Perry’s New York City charter school application generates requests for investigations

To:

New York Board of Regents
General Counsel, Board of Regents
Office of Audit Services, Board of Regents
 
New York Attorney General Eric Scneiderman
New York Comptroller Thomas P. DiNapol
 
NYC Mayor Bill de Blasio 
NYC Comptroller Scott M. Stringer
NYC Public Advocate Letitia James

 

Re:  Request for investigation into the New York Board of Regent’s recent approval of Capital Preparatory Harlem Charter School

Earlier this month, the New York Board of Regents moved to approve a charter school application from Steve Perry, a principal of a public school in Connecticut who has formed a charter school management company in the hopes of opening up charter schools in the greater New York City region.

Although the Board of Regents’ Education Committee approved the charter school application submitted by Mr. Perry, he does not own the concepts, materials and intellectual property contained in that application.  Instead they belong to the Hartford, Connecticut Board of Education.

At their November meeting, the P-12 Education Committee of the New York Board of Regents, upon the recommendation of Commissioner John B. King, Jr and the staff of the New York State Department of Education, voted to approve the application for the Capital Preparatory Harlem Charter School.

In the memo to the P-12 Committee, Cosimo Tangorra, Jr. wrote, “The Commissioner and Department staff recommend that the Board of Regents consider, approve and issue initial charters and provisional charters for the following four new charter schools.”  The list included Capital Preparatory Harlem Charter School.

The memo added, “In New York City, Capital Preparatory Harlem Charter School, proposed as a replication of an effective magnet school in Connecticut, will partner with the Boys and Girls Club of Harlem to provide middle- and high-school students with a rigorous, year-round college preparatory curriculum”  and recommended, “VOTED: That the Regents find that the proposed charter school: (1) meets the requirements set out in Article 56 of the Education Law, and all other applicable laws, rules and regulations; (2) will operate in an educationally and fiscally sound manner; (3) is likely to improve student learning and achievement and materially further the purposes set out in subdivision two of section twenty-eight hundred fifty of Article 56 of the Education Law; and (4) will have a significant educational benefit to the students expected to attend the charter school, and the Board of Regents therefore approves and issues a charter and provisional charter to the Capital Preparatory Harlem Charter School for a term of five years in accordance with §2851(2)(p) of the Education Law.”  See: http://www.regents.nysed.gov/meetings/2014/November2014/1114p12a3.pdf.

However, either the Commissioner, staff and Regent’s Committee were unaware that Mr. Perry and his fellow charter school applicants do not own the concepts, materials or intellectual property that they claim or the Commissioner, staff and Committee was aware of this issue and are intentionally engaging in what appear to be Mr, Perry’s criminal violation of copyrighted material owned by the Hartford, Connecticut Board of Education.

For background, the application to open the Capital Preparatory Harlem Charter School was submitted by Steve Perry and his private company, Capital Preparatory Schools, Inc.

Steve Perry is a full-time employee of the Hartford Board of Education and serves as the principal of Hartford’s Capital Preparatory Magnet School, a public school owned and operated by the Hartford Board of Education and located on Main Street in Hartford, Connecticut.  The public school is funded by federal, state and local funds.

In 2012, Mr. Perry created a Connecticut company which he named “Capital Preparatory Schools, Inc.”

When forming the corporation, Mr. Perry filed with the Connecticut Secretary of the State that his company was located at his residence in Middletown, Connecticut.  However, for purposes of the Internal Revenue Service, Mr. Perry, until recently, has been using the address of the public school in which he works.

The charter school application submitted to the New York Board of Regents by Mr. Perry and his associates can be found here: Capital Preparatory Harlem Charter School Application

Throughout the application, and in the hearings, meetings and communications associated with his attempt to get garner approval from the New York Board of Regents for his Harlem charter school application, Mr. Perry consistently claimed that he and his company own the concepts, materials and intellectual property associated with the Capital Preparatory Magnet School in Hartford and have the legal right to “replicate” that school in New York using materials created for the Connecticut public school.

However, neither Steve Perry nor his private company has any legal right to those concepts, materials or intellectual property.

Since Steve Perry and his associates are full-time employees of the Hartford Board of Education, the copyright laws are extremely clear.  Concepts, materials and intellectual property created by employees of a school district are the sole property of the school district.

Even the Hartford Board of Education’s own policies specifically address the issue by stating,

‘Materials created by staff at the instigation and/or direction of superiors and/or during work-time shall be considered “work made for hire” under Sections 201(b) and 101 of the Copyright Act and shall be solely the property of the school district.”

Mr. Perry and his company are seeking to use copyrighted materials for personal gain, which of course, is an extremely serious and potentially criminal offense.  According to federal law, “A commercially motivated infringer can receive up to a five-year federal prison term and $250,000 in fines.  (17 U.S.C. § 506(a)), 18 U.S.C. § 2319)

Mr. Perry’s application to open a charter school in Harlem contains numerous claims that he is basing his work plan on concepts, materials and intellectual property that he does not own or have the right to utilize.

For example, Perry and his team write;

“The founders of Capital Preparatory Harlem Charter School (“Capital Prep Harlem”) seek the opportunity to replicate our successful flagship school, the Capital Preparatory Magnet School – Hartford, CT (“Capital Prep”), in New York City’s Community School District 5”  (Page 2 of the pdf submitted to the New York Board of Regents.)

“CPS will support Capital Prep Harlem through its oversight of the principal, on behalf of the Board of Trustees, and its overall monitoring of fidelity to the Capital Prep model.  CPS will also utilize its two other schools in Bridgeport and Hartford to provide professional development and to share resources. The three schools will act as a ‘boutique’ network in which faculty, staff, parents and students participate in academic and social exchanges. (Page 4 of pdf)

“Capital Prep’s curriculum is being replicated in the form of the Capital Prep Harlem charter. It is a unique curriculum that has been created by the founders of Capital Prep in Hartford and will be implemented, monitored and measured by CPS. (Page 21 of pdf)

Capital Prep Harlem’s program and curriculum designs are based on the internationally recognized, research-based model developed by the founders of Capital Preparatory Schools, Inc. (CPS) and implemented over the past ten years at Capital Prep in Hartford, Connecticut…

‘Over the past two years, members of Capital Prep Harlem’s founding group have formally collaborated on this proposal through regular meetings and ongoing interim communications.  CPS enlisted its founders, current teachers at Capital Prep in Hartford, and strategic consultants to codify the mission, vision and key design elements of the Capital Prep model and operationalize the educational philosophy of the school in order to facilitate replication and training.’ (Page 42 of the pdf)

Attachment 6a: CMO Information – “CPS is designed to be a fiscally fit “boutique” charter management organization (“CMO”) ….Geographic clustering will allow us to stay small yet generate the revenue necessary to effectively maintain a CMO. Hartford, Bridgeport and Harlem are the three cities in which we have decided to manage schools. It is our hope that we will manage two schools in Harlem. The first is to be Capital Prep Harlem, 6-12. The second would be a kindergarten to 5th grade school in or near the first in CSD 5. Managing four schools in three cities that are within a two–hour drive of each other allows us to support the schools without having to hire completely new staff for each school.

Our anticipated enrollment across all four CPS network schools is approximately 2,500 students between 2015 and 2020. Capital Prep Hartford has 700 students. The Capital Preparatory Harbor School in Bridgeport Connecticut will have 765 students at full enrollment. Capital Prep Harlem will have 600 students in the next five years, and we hope to open a companion kindergarten to fifth grade school in Harlem that will serve another 600 students. (Page 180 of pdf)

Ten founding group members from Capital Prep came together to launch CPS as the school management organization to lead replication of the Capital Prep model. Each founding member brought a unique background and set of skills to the process. (Page 180 of pdf)

Founding members of the charter management company are then listed. Nine of ten are full-time employees of the Hartford Board of Education.  The management team of the charter management company is also listed, with two of three serving as full-time employees of the Hartford Board of Education (Page 183 of pdf)

FINANCIAL PLAN – Surpluses are projected in each year beginning in 2015. The annual ending cash balance per year for CPS will be just over $500,000 in management fees collected. Conservative five year estimates have our year end cash balance at $2 million by year five between Hartford, Bridgeport and our Harlem 6 to 12 school.

We are focused on running a right-sized CMO. Operating within a small geographic region affords us the opportunity to create efficiencies that will ensure that CPS staff can effectively support all three schools and the students therein.” (Page 188 of pdf)

In addition to the significant copyright infringement issues, it would appear that Mr. Perry and his associates have also tried to mislead the New York Board of Regents into believing that Capital Preparatory Schools, Inc. (Perry’s CMO) owns and operate other schools including Capital Prep in Hartford Connecticut.

Note above, the wording from the application,

“CPS is designed to be a fiscally fit “boutique” charter management organization (“CMO”) ….Geographic clustering will allow us to stay small yet generate the revenue necessary to effectively maintain a CMO. Hartford, Bridgeport and Harlem are the three cities in which we have decided to manage schools.”

“Our anticipated enrollment across all four CPS network schools is approximately 2,500 students between 2015 and 2020. Capital Prep Hartford has 700 students.”

“Surpluses are projected in each year beginning in 2015. The annual ending cash balance per year for CPS will be just over $500,000 in management fees collected. Conservative five year estimates have our year end cash balance at $2 million by year five between Hartford, Bridgeport and our Harlem 6 to 12 school.”

But the truth is that Mr. Perry does not own Hartford’s Capital Prep Magnet nor does his private company have ownership interest or management control of the Hartford, Connecticut public school,

His suggestion that Capital Prep is part of CPS (“Capital Preparatory Schools, Inc.”) or that it is part of his “boutique” charter management organization (“CMO”) is nothing short of an outright lie.

Furthermore, while Mr. Perry’s private company has received approval from the Connecticut State Board of Education to open a charter school in Bridgeport, Connecticut this coming fall, there is no money in the state budget allocated for that school and Connecticut is facing a projected $1.4 billion deficit, making it unlikely the any funding will be available for his proposed charter school.

Despite Mr. Perry’s claim, his charter management company does not manage any schools.

The application submitted to the New York Board of Regents by Steve Perry and his private company, Capital Preparatory Schools, Inc., raises extremely serious legal and ethical issues.

The fact that the Regents’ P-12 Education Committee approved the application means the Commissioner, his staff and Committee members were either unaware of these issues or chose to overlook them.

In either case, a full and complete investigation into Mr. Perry and the Board of Regent’s action is needed, followed by any appropriate legal action to ensure that federal, state and local laws are upheld.

Please accept this document as a request for a full and complete investigation by your office.

Jonathan Pelto
Storrs, Connecticut
[email protected]
860-428-2823