Santa Ynez school district says payments to charter school could be detrimental

A 2018 decision by the State Board of Education requires several Santa Barbara County school districts to pay a local charter school system hundreds of thousands of dollars each year to help it operate.

While two of the districts have already made their first monthly payments, Santa Ynez Valley Union High School District has not, and its superintendent said the projected costs of helping fund Olive Grove Charter School could eventually lead the district to insolvency.

“We can’t afford this,” Superintendent Scott Cory said. “It literally would eviscerate our people and programs.”

Cory presented details on the situation at a Santa Ynez board of education meeting on Jan. 15, when he told board members and attendees that the district will have to pay Olive Grove an estimated $696,586 for the 2018-19 school year. That amount could be adjusted—and even increased—based on Olive Grove’s official year-end enrollment count.

Olive Grove Charter School provides non-traditional, out-of-classroom education to K-12 students and has existed on the Central Coast for nearly 20 years.

In 2016, an appellate court ruled that charter schools can’t operate resource centers outside the geographic boundaries of their authorizing school districts. That reversed the previous interpretation of a law dictating how charter schools are operated, according to Cory, and put charter schools across California out of compliance—including Olive Grove.

In order to continue offering services to students in Santa Maria, Lompoc, Buellton, and Santa Barbara, Cory said Olive Grove had to apply for and receive authorization from a district in each area. That essentially means that a district will agree to fund a charter school, Cory said, without any role in managing its operations.

Olive Grove’s applications for authorization were denied twice by Santa Maria Joint Union High School District, Lompoc Unified School District, Santa Ynez Valley Union High School District, Santa Barbara Unified School District, the Santa Barbara County Education Office, and once by the California Department of Education. Then in July 2018, the California Department of Education authorized Olive Grove’s petition appeal, making all denying districts fiscally responsible for the charter.

Involved districts received the California Department of Education’s official cost estimates on Dec. 28, 2018, Cory said.

While the impacted districts in Santa Maria and Lompoc will receive back-filled funding from the state for any revenue losses, Cory said the districts in Santa Barbara and Santa Ynez will not. Santa Barbara and Santa Ynez are designated basic aid districts, and they don’t receive additional state funding because they receive more revenue from local property taxes per student than required by the state. In short, basic aid districts are typically located in more advantaged, higher income communities.

Still, Cory said Santa Ynez is a much smaller district than Santa Barbara. It has a 2018-19 budget of about $12.4 million, and a structural deficit of roughly $750,000 from increasing contribution rates to CalPERS and CalSTRS and ripple effects of the Refugio oil spill.

Funding Olive Grove, he said, will be “uniquely detrimental” to Santa Ynez. Cory said he plans to work with his board, legal counsel, and the California Department of Education to find a solution to, or way out of, this issue.

“I cannot imagine the intent was to fund another school at the extent of eviscerating another,” Cory told the Sun. “We’re putting the full-court press on this one.”

Laura Mudge, executive director of Olive Grove, said that while she highly doubts Santa Ynez would be forced to dissolve over these payments, she plans to help the impacted school districts find ways to remain fiscally viable through the transition.

“We don’t want them to be negatively impacted in any sort of way,” Mudge told the Sun, adding that the state is already working to assist all parties involved.

Still, Mudge said the authorizing districts had an opportunity to work with Olive Grove prior to the charter school’s appeal to the state board, and all knew this outcome was possible. Instead, she said, they repeatedly declined Olive Grove’s applications and refused calls for collaboration and negotiation.

The districts also received Olive Grove’s budget projections before the state’s were released in December 2018, so Mudge said they can’t be surprised by the amount owed. Santa Maria and Santa Barbara have already made their first payments no problem, Mudge said.

Although Mudge said she hopes other schools and students aren’t shortchanged by this decision, Olive Grove’s students and families are just as important.

“There are many students who don’t fit the mold of a traditional high school,” Mudge said, adding that if Olive Grove closed any of its locations, those kids would be displaced. “For the students and families who want us, that’s why we’re there.”