Phoenix Charter School $3 Million In Debt, Fighting To Stay Open

By Claire Caulfield
Associated Press
Published: Friday, March 23, 2018 - 7:14am
Updated: Friday, March 23, 2018 - 8:20am
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(Photo by KJZZ)
StarShine Academy's website.

A Phoenix school that had its charter revoked amid findings of financial mismanagement could stay open under another operator, the school's founder said Thursday.

Trish McCarty disputed reports that the loss of its charter contract likely meant that StarShine Academy would be closing in June. McCarty said that she was already negotiating with another charter operator to buy the property when state regulators voted on the revocation. She declined to identify the charter operator.

"My purpose was really to transfer the charter at the end of the school year to the new charter. The other charter has been around for a long time and they have a good record," McCarty told The Associated Press.

The Arizona State Board for Charter Schools unanimously voted Tuesday to initiate revocation. According to a summary of the meeting on the board's website, StarShine failed to comply with its charter contract and state law and financial records were incomplete.

The school of roughly 90 students near 35th Avenue and McDowell Road filed for bankruptcy protection in February 2016 after being unable to meet payments on a $12 million expansion. A bankruptcy court and the U.S. Department of Justice investigated and recommended last month that StarShine close to prevent further spending by McCarty. Recent records show the school was nearly $3 million in debt.

A review of the school's expenses found McCarty had spent thousands of dollars on cash withdrawals, a trip to New Mexico and her home electricity bill. Other purchases included a cash advance at a Santa Fe casino, car rentals and Walmart items. McCarty said those were all related to the opening of a school in Santa Fe.

She disputed the allegations of inappropriate spending.

"It's almost ludicrous. My mom taught me to look in the mirror at the end of the day and say 'Did I do the best I could for the most people and did I do it in service and gratitude?' I've lived my life like that," McCarty said.

StarShine's academic standing has dropped in the last few years. The charter school currently ranks 48.96 on a 100-point scale, placing it below the minimum standard.

The low rating was due to half of the students being refugees and decreasing enrollment, McCarty said.

StarShine's charter revocation comes two months after a charter school in Goodyear abruptly closed. Discovery Creemos Academy, formerly Bradley Academy of Excellence, had a deficit of more than $3 million in net assets by June 2016 and low test scores. The school's president gave himself hundreds of thousands of dollars in reimbursements for school purchases and other payments, according to 2015 tax records.

The school was under investigation for more than a year, but the president closed it before the board could intervene. The board revoked the charter's state license last month.

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