“Money woes at charter school; Memo shows Brighter Choice delayed paying some employee benefits; Albany district blamed.” Times-Union (NY), 8/3/2011
ALBANY -- Serious financial trouble has prevented the Brighter Choice Charter School for Girls from paying some employee benefits.The school had such a hard time meeting payroll that it did not pay the retirement benefits of some employees for several months, according to an internal email obtained by the Times Union. The school is under "tremendous fiscal pressure," Ronald Racela, director of finance and operations for Brighter Choice Charter Schools, wrote to employees to explain why no contributions had been made to their 403(b) retirement plan. He blamed the financial conditions on the Albany school district's withholding of funds, which were finally repaid last week."No 'funny business' has occurred with the school's cash and ... we are victims of lack of cash flow due to our biggest funding source (the ACSD) not making good on their responsibility," he wrote.However, a financial audit on file with the state Education Department indicates the school has suffered financially for years...Chris Bender, executive director of Brighter Choice Foundation and vice chairman of the school's board, said the school made mistakes in prioritizing how it spent money.He said he was not sure if it was illegal to withhold retirement fund payments and said it would not happen again. He said the payments were made current last week and that the total was about $10,000."We value the employees, we have obligations to pay them and their benefits," he said.The four months of missed payments are a sure sign that a charter school, generally considered to be one of the city's best, has major financial struggles.The school's financial picture has darkened for at least two years, according to an audit at the state Education Department.Brighter Choice ended the 2009-10 school year $453,745 in the red, which was worse than previous year, when its expenses exceeded its income by $311,638...In 2007, the school was issued $18 million in tax-exempt bonds through the city's IDA to refinance the construction of the school at 250 Central Ave.If the school were to default on the payment of those bonds, bondholders would be on the hook, not taxpayers.
