By Raiza Giorgi
and Victoria Martinez
Officials at Olive Grove Charter School and Santa Ynez Valley Union High School say a court ruling that requires the SYVUHS District to pay the charter school perhaps $1 million a year has forced them into a situation that neither wants.
Superintendent Scott Cory says such an annual payment could bankrupt the high school district, and Olive Grove CEO and Executive Director Laura Mudge says the charter didn’t intend to take money from Santa Ynez.
Now both schools are working with the California Department of Education (CDE) to find solutions to the problem.
According to a 2017 appellate court ruling, a charter school operating within a public school district’s boundaries must be “sponsored” by that district.
Cory stressed the importance of finding a solution as the district is already facing a $750,000 structural deficit this year. “So adding an additional $700,000 with potentially more in the coming years will ruin us,” he said.
Both Cory and Mudge said that state legislation might be changed because of this situation.
“I think there can be a positive outcome for both sides, as our intent was not to take away anything from Santa Ynez, but our situation does not fit the mold and it has to be corrected,” Mudge said.
The high school initially reported that of its $12.4 million annual budget for the current fiscal year, it would have to make an in-lieu payment of roughly $700,000 to Olive Grove. Olive Grove believes the figure will be closer to $1 million or $1.2 million by the end of the school year.
Mudge said Olive Grove’s enrollment typically tends to grow just after the holiday season and they end up with a higher number of kids at the end of the year.
“These are kids that halfway through the year realize they won’t make it in a typical school setting and need a different way of learning. What is funny is that a lot of the students are referred to us by the districts themselves,” Mudge said.
Olive Grove operates campuses around Santa Barbara County, within the Santa Ynez, Santa Barbara, Lompoc and Santa Maria high school districts. Only Santa Ynez and Santa Barbara are hit hard financially by the new situation because they rely on local property taxes for their revenue. Lompoc and Santa Maria receive per-pupil state funding based on average daily attendance.
Cory said he has been in talks with the Santa Barbara County Education Office as well as legal counsel and the CDE. At the SYVUHSD school board meeting Jan. 15, all board members gave Cory their full support.
“Since we are a basic-aid district that means we do not get any funding from the state to backfill this loss, because when the laws were made basic-aid districts were not taken into consideration,” Cory said.
Olive Grove leaders were also upset by the decision because they had just spent years fighting to operate on their own but were forced to comply as well.
“We already went through a huge battle to be on our own, as we were the first state-sponsored, non-classroom-based charter school, which is huge in itself,” Mudge said.
Olive Grove opened in 2000, operating under the Los Olivos School District. The charter school provides education for students who typically don’t do well in a traditional classroom or who are looking for an alternative way to learn, such as kids who are working or are professional athletes or in the entertainment business. In July 2015, the CDE authorized Olive Grove Charter School to continue operating on its own in Santa Barbara County.
However, an appellate court ruling in 2017 said that a charter school could not set up shop within another district without that district’s permission. That case, Anderson Union High School vs. Shasta Secondary Home School, set a precedent in the Charter School Act by saying that charter schools are prohibited from operating facilities outside the geographical boundaries of their authorizing school district, subject to limited exceptions.
Olive Grove was forced either to close or to ask the nearby school districts to grant a separate charter to operate the charter campuses. Failing to get that permission meant they could appeal the denial of a district charter to the county board of education or the California State Board of Education.
The charter’s applications were rejected by all the districts involved as well as by the county Education Office. All cited concerns about aspects of Olive Grove’s programs and finances.
“When we petitioned the other school districts they were concerned, as we had loans to pay for our budget, but the reason we had loans was we were brand new and growing faster than the state funding could keep up. This year is the first year we haven’t had any loans, and we are doing just fine,” Mudge said.
Olive Grove’s total budget is approximately $8 million for all its locations, she added. Because it is no longer state-sponsored, Olive Grove needs to get its funding from the school districts where it operates its campuses.
“When the (Los Olivos) school board knew the funding model was changing to LCFF back before the 2015 school year, they opted to not renew Olive Grove as they were unsure of how that would look like for their budget. Olive Grove started working on becoming our own school, and I am so proud of the work we already accomplished,” Mudge said.
The local control funding formula (LCFF) was enacted in 2013–14, and it replaced the previous kindergarten through grade 12 (K–12) finance system that had been in existence for about 40 years. For school districts and charter schools, the LCFF established base, supplemental, and concentration grants in place of the myriad of previously existing K–12 funding streams, including revenue limits, general purpose block grants, and most of the 50-plus state categorical programs that existed at the time, according to the CDE.
Based on the appellate court decision, the state Department of Education ruled in July 2018 that all of the districts in which Olive Grove operates are supervisory districts and will have to make monthly payments to the charter school.
Mudge said the funds that come from SYVUHS will go only toward Olive Grove’s Buellton location, which serves about 95 students and with a current budget of $1.2 million.
Mudge is a neurosurgeon who became an educator when she decided to leave medicine to focus on her family and raise her three daughters. She got involved in their education and got her teaching credential, then got her first job at Olive Grove in 2009.
When Olive Grove started on its own after being state-sponsored, it had 100 students the first year and has more than doubled its student attendance every year, with now more than 650 students enrolled around Santa Barbara County.
“People see that we only have one-hour meetings a week and think we don’t have structure, but that couldn’t be further from the truth because our students are here for hours during the week working with teachers and doing their work. Just because they aren’t here for the typical 8:30 a.m. to 3 p.m. time frame doesn’t mean they don’t do their work,” said Stacey Adams, learning center director for Olive Grove’s Buellton campus.
Adams said the charter’s learning style isn’t for everyone, and school officials are in constant contact with parents to ensure their children are doing well.
“It really takes a partnership with the entire family, and a student that is able to self-motivate to get the work done,” Adams added.
