Appeals court says charter schools don’t owe KC district

An appellate court Tuesday reversed a decision that some Kansas City charter schools had feared could put them into bankruptcy in a funding dispute with Kansas City Public Schools.

The ruling prompted charter schools to call for an end to what has been a seven-year tug-of-war over the distribution of public education dollars.

“It’s time to close the books on this one,” said Doug Thaman, executive director of the Missouri Charter Public School Association. “It’s time to move forward with the education of children.”

Tuesday’s ruling from the Court of Appeals in the Western District of Missouri reverses a Cole County Circuit Court decision from a year ago. That decision ordered charter schools to repay money that the court determined had been wrongly diverted from Kansas City Public Schools in 2005.

A spokesman for Kansas City Public Schools said the district is still reviewing the decision and that it will decide in the coming days what action it will take.

When the dispute arose in 2005, funding for charter schools flowed through the school district. The state’s charter school law directed the school district to withhold a portion of its per-pupil funding to help pay off $300 million borrowed during the federal desegregation case to build and improve schools.

That debt is due to be paid off in 2014. But the state’s Board of Fund Commissioners in 2005 ruled that the school district had enough reserves to pay off the bonds and ordered that the withholding end.

The district had been withholding about $800 per pupil each year.

The state stopped withholding that money from charter schools for several months in 2005 before court challenges prompted a reversal.

The Cole County ruling last year jolted charter schools. Not only should the withholding continue, the ruling said, the charters should repay that portion that flowed to them in 2005.

Fourteen charter schools that were operating in 2005 faced potential bills totaling $9 million, including interest, according to court records. University Academy could have owed $1.12 million for a school with an annual budget of about $12 million.