BY LAYLI WHYTE
Staff Writer

RED BANK - More than 100 parents of Red Bank Charter School students attended the meeting of the school's board of trustees last week, many pushing for a resolution to the school's debt.

Mark Cool, parent of a third-grade student, submitted a petition to the board signed by 33 parents last Wednesday, and read aloud a statement urging the board to agree to pay back the debts originally incurred by the Red Bank Charter School Foundation, the school's main fundraising entity.

"If a speedy resolution is not reached on behalf of the RBCS Board of Trustees," he read, "we the undersigned, along with other interested parents and guardians, will pursue any and all remedies available to us to satisfy this matter."

The charter school is currently involved in two lawsuits brought by creditors claiming lack of payment.

Patock Construction, the company that performed renovation and construction work on the school's Oakland Street campus, filed suit against the school last January for $480,000, the amount it said is the balance of the $2.2 million contract between Patock and the charter school foundation.

Short Term Money, a loan firm, filed suit April 10 for $800,000 for money lent to the foundation to cover some of the money owed to Patock Construction for the work done on the school building.

In December, Friends of Charter Public Education (FCPE), a nonprofit group, was formed to support charter education and come up with a solution for the financial situation of the charter school.

The friends group proposed a plan last February to bring creditors, school and charter school foundation officials and representatives of the state Department of Education (DOE) together to negotiate a settlement of the school's debt.

The proposal currently proposed by FCPE calls for the school to pay Short Term Money and Patock Construction $100,000 each immediately and make monthly payments to each over the next 20 years to pay off the respective debts.

The school property would have second and third mortgages placed on it as collateral for the payments.

The charter school is also currently appealing a decision by the DOE Office of Compliance Investigation (OCI) to impose a $1 million penalty on the school because it did not go out to public bid on the school construction project.

Malachi Kenney, attorney for the charter school board of trustees, filed an appeal of the $1 million fine with the Superior Court Administrative Law Division last week, arguing that because the school and the foundation are separate entities, the school is not required to go out for public bid on capital projects.

The OCI, during the course of an investigation last year into the school's finances, concluded that the school and the foundation are one entity, and it has not rescinded that decision.

Board member Nancy Bunn, in response to parents' pushing for the board to accept the deal put forth by FCPE, said that because the arguments made by Kenney concerning the $1 million penalty are based on the fact that the school and the foundation are separate entities, the board cannot agree to a plan that would have the school paying debts incurred by the foundation.

"We're saying that the school and the foundation are separate entities," said Bunn at last week's meeting. "If we are one and the same, we should have complied with public bidding laws."

Board President Barbara O'Hern said that she believes the FCPE plan puts the future of the school at risk.

"We cannot put the school in jeopardy for a debt we did not incur," she said. "The debt was incurred by the foundation. To take on that debt is to close the school, and that we cannot do."

Jeffrey MacPherson, a founding member of FCPE and a member of the charter school foundation board of trustees, until he, along with the entire foundation board resigned last summer, read a prepared statement addressing the board at last week's meeting.

"The public should know that people who believe in this school are standing by, waiting for you to get out of the way," he said. "Waiting with donations to pay Patock Construction and Short Term Money. Waiting for us to hand that agreement to the state Department of Education so we can celebrate the removal of the $1 million fine. I know that you don't believe they'll remove the fine, just like you don't believe the parents understand the issues well enough to vote. It seems you don't believe in anything, but is that the kind of leadership we want for our children?"

Michael Stasi, former president of the board who was ousted last July by a 5-to-4 vote by the board to not reinstate him at the end of his three-year term, was also a member of the school's foundation until last summer and is a current member of FCPE.

He also read from a prepared statement to the board, urging them to agree to the FCPE proposal.

"Since January," Stasi said, "a proposed workout agreement put forth by community members and parents to help settle this debt of the school, has received support by the creditors and the Department of Education. You are the only stakeholder remaining to agree to this proposal."

Richard Vespucci, a spokesman for the DOE, said last week that although the DOE supports the FCPE concept of getting all parties together to work out an agreement, the specifics of the agreement proposed by FCPE have not been sent to the DOE.

"We haven't seen the document," he said, "not that anyone is required to show it to us."

Vespucci said that although the DOE does not want to speculate on a plan that it has not seen, the department would have no say on the additional mortgages if the school property is privately owned, as are many charter schools.

According to Kenney, the school property is publicly owned, but the issue is whether or not the school and the foundation are one entity.

"The board of trustees," he said last week, "can't guarantee a debt. They can only secure loans with property."

Catherine Donahue, a charter school parent, said that she would like to see the parents of the charter school be more understanding of the actions of the board.

"The board of trustees are the trustees for the community's money," she said. "They don't represent only you. This is a public school funded by taxpayers. They are safeguarding their financial responsibility and financial trust."

Donahue said she believes the FPCE is putting the needs of the school's creditors before the needs of the school.

"When you are in a lawsuit," she said, "that person is your enemy. Friends of Charter Public Education has more good things to say about our adversaries than our board. This community needs to start thinking more."