ORDERS:
ORDER OF REMAND
STATEMENT OF THE CASE
This matter is before
the Administrative Law Court (“ALC” or “Court”) pursuant to S.C. Code Ann. §§
59-40-10 et seq. (Supp. 2006), the South Carolina Charter Schools
Act of 1996 (“Act”). In late spring of 2006, the Greenville Science Charter School (“Charter School”) submitted a charter school application (“application”) to the State Charter
School Advisory Committee (“Advisory Committee”). The Advisory Committee reviewed
the application and recommended in writing to the School District of Greenville
County (“School District”) that it approve the application. On November 16,
2006, the board of trustees for the School District (“School Board”) held a
hearing on the matter and issued its order and decision on November 27, 2006
(“School District Decision”). In the School District Decision, the School Board
held that the Charter School had not complied with the statutory requirements
of S.C. Code Ann. §§ 59-40-10 through 59-40-240. The School District Decision was appealed to the State Board of Education (“State Board”) which conducted an appellate hearing on February 14, 2007. On March 6, 2007, the State
Board issued its Final Order (“State Board Order”) in which it reversed the
School Board Decision and approved the Charter School’s application.
The School District and the Charter School filed cross appeals from the State Board Order to the
ALC on April 4, 2007, and April 12, 2007, respectively.
The record on appeal was delivered to the ALC by the State Board on May 8,
2007.
After timely notice to the parties, a hearing was held at the ALC in Columbia, South Carolina on November 27, 2007, at which time the parties presented
arguments on their respective positions. This Order addresses both appeals.
FACTUAL
BACKGROUND
The Charter School is a product of the efforts of science faculty at Clemson University, as well as
other individuals, to create a charter school in the Greenville, South Carolina area that will specialize in the teaching of science. Its mission – as stated
in its application – is “to provide improved science learning opportunities
that promote scientifically literate individuals, workforce, and leadership
through world class and challenging science teaching standards.” Its charter
committee consists of five individuals: Ms. Joan Breitenbruck;
Dr. Guven Yucesan;
Dr. Mevlut Tascan;
Ethan E. Ballard;
and Ali Ozer.
Mr. Ozer is the project director of the charter committee for the Charter School and has previously assisted in the founding of two charter schools, one having
been in operation for one year at the time of the application filing and the
other, located in Atlanta, having been in operation for six years at the time
of the application filing.
On June 15, 2006, the
Advisory Committee met with representatives from the Charter School, the South Carolina Department of Education (“Department”) and the School District's
administration, to review the application. At that meeting, the Advisory
Committee determined that the Charter School had not met the minimum
requirements for the issuance of a charter. Among the concerns the parties discussed
at the meeting was a failure by the Charter School to show that it could meet
its enrollment projections, the soundness of its proposed budget, and its
partial reliance on special education funding for its support and the purchase
of needed equipment and technology.
On June 29, 2006, the representatives
from the Department and the School District met once again with representatives
of the Charter School. At this meeting, the same concerns were discussed. The
Advisory Committee again found that the Charter School’s proposal was not in
compliance with applicable state law. After this meeting, the Charter School conducted a survey to solicit support from interested persons in the
community. On September 21, 2006, representatives of the Charter School met for the third time with representatives from the School District and the Department,
and the Charter School provided the School District and the Department a revision
of its proposed charter application. Attached to the revision were more than 160
completed survey forms (characterized by the Charter School as support letters), copies of two newspaper advertisements, and six survey forms. Each survey form
stated that the Charter School would be known as “Greenville Science” and that
it would be a “tuition-free college preparatory middle and high school with a
rigorous inquiry based educational program focusing on science.” Further, it stated
that the Charter School would consist of grades 6-12, would begin in the fall
of 2007, would provide “exceptional learning in a tuition-free private school
environment,” and would contain “80 students per grade level.” The survey form
contained blank spaces in which interested persons could write their name,
address, email address, and any comments. Also, the survey form listed a
personal email address and a website which interested persons could write to or
log onto to request or obtain additional information about the Charter School. Finally, each survey form contained two questions which interested persons
could respond to by circling the word “yes” or “no” at the end of each question:
(1) “Do you support the idea of opening this school in the Greenville County
School District?” and, (2) “Would you consider sending your children to this
school if the application is approved?”
The School District
asserts that throughout this entire review process its representatives
expressed concerns about the Charter School’s enrollment projections, budget, projected revenue (particularly to its inability to hire a qualified
teaching staff, special education teachers and to purchase equipment and
technology), and the projected revenue’s heavy reliance on special education funds. In sum, representatives of the School District and the Advisory Committee were
extremely concerned that the Charter School’s budgetary plans were based upon
faulty assumptions, used excessive revenue projections, and that, absent
sufficient community interest, it would not attract enough students to generate
the funds needed for its operation.
On October 17, 2006,
the Advisory Committee notified the School District in writing that the Charter School’s application complied with the standards set forth in Reg. 43-601 and
recommended that the School District approve the application. On Friday, November 10, 2006, the School District notified the public of its School Board’s regular monthly meeting and that the agenda included consideration of the Charter School’s application. The meeting was set for the following Tuesday,
November 14, 2006; however, on Monday, November 13, 2006, the Charter School
requested a postponement of the special meeting of the School Board. The School District postponed the meeting to 9:00 a.m. on November 16, 2006.
During the School
Board’s hearing, the Charter School objected to the timing of the hearing based
upon procedural irregularities, arguing that due process required more than two
business days notice of the hearing and that the hearing should be a public
hearing. Also, it requested an opportunity to supplement the record after the
hearing. During the hearing, representatives from the Charter School and the School District’s administration gave their respective positions on the
application. At the conclusion of the hearing, the School Board denied the charter application request, finding that the Charter School had not
complied with the statutory requirements of §§ 59-40-60 (F)(3) and 59-40-60
(F)(6) as follows: (1) the Charter School failed to show that an adequate
number of parents, teachers, pupils, or any combination of them supported the
formation of the Charter School; and, (2) the Charter School failed to show
that its plan was economically sound.
On December 7, 2006,
the Charter School appealed the School District Decision to the State Board, seeking
its reversal and alleging procedural irregularities by the School Board. Subsequently,
on February 1, 2007, the Charter School filed a motion with the State Board, requesting
to supplement the record before the State Board with evidence it alleged it was
unable to present to the School Board during its hearing. The State Board
denied the motion to supplement the record, stating that pursuant to Reg.
43-600 only the record before the School Board should be considered by the
State Board on review.
The State Board held its
appellate hearing on February 14, 2007, and both parties gave oral arguments. The Charter School argued that representatives of the School District neither
commented about the adequacy of the completed surveys during the meeting on
September 21, 2006, nor did they approve or reject the application until Friday,
November 10, 2006 – when the Charter School was told that a public hearing
would be held on November 14th to consider its application. Further, the Charter School argued that it was first told of the specific reasons for the School District’s denial
of the application at 3:00 p.m. on November 14, 2006, just over one day prior
to the hearing, which began at 9:00 a.m. on November 16, 2006. At the
conclusion of the hearing, the State Board found that the procedures utilized
by the School District were neither unlawful nor did they affect a substantial
right of the Charter School; however, the State Board did express concern about
the short notice of the hearing. The State Board reversed the School District
Decision, finding that: (1) there was substantial evidence in the record to
show sufficient community support for the Charter School; and, (2) there was
substantial evidence in the record to show that the Charter School had an economically sound plan.
JURISDICTION
AND STANDARD OF REVIEW
A
proposed charter school must seek review of its application by submitting it to
the Advisory Committee and by providing a copy to the local school board of
trustees in the district in which it is seeking sponsorship. Thereafter, the
Advisory Committee receives input from the local school district and requests
clarifying information from the applicant. Within sixty days after submission,
the Advisory Committee determines if the application is in compliance with the Act.
If the application is deemed in compliance, the Advisory Committee forwards the
application to the local school district along with a letter informing it of
the compliance. The letter must contain a recommendation to approve or deny
the charter application together with the Advisory Committee’s reasons for its
recommendation. The recommendation is not binding on the local school board of
trustees. § 59-40-70 (A)(5).
The
board of trustees of a local school district, upon receipt of an application from
a proposed charter school seeking sponsorship must, within thirty days after
its receipt, rule on the application at a public hearing. The statute requires
that reasonable public notice of the hearing must be given. §
59-40-70(B). After the hearing, the local school board must deny the application
if it does not comply with those requirements contained in §§ 59-40-50 or
59-40-60, fails to meet the spirit and intent of the Act, or adversely affects,
as defined in the regulation, the other students in the district in which the
charter school is to be located. § 59-40-70(C). The local school district shall
provide, within 10 days of the public hearing, a written explanation of its
reasons for denial, citing specific standards related to the provisions of §§ 59-40-50
or 59-40-60 that the application violates. This written explanation must be
sent immediately to the charter school and must be filed with the State Board
and the Advisory Committee. § 59-40-70(C).
Appeals
from a decision by a local school board must be filed with the State Board within
10 days of the school board’s decision. §§ 59-40-70 (E), (G) and 59-40-90
(B); see also Reg. 43-600. Pursuant to § 59-40-90 (C) and Reg.
43-600(G), the State Board must, within 45 days after receipt of the Notice of Appeal
and, after reasonable public notice, conduct a public hearing to consider the
appeal. Each party to the appeal is authorized to make an oral argument at the
hearing addressing the issues on appeal, and the State Board may, at its
discretion, allow public comments addressing the issues on appeal. Within 20
days of the public hearing, the State Board must issue a final written
order. Reg. 43-600(D) provides that the State Board’s review will be limited
to the record on appeal and that it will not consider any fact that does not
appear in the record on appeal. Further, Reg. 43-600(E) provides that the standard
of review to be applied by the State Board in its appellate review mirrors the limited
standard of review contained in the South Carolina Administrative Procedures
Act (“APA”); Beaufort County Bd. of Educ. v. Lighthouse Charter School Comm.,
et al, 335 S.C. 230, 234, 516 S.E. 2d 655, 657 (1999); S.C. Code Ann. § 1-23-380
(A)(5) and (B).
A
decision by the State Board may be appealed to the ALC as provided in §
1-23-600(D). See § 59-40-90(D) (Supp. 2005).
The ALC has authority to review the order of the State Board as an appeal under
§ 1-23-380 (A)(6), which provides for reversal only if its findings are:
(a)
in violation of constitutional or statutory provisions;
(b) in
excess of the statutory authority of the agency;
(c)
made upon unlawful procedure;
(d)
clearly erroneous in view of the reliable, probative and substantial evidence
on the
whole
record; or
(e)
arbitrary or capricious or characterized by abuse of discretion or clearly
unwarranted
exercise
or discretion.
In
applying this scope of review, the reviewing court may not substitute its
judgment for that of the agency as to the weight of the evidence on questions
of fact, but may reverse where the decision is affected by an error of law. Liberty
Mutual Ins. Co. v. S.C. Second Injury Fund, 363 S.C. 612, 611 S.E.2d 297
(Ct. App. 2005). This Court reviews the findings of the School Board to
determine if its findings of fact or conclusions of law are based on
substantial evidence contained in the whole record. The South Carolina Supreme
Court in Porter v. South Carolina Public Service Commission, 333 S.C.
12, 20-21, 507 S.E.2d 328, 332 (1998) defined the substantial evidence standard
of review:
Substantial
evidence is relevant evidence that, considering the record as a whole, a reasonable
mind would accept to support an administrative agency’s action. Substantial evidence
exists when, if the case were presented to a jury, the court would refuse to
direct a verdict because the evidence raises questions of fact for
the jury. It is more than a mere scintilla of evidence, but is something less
than the weight of the evidence. Furthermore, the possibility of drawing two
inconsistent conclusions from the evidence does not prevent a court from
concluding that substantial evidence supports an administrative agency’s
finding.
The Supreme
Court found “[t]his deferential standard of review does not mean, however, the
Court will accept an administrative agency’s decision at face value without
requiring the agency to explain its reasoning.” Id. at 332. Further,
the agency “must fully document its findings of fact and base its decision on
reliable, probative, and substantial evidence on the whole record.” Id. “An administrative body must make findings, which are sufficiently detailed to
enable this Court to determine whether the findings are supported by the
evidence and whether the law has been applied properly to those findings. Id. And if “material facts are in dispute, the administrative body must make
specific, express findings of fact.” Id.
DISCUSSION
Did the hearing before the
School Board involve significant procedural irregularities affecting a
substantial right of the Charter School?
The Act
establishes the process that must be followed in filing an application,
provides that an applicant must meet with the Advisory Committee, and provides
that the applicant must demonstrate to both the Advisory Committee and the
local school district that the application complies with the Act’s requirements.
Sections 59-40-50 and 59-40-60 of the Act state the requirements for admission of
a charter school, and § 59-40-70(C) provides that “a school district board of trustees only shall deny an application if the application does not meet
the requirements specified in § 59-40-50 or 59-40-60 . . . .” Section 59-40-70(B) of the Act clearly provides that within thirty days after the Advisory
Committee submits an application for a charter school to a local school board,
the board shall, after reasonable notice, approve or deny the application in a
public hearing. The School Board is not required to issue its written order
until ten days after the public hearing.
The instant application
process began in 2006. On April 23 and April 26, 2006, the Charter School placed advertisements in the “Greenville News,” a newspaper of general
circulation in Greenville County, South Carolina, notifying interested persons
of the proposed charter school. Further, during the summer of 2006 the Charter School solicited written indications of interest from persons in the community and provided
those completed or partially completed survey forms to the Advisory Committee and
representatives of the School District during the meeting on September 26, 2006.
The Charter School argues that the School District’s failure to provide it more notice and time to
prepare for a hearing was unjust, unreasonable and totally insufficient for it
to digest the reasons for the denial of the charter application and to prepare
for a hearing. It opines that the South Carolina Supreme Court in Lee
County School District Board of Trustees v. MLD Charter School Academy Planning
Committee, 371 S.C. 561, 641 S.E.2d 24 (2007), has mandated that the thirty
day notice requirement for hearings, as contained in § 1-23-320(a) of the APA, must
be applied to hearings required under the Act. In Lee County, the Supreme Court addressed several issues concerning the APA. The first issue dealt
with the standard of review the circuit court (the court that reviewed appeals
from the State Board at that time) must apply when reviewing an order of the
State Board. The second issue dealt with the requirement that administrative
agencies make specific, express findings of fact in their final orders, as
outlined in Porter v. South Carolina Public Service Commission, 333 S.C.
12, 507 S.E.2d 328 (1998). It is clear that the South Carolina General Assembly has enacted statutory
provisions and the State Board has promulgated regulations which provide the
process applicable to hearings concerning charter schools. Although these
statutes and regulations do not provide that the hearings held by local
school boards are subject to the APA, the Supreme Court in Lee County held that local school boards, just as all administrative agencies, must
comply with the requirements of § 1-23-350. However, the Lee County holding did not make the leap to require that hearings held by local
school boards are subject to the APA. Consequently, because the local school
board is not required to adhere to the notice requirements set forth under the
APA, specifically § 1-23-320, the notice requirement provided for under the Act
must be used. Section 59-40-70 requires that the local school board “rule on
the application for a charter school in a public hearing, upon reasonable
public notice, within thirty days after receiving the application.” §
59-40-70(B). Given the clear and plain language of the statute, it would be almost
impossible for the local school board, upon receipt of a charter school
application, to provide notice of the hearing to the parties and general
public, and conduct a hearing – in which the local school board renders a
decision on the charter application – within the 30 days as required under §
59-40-70(B).
Section 59-40-70(B)
does not provide a specific period of time for which the local school board
must provide notice of the public hearing. Rather, the statute merely provides
that “reasonable public notice” must be given. Here, the Charter School received two business days notice that the School Board would hold a public hearing
regarding the Charter School’s application. Although § 59-40-70(B) does not specify
the number of days notice that must be provided, this Court does not find that
two business days satisfies the “reasonable notice” requirements. See In re Mixson, 258 S.C. 408, 412, 189 S.E.2d 12, 14
(1972) (stating that twenty-five days notice of a hearing to an individual was
sufficient under a rule that specifies “reasonable notice” must be given); see,
e.g., S.C. Dep’t of Health and Envtl. Control v. Armstrong,
293 S.C. 209, 215, 359 S.E.2d 302, 305 (Ct. App. 1987) (“Due process is not a technical concept with fixed parameters
unrelated to time, place and circumstances; rather, it is a flexible concept
that calls for such procedural protections as the situation demands.”).
This requirement by our
General Assembly that the school board give reasonable notice to the public is
provided in part to ensure that the entire general public has the
opportunity to participate in the hearing; it is not meant solely as a
procedural protection for a charter school applicant. Although the Charter School knew, as a result of its investigations, that the School Board was required by statute to conduct a hearing at some
point after it received the letter from the Advisory Committee, the general
public was not as aware. The general public must be given an opportunity at
the hearing to raise any concerns it has about the application and the applicant
must be prepared at the same time to support its application and answer any
queries raised by any member of the public and/or the school board and the school
district administration.
Further, because the School
Board did not provide reasonable notice to the Charter School of the public
hearing, its right to prepare for a hearing was prejudiced and adversely
affected. It was denied the time to properly digest the reasons for denial of the
application, to seek legal counsel, and prepare for the hearing. Further, by
giving reasonable notice of the public hearing, the general public is
given an opportunity to meaningfully participate in the hearing to raise any
concerns it may have. For its failure to give reasonable notice of the
hearing, the Court finds that the matter must be remanded to the School Board
for a public hearing to be conducted on the merits after giving reasonable
notice of at least ten (10) days to the Charter School and the general public. See Ross v. MUSC, 328 S.C. 51, 492 S.E.2d 62 (1997) (holding that
a state may cure a procedural deprivation of due process rights by providing
later procedural remedy). Because of the Court’s ruling in these matters, it
is unnecessary to address the parties’ additional arguments.
ORDER
IT IS HEREBY ORDERED that this matter is remanded to the School District of Greenville County.
IT IS FURTHER
ORDERED that the School Board shall conduct a public hearing after giving reasonable
notice of at least 10 days to the parties and to the general public of the
public hearing.
IT IS FURTHER
ORDERED that the School Board shall render a written, amended decision,
within 10 days of the public hearing, taking into account any new evidence or
arguments propounded during the public hearing.
AND IT IS SO
ORDERED.
______________________________
Marvin F. Kittrell
Chief Administrative Law Judge
April 25, 2008
Columbia, South Carolina
Our General Assembly spelled out clearly
in § 59-40-60 all the information a charter school applicant must provide or
conform with before a charter could be issued to it. This section, as well as §
59-40-115, speaks about the contract or agreement the charter school enters
into with its sponsor, and subsections 59-40-60(D) and (E) list all the
requirements that must be met. Since the application had undergone repeated
rewrites and reviews before approval by the Advisory Committee, it strains
credibility for the Charter School to assert it was unaware that a public
hearing would be required.
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