A hearing is scheduled Thursday in a Santa Ana courtroom on the request by the Orange County School of the Arts for a temporary restraining order blocking the Santa Ana Unified School District from withholding $500,000 monthly to collect on what district officials say is $19 million in back payments for special education services.
Steven Wagner, the chief operating officer of the Santa Ana charter school, said district officials in March sprang a $19.5 million bill on the school, prompting the filing of a lawsuit seeking the restraining order on Tuesday.
“We received a letter back in early March that the district would be collecting from us and four other charter schools,” Wagner said.
At issue is an “encroachment fee” regarding state allocations for special education services. Wagner said the school’s charter in 2000 contained specific language mandating a 15-month notice if the district intended to collect the fee.
“We kind of assumed that was their notice going forward,” Wagner said.
However, on March 20, the director of the special education program at the school was handed an invoice for $19.5 million from the district, Wagner said.
“They had calculated an invoice of 17 years of money owed by the school for special education services,” Wagner said. “So, obviously, we were shocked and dismayed and surprised.”
Until recently the school has had a “wonderful collaborative relationship” with the district, Wagner said.
When school officials told the district it needed to give the school a 15-month heads-up, the district responded that the language cited in the charter “didn’t apply and frankly they wouldn’t honor it and we owed them $19 million,” Wagner said.
“We kind of took a breath and decided to see how this would play out. We don’t want to be bad neighbors,” Wagner said.
After an exchange of letters between attorneys, the district sent the school a letter saying it would begin withholding the $500,000 monthly payment for special education services as a sort of garnishment of wages to collect the past-due amount, Wagner said.
“We filed the TRO so we can get some sense of space and hopefully calmer and more logical minds will prevail and we can work this out,” Wagner said.
According to a statement issued Wednesday night by the Santa Ana Unified School District, the district discovered earlier this year that several charters under its authorization, including the Orange County School for the Arts, had not been making required contributions from their general fund revenue to support special education services for students with disabilities residing in Santa Ana, including those attending schools operated by the district and charter schools.
California law and each of the charter school’s charters requires them to contribute a fair share of their general fund revenue to provide special education and related services needed by Santa Ana residents in excess of funding provided for those services from the state and federal government, according to the district.
The district informed each charter school it has authorized that participates in its special education local plan area of this required contribution and sought to meet and work collaboratively with them to make the contribution required by law and their charters to students with disabilities residing in Santa Ana, according to the district.
The district expressed its goal to work collaboratively with its charter schools to ensure the needs of all of our special education students are being met in accordance with existing laws and authorized charters.
The district claims it has not “threatened” its charters with withholding property tax payments. When informed of its delinquency in making contribution to district-wide special education cost that exceed funding, only the Orange County School of the Arts responded by refusing to make any contribution and confirming it never intended to make any contribution to special education costs in the past, the present or the future, according to the district.
The school took the position that it should be able to make its contribution from special education funds instead of the general education revenue that must, by law and charter, be used to contribute, according to the district.
“OCSA has deliberately and systematically sought to avoid its legal obligation as a public charter school to contribute to excess costs all public schools bear in meeting the educational needs of special needs students,” the statement said.
“When approached in good faith to work out a fair settlement, they chose instead to expend their funds on court battles and not the needs of special education students. We believe that the children of Santa Ana deserve better.”