ONLY ON 3 Investigation: Charter school owner under federal investigation

WILMINGTON, NC (WWAY) -– Baker Mitchell, the founder of Roger Bacon Academy in Leland, is facing some challenges. He is under federal investigation.

His newest charter school, Douglass Academy, has an enrollment problem with the state and there are questions about where millions of your tax dollars are going to support his schools.

Mitchell is an elusive person. His secretary hangs up on us when WWAY calls with questions and he rarely appears in public to talk with the media.

Mitchell would not acknowledge whether he knew he is being investigated by the US Department of Education’s Office of the Inspector General.

While the document that confirms the investigation does not go into detail, Brunswick County Superintendent Dr. Edward Pruden thinks it has to do with improper enrollment practices.

Two former employees told WWAY, on condition of anonymity, that they were aware of fraudulent ways of counting students to beef up the numbers at Mitchell’s charter schools.

For instance, they say some students would just show up for the first 20 days so the school could get the allocated tax dollars and then quit, and go back to Brunswick County Public Schools.

In Brunswick County for example, Charter Day School gets $2,464 from the county and $4,692 from the state for each student. That’s a total of more than $7,000 per pupil.

A lot of money to play with if that student never shows up for class after the first 20 days, and a burden on the county school system that takes the student back.

At Douglass Academy in Downtown Wilmington, Mitchell only has about 35 students. The state says he needs 65 to be open.

Mitchell faces a hearing next month in Raleigh to explain what he will do to get the numbers up.

“It (the statue) specifies no time limit on which you are to achieve that 65 number. We have over 90 students registered for this fall. We are looking forward to growing to fulfill our charter,” said Mitchell.

Then, there are the tax returns from Charter Day for 2008 through 2012 which show Mitchell got millions of your tax dollars from management fees, as well as for building and equipment rentals. Add the five years of returns up, and it’s almost $16 million.

State law says Mitchell does not have to explain how he spends the money in that account, but several employees have told us Mitchell takes the building and rental money and pays it to a company called Coastal Conservancy LL, which he owns.

Coastal Conservancy then charges Charter Day to rent the land, which Mitchell owns as well, and then charges the school rent for the buildings, the chairs, the tables, and even the pencils. Tax dollars going straight back into Mitchell’s pockets, which he is not spending on students or teachers.

Mitchell says all dollars are accounted for in the school’s audit.

“We’ve had a series of no findings audits. We keep our books identically to the District’s. We are required by state law to maintain charter accounts. All of that information is in our audits that are publically available if you would like to read them,” said Mitchell.

WWAY asked Mitchell to explain what actually are in the audits, but he would not elaborate.

“If you are too lazy to read the audit, I cannot help you,” said Mitchell.

Americas For Prosperity sponsored Friday’s open house at Douglass, claiming it is excited about supporting school choice.

WWAY tried to sit down with its director, John Dudley, and discuss the federal investigation and how Douglass is not meeting enrollment requirements.

While WWAY had the documents to show him, he refused to look at them and said he had no comment.

“We talked enough. I can’t be here all day,” said Dudley.

WWAY also tried to talk to local politicians at the open house about the investigation, but they said this was the first they were hearing about it.

Categories: New Hanover