World Communications charter awaits outcome of Philadelphia inquiry

The Philadelphia School District is investigating one of the oldest charter schools in the city for financial and management irregularities, problems that might eventually force the school to close.

World Communications at 512 S. Broad St. expects to learn its fate Oct. 17, when the School Reform Commission plans to vote on a new, five-year operating charter.

The district charter school office in July recommended against renewing the charter on multiple grounds, including a lack of employee background checks, failure to document expenses, and high student turnover.

According to documents The Inquirer obtained from the district under the state's Right-to-Know law, the charter office found that World Communications could not document more than $240,000 in expenses from 2010 to early 2012, including 10 charges on the school's American Express card.

The district report said the former CEO, Martin Ryder - whose son now runs the school - was still receiving medical and dental insurance from the school and using its American Express card to make purchases after stepping down in July 2011.

Lord J. Ryder, whom the previous board promoted to succeed his father, said in interviews last week the school gave the district more information over the summer, including documentation for nearly all the questioned expenses. He said the charter had replaced its board, hired a firm to handle its finances, was bringing employee child-abuse and criminal-background clearances up to date, and addressed other concerns.

He said he was optimistic the additional information and the changes would persuade the charter office to recommend renewing the charter.

In a July 24 cover letter accompanying World Communications' inch-thick response to the charter office report, Lord Ryder wrote: "The concerns raised are valid, and will be addressed individually. You will see that many of the issues were identified by our leadership team and addressed early in the 2011-12 school year, but after the data was collected for the review."

Despite the supplemental material, concerns about World Communications remain. As a result of issues district auditors raised, the SRC gave the district's general counsel permission last month to begin an inquiry into the school's operations.

The district law department denied The Inquirer's request for a copy of the audit on grounds that it was part of the official inquiry.

World Communications was one of four city charter schools that opened in 1997, a few months after the state charter law was passed. The school has 550 students in grades six through 12.

Throughout its history, the school - as has been the case with many city charters - has had close ties with local politicians. Records show that over the years, State Sen. Anthony H. Williams (D., Phila.), State Rep. Louise Bishop (D., Phila.), former Traffic Court Judge Jimmie Moore, and City Councilwoman Jannie Blackwell have served on the charter's board.

No politicians are on the five-member board impaneled in July. Ryder said a review of minutes of the previous board's meetings showed "the politicos" rarely attended them.

New board members include an insurance executive, an assistant city solicitor, a former U.S. Treasury Department employee, and a representative from the school's Home and School Association.

In its report, the district's charter office said it was troubled by minutes from the July 2011 board meeting indicating that Martin Ryder - who was no longer a board member - had seconded the motion to promote his son.

In an interview, Lord Ryder said he was the logical choice to assume the school's leadership because he had been involved with the charter since 2001, when he began helping students prepare for the state math tests. He said he saw himself as a transitional CEO with a mission "to get the school straight."

According to documents World Communications gave The Inquirer, the new board ratified Ryder's appointment at its July 23 meeting.

At that same meeting, the board approved new ethics policies and bylaws that prohibit conflicts of interest. It also ratified a two-year contract for Martin Ryder to act as the educational climate adviser that took effect in fall 2011. The agreement called for him to be paid a total of $120,000 over two years with health-care benefits worth $22,347 for only the fiscal year that ended June 30.

To comply with the school's new conflict-of-interest policy, Lord Ryder was not present for the discussion and did not vote.

He said his father no longer had access to the school's American Express card. He said instead of reporting to him, his father reports to Michael Young, an insurance company executive who is chairman of the new board.

World Communications hired the Center City law firm Fox Rothschild L.L.P. to represent it and to train board members about their responsibilities under nonprofit and charter law. Instead of handling business matters itself, the school contracted in November with OmniVest L.L.C., a financial-management firm in Newtown that has several charter clients.

The school also hired a firm to do a forensic audit to try to document the more than $240,000 in purchases the district questioned.

According to information World Communications provided to The Inquirer and the district, the auditors said they tracked down receipts for all but $4,806 of the questioned expenses and recommended tightening fiscal practices. Many of the receipts showed the money had been spent on janitorial and technology services.

Although the charter school's academic performance has been stable, the district found that students' math scores on state tests consistently lagged district and charter averages.

To address the academic weaknesses, Lord Ryder said he recruited a new principal, added academic coordinators, and replaced the math curriculum.

And at a charter school that has a 47 percent annual student turnover rate, enrollment has begun to stabilize and grow. Ryder said enrollment had grown from 400 in 2011-12 to 550 this school year.

"I think the school has a good track record," he said. "The money thing was the biggest thing, actually - there were no improprieties. It was just not keeping up with accounting practices in the past."