA to School or placed by ASPIRA in School’s facilities for ASPIRA’s or School’s use in connection with the Services shall remain the exclusive property of ASPIRA” (p. 18 , Attachment 11). In essence, the proposed Charter School would be purchasing the materials, but not retaining any ownership in such materials. Such an arrangement may not be in compliance with applicable federal and state laws governing technology equipment and raises concerns about whether charter school funds are properly being spent for charter school purposes.”  [bold added]
De Hostos would also be required to maintain insurance against any damage or loss of the equipment, not ASPIRA, Inc., who actually owns the equipment.
The CSO raises additional concerns about the potential for ASPIRA to profit from this school. The evaluation points out that in addition to the management fee, de Hostos would have to pay ASPIRA a “staffing fee” which would potentially add an additional $1.74M or more on top of the 10.5% management fee. In reference to proposed health services at de Hostos, the CSO observes: “The Applicant writes that both physical and dental exams are required upon entry to the proposed Charter School. The Applicant writes that it will offer ‘low cost physicals from our school physician’ (p. 46, Narrative), with no rationale for the fee provided, a significant concern as state law mandates that these services be provided at no charge to students or their families. [bold added]  In fact, the position of school physician is not included in the staff list or the budget, nor mentioned in the management agreement.  To whom, then, would that fee be paid? 

Financial Management
The CSO concluded that the proposed budget for de Hostos does not accurately reflect the cost of many of the positions and services described. They cite  inconsistencies and conflicting statements throughout the application about both revenues and expenditures including, but not limited to: salary and benefit increase assumptions, proposed rent and maintenance costs, anticipated special education and English language learner populations, funding for a marketing plan, purchasing policies, financial reporting to the the board, and the board’s role in developing the budget.
The application narrative states that de Hostos Prep would be a replication of the successful education and financial model of existing ASPIRA charter schools (p 53).  One wonders how they can say that given the academic outcomes and the financial irregularities that have been found repeatedly in ASPIRA’s existing schools.

In this year’s application,  ASPIRA states that the mission of this new charter school would be “to provide a bilingual, bicultural, academically rigorous program in English and Spanish that enables students to achieve their maximum potential in all aspects of life.” The CSO evaluation, however, points out that not only does the proposed curriculum fail to cover all of the required Pennsylvania Core and Academic Standards, it does not “demonstrate elements of a dual language model across multiple core subjects… It does not include a comprehensive set of curricular materials to demonstrate that the proposed Charter School would meet grade level requirements as required by Chapter 4, Title 22 of the Pennsylvania Code.  A curriculum must contain tangible resources to include goals, assessments, instructional strategies, expectations, and resources for teaching and learning.”

The CSO observes that “the applicant proposes a staffing model that is flawed both in design and the detail of implementation.”  Some staff members would be employees of the school and report directly to the board (principal, assistant principal, lead administrative assistant, classroom teachers, counselors). All other staff members including senior lead educators, English learner coordinator, speech/OT therapist, safety team, maintenance and custodial staff would be employees of ASPIRA and under ASPIRA’s supervision.  The CSO finds that this arrangement “does not provide the principal with the ability to function in a supervisory role with ASPIRA employees, including the specialized services staff, thereby limiting the ability of the principal to ensure that the school model is implemented consistently with fidelity.” 

Community Partnerships
Aspira’s application states that De Hostos will partner with Concilio, Hispanic Community Counseling Services, Taller Puertorriqueño, the State Representative of the 180th District, Pan American Behavioral Health Services, Inc., In the Light Ministries, and Asociación Puertorriqueños en Marcha.  All of these organizations would be providing supplementary services for both physical and mental health, cultural enrichment, academic enrichment, faith-based opportunities and local government initiatives.  However, ASPIRA did not provide any MOUs or letters of support from these organizations. Of the six undated letters of support from organizations that were provided, the CSO notes that  “none of these organizations appears to specialize in the fields of physical and mental health support areas the Applicant references as being core focuses for its community partnerships, and the letters do not detail specific plans providing services to the proposed Charter School.”

Application Process and Lottery
The school would admit students from all parts of the city, with preference given in this order: to a child of a parent who participated in the development of the charter school; siblings of students enrolled in the school; students living in the 19120, 19140 and 19134 zip codes.  The application contends that two of ASPIRA’s existing schools have waiting lists of 900 each. If a lottery is required due to more applicants than seats, it would be automatically populated by ASPIRA’s pre-existing wait lists and the completed “intent to enroll” forms (p. 84). After the wait list is added to the lottery, any open vacancies would be populated according to the applications of the families in the catchment areas. Actually, it seems that if students from ASPIRA’s wait lists fill all of the open seats, those living in the targeted zip codes would not be admitted.  
The CSO points out that only 44% of the Applicant’s submitted intent to enroll forms come from the targeted zip codes. Also, it is unclear whether the “intent to enroll” forms were ones submitted for this application or last year’s application. When asked at the hearing if those submitted from last year’s application were still valid, an Aspira representative testified that they confirmed the continued intent to enroll via email.  However, those emails were not submitted with the charter application.

The CSO Evaluation is 973 pages including 15 extensive documents of the Annual Charter Evaluations of ASPIRA’s four charter schools for the past two years, reports and supplements to the non-renewal proceedings of Stetson and Olney, and a corrective verification/ compliance  and improvement plan from the Bureau of Special Education for Olney High School.  
In the evaluation’s concluding section entitled  “Historic Trends of the Existing Operator”,  the CSO describes an applicant that “does not have a track record of strong academic outcomes and compliance for the charter schools it manages” and that has two schools already in the non-renewal process.  The CSO concludes that Aspira “does not have an existing charter school that served as a model for  replication for the proposed school… does not present data that demonstrates whether existing charter schools managed by the Applicant have maintained or improved performance and compliance outcomes with the expansion of charter schools managed by Applicant.”
This report is just a sampling of the information in the Application Narrative and the Charter School Evaluation. Both documents can be found under the sub-heading 2012-22 New Charter Applications on the District’s New Charter Schools page.