An F-rated St. Petersburg charter school stands on the verge of collapse, mired in debt and losing enrollment. And most of those debts — around $1 million in public tax dollars — are owed to the same private company that founded it.
According to the Internal Revenue Service, charters must be run by independent boards and negotiate contracts that benefit the school — not a management company or vendor.
"A board must show that it is not a front for a management company," the agency said in published guidelines.
But the Pinellas charter's board is chaired by Justin Matthews, who works for the company as a school principal in North Port.
"Who's he going to support, Imagine or the school?" Clark said.
Huber, the Imagine spokesman, said the company was seeking a replacement.
"Just because Imagine appoints the board member doesn't mean Imagine doesn't have an arm's-length relationship," he said.
Still, Imagine has yet to receive the nonprofit status it has sought from the IRS since 2005, and school officials in Texas, Georgia, Nevada and Indiana — as well as Alachua, Indian River and Palm Beach counties in Florida — have challenged the company's applications.
Who's in charge?
Pasco County may be next, raising similar questions about the company's Land O'Lakes school.
Unless Imagine provides clear evidence of its legal status soon, superintendent Heather Fiorentino told Imagine in a letter, the district "will have no choice but to consider this a breach of the charter contract and take appropriate action."
In Hillsborough, officials wondered whether the proposed charter's local board would have the power to fire Imagine, or just serve as a front for the company.
In a meeting, charter supervisor Jenna Hodgens asked the question.
"Karl Huber yelled out, 'Of course they cannot fire us. They are Imagine Schools,' " she recalled.
Faced with challenges from several districts, Imagine sought a ruling from the state on its nonprofit status. On Jan. 5, the Department of Education told the company it would develop new rules on the issue and invite public comment.
Imagine officials say they're pleased with the result.
"The proposal is pretty much what we've always argued defines a nonprofit," Huber said.
The draft rules, due to be reviewed Wednesday at a public meeting, would allow schools to qualify for nonprofit status by demonstrating that they were operated for public purposes and "not organized primarily for profit." They also specify that individuals or shareholders can't benefit from net earnings.