Tighter Control Of Charters Is Urged

D.C. Officials React to Report On Business Ties

By Derek Kravitz and April Witt
Washington Post Staff Writers
Tuesday, December 16, 2008

The D.C. Public Charter School Board pledged yesterday to reexamine its policy on conflicts of interest as some elected officials called on Chairman Thomas A. Nida to resign and said the city should tighten regulation of its burgeoning charter school system.

The District's attorney general, Peter J. Nickles, said he has begun examining the official conduct and business ties of two unpaid panels that oversee one of the largest charter systems in the nation.

The pledges and calls for reform followed a report by The Washington Post, which found that key members of the two panels have taken part in official decisions that stood to benefit themselves, their colleagues, employers and companies with which they have business ties.

"I'm certainly looking into it," said Nickles, adding that the allegations of conflicts of interest "are important and need to be resolved."

"I don't think we've paid as much attention to charters in the past as we will in the future," he said.

Mayor Adrian M. Fenty (D) said last night that when Nickles told him he wanted to look into the charter board, he responded, "Sounds like a good idea."

Del. Eleanor Holmes Norton (D-D.C.) called for the resignations of Nida and Barbara "Bobbie" Hart, the chairs of the congressionally mandated charter school board and the D.C. Public Charter School Credit Enhancement and Direct Loan Funds Committee, respectively.

Norton called The Post's revelations "astonishing, acknowledged and systemic conflicts of interest and financial self-dealing." She said she would reintroduce a bill that would give the mayor and D.C. Council more authority over charter board appointments.

D.C. Council member Tommy Wells (D-Ward 6) said the board "should be subject to all D.C. laws and regulations" and should be placed under the authority of the city's state education office.

Nida, chairman of the seven-member charter board, is a vice president of United Bank and an expert on charter school financing. During his tenure on the charter board, United Bank has lent more than $55 million to D.C. charter schools, their developers or landlords. Nida has been directly involved in about $35 million of those loans, The Post found.

Nida told The Post during a recent interview that he has never put his own or the bank's interests ahead of charter students in the District. Through a spokeswoman, he declined to comment yesterday.

The Post found that the Hart-chaired credit committee, which has awarded $47 million in taxpayer loans and guarantees to more than 30 schools or their developers, has also benefited banks and companies that have ties to the committee. Hart has declined to comment.

The Public Charter School Board issued a statement yesterday pledging to reexamine its policies and make changes as needed:

"As volunteers, D.C. Public Charter School Board members work hard to do what they believe is right and in the best interest of D.C. students and families," board spokeswoman Nona Richardson said. "They make decisions in a principled way, responding based on the facts and circumstances presented to them. In light of points raised about possible conflicts of interest, the PCSB is reviewing its current conflict of interest policies and applicable D.C. law and will implement whatever changes are necessary and appropriate."

The charter board also has come under the scrutiny of the D.C. office of the inspector general, which recently issued an audit report concluding that the board has failed for years to give the required notification to elected neighborhood officials before voting on matters such as allowing a charter to move into a neighborhood. "As a result," the audit said, "the Commissioners did not get the opportunity to voice their concerns."

Last night, during a sometimes-contentious regular public meeting of the charter board, several parents and advisory neighborhood commissioners called on board members to step down after hearing the reports of their complex business ties.

Steve Lowe, who had opposed the move of two charter schools into a United Bank-funded building in his Brady Hall neighborhood, asked Nida: "Will you resign before we have to press the mayor?"

Nida declined to answer that question but noted that he has recused himself from several votes in which he felt he had a conflict of interest.

Staff writers David S. Fallis, James V. Grimaldi and Theola Labbé-DeBose contributed to this report.

© 2008 The Washington Post Company