The edu-business world is making a killing from corporate welfare payments and easy-pay or no-pay loans from city and state officials across the country who are bilking taxpayers as a part of the charter school revolution. Here's a great example of one sweetheart deal that has come to light in California. Some clips:
A nationally recognized charter school in South Los Angeles has defaulted on a $9.9 million loan extended by the Los Angeles Unified School District using voter-approved bond funds, documents and interviews show.
The Accelerated School, an elaborate, high-tech campus where Mayor Antonio Villaraigosa delivered his State of the City address last spring, made a $200,000 payment about two weeks ago - but only after district officials received a memo alerting them the campus was in default. The school previously had made two payments totaling about $1 million, the last in October 2005.. . . .
"We took out a $10 million line of credit with the district in order to finish construction of our school (and) we were hopeful and ambitious of our fund-raising."
Although the school has close ties to the Mayor's Office, there is no indication that Villaraigosa has been involved in the loan or in the renegotiation discussions.Williams said the original terms of the loan required repayment of the loan within five years. The payments included interest, which Meghrouni said was calculated based on the district's bond rates.
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Williams and Kevin Sved, like Williams a former teacher, opened the school in 1994 with 50 students in grades K 4, renting space from a Catholic church where every Friday the founders and parents packed up and stored the school equipment so the space could be used for church services.
Its expansion a decade later was made possible by $28.1 million from the LAUSD and a credit line with the district of $11.3 million, of which the school used $9.9 million to complete its growth, according to district documents.
According to Tokofsky, the loan was necessary because the school founders' vision for their construction - "more detailed, more elaborate, more spectacular" than anything the LAUSD has built - exceeded the budget allotted by the district and the state.