The Delaware Charter Schools Network, 11 charter schools and the Delaware secretary of education are waiting on a judge’s ruling in a lawsuit about $4 million in tax revenue the charters say they are due.
The network and the 11 charter schools sued Education Secretary Mark Holodick in Kent County Superior Court in July to get the money and to remove the secretary of education from the process approving the payments.
The charters claim that Holodick failed to perform his legal duty to verify and certify their invoices and so they were not paid.
State code requires the secretary of education to verify the invoices within 20 days of receiving them.
Representatives of the network and the Department of Education declined to comment on the case and even to define “special services.”
Holodick did reference the lawsuit in the February State School board meeting when a member asked him about rewriting the language for licensure and certification.
“At some point, we will,” he said. “I think we’re going to wait until this lawsuit is over between the charter schools and the traditional districts that’s active … I think it makes sense for us to wait until that lawsuit plays out.”
The districts are not defendants in the suit. Only Holodick is.
Delaware codes says special services include speech therapy, occupational therapy, physical therapy, early identification and assessment of disabilities, special counseling services,
developmental, corrective or supportive services that may assist a child with a disability to benefit from special education.
Under Delaware Code, a charter school student’s district of residence is responsible for paying for a student’s special services with money from school property taxes.
That means, for example, if a student who lives in Appoquinimink School District attends a charter school in Wilmington and requires special services, that Wilmington school could bill Appo for those services.
The lawsuit claims that the scope and types of special services funded with property tax revenue – which is referred in the lawsuit to as “tuition tax” – have grown and charters have missed out on millions of dollars to which they’re entitled.
The suit says Academia Antonia Alonso, Aspira Academy, East Side Charter, First State Montessori Academy, Gateway Charter, Great Oaks Charter, Kuumba Academy Charter, MOT Charter, Newark Charter, Odyssey Charter and Sussex Academy submitted $4 million in bills for tuition charges to Holodick in late 2021.
The charter school lawsuit said a district or charter school calculates the cost of providing special services to students.
But before a charter can give a bill to a district, an invoice must be verified by the secretary of education as “true and correct.”
Court records show that the 11 charters listed as plaintiffs submitted bills to Holodick between Nov. 10 and 15 in 2021.
Holodick admitted in court records that he took no action on the bills.
His lawyers argue that the invoices submitted in November were the first bills for tuition charges ever submitted to the department for certification.
There is no longstanding or established practice of the education secretary certifying invoices, the defense said.
Holodick’s camp also argued that the charters failed to state a claim in which financial relief can be granted.
“Plaintiffs lack legal standing to assert any of the causes of actions and forms of recovery contained within the complaint,” Holodick’s defendant reply said.
His lawyers also argued that he is immune from liability because of the State Sovereign Immunity statute. It grants him immunity if his actions weren’t performed with deliberate negligence or willful and malicious intent.
His defense also said the charters’ claims were filed too late to be considered.
The parties attended a hearing on the case Dec. 21 before Judge Noel Eason Primos but he has not yet issued a ruling.
Raised in Doylestown, Pennsylvania, Jarek earned a B.A. in journalism and a B.A. in political science from Temple University in 2021. After running CNN’s Michael Smerconish’s YouTube channel, Jarek became a reporter for the Bucks County Herald before joining Delaware LIVE News.
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