Board members quit after two embattled Indiana virtual schools lose charters

After losing their charters Monday night, two embattled virtual charter schools were scheduled to hold board meetings Tuesday night to discuss finishing the process of shutting down.

But that discussion never happened because Indiana Virtual School and Indiana Virtual Pathways Academy no longer had any board members.

“There’s no one left,” said the schools’ attorney, Mary Jane Lapointe.

Two board members, Thomas A. Krudy and Sam Manghelli, resigned during an executive session held in the lobby of an Indianapolis office building because they were locked out of the virtual schools’ fourth-floor suite.

“We lost the charter, and in effect, there is no school,” said Krudy, the former board president and a bankruptcy trustee. “So there wouldn’t be any kind of decision on my part.”

The two other board members were not present. Dave Milligan could not be reached for comment Tuesday night. By phone, Mitch Smith told Chalkbeat that the board had dissolved. He said he believed any outstanding business with the schools would be handled by the company that had been paid to run them, AlphaCom.

With the board’s dissolution, it’s unclear who remains responsible for Indiana Virtual School and Indiana Virtual Pathways Academy. The schools have stopped operating, but even as teachers are no longer getting paid, they say they’re still helping students transfer to new schools.

The decision comes as the two virtual schools face questions from state and federal investigators over their enrollment practices and finances. The state has found that the schools over-reported their enrollment in recent years and took in $47 million more in state funding than they should have.

Lapointe said she believed the schools were still going to respond to a subpoena from the U.S. Attorney’s Office in the Southern District of Indiana to provide information to the FBI.

With no board members, the not-for-profit organization that held the charters for the schools, the Indiana Virtual Education Foundation, will likely dissolve, Lapointe said. She said the schools had no assets, and she did not know about any liabilities.

Lapointe directed questions to Daleville Community Schools, the schools’ oversight agency that unanimously voted Monday night to immediately revoke the charters.

“When it revoked its charter, it took responsibility for the students,” Lapointe said. “So, the foundation is no longer involved.”

She did not answer other questions, saying, “I can no longer speak for a nonexistent board,” and adding that she didn’t know whether she still represented the schools.

Sara Blevins, a partner at Lewis Kappes, the law firm that represents Daleville, said she was “disappointed but not surprised” by the board’s disbanding.

“Frankly, we never expected much help from the charter schools in the closure process, and we’re trying to set things up so we can do as much ourselves as we can,” Blevins said. “Which is not as much as we’d like to be able to do, but our hands are tied to some extent, and they just tied them a little bit more. I was hopeful that someone would take some measure of responsibility for the students’ sake.”

Blevins said the schools still had financial obligations under the closure process that they needed to address.

Several teachers and counselors who showed up for the meeting seeking answers appeared stunned by the decision.

“We showed tonight because we were trying to support the kids,” said counselor Carrie Bennett. “It’s sad that the board members who were supposed to have them at their highest priority didn’t bother showing and resigned just before they could have the opportunity to do anything.”

Board members told reporters they could not answer several questions about where this leaves the schools because they were not involved in the day-to-day operations. Krudy added that they were “deeply disappointed.”

“We thought this was the wave of the future and a way of educating kids,” Krudy said. “And we believed in it.”

Smith said the schools took in students who were getting failing grades and enrolled students throughout the year.

“I’m not sure what really went wrong with the situation, but I feel sorry for all the kids,” Smith said.

Chalkbeat is a not-for-profit news site covering educational change in public schools.