Charter School Explains Missed 403(b) Contributions

An internal email obtained by the Albany Times Union said the school had such a hard time meeting payroll that it did not pay retirement benefits for some employees for four months. Ronald Racela, director of finance and operations for the school, blamed the financial conditions on the Albany school district’s withholding of funds, which were finally repaid last week.

“No ‘funny business’ has occurred with the school’s cash and … we are victims of lack of cash flow due to our biggest funding source (the ACSD) not making good on their responsibility,” he wrote, according to the Times Union.   

The news report said the Albany school district is sending about $30 million to the city’s 11 charter schools this year, though it has refused to obey a new state law that requires it to reimburse charter schools at a higher tuition rate per pupil. Albany’s charter reimbursement rate is $14,072, but the district is paying only the previous rate of $11,712 per student. The city’s charter schools, which are owed millions of dollars, have sued to obtain the money, and the state Education Department has withheld some of the district’s aid payments.   

Racela claims that Brighter Choice for Girls is owed more than $400,000.   

Chris Bender, executive director of Brighter Choice Foundation and vice chairman of the school’s board, said the school made mistakes in prioritizing how it spent money. The Times Union reports that he said he is not sure if it is illegal to withhold retirement fund payments and said it would not happen again. He said the payments were made current last week and that the total was about $10,000. 

The news report said employees concluded that malfeasance was to blame after they began receiving letters from TIAA-CREF that contributions had not been made to their retirement fund.