Concerns of Confilct of Interest in Villaraigosa And Nunez's District at Local Charter School

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Since Los Angeles is now on the national platform with Los Angeles Mayor Antonio Villaraigosa endorsing New York Senator Hillary Clinton for President in the '08 election -- and has in turn been appointed Clinton Co-Chair (California Speaker of the Assembly Fabian Nunez is already Clinton Campaign Co-Chair), we will be presenting some of the stories as covered by local LA political blogs.

Recently, Charter School reform has become a hot topic, because Mayor Antonio Villaraigosa has taken control of the Los Angeles Unified District School Board, after having two of his privately backed candidates win last months school board elections. This gives his a majority of four, out of seven members.

Additionally, close Villaraigosa ally and backer, billionaire developer Eli Broad has begun donating millions and millions (along with Bill and Melinda Gates) to local California Charter schools.

So look for the Villaraigosa controlled school board to start approving more Charter schools (to help "privatize" education and take it out of the hands of the eternally-failing LAUSD system. An education system, so plauged, it is actually creating a socio-economic problem for the City due to the high drop out rate and drying up the pool of young adults who can enter the "high quality" job market and serve the City as teachers, police and various other City staff positions.

However, although the principal of Charter schools is a good one (take the same demographic population, do a better job educating them, and raise student achievement and test scores) -- however, this local story of a Charter school in Nunez's district, and Villaraigosa's old Assembly and Council district (before he was elected mayor) demonstrates how State and local state grant money can be funneled outside the spirit in which this system has been created.

Many of you have heard about the LAUSD Charter school "Academia Semilla Del Pueblo".

ACADEMIA SEMILLAS DEL PUEBLO: In Care of MARCOS AGUILAR, LOS ANGELES, CA 90032-1942: IRS Subsection 501(c)(3) - A religious, educational, charitable, scientific or literary organization. Exempt Since 12-2001 Form 990 Amount $2,104,241

Previously, the school has been surrounded in controversy over it's separatist cultural agenda, and it's low AMI test scores. The math scores are the lowest in the State. So until now, the story about Semilla has been whether the school should have it's Charter re-newed by LAUSD, or not.

Well as of March '07, it was first denied -- then after a promise that the school promised (with sugar on top) that they would raise test scores, they were given approval for not only another five years of LAUSD "gravy train" money; but will be allowed to accept 600 students (up from an initial approval of 200, for which they got $2,000,000).

So with 600 students, not only can they rake in a lot more LAUSD AND State Education money (cause they are paid per head), now the school has to look for a bigger building; which also means they will probably need more rent money from LAUSD and the State.

I heard the school is already looking for a new location, to build a big, new school -- somewhere on the Eastside. Exact location is still trying to be negotiated. Rumor had it that they had $13 million to work with, but they are having a tough time striking a deal. Word is, they tried to get some Park space in Rose Hill, El Sereno (and possibly elsewhere), but nothing has panned out as of yet.

[GREAT...so let's give them more money, for more kids, when they can't even get 200 right?!?! What if in five years the scores are still the same? Do they give the money back? Do the kids have to repeat the grades?]

Semilla does not own the school, itself: They rent it from a separate company called TZICATL COMMUNITY DEVELOPMENT CORPORATION: In Care of Name MARCOS AGUILAR, LOS ANGELES, CA 90032-1942. They are listed as an IRS Subsection 501(c)(3) - A religious, educational, charitable, scientific or literary organization.
Classification Community, Neighborhood Development, Improvement (General).

In June 2002, TZICATL CDC acquired a blighted commercial structure to be rehabilitiated and utilized as the site for a non-profit charter school.

The real estate tax was $193 and zero cents. The land cost $503,152; the building cost $300,000; and the loan fee was $5,000; for a total of 811,152.

And oh yeah...RAZA DEVELOPMENT FUND, INC. provided $808,000 (7% interest rate) on 06/06/02 (maturity date: 06/05/07), with repayment terms of $25,000/yr for '02-'03; $30,000/yr for '04-'07. It was secured by a first deed of trust on a home on Huntington Drive to purchase and renovate the building.

The list of officers, directors and trustees included; Marcos Aguilar, Chairman; Antonia Viteri, Secretary; Minnie Ferguson, Treasurer and Norm Apostal, Abel Aguilar, Erica Friedman, and Irene Vasquez, Directors.

To facilitate the purchase of TZICATL's first development, Boardmember Erica Friedman advanced $25,000 toward an open escrow in June 2002, that was repaid in October 2002.

When the IRS asked RAZA, INC., "Is the organization related through common membership, governing bodies, trustees, officers, etc to any other non-exempt organization; the answer is "Yes, National Council of La Raza (exempt)".

RAZA claims exemption BECAUSE they support NC of La Raza -- and RAZA put up $808,000 for the building, that was renovated and used for the school.

LA RAZA Development Corp. borrowed $185,000 on the property on Aguilar's Huntington Dr. South last year.

The property was purchased in 2001 for $800,000. It was an ALL CASH purchase from a William Vasquez. Mr. Vasquez only owned this property for 6 MONTHS, AND HE ONLY PAID $250,000 for it!!!

Vasquez made a tidy profit of $550,000 IN A PERIOD OF SIX MONTHS.
CLICK READ MORE FOR A WHOLE LOT MORE...
COST PER STUDENT: There sure seems like a whole lot of money being spent for 200 kids.

In 2004, you had teachers making $58,355 (plus $4,814 in benefits);

In 2003, Marcos was making $90,295 (plus $9,409 contributions) AS SECRETARY! Minnie Ferguson $91,427/$7,543. Isidro Nunez (business manager) was paid $68,000/$7000. Total Education Solutions (Special Ed services) was paid $54,874, too.

HEY LAUSD: Was Marcos taking a salary as Board Member AND Principal? I don't see the salary as principal? It doesn't show up on my batcomputer if he took under $50,000 as principal. (Which would be shady, cause the teachers make more.)

Here are some issues:

Bet no one on the board complains about the principal...you have a board member, who is also the principal, who also owns the building (that was basically donated to him by La Raza). The building sure did skyrocket in value in one-year's time. (They must have an AWESOME real estate appraiser!)

LAUSD provides money to pay the rent for the school, and the school pays itself, since it owns the building, and Marcos gets to set the amount of annual rent he pays himself. (Nice!)

The list of Academia Semillas del Pueblo Charter School donors and supporters, besides taxpayers include:

National Council of La Raza Charter School Development Initiative
Raza Development Fund, Inc.
Glendale Nissan/Infinity, Inc.
California State University, Los Angeles
Pasadena City College - MeCHA
The Latino Museum of History, Art and Culture

So you have Marcos Aguilar who is principal, board member (along with his wife) AND owns the separate company that builds and owns the school, so Marcos gets to decide how much rent money he's gonna charge himself, then pay himself with LAUSD and State money. (Niiiiiiiice!) And when you run a Charter school, if your test scores are not high enough you can lose the right to use the land your school sits on. Well, luckily, Semilla doesn't own the school or the land, so they can't lose lose it. (Even though the principal/board member actually owns it.)

But let's just say for arguments sake, you want to yank your kid out of LAUSD and pop him/her into a Charter school, that is supposed to produce higher levels of student achievement: But you hear Semilla has rock bottom test scores. So you figure, "Gee, I'll complain to the school board and have him replaced." Except he and his wife and cronies ARE the school board. So forget that!

You gotta go one level higher now, and talk to the landlord, and tell them to kick this under-performing school out of the building, and replace it with a more responsible Charter operator.

SLIGHT PROBLEM: Remember, Aguilar and his wife/compainion (not sure if they are legally married) ARE the landlord/building/land owners. (So you're not gonna have much luck there, either.)

It's called a conflict of interest, and could very well be in violation of LAUSD/State Charter rules.

And now, they have been approved for another five years. But this is bascially the "preface" of the story, because it is a deep one and a wide one. I am told there are a lot of familiar names associated with the Semilla/Tzicatl posse.

Some have warned ZD that there is a lot of shady impropriaties involved with the back and forth selling of the building; the escrow appraisals (big jumps in value), there was a whole lot of improvement money spent on the school -- what are the improvements; they are looking for land to build a big, new school, but no one has reported that they are looking for a new school.

Of course not, they want to get all the state and city construction budget and build it themselves. [Can't argue with that? Who WOULDN'T want to? I want to!]

You may have heard that Doug McIntyre of 790-KABC sent reporter Sandy Wells to the school to investigate the school. Well there must have been something they didn't want him to find out -- or maybe he DID find out...because, FIRST someone tried to run him over with a car (which means he was willing to risk killing him, cause Wells had to jump out of the way); then his audio was stolen.

And that's when some folks figured this story was about more than counting on a system of twenty, learning languages like Mandarin, and a whole lot of Azteck singing and dancing. (More than a mere culture clash.) So that's when Semilla was looked into a little bit further, and all this stuff about the building, who supports/donates to them, associations with local/state politicians, and the whole enchilada fell into ZD's lap.

So this is a good stopping point, for the starting point. Just a little appetizer to familiarize everyone with the school besides the cultural aspect. And I would like to add, whether I agree with the culture or philosophy of the school isn't an issue I was covering until now. This is important because Villaraigosa has control of LAUSD school board, at the same time Eli Broad is funding a Charter School movement in Los Angeles. So that's a lot of City and State Education money that will be given out over the next several years. And although I support the concept of Charter schools to help raise student achievement...there are some serious concerns over fraud, waste and abuse of the funds.

MORE TO COME...