Norton Calls for Resignations and an End to Federal Appointments to Public Charter School Boards

December 15, 2008

Washington, D.C. -- Congresswoman Eleanor Holmes Norton (D-DC) today called on Thomas A. Nida and Barbara Hart, the respective chairs of the congressionally-created D.C. Public Charter School Board (PCSB) and the D.C. Public Charter School Credit Enhancement and Direct Loan Funds Committee (the "Committee"), to resign following reports in Sunday's Washington Post of "astonishing, acknowledged and systemic conflicts of interest and financial self-dealing" within the two charter school entities with oversight of D.C. charter schools. If Nida, whose personal business appears to be substantially linked to charter school financing, does not resign, U.S. Secretary of Education Margaret Spellings should remove him for cause, and the Loan Funds Committee should remove Hart, in accordance with its bylaws, Norton said.

According to the undisputed Post report, Nida approved the use of federal and local funds in connection with real estate and other charter school business transactions that benefited his current private-sector employer and business associates. Although Hart apparently recused herself from all but two votes, her employer benefited repeatedly from transactions with charter schools and developers, and committee members had conflicts in approximately a third of the approved applications or projects. Norton said it is inappropriate for a member of a public board, let alone the chair, to have financial interests in so much business that she has to waive the participation that the statute contemplates.

In calling for the resignations, Norton said, "The actions of Nida and Hart cast a shadow over a unique and remarkable alternative public school system whose success in educating the city's children speaks for itself. The conflicts of interest revealed are so wide-ranging that it is impossible for these officials to proceed with charter school business with any public confidence. I believe they want these schools to continue their outstanding progress and that, for the good of our charter schools, they must know they should resign following this report. Public ethics 101, not to mention ordinary good judgment, starts with the standard that financial transactions always must be carried out at arm's length and separated from policy decisions. Nida built a virtual charter school banking business from his role as chair of the PCSB at the same time he was considering charter school applications from educators who would need facilities. There has been little risk involved in this business. Nida and his business associates were assured of relatively safe returns because of the steady cash flow from per pupil enrolment and public facilities funding."

Because the mayor may appoint members of the PCSB only from a list selected by the U.S. Secretary of Education, Norton earlier introduced the Public Charter Schools Home Rule Act of 2008 to give the District of Columbia greater control over public charter schools. The bill was voted out of committee but was not considered on the House floor. The objection was not to home rule, but some concern was raised in the Senate that the charter schools should have as much independence as possible consistent with House rules because public charter schools across the country sometimes have encountered interference from public officials. Norton, whose approach to D.C. issues in Congress is guided by home rule principles, believes that the mayor and city council should be given the appropriate authority and that a solution can be found to enable her to reintroduce and get the bill through this session. However, she said, "immediate action is required now to remove any taint from the educational and financial decisions of the boards." Although the other board members appear to be implicated because they approved these arrangements, Norton's bill will provide for an orderly transition in order to assure institutional knowledge for incoming members.

The Congresswoman said that there always has been a great demand for charter school space and few vacant schools have been available. She remembers visiting charter schools in church basements and rundown buildings and acknowledged that Nida served a useful role in helping the schools to build and renovate facilities. But, she said this responsibility should have been taken by disinterested parties, such as public interest law firms, pro bono lawyers, UDC legal clinics that assist non profits every day or by private sector representatives such as the banks Nida and Hart were associates with while simultaneously serving on these boards. The actual or the appearance of conflicts of interest is inevitable when the person who leads in deciding which schools are granted charters then personally benefits from public funding that develops the school facilities.