So, While Apparently Not Worrying About Ballou, Our Mayor Requested $230 Million In DC Bonds For KIPP DC

Seems that in a burst of activity in the short week before Thanksgiving, instead of addressing the ongoing education crisis of some of our city’s most vulnerable kids, Mayor Bowser asked the council to issue $230 million in DC revenue bonds for KIPP DC. The council is considering this as emergency legislation, voting on it as early as next week.

The legislation would provide low-cost funding to KIPP DC for a variety of real estate ventures, including the refunding of more than $120 million in DC bonds issued years before; refinancing of loans for its school at 2600 Douglass Rd. SE, which KIPP DC is leasing from the city (it’s the former DCPS Douglass school); and expansion of its campus on Benning Road.

Perhaps the most curious stated reason for these revenue bonds is to fund the building of a school (or schools) on sites that are not exactly free and clear for that purpose, much less have community buy-in for it. (More on that in a second.)

According to the charter board’s 2016 financial audit, KIPP DC is the wealthiest of all DC charter schools, having more than $126 million in net assets, which is more than three times as much as the next wealthiest DC charter (Friendship) and more than twice as many assets as it had just 4 years earlier.

To be sure, DC’s charter schools (as well as other local, privately operated, nonprofits) often request such bonds, for help with large real estate expenditures. The bonds are not a direct handout by any means–rather, they provide lower cost financing for entities that the city, for whatever reason, finds value in. Such bonds work generally like this: Investors buy the bonds, which the beneficiary is obliged to pay back to investors, while the municipality issuing the bonds ensures they are tax-exempt and thus lower cost.

As far as I can see via the city’s legislative database, until now no DC charter school has made such a large bond request. Friendship’s request for $110 million in revenue bonds, in June 2012 during Vincent Gray’s mayoral tenure, was the next largest. Searching the database, I found tens of millions in charter school revenue bond requests in the last 18 years, spanning a variety of mayors and schools. A fair number of requests appeared to have been moved on an emergency basis, possibly as much to avoid public scrutiny as to address a funding emergency.

Even before the present ask for KIPP DC, our current mayor seems to have set the record for the largest charter school bond requests, having asked the council for more than $200 million in revenue bonds for just two charter schools, Friendship and E.L. Haynes. (Bowser’s deputy mayor for education (DME), Jennifer Niles, is the founder of E.L. Haynes.)

One of the proposed uses for KIPP DC’s current request may explain why this legislation was introduced during a short holiday week:

“The acquisition, development and construction, in one or more phases, of one or more public school facilities to be located at any one of the following sites: (i) 4650 Benning Road, S.E., Washington, D.C. [location of the closed DCPS school Fletcher-Johnson], (ii) 3100 Erie Street, S.E., Washington, D.C. [location of the closed DCPS school Winston], or (iii) five contiguous parcels of land located near Naylor Avenue, S.E., and Southern Avenue S.E., including a parcel with an address of 2907 Branch Avenue, S.E., Washington, D.C.” [location of KIPP DC’s real estate purchase earlier this calendar year for $5 million]

As you may recall, earlier this year KIPP DC applied with the charter board to create several new schools, including a high school in Hillcrest, to be located on land KIPP bought a short time earlier (the parcel referenced in iii above).

Ward 7 residents found out about KIPP DC’s plans well after the $5 million purchase of the land and KIPP DC’s subsequent application to the charter board.

Facing community opposition to its grand expansionism, in April KIPP DC asked the charter board to postpone its vote–and then amended its application, for just a new high school.

On June 4, I received an email from charter board spokesperson Tomeika Bowden, who noted that “while KIPP DC PCS originally expressed intent to locate the proposed high school at property purchased in the Hillcrest neighborhood, the school has since recanted that notion, and is considering alternate sites in Ward 7.”

Not long after, at its meeting on June 19, 2017, the charter board approved KIPP DC’s request to start a high school. Minutes of that meeting (page 19, to be exact) show that KIPP DC staff testified that the school had no intention of building a high school on its Hillcrest parcel.

But in a document attached to the proposed revenue bonds legislation (starting on page 16), KIPP DC has a slightly different version of what it wishes to do with these revenue bonds (boldface mine):

“The acquisition, development and construction, in one or more phases, of a high school to be located at one of the following sites: (i) 4650 Benning Road, SE, Washington, DC, (ii) 2330 Pomeroy Road, SE, Washington, DC, or (iii) five contiguous parcels of land located near Naylor Avenue, SE, including a parcel with an address of 2907 Branch Avenue, SE, Washington, DC.”

So, in the actual legislation, “high school” (from this letter) has been edited to “one or more public school facilities,” and the address for the closed Winston school has been substituted for a school at 2330 Pomeroy Rd. SE, which happens to be just around the corner from KIPP DC’s Douglass campus. The school at 2330 Pomeroy is a closed DCPS school, Wilkinson, that DCPS is using for athletics. It’s not up for RFO–well, not that anyone in the public knows about.

It’s possible that someone confused Winston–which is up for RFO–with Wilkinson, which as far as I know is still owned and operated by DCPS.

But the disturbing weirdness in all of this goes well beyond KIPP DC’s apparent plans for DCPS schools whose names begin with the letter W:

After all the declarations of not having a high school on that Hillcrest land, here is current legislation, proposed by our mayor no less, to approve public leveraging to locate some school (and, according to the KIPP letter, a high school, no less) on that same Hillcrest land.

Or, if not on that land, then a school (or multiple schools) in some nearby closed DCPS buildings up for RFO (Winston and Fletcher-Johnson), which as far as I know have not had any public disclosure of charter school bidders, much less awardees.

(Good luck to the other charter school bidders.)

And that’s not even getting into the fact that many Ward 7 residents who attended public meetings about Fletcher-Johnson this year alone have expressed dismay that any charter school would be located there. Residents cited more pressing needs, including retail, health care facilities, housing, and training for trades. Although prior practice has been that closed DCPS schools are offered to city agencies first by DGS, and then to charter schools by the DME if no city agency has any declared use for the schools, there is nothing in DC code that speaks to what happens when a charter school is not selected through the RFO process–which is what happened in 2014 with Fletcher-Johnson.

Yet, despite the ensuing years without review by city agencies since Fletcher-Johnson’s first RFO, and with a lot of community opposition (including people who asked why the building wasn’t simply sold to developers, a la the closed Hine middle school on Capitol Hill, which had been through an RFO with no charter selected), Fletcher-Johnson is being offered again to charter schools. A staff member for the DME indicated to me that this new RFO was a decision of DGS counsel. When I asked (repeatedly, over a period of weeks) when the DGS counsel made that determination, the DME staffer didn’t respond.

(Yeah.)

Although $230 million is the most ever issued in bonds for KIPP DC, the school appears to have a uniquely lucrative track record for revenue bonds.

In January 2008, Mayor Fenty asked the council to pass similar legislation for $40 million in bonds for KIPP DC. Then, in April 2013, Mayor Gray asked for $125 million in bonds for KIPP DC–partly to construct a high school. Later that year, in September, KIPP DC was awarded the closed DCPS Hamilton school, the site of its current high school.

But KIPP DC’s fortune appears to have grown considerably under our current mayor. Just a few weeks after taking office in 2015, Mayor Bowser put forward legislation to authorize $30 million in bonds for KIPP DC. Two current KIPP DC board members and one of their relatives together donated $6000 to the mayor for her 2014 mayoral election.

At the same time, Bowser realized $4000 more in donations connected to KIPP DC through former KIPP DC board member Charlene Drew Jarvis. A company founded by one of Drew Jarvis’s relatives gave $2000 to Bowser’s mayoral campaign in June 2014, while the company founder and Drew Jarvis’s son each gave $1000.

(Interestingly, the Jarvis company was headquartered at 2600 Virginia Avenue NW–the same address as KIPP DC–in the Watergate building. Yes, that Watergate building. And no, it’s nowhere near any KIPP DC school, though KIPP DC is very active elsewhere in the city where there are charter schools. For instance, although KIPP DC withdrew its application this year to take over another charter school, an invitation-only meeting for city education leaders on December 7 (starting at 9 am) on DC charter school takeovers will be hosted by KIPP DC at its Arts and Technology Academy. KIPP DC had taken over the prior charter school there–which had purchased the former DCPS building at 5300 Blaine Street NE–when that charter school (ironically, also granted revenue bonds by DC) had its charter revoked.)

So, if you were a bit distracted by last week’s holiday planning to pay attention to education debt and funding in DC, no worries: our mayors have been apparently devoted to such helpful public funding mechanisms to create new schools, even as our old ones struggle or are just forgotten.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s