Litigation Trial Update - Day 2 (Jan. 29, 2013)


Tuesday marked the second successful day in presenting charter school evidence in the school finance litigation.

Picking up where we left off Monday, we began the day with testimony from Matt Abbott, Chief Executive Officer of Wayside Schools in Austin and Mario Flores, parent of a student at Eden Park Academy of Wayside Schools in Austin.


Matt Abbott
 The terrific testimony of Matt Abbott occupied the morning as he explained in detail for the court the challenges his schools faced in finding adequate facilities, and in operating in "minimalistic" conditions. Mr. Abbot also expounded on the challenges in facilities financing options for charters, particularly at the beginning of the life of a charter school, noting that most schools in the early years operate in any type of property they can find. Mr. Abbott also testified to his school's demographics and to the school's success in spite of these challenges and recognized that success comes from a dedicated staff that works against the odds to ensure the job of educating students gets done. Mr. Abbott was then subjected to extensive cross-examination by the State's counsel and performed exceptionally well in dispelling the notion proposed by counsel that because charter schools have more flexibility in their operations, charters can-and should--operate with less funding. As Mr. Abbott aptly explained to the State's counsel, while flexibility in operation may be a significant factor in a charter school's success, that flexibility does not come without costs, and facilities are a major part of that cost. 
After Mr. Abbott, Mario Flores, parent of a student at Eden Park Academy of Wayside Schools in Austin, gave compelling testimony about his choice to enroll his son at a charter school and the reason why he joined the lawsuit as a plaintiff. Mr. Flores gave passionate testimony about joining the lawsuit to make certain his son gets the best education possible. Mr. Flores also testified that while his son is thriving at Eden Park Academy, he does have concerns about the school's ability to provide the educational environment that his son deserves, noting that in order for the school to afford an outdoor recess space, the PTA raised private money to build the playground.


Tom Sage
The charter schools then called Tom Sage to the stand. Mr. Sage is a partner with the law firm of Andrews Kurth, LLP and is a public finance attorney who has represented both ISDs and practically all of the charter schools in Texas in public bond financing. Mr. Sage submitted his expert witness report to the court and explained in detail his tremendous wealth of experience in representing schools in bond financings.  Early in his testimony, Mr. Sage informed the court of the state of charter school facilities throughout Texas, noting that he has seen charters operating in a converted horse barn, a converted apartment building and a number of other "suboptimal" spaces. Mr. Sage then continued to discuss a number of irrefutable and salient points to the court regarding charter school bond financings concluding that most charter schools don't have access to bond financings because of the strict eligibility requirements of the bond market, noting that out of the 209 charters granted by the state, only approximately 40 charter holders have been able to obtain bond financing. Mr. Sage noted that a lack of dedicated revenue for the debt service was one of a number of reasons charters were unable to do so, in addition to the higher cost of obtaining and servicing the debt.  Mr. Sage elaborated on the high cost to charters of a bond financing, concluding that in his experience, a 2-3% difference in rates between bonds issued to traditional ISDs and charters existed, and that the practical effect of that difference is that for a charter school servicing a $20 million, 25 year term, a charter school pays approximately $400,000 more annually per year in interest, and over the life of the 25 year debt, an astronomical difference of $10,000,000 more in interest than a traditional ISD. 


Dr. Anthony Rolle
 We then wrapped up Tuesday by introducing Dr. Anthony Rolle, one of two school financing experts to testify on behalf of charter schools in the case, and presenting his impressive qualifications to the court. Today, Dr. Rolle will dive into the substance of his expert witness testimony regarding statistical analyses of charter school funding, followed by his colleague Dr. Wood and then we will close our presentation of the evidence on Thursday with TCSA Executive Director, David Dunn.

The case is being tried before the Honorable Judge John K. Dietz in the 250th District Court at the Travis County Courthouse in Austin. The courtroom is open to the public and our witnesses and litigation team from Schulman, Lopez & Hoffer, LLP appreciate your ongoing presence and showing of support. 


Should you have any questions about this case, please do not hesitate to contact TCSA attorneys Denise Pierce or Lindsey Jones at 512-584-8272. Tracy Young, VP of Public and Government Affairs, can assist with any questions regarding responses to press/media calls.



Lindsey Jones, Director of Legal and Policy Services

Denise Pierce, General Counsel and Vice President of Member Services


Litigation Trial Update - Day 1 (Jan. 29, 2013) 

my SA
Charter schools weigh in at lawsuit trial
By Maria Luisa Cesar; January 29, 2013
AUSTIN - The chief executive officer of a growing charter school with campuses in Austin testified Tuesday that a lack of state funding for buildings is forcing him to make stark decisions as his enrollment swells. Matt Abbott, CEO of Wayside Schools, said charter schools are cropping up in spaces not intended to be schools, including former churches and storefronts. Unlike traditional public schools, charters get no facilities funding from the state and can't tax property. Hundreds of school districts - including 12 in San Antonio - are suing the state over a school funding system they say is inadequate and inequitable, reacting in part to a $5.4 billion cut made to public education in the last legislative session. State District Judge John Dietz is expected to rule Monday, and the Texas Supreme Court is expected to eventually decide the case on appeal. Read more.  

Lindsey Jones
Director of Legal and Policy Services

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