4 On Your Side investigation reveals charter school rent problems

Posted at: 05/06/2013 9:07 PM
Updated at: 05/06/2013 10:29 PM
By: Gadi Schwartz, KOB Eyewitness News 4

A 4 On Your Side Investigation has found taxpayers are paying hundreds of thousands of dollars in rent money for school buildings they already own.

The double payments come as some charter schools around the state look at renting out old school buildings to house their classrooms.

A review of a report prepared for the states Legislative Council Service found the amount of money spent on charter school lease payments overall has increased by 377 percent from 2005 to 2013.

In at least two cases the maximum allowable lease payment of $137,000 was being paid for schools that had already been built and then abandoned.

In Las Cruces, the Alma D' Arte Charter School is now housed in a newly renovated school that is owned by the Las Cruces School District. The district leases the building to the City of Las Cruces for one dollar, which then leases the building to the non-profit group "Mesilla Valley Youth Foundation for one dollar. The foundation then leases the building to the charter school Alma D' Arte for $137,000.

Principal Mark Hartshorne tells 4OYS he knows it looks weird but says it's completely legal and all the money goes back into an art program that was the foundation of the charter school.

"If there are loop holes that need to be closed, well close them," said Hartshorne. But he said he is comfortable with taking advantage of the loophole because it benefits both students and a city art program.

4OYS toured the school and found an impressive display of student art work.

Hartshorne said the results speak for themselves and told 4OYS that high graduation rates and student participation have been achieved in part from the rent money that effectively gets funneled back into the the art program.

Hartshorne also added that in the next few years the district plans to move several other charter schools into the building to create a new charter school complex.

4OYS also found the Carinos Charter School in Espanola was paying the maximum allowable rent in an old school building that tax payers had already paid for.

The charter school is located in the old Espanola Middle School which was closed after the state deemed parts of the building were unsafe to house students.

A spokesperson for the PED said the school has since been repaired and administrators tell 4OYS that the building is up to code and safe for students.

Administrators say because the building is in such need of repair it is actually cheaper to pay the maximum allowable rent because utilities and maintenance on large ticket items like heating and cooling systems exceed the cost of the lease.

In some cases the state report to the Legislative Council Service also found some schools paying in excess of the maximum $137,000 lease amount.

In at least 10 cases, charter school operational funds were being used to offset higher costs of rent.

The report recommended that lawmakers develop a standardized leasing system for charter schools that would have to be approved by the state.

The report also recommends the possibility of eliminating lease payments for schools in buildings already owned by the state or local school districts.