LOS ANGELES — The Los Angeles school board refused to renew three charters for Magnolia Schools, a charter school system that has faced financial problems and questions about connections to Turkey's coup.
More than 200 parents, students and teachers sporting yellow Magnolia shirts or blue Celerity shirts protested outside the school district headquarters Tuesday evening and filled an overflow room as they waited for the district's decision in a special meeting that dragged on for more than four hours.
Parents and teachers testified about the schools' academic achievements and about the one-on-one attention their children receive.
They also questioned whether LAUSD should oversee independent charter schools it competes with.
The board was weighing the future of six campuses involving three different charter systems that educate 13,000 students, and only one school avoided having its charter revoked.
The board stayed the revocation process for El Camino Real Charter High School in Woodland Hills, but only after its founding executive director, David Fehte, agreed to resign. The school has faced an investigation over the use of a school credit card.
The board denied the renewal of Magnolia's three charter schools and those for two Celerity Educational Group schools.
Board members appeared convinced by arguments from the district's Charter School Division that Celerity was operating too secretively by not turning over financial information and about an independent fiscal team's concerns regarding Magnolia's responsiveness to operational problems.
The board did not discuss an ongoing investigation by the district's inspector general into Magnolia's practice of hiring Turkish immigrants.
But Jerry Simmons, an attorney for Magnolia, said he was going to address the unmentioned elephant in the room regarding Magnolia and called the focus on the Turkish workers "discrimination based on nationality and religious beliefs."
"These people have never done anything, but provide a world-class education to inner-city kids in Los Angeles," Simmons said.
The vote against renewal impacted Magnolia Science Academies 1, 2 and 3. Magnolia operates 10 campuses, including eight located within LAUSD's borders. The three schools have 1,400 students enrolled of the 3,800 students taught by Magnolia.
Academy 1 in Reseda was built using $6 million in bonds issued through the California School Finance Authority in 2014. The bonds have a BB rating from S&P Global Ratings.
Caprice Young, Magnolia's chief executive officer, said the school board's decision will not impact Magnolia's ability to make bond payments.
She said Magnolia officials will appeal to the county and the state, a tactic it has used successfully before. It also won a lawsuit against LAUSD two years ago and has been operating under a settlement agreement with the district since then.
Young added that Magnolia has another school located three miles from the Reseda school that is not up for renewal.
If the school were forced to shutter before the 2017 school year, Magnolia would move the students into the nearby school, so the "kids would still have a place to go to school," Young said.
"We are virtually certain the county or the state will approve us if the district doesn't," Young said. "Can you imagine anyone closing a school that graduates 200 students from the highest poverty neighborhoods every year and sends them to top universities?"
Magnolia received scrutiny after the Turkish government accused it and some other U.S. charter schools of providing financial support to the failed July coup in Turkey. The schools' leaders denied involvement.
The charter school has faced criticism for years for hiring large numbers of Turkish nationals for teaching and other staff positions.
Turkish President Recep Tayyip Erdogan has jailed and fired thousands of perceived enemies since the July coup and has ramped up efforts to use lobbyists and lawyers in the U.S. to go after perceived enemies here. Erdogan has claimed that his political rival, Fethullah Gulen, leader of a Turkish religious movement, who lives in Pennsylvania used money from U.S. charter schools controlled by his followers to support the coup.
In an interview prior to the meeting, Young said Magnolia Schools have no financial connection to Gulen's charter schools.
"Our teachers that come from Turkey are Muslim and some are admirers of Gulen's teachings and scholarship, and some are not," Young said.
Yet, the "president of Turkey has hired a multi-million dollar attorney and lobbyist to close our schools. It is unfathomable to me that someone thousands of miles away would care about the mostly Latinos from underserved neighborhoods we teach," she said.
At its highest point, Magnolia employed 97 Turkish immigrants as teachers, but currently employees 37, Young said. Magnolia has a staff of 350 teachers, deans and principals, so the 37 Turkish educators comprise about 10% of the staff, she said.
"We have not been doing any international hiring for the past several years with the exception of one Chinese teacher hired to teach Mandarin, who is employed in our San Diego school," Young said.
She explained that when Magnolia was founded over a decade ago one of its founders was Turkish. A number of the original teachers were University of California, Irvine and California Institute of Technology graduates from Turkey, who were college classmates.
New charter schools tend to ask existing teachers for referrals as well as advertising in educational publications when looking to add more teachers, she said of how the school ended up with a large concentration of Turkish teachers.
School board Member Ref Rodriguez, who said both Celerity schools are in his district, questioned whether it wasn't better for the board to work with the schools, rather than to not renew their charters, and have them end up being overseen by the state, rather than district, so board members have no control of schools located in their districts.
Rodriguez said that is already the case for two other charter schools in his district.
"I want to tell our charter partners out there that you've got to be good partners," said Rodriguez, who himself is a co-founder of a charter network. "You've got to look in the mirror and say, 'Are we being good?'
"But I also want the district's Charter Schools Division to ask themselves that same question," Rodriguez added, "because it takes two to tango. We need to be in a situation where we can get through some of these things because I don't want to see these schools in our backyard get authorized by someone else."
Rodriguez ended up voting with other members not to renew Celerity, though he abstained from voting on Magnolia, after hearing arguments from Charter School Division Director Jose Cole-Gutierrez about unsuccessful efforts by the district to work with Celerity and Magnolia.
Young contends that the report from the Charter School Division lists the financial problems Magnolia had before she took over in 2015 and doesn't take into account changes made since then.
"The state auditor's report gave us a clean bill of health in June 2016, because we had fully implemented all of the recommendations they provided," Young said.
The state determined that Magnolia needed an operational clean-up, not to be closed. LAUSD also tried to close MSA 6, 7 and 8 in 2014, but the courts ruled in Magnolia's favor.
Speakers raised questions about the inherent conflict in having LAUSD both compete with and oversee charter schools in its district. As LAUSD's traditional schools have seen enrollment decline, charter schools have experienced growth.
To make the decision more difficult, the charter schools reviewed during the special meeting are also attaining equivalent and sometimes better academic achievements than LAUSD's traditional schools.
LAUSD has the largest number of charter schools in the country in its district boundaries, said LAUSD Board Member Steve Zimmer.