When a Kinston charter school suddenly shut down in September, it left nearly 200 students and their families scrambling to find new classrooms a few days into the school year.
It also pushed nearly 60 staff members unexpectedly into unemployment and who are now unsure of when, or if, they’ll be paid for the week of school they worked.
“It’s left my family in a mess,” said Michael Joyner, the associate principal for school operations. “We did our jobs, we didn’t do anything wrong.”
Joyner worked at the school through then end of September as part of a transition team to help process student records after the final day of school on Sept. 6. He hasn’t been paid for that month’s work nor has he gotten any guidance about whether he will be paid and who will pay him.
There’s little question about whether teacher and staff is owed money, with state law  requiring that “every employer shall pay every employee all wages and tips accruing to the employee on the regular payday.”
What’s less clear is how the teachers, bus drivers and staff will be paid, and who will pay them.
Kinston Charter Academy’s former principal, Ozie Hall, Jr. says the school’s bank accounts are empty and wants the N.C. Department of Public Instruction, the agency which oversees charter schools, to pay staff.
“The school doesn’t have the money to make a payroll,” Hall said, who has accused DPI staff of conspiring against the school to discourage lenders from refinancing existing loans or offering new loans to keep the school open.
All of the school’s remaining assets are tied up in school’s building, which has an appraised tax value of $2.7 million , and is in foreclosure proceedings with Self-Help, a Durham-based non-profit lending agency. Hall said the school had already given possession of the school to Self-Help, but David Beck, a spokesman for the lending group, said the foreclosure was still pending.
Meanwhile, state officials maintains that settling up old bills, including payroll, is the responsibility of the charter school, as is the case with all of the state’s 127 charter schools funded with public dollars but whose day-to-day operations and finances are handled by private non-profit boards.
“They were supposed to budget their money accordingly,” Joel Medley, the head of DPI’s Office of Charter Schools, previously told N.C. Policy Watch . “It is the school’s responsibility.”
Kinston Charter Academy’s beginnings
Charter schools, a growing segment of North Carolina’s public education system, are funded with state, federal and local education dollars but are governed by private boards of nonprofit directors that are responsible for the school’s finances.
The state currently has 127 charter schools serving an estimated 65,000 students around the state, a fraction of the more than 1.5 million children who attend North Carolina’s public schools. But interest is growing, with 170 letters of intent  from prospective charter schools operators hoping to open for the 2015-16 school year. Twenty-six new charter schools will open next fall.
Kinston Charter Academy opened in 2004 and, unlike many charter schools, provided transportation and also took part in the federal school lunch program to help its primarily low-income, black student population succeed. But it struggled to keep on par with state standards, and only a quarter of its students passed the math and reading end-of-grade tests in 2011-12.
The school had been on shaky financial footing for years when the N.C. Department of Public Instruction recommended that the State Board of Education start proceedings in early September to revoke the school’s charter.
Instead, the school’s board of directors voluntarily turned in its charter in the midst of the state board meeting Sept. 3, a move that surprised state officials, staff and families of students alike.
Hall, in an emailed message Tuesday, said the school was unable to secure loans and refinance its loans and the board viewed surrendering its charter as the most practical option. He does not serve on the board, though his wife, Demyra McDonald Hall, serves as the board’s chair.
“If the State Board ultimately decided to revoke the charter at the October 2013 State Board meeting the school could have appealed it and the school would not likely have closed … until the end of the 2013-2014 school year, if at all,” Hall wrote. “The board decided to surrender the school’s charter on September 4, 2013, because the Office of Charter Schools and the Division of School Business efforts to argue for revocation during the first 20 day count made our lender and the management group withdraw.”
State education officials are now looking to see what happened to more than $660,000  Kinston Charter Academy received this summer, which was supposed to last through October and could have been able to cover the final payroll checks. Money was used to pay back two high-interest loans the charter school had taken out and payments owed for staff retirement and health benefits. The school also paid Hall nearly $10,000 in August for unused vacation and personal leave time; payments that Hall said were because he was planning on leaving the school and preceded any discussion about the school relinquishing its charter.
Both Hall and Alexis Schauss of DPI’s school business office confirmed that the State Auditor’s office is examining the school’s financial documents to see if anything was amiss in how the public education funding was handled. The state auditor’s office declined to comment, and spokesman Bill Holmes said he could not confirm nor deny the existence of an audit.
Meanwhile, former staff of Kinston Charter Academy are dealing with their sudden unemployment and looking for new jobs.
Valerie Parker, who worked for four years as a data manager at the school, said she’s been unable to find work and is relying on unemployment and her husband’s income to keep their family afloat.
“It’s been tough,” she said, adding that she spends every day searching for work but has had few viable job prospects.
Parker estimates she’s owed a week’s worth of pay, as well as 12 days of combined vacation and personal time from Kinston Charter Academy. The last communication she got from the school was a Sept. 30 letter tallying up her vacation and personal time, but without any indication of whether she’d be compensated.
Parker is now focused on finding a new job and keeping the spirits up of her former work colleagues, most of who are also struggling to find jobs.
““This too will pass,’” Parker said. “We can’t allow this to get the best of us, something is going to give.”
Hall, the former charter school principal, is continuing his work with the charter school community and is serving on the board of Anderson Creek Club Charter School , a Harnett County school slated to open next fall.
The Anderson Creek school will be located on land adjacent to the gated Harnett County golf community of Anderson Creek Club  , which draws most of its population from the nearby Fort Bragg Army base. The new charter school aims to serve the gated community, as well as surrounding neighborhoods in the elementary school focused on academics, said David Levinson, the Anderson Creek Club developer and board chair of the charter school.
Levinson said he was aware of Kinston Charter Academy’s financial problems, much of which he said preceded Hall, and that he continues to support Hall.
“I saw what a fabulous job he did in impossible circumstances,” Levinson said.
Questions? Comments? Reporter Sarah Ovaska can be reached at (919) 861-1463 or [email protected]