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Fixing D.C.'s Schools: The Charter Experiment

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In One School Deal, Chairman Played Three Roles

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By James V. Grimaldi and Theola Labbé-DeBose
Washington Post Staff Writers
Sunday, December 14, 2008

Thomas A. Nida often has played two roles when District charter schools enter into real estate deals. As a banker, he has arranged loans to the schools or their landlords. And as chairman of the public board that oversees charters, he has approved the schools' borrowing and spending.

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But in one episode, Nida ended up wearing three hats.

The deal centered on the old Kingsman public school, a Northeast landmark that closed in 1993 because of declining enrollment. Kingsman became an eyesore and a haven for drug dealers, with punched-out windows and peeling paint cascading onto the floors. In 2003, a charity bought the dilapidated edifice from the city for about $300,000 and began to renovate it for charter schools.

Nida was the bank officer who handled the initial $2.45 million construction loan to the tax-exempt organization, Charter School Development Corp., known as CSDC. Soon after, Nida was appointed to the Public Charter School Board and began taking official actions that affected CSDC and its tenants. Then, as a banker, he refinanced the loan. After that, he joined the nonprofit group's board of directors, where he further helped expand its financing to obtain city revenue bonds.

Finally, in July 2006, Nida made a move that led to a financial windfall for CSDC. He led the effort and cast the deciding vote that shut down one of the two charter schools renting space in Kingsman, clearing the way for the other tenant to purchase the 54,810-square-foot building.

CSDC made almost $1 million from the sale. "We made a nice gain on it," said Frank Riggs, the former California congressman who is the group's chief executive, "which we need, to be candid with you, to offset the risk for properties we own in northwest Indiana."

Nida did not disclose his multiple roles in the Kingsman deal at a public hearing, according to a transcript, or before the vote, according to two charter board members who voted against the closure. Nida also has not listed his CSDC board membership on the financial disclosure forms he filed with the city. Nida said yesterday that he did not think he needed to disclose the position because it was unpaid.

In an earlier interview, Nida acknowledged his multiple roles but said he kept each of them separate. He said his official acts on the public charter board are always based on the needs of schoolchildren and are not influenced by his banking job or his unpaid position at CSDC.

"Any consideration that would have involved CSDC for better or worse was not a consideration in my decision," Nida said. "That hat that I wear on a charter board is what is best for the students, as far as I'm concerned. And if there is a financial consideration, good or bad, that is a distant second issue."

The board's 2006 decision to close Sasha Bruce charter school, with more than 260 students in grades seven through 11, left Options Public Charter School, which at the time had 240 middle schoolers, as the sole occupant of the Kingsman building. Options itself had almost been shut down by the city three years earlier, after management turmoil and news reports that its principal had an undisclosed criminal record. In the interview, Nida said the decision to close Sasha Bruce was based on its "lousy academic performance" as a result of management problems. "They were going down the toilet academically and financially," he said.

Board minutes reviewed by The Washington Post show that Nida had recused himself from one vote in 2004 related to Sasha Bruce's enrollment, although he said he could not recall why. But there is no public record that he ever recused himself from the discussions about closure. At a public hearing requested by Sasha Bruce to challenge the board's plan to revoke its charter, Nida led the questioning, suggesting there was financial mismanagement.

Officials from Sasha Bruce vehemently contested Nida's characterization. "There was nothing wrong with our financials," said Deborah Shore, executive director of Sasha Bruce Youthworks Inc., a related nonprofit that has a board of directors separate from the school and remains active in its 34th year serving runaway and homeless children.

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