When the leaders of IDEA Public Schools gathered last December to vote on an eight-year lease for a private jet, the charter network’s then-board chair, David Guerra, thought of the nearly $15-million deal in business terms.
As president and CEO of International Bank of Commerce, Guerra and his team had used six corporate jets to grow the multibillion-dollar company beyond its Laredo home base. The same advantage would hold true for IDEA, he reasoned, as the state’s largest charter school network, which started in the Rio Grande Valley, rapidly expanded across Texas, Louisiana and Florida.
“We cannot fulfill our commitment to such a large geographic area without having this type of transportation,” the retired banking chief told fellow board members, who unanimously approved the lease. But they reversed the decision two weeks later after charter school opponents and even some of the network’s supporters denounced it as an irresponsible extravagance.
The episode triggered a wave of embarrassing headlines, oversight changes and soul-searching at IDEA, which now is grappling with how to maintain its corporate-like culture while abiding by more traditional expectations about how public school districts should be run, its leaders said.
IDEA operated 92 schools in Texas last year. It has almost 17,000 students in 24 schools in the San Antonio area and will open four new schools here in the fall of 2020. The upheaval comes as it plans to open its first four schools in Houston in August, then add 16 more over the next five years, all in pairs, two schools to a campus.
Beyond the charter jet lease, IDEA drew scrutiny in recent months for its financial practices: spending hundreds of thousands of dollars annually on Spurs tickets and luxury boxes at San Antonio’s AT&T Center; making business deals with members of IDEA’s leadership and their relatives; and reaching a separation agreement with co-founder and CEO Tom Torkelson that will net him $900,000 following his resignation in May.
IDEA officials do not appear to have violated any laws, and the charter’s leaders have defended each practice.
On HoustonChronicle.com: Why IDEA chose to lease a jet — and ultimately eversed course
Still, its governing board announced several reforms last month. They include banning private air travel, curbing executive benefits, ending business deals with leaders and family members, and requiring additional spending approvals from the governing board and chief financial officer.
“We don’t want to have execution that’s just like a traditional school district, because we want to have innovation and take some risks and be more aggressive,” IDEA Board Chair Al Lopez said. “But after 20 years of policies and practices helped us get to the point we’re at, we felt like we were at an inflection point.”
The stakes are high not just for IDEA, but the entire charter school movement.
Charter critics
Advocates for traditional public schools have seized on IDEA’s spending as an example of lax oversight of charters, which largely are funded by taxpayers. Texas American Federation of Teachers leaders blasted IDEA officials for the jet lease, accusing them of “flying adults around the state” instead of directly funding classroom programs. State Rep. Terry Canales, D-Edinburg, deemed IDEA’s practices “nonsense” that “absolutely underscores the problem.”
Charter governing board members are not elected by voters, though their operations are mostly held to the same financial accountability and governance laws as traditional school districts.
“IDEA has operated outside the public eye with little transparency while still receiving taxpayer dollars — and it shows,” said Patti Everitt, an education policy and research consultant who monitors Texas charter school operations. “IDEA can’t have it both ways.”
IDEA’s 51,000 students are spread across five regions in Texas, from El Paso to Fort Worth to the Rio Grande Valley. The network serves mostly lower-income and Hispanic students who score better on standardized tests and get into college at higher rates than their peers.
The charter’s leaders credit IDEA’s success, in part, to a culture that borrows from the business, nonprofit and higher education worlds. The organization employs a regimented, highly centralized model that emphasizes student and employee performance data.
On HoustonChronicle.com: IDEA arrives in Houston with high scores and plenty of skeptics
Critics, however, argue the network indirectly screens out children with greater academic and behavioral needs by emphasizing advanced-level courses. As an example, they note IDEA’s enrollment of students with disabilities totaled 5.4 percent in 2018-19, compared to 9.6 percent in other Texas public schools.
Still, IDEA schools remain in high demand, helping fuel the network’s ambitious approach to expansion along with substantial U.S. Department of Education grants. IDEA added more students in the past five years than any other Texas charter operator, and it plans to hit 100,000 students across the southern United States by 2022-23.
Along the way, IDEA’s governing board largely empowered Torkelson and fellow co-founder JoAnn Gama, who served as superintendent and president, to execute their unique, aggressive plans. Tax records show the board rewarded them and other executives with well above-average compensation in 2018-19: $817,395 for Torkelson, $507,887 for CFO Wyatt Truscheit, $482,930 for Gama, and at least $250,000 for six other employees.
“I’ve always kind of thought of our board more like a corporate board,” longtime IDEA board member Michael Rhodes, who stepped down from his position earlier this year, told the Houston Chronicle in January. “Traditional school boards that I’ve seen, they’re getting down in the minutiae and spending hours talking about the skirt lengths of cheerleaders, and that’s not what we do.”
That approach, however, ultimately resulted in spending practices that brought unflattering attention to IDEA and charter schools across the country.
On HoustonChronicle.com: IDEA co-founder getting $900,000 payout following resignation
Some of IDEA’s donors — whose contributions to the network have grown substantially in the past three years — grew frustrated, Lopez said. Notably, Torkelson’s separation agreement specifies the two sides reached a deal, in part, to “preserve needed philanthropy.”
Reform plans
Lopez said IDEA’s governing board has taken the criticism to heart.
Beyond the immediate changes and resignation of Torkelson — who was replaced by Gama — IDEA’s governing board continues to work with governance and leadership advisers from Nygren Consulting. IDEA leaders also are considering more board reforms, such as increasing the number of public meetings and establishing term limits.
“You hate to see anyone make mistakes like this, but it’s encouraging to see them take some clear steps to change,” said Emily Sass, a policy director for the Austin-based Texas Public Policy Foundation, which generally supports charter school expansion.
“Their focus on improvement in all areas seems to pervade the organization, and it helps them to be a school that’s able to focus on moving the needle where it counts, which is students.”
Everitt, though, said the reforms do not address the underlying state laws and structures that created the conditions for IDEA to spend improperly.
“Importantly, public school districts are governed by democratically elected representatives who are accountable to voters and live in the community they serve,” Everitt said. “IDEA is governed by self-selected board members of a private organization and may live hundreds of miles from the students they serve.”
IDEA leaders, chastened by the past several months, plan to move with more awareness of outside perceptions about their practices, Lopez said. He noted Gama will not receive a pay increase after becoming CEO, and said board members have met nine times this year instead of quarterly.
At the same time, IDEA wants to remain an “entrepreneurial disruptor,” he said, which will continue to ruffle feathers in education.
“We may make more mistakes along the way,” Lopez said. “I hope not, but I think we’re on a good path.”
jacob.carpenter@chron.com
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