As Enrollment Drops, Charter School Eyes New Management

The Child Development Center of the Hamptons charter school is looking to a new management situation as it works to overcome the challenges that come with lower enrollment.

Durell Godfrey

Feb. 1, 2016

Christine Sampson

The Child Development Center of the Hamptons is in talks with Kevin Gersh, who operates several private schools for autistic children on Long Island and in Puerto Rico, for a potential management role at the school following at least one financially troublesome year that saw the South Fork's only charter school lose about $350,000.

Last week, in response to a Freedom of Information request seeking financial data and other school records from C.D.C.H., school staff forwarded the inquiry to Mr. Gersh, a philanthropist and the founder of the Gersh Academy schools, summer camp, and after-school programs, as well the Gersh Experience, an independent living program for young adults on the autism spectrum. He is also a co-founder of the West Hills Montessori School. Mr. Gersh's public relations firm declined to detail Mr. Gersh's relationship with C.D.C.H. However, Marilyn Zaretsky, the chairwoman of the C.D.C.H. board of directors, confirmed Friday that talks are under way.

"The programs that they create are extraordinary," Ms. Zaretsky said.

A change in the management of the school could happen as early as July 1, pending approval by the State University of New York's Charter School Institute, which is the entity that approves new charter schools, renews or revokes their credentials, conducts audits and performance reviews, and approves mergers.

The relationship with Mr. Gersh comes to light just after C.D.C.H., a public charter school on Stephen Hand's Path in East Hampton that offers both general education and special education programs, said it had stabilized its finances. Ms. Zaretsky said the school was able to "level out" its financial woes by handing some of its expenses over to Family Residences and Essential Enterprises, an Old Bethpage not-for-profit that currently manages the school. Ms. Zaretsky said the school also eliminated the position of assistant head-of-school and "streamlined some of our programs and the auxiliary staff so that we were able to function."

According to C.D.C.H.'s February 2015 board meeting minutes, the school reported losses of at least $350,000 between July and December 2014. "The school is experiencing financial difficulty due to the lower number of special needs children in attendance," the minutes read. "Cash flow is also a problem, as expenses exceed revenue."

By June 2015, the deficit had grown slightly, to about $355,000. The June 2015 minutes — which were the most recent available on the school's website, though the board met three more times in 2015 — noted that lower attendance had continued to impact the school financially. During the same meeting, the board adjourned to an executive session to discuss, among other things, "matters leading to the employment of a particular corporation."

In November 2013, C.D.C.H. had 80 students in kindergarten through fifth grade. That figure fell to between 57 and 62 students for 2015-16, according to Ms. Zaretsky. The students come from local public schools, which pay the C.D.C.H. tuition from operating budgets.

A significant portion of the student body comes from the Springs School District, which sends 26 students across the grade levels to C.D.C.H. , according to a Springs official. Wainscott and Montauk each have one student at C.D.C.H.; East Hampton has two special education students there and eight in the general education program, representatives of those districts said. Amagansett has three, but two are preparing to transfer out, according to that district. Citing student privacy concerns, Sag Harbor school officials declined to say whether any of its students attend the charter school. Bridgehampton and Sagaponack School do not have students at C.D.C.H.

Schools within a radius of 50 miles may send students to C.D.C.H.. But Ms. Zaretsky said it is those districts' budgetary constraints that have had an impact on C.D.C.H.'s finances and said, "they are doing as much as possible to keep children in district" because they pay tuition per student. This year's tuition rates are $25,075 in the general education program and more than $60,000 per student in special education.

"We are focusing a great deal on recruitment," Ms. Zaretsky said. "It's very much needed on the East End, this type of program. There is not a real centralized Board of Cooperative Educational Services to provide what we can provide, whether [for] a child with special needs or not. We've been able to make headway with all types of children with a very personalized program."

After beginning in 1997 as a program for a small group of toddlers in the house of Dawn Zimmerman Hummel, its founder, who sought a social and educational opportunity for her autistic son, C.D.C.H. opened as an official public charter school in January of 2001. It served students in kindergarten through third grade. By the 2005-6 school year, it had expanded up to fifth grade.

The SUNY Charter School Institute found C.D.C.H. to be in good academic standing during the 2014-15 school year and in several school years prior. In February of 2015, the Charter School Institute recommended a full five-year renewal of C.D.C.H.'s charter.

But despite its positive academic standing, the school has had challenges on the financial front. In February of 2013, an audit by the office of New York State Comptroller Thomas P. DiNapoli found a weakness in C.D.C.H.'s financial practices due to the lack of certain financial reports from FREE.

"The board’s failure to rigorously review the school’s finances, particularly in view of the management corporation’s complete control of its financial activities, significantly increases the risk that school assets could be lost or misappropriated," the comptroller's audit stated. "We also found that the two-month budget-to-actual revenue and expenditure reports that FREE presented to the board did not contain information to ensure school funds are effectively and efficiently used."

Also among the audit's findings was that for two years, C.D.C.H.'s regular school program operated at a surplus, masking the fact that its summer program operated at a deficit. The comptroller said in the February 2013 audit that the school's financial reporting procedures at the time failed to show that loss. The school's board said in a subsequent letter to the comptroller that it had resolved any deficiencies by requesting and receiving more financial data from FREE.

Gerard Cairns, FREE's vice president of education and youth services, who is C.D.C.H.'s interim school leader, could not be reached for comment Friday.

As recently as Jan. 1, the C.D.C.H. Foundation for Special Children, a nonprofit organization that supports the charter school, was collecting donations via the crowd-funding website gofundme.com. As of Friday, about $3,500 of its $500,000 goal had been raised over the course of 10 months. The campaign's page reads, "The shifting educational landscape has presented us with some short-term financial hurdles, and we would greatly appreciate your help."

"I think [our direction] is extremely positive," Ms. Zaretsky said. "Last year we spent a lot of time with committees reviewing the finances, knowing the position we were in, and getting a great deal of parent support to keep the school open."

A correction: The Springs School District is currently sending 26 students to C.D.C.H., not 31, as stated when this article was first posted. It had 31 students at C.D.C.H. in the fall, but some are no longer enrolled there, according to the Springs principal, Eric Casale.