two rivers pcs review report

2013-14 Charter Review Report

Two Rivers

Public Charter School

July 21, 2014

DC Public Charter School Board 3333 14th Street, NW, Suite 210

Washington, DC 20010 (202) 328-2660

www.dcpcsb.org

TABLE OF CONTENTS

FINDINGS AND RECOMMENDATION .................................................................................. 1

INTRODUCTION ........................................................................................................................ 1

ANALYSIS .................................................................................................................................... 6

SECTION ONE: GOALS AND ACADEMIC ACHIEVEMENT EXPECTATIONS ............... 4

SECTION TWO: COMPLIANCE WITH APPLICABLE LAWS ........................................... 27

SECTION THREE: FISCAL MANAGEMENT AND ECONOMIC VIABILITY ................. 32

1

SUMMARY OF FINDINGS AND RECOMMENDATION The District of Columbia Public Charter School Board (“PCSB”) staff has conducted a charter review of Two Rivers Public Charter School (“Two Rivers PCS”), as required by the School Reform Act (“SRA”).1

Two Rivers PCS fully met 14 goals and academic achievement expectations (“academic expectations”), substantially met one goal, and partially met one goal. The school has not materially violated the law or its charter, and is in strong fiscal health.

Based on these findings, the PCSB Board voted to grant full continuance to the school without conditions.

INTRODUCTION

School Overview Two Rivers PCS began operation in 2004 under authorization of PCSB and recently completed its tenth year in operation. Its mission is to nurture a diverse group of students to become lifelong, active participants in their own education develop a sense of self and community and become responsible and compassionate members of society. The school uses Expeditionary Learning, “an educational model that emphasizes interactive, hands-on project-based learning.”2 Additionally, it focuses on developing students’ social skills through its use of the Responsive Classroom model.

Two Rivers PCS currently operates one campus with grades pre-kindergarten-3 through eighth grade. The school’s overall performance data are summarized in the table below.

Ward Year Opened

Grades Served

2013-14 Enrollment

6 2004 PK3-8 516

10-11 PMF 11-12 PMF 12-13 PMF

PK3-2 Met 6 of 8 targets (75%)

Met 5 of 8 targets (62.5%)

Met 7 of 7 targets (100%)

3-8 75.0% (Tier 1)

73.8% (Tier 1)

69.9% (Tier 1)

1 DC Code §38-1802.12(a)(3). 2 See p. 3 of Two Rivers PCS 2012-13 Annual report, attached to this document as Appendix A.

2

.

Charter Amendments On March 7, 2014, Two Rivers PCS submitted a request to amend its charter to allow it to open a second campus that will replicate its pre-kindergarten through eighth grade program beginning in SY2015-16, and to increase its enrollment ceiling from 750 to 1100 to reflect the student population at the new campus.3 The PCSB Board conditionally approved this request at its June 2014 board meeting, on the conditions that the school (1) receives full continuance on this charter review; and (2) updates its goals and academic achievement expectations according to PCSB guidelines.

Previous Charter Review In 2009-10, PCSB conducted a five-year charter review of Two Rivers PCS. The school was found to have met two of three academic performance standards and all non-academic performance standards in place at the time.4 PCSB found the school’s governance and finances to also be strong. Based on this review, the PCSB Board voted at its January 2010 meeting to fully continue the school’s charter.5

Charter Review Standard The SRA stipulates that the authorizer “shall review [a school’s] charter at least once every [five] years.”6 As part of this review, PCSB must determine whether:

(1) The school committed a material violation of applicable laws or a material violation of the conditions, terms, standards, or procedures set forth in its charter, including violations relating to the education of children with disabilities; and/or

(2) The school failed to meet the goals and student academic achievement expectations set forth in its charter.”7

If PCSB determines that a school has committed a material violation of law, or has not met its goals and expectations, it may, at its discretion, revoke the school’s charter, or grant the school a conditional continuance.

Additionally, there is a fiscal component to the charter review. PCSB is required by the SRA to revoke a school’s charter if PCSB determines in its review that the school (1) has engaged in a pattern of nonadherence to generally accepted accounting principles; (2) has engaged in a pattern of fiscal mismanagement; and/or (3) is no longer economically viable.

3 See PCSB board memorandum, “Charter Amendment Request to Replicate – Two Rivers PCS, dated May 19, 2014, attached to this report as Appendix B. 4 See 5-year charter review, attached to this report as Appendix C. 5 See January 2009 meeting minutes, attached to this report as Appendix D. 6 SRA §38-1802.12(a)(3). 7 SRA §38-1802.12(c).

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PCSB staff review analysis and recommendation Two Rivers PCS fully met 14 goals and academic achievement expectations (“academic expectations”), substantially met one goal, and partially met one goal. The school has committed, as a condition to replication, to amending its goals to align with PCSB policy.

The school is very strong academically – one of the highest performing charter schools in the sector. The school has not materially violated the law or its charter, and is in strong fiscal health. Based on these findings, the PCSB Board voted to grant full continuance to the school without conditions.

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SECTION ONE: GOALS AND ACADEMIC ACHIEVEMENT EXPECTATIONS The SRA requires PCSB to review whether a school has met its goals and student academic achievement expectations (“expectations”) at least once every five years. Goals are specific aims that are measurable and usually related to a school’s mission, which may be categorized as academic, non-academic, and organizational, whereas expectations are student academic aims measured by assessments. Goals and expectations are only considered as part of the renewal analysis if they were included in a school’s charter, charter amendment, or accountability plans approved by the PCSB Board (collectively, the “Charter”).

The chart below summarizes PCSB’s determinations whether the school met its goals. These determinations are further detailed in the body of this report.

Goal or Expectation Met?

1

To implement learning expeditions – long-term, in-depth investigations of a theme or topic that engage students through authentic research, projects, fieldwork, service, and adventure – as the foundation of teaching and learning.

Yes

2a

To expect and attain high levels of student achievement, critical and creative thinking, effective communication skills, and character development, and to develop a sense of joy in learning.

Yes 2b

To demonstrate consistently high expectations, teamwork, sense of adventure, respect for diversity, and high quality work in the classroom, in the larger school community, and in the community-at large.

2c To promote a culture of high expectations, collaboration, service, and respect for diversity.

2d To create a student-centered environment focused on the whole child.

3

To increase student test scores form year-to-year, so that students are performing at or above grade level in reading and mathematics, and at comparable levels with students in area private schools, suburban public schools, and DCPS schools.

Yes

4 To prepare graduates for the area’s top public and private high schools. Yes

5 To use diagnostic, formative, and summative assessments to evaluate student performance and inform curricular and instructional

Yes

5

practices.

6a To create a community of professionals dedicated to personal growth through learning and the sharing of expertise.

Yes

6b

To create a flexible school environment that supports creative student grouping, innovative use of instructional time, and common staff planning time.

7

To use portfolio assessment to demonstrate students’ knowledge, skills, and character, and as a means of understanding curriculum and instructional practice.

Partially

8

To demonstrate the character values of responsibility, compassion, discipline, integrity, and courage in the classroom, in the larger school community, and in the community-at-large.

Yes

9 To foster family and community participation. Yes 10 To create a school that is diverse by design. Yes

11a

To engage all members of the community in continuous improvement through a system of shared decision-making, a culture of revision, and ongoing school review.

Substantially

11b To promote inquiry and innovation in a culture of reflection, critique, revision, and collaboration.

11c

To involve staff, students, and parents in a collaborative community of reflective learners engaged in ongoing assessment, planning, and action to improve teaching and learning.

11d

To regularly collect and analyze data to assess progress toward a common vision, set improvement goals, and develop a comprehensive school improvement plan.

12 To conduct an extensive annual school review. Yes

13 To develop a stable student enrollment with high rates of student retention. Yes

14 To expand access continuously to funding sources from the government, corporate, and foundation sectors

Yes

15a To make careful financial decision that further the mission of the school. Yes

15b To have a clean audit and balanced budget. Yes 16 To participate in the larger charter school

community.

6

To implement learning expeditions – long-term, in-depth investigations of a theme or topic that engage students through authentic research, projects, fieldwork, service, and adventure – as the foundation of teaching and learning.

Assessment: Two Rivers PCS has met this goal. The school has consistently used with fidelity learning expeditions as its foundation of teaching and learning.

Two Rivers PCS uses learning expeditions as its primary instructional strategies. In each classroom, teachers choose two areas of study from the curriculum framework, which students “explore[] in much greater depth each year…All units of study involve intensive research, reading, writing, scientific exploration, and real-world application.”8 In its 2012-13 annual report, Two Rivers PCS explained that, “… [Two Rivers PCS] educators have continually improved projects by refining recurring themes, strengthening in-depth student tasks, and discovering new authentic research opportunities and areas to focus project work.” The school also reported that students participated in 22 unique expeditions in 2013, in fields such as Urban Planning, Biology, Anthropology, Ecology, Construction, and Economics. Work products included policy proposals, urban design schematics, and presentations to the D.C. Council and the Two Rivers PCS community.9

Qualitative Evidence PCSB conducted a Qualitative Site Review of Two Rivers PCS in October 2013, during which the following was observed in support of this goal.

…[The] review team members observed a lesson related to results from the 6th grade “scholars on field study”. During the observed lesson, students were assigned to small groups of three or four and given the opportunity to present results related their in-depth investigation of food options and choices. Students invited comments and questions from their small group members. Similarly, an elementary class participated in an in-depth investigation centered on how to allocate and disburse a finite amount of money. The class worked collaboratively and reported how they planned to use the money and listed several concerns and questions linked to the learning expedition.10

2a. To expect and attain high levels of student achievement, critical and creative thinking, effective communication skills, and character development, and to develop a sense of joy in learning.

2b. To demonstrate consistently high expectations, teamwork, sense of adventure, respect for diversity, and high quality work in the classroom, in the larger school community, and in the community-at large.

8 See Two Rivers PCS 2009-10 through 2012-13 Annual Reports, attached to this report as Appendices E, F, G, and A. 9 See 2012-13 annual report, p. 21. 10 See p. 4 of Two Rivers PCS site review, attached to this report as Appendix H.

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2c. To promote a culture of high expectations, collaboration, service, and respect for diversity. 2d. To create a student-centered environment focused on the whole child. Assessment: Two Rivers PCS met these goals. Qualitative evidence supports the school meeting these goals.

Two Rivers PCS uses the Responsive Classroom approach to develop students’ social-emotional learning and character. Responsive Classroom is an elementary teaching method that “…incorporates the students’ social and emotional growth into their academic learning, stemming from the notion that children learn best through social interaction and when they are explicitly taught socially and emotional skills along with their academic lessons.”11 The school reports that this approach “…create[s] a safe environment where children are able to take academic and social risks to help children understand the importance of kindness toward and acceptance of all people, to celebrate differences in people and cultures, and to learn important social skills such as empathy and problem solving.”12

Specific strategies within this approach implemented by the school include starting each day with Morning Meeting, creating clear and consistent approaches to discipline fostering social responsibility, classroom organization, and family communication to facilitate families as partners in their children’s education. Two Rivers PCs middle school students study “Scholarly Habits,” designed to prepare them for success in high school and beyond.

Qualitative Evidence The PCSB review team observed the following in support of these goals.

The review team observed evidence that the school stresses student achievement, critical and creative thinking, communication, character development, and joy of learning. Teachers provided students lessons in multiple modalities (e.g., auditory, kinesthetic, visual, etc.) and incentivized students with friendly competitions (i.e., “Last time you did it in a little over a minute, let’s see if you can get through these flashcards in under a minute!”) to help students “develop a sense of joy in learning.”

…

In addition, students were encouraged to be “critical and creative” thinkers and expand on their communication skills by teachers asking thoughtful questions and often encouraging students to explain what they were learning.

11 “The Responsive Classroom Approach.” http://teach.com/what/teachers-teach/the-responsive-classroom-approach. Accessed July 1, 2014. 12 See Appendix A, p.7

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Teachers encouraged intellectual engagement by asking students to present content. In one math class, the students had to represent multiplication problems on a number line, and explain their representations to the rest of the class. Students had extensive choice in completing learning tasks.

…

The review team looked for evidence of teamwork and high-quality work within the context of community. Many of the observed classrooms supported an environment where students were encouraged to work with others such as in pairs (e.g., “turn and talk” practice) and, during the 6th grade jigsaw exercise, in groups of three to four.

… In one classroom, the teacher allowed the students to highlight one of their fellow classmate’s achievements during the lesson. This process was called “spot the dot.”

…

Students begin each school day with a morning meeting aimed to enhance character development and to create a sense of community within the school. During a student led community meeting, students asked for high quality work for magazine submissions and the best pieces would be selected to be read at a future community meeting.13

3. To increase student test scores from year-to-year, so that students are performing at or above grade level in reading and mathematics, and at comparable levels with students in area private schools, suburban public schools, and DCPS schools.

Assessment: Two Rivers PCS has met this academic expectation. PCSB did not compare Two Rivers PCS students’ performance to that of students in private, suburban, and DCPS schools. However, the school met its goal based on its strong academic performance – proficiency rates well above the state average, and higher-than-average median growth percentiles, indicating that Two Rivers PCS students are growing faster than their peers in the state.

Early Childhood Performance Two Rivers PCS has met the majority of the early child targets it set, as detailed in the table on the following pages. The only area in which the school did not meet its target is first and second grade math growth.

13 See Appendix H, pp. 4-5.

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Pre-Kindergarten Literacy and Numeracy Growth

Year Target Target Met?14

2010-11

85% of preschool and pre-kindergarten students who score below age equivalency in the fall administration of the reading and/or quantitative subtests of the Brigance Developmental Inventory will score at or above age equivalency on the reading and quantitative subtests of the Brigance Developmental Inventory in the spring administration.

No 68% of students increased

to age equivalency on both tests.

2011-12

80% of pre-kindergarten-3 and pre-kindergarten-4 students will maintain or progress to age equivalency on the reading or quantitative subtest by the spring administration on the Brigance assessment.

Yes 91.7% of students

maintained or progressed to proficiency.

Pre-Kindergarten Literacy Growth

2012-13

60% of pre-kindergarten-3 and pre-kidnergarten-4 students will progress to age equivalency in literacy/language on the Brigance Development Inventory Standardized assessment.

Yes 99.0% of students met this

goal.

K-2 Literacy Growth (as measured by mCLASS)


2010-11

90% of kindergarten students will progress to at least proficiency by the spring administration in reading on the Wireless Generation – mCLASS assessment.

Yes 98% of students

progressed to above proficiency.

2011-12

90% of kindergarten students will maintain or progress to proficiency by the spring administration on the Wireless Generation mCLASS reading assessment.

Yes 98% of students

maintained or progressed to proficiency.

2012-13 60% of kindergarten through second-grade students will advance at least one level in reading on the mCLASS reading.


goal.

14 In 2010-11, all early childhood results were rounded to the nearest whole number. In 2011-12 and 2012-13, early childhood results were rounded to the nearest tenth decimal. 15 In 2010-11, all early childhood results were rounded to the nearest whole number. In 2011-12 and 2012-13, early childhood results were rounded to the nearest tenth decimal.

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First and Second Grade Literacy Achievement


2010-11

73% of first- and second-grade students will be projected to proficient in reading on the Northwest Education Association’s Measures of Academic Progress (“NWEA MAP”).

Yes 79% of students scored

proficient.

2011-12 73% of first- and second-grade students will be projected to proficient in reading on the NWEA MAP.

No 62.8% of students were projected as proficient.

2012-13 60% of first through second-grade students will meet or exceed college readiness targets in reading on the NWEA MAP.


goal.

First and Second Grade Math Growth and Achievement


2010-11 73% of first- and second-grade students will score at or above the expected level of growth in mathematics on the NWEA MAP.

No 63% of students scored at

the expected level of growth.

2011-12

73% of first and second-grade students will score at or above the expected level of growth in math by the spring administration on the NWEA MAP.

No 58.7% of students scored at or above the expected

level of growth.

2012-13 60% of first through second-grade students will meet or exceed college readiness targets in mathematics on the NWEA MAP.


goal.

16 In 2010-11, all early childhood results were rounded to the nearest whole number. In 2011-12 and 2012-13, early childhood results were rounded to the nearest tenth decimal. 17 In 2010-11, all early childhood results were rounded to the nearest whole number. In 2011-12 and 2012-13, early childhood results were rounded to the nearest tenth decimal.

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Reading Proficiency Since 2009-10, the school’s reading proficiency has been well above the state average, although it has declined from 2010-11 to present.

Reading Growth The graph below represents Two Rivers PCS’ median growth percentile (“MGP”) in reading, which is the median of its individual students’ growth percentiles.18 A growth percentile of 50 indicates that a school’s students have “average” growth in reading proficiency, as compared to other DC students in the same grades and with the same initial DC CAS performance.

In reading, the median growth of Two Rivers PCS students exceeds the rate of peers with comparable starting scores attending other public charter and traditional schools in the District.

18 A student’s growth percentile (“SGP”) can range from 1% to 99%, and reflects that students’ academic growth compared to that of other DC students in their grade with similar initial proficiency. For example, a student with a reading SGP of 77% SGP has grown in reading proficiency (as measured by the DC-CAS), as much or more than 77% of his/her peers.

72.1% 77.9% 74.1% 64.7%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

100%

2009-10 2010-11 2011-12 2012-13

Two Rivers PCS: Grades 3-8 DC CAS Reading Proficiency

Two Rivers PCS Grades 3-8 State Average

64.0 62.2 56.5

0

50

100

2010-11 2011-12 2012-13

Two Rivers PCS: Grades 3-8 Reading MGP

Two Rivers PCS 50th Percentile

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Math Proficiency Since 2009-10, the school’s math proficiency has been well above the state average.

Math Growth The graph below represents Two Rivers PCS’ median growth percentile (“MGP”) in math, which is the median of its individual students’ growth percentiles.19 A growth percentile of 50 indicates that a school’s students have “average” growth in math proficiency, as compared to other DC students in the same grades and with the same initial DC CAS performance.

In math, a majority of Two Rivers PCS students are exceeding the rate of peers with comparable starting scores attending other public charter and traditional schools in the District.

19 A student’s growth percentile (“SGP”) can range from 1% to 99%, and reflects that students’ academic growth compared to that of other DC students in their grade with similar initial proficiency. For example, a student with a reading SGP of 77% SGP has grown in reading proficiency (as measured by the DC-CAS), as much or more than 77% of his/her peers.

58.8% 67.6% 72.6% 68.8%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

100%

2009-10 2010-11 2011-12 2012-13

Two Rivers PCS: Grades 3-8 DC CAS Math Proficiency

Two Rivers PCS Grades 3-8 State Average

61.5 59.4 57.5

0

20

40

60

80

100

2010-11 2011-12 2012-13

Two Rivers PCS: Grades 3-8 Math MGP

Two Rivers PCS 50th Percentile

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Academic Proficiency of Students with Disabilities As of April 2014, 22.7% of the school’s students had been identified as students with disabilities (“SWD”) requiring special education services, higher than the overall charter sector rate of 12%. The following table compares the percentage of the school’s SWD population at each special education service level to that of the charter sector as a whole.

Students with Disabilities by Special Education Service Level

Level 1 Level 2 Level 3 Level 4 Two Rivers

PCS 45.3% 26.5% 16.2% 12.0%

Charter Sector 32.1% 32.3% 14.5% 21.2% Since 2009-10, the reading proficiency rate of Two Rivers PCS’s students with disabilities has been above the state average.

Reading Proficiency Among Students with Disabilities

09-10 10-11 11-12 12-13 Two Rivers PCS 33.3% 28.6% 42.9% 37.8%

State SWD Average

(Grades 3-8) 15.7% 17.5% 17.1% 20.2%

Since 2009-10, the math proficiency rate of Two Rivers PCS’s students with disabilities has been above the state average.

Math Proficiency Among Students with Disabilities

09-10 10-11 11-12 12-13 Two Rivers PCS 25.6% 22.4% 40.5% 45.1%

State SWD Average

(Grades 3-8) 18.4% 21.1% 20.3% 25.4%

4. To prepare graduates for the area’s top public and private high schools.

Assessment: Two Rivers PCS has met this goal. Since 2009-10, the school’s eighth grade reading and math proficiency rates have been consistently higher than the state average. In 2012-13, 85.7% eighth grade students tested proficiency in reading, and 82.9% of students tested proficient in math.

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Eighth Grade Proficiency: Reading and Math The school’s eighth grade proficiency rates in reading and math have consistently been above the state average, and have increased each year since 2009-10.

High School Enrollment Two Rivers PCS’s reports (but PCSB has not verified) that the majority of graduating eighth grade students were admitted to selective high schools, including Benjamin Banneker Academic High School, School Without Walls High School, and Duke Ellington School for the Arts, Dematha Catholic High School, Georgetown Visitation Preparatory School, and Edmund Burke High School.

57.1% 59.1% 70.6%

85.7%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

100%

2009-10 2010-11 2011-12 2012-13

Two Rivers PCS: Grade 8 DC CAS Reading Proficiency

Two Rivers PCS 8th Grade State Average

57.1% 68.2% 76.5% 82.9%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

100%

2009-10 2010-11 2011-12 2012-13

Two Rivers PCS: Grade 8 DC CAS Math Proficiency

Two Rivers PCS 8th Grade State Average

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5. To use diagnostic, formative, and summative assessments to evaluate student performance and inform curricular and instructional practices.

Assessment: Two Rivers PCS has met this goal. The school details in its annual reports how it uses data to both evaluate student performance and to inform curricular and instructional practices. The primary tool for this is the “Data Analysis Strategy Loop.” According to its 2012-13 annual report, “teachers continuously learn how to use data to help them differentiate in the classroom, so that instruction creates different pathways for students of different starting places to all access the same larger conceptual understandings.”20

The school also details in its annual report several assessments used to measure student growth, provide interventions and to share with parents to show their children’s progress.21 These assessments include the Measures of Academic Progress, Achievement Network quarterly benchmark tests, and Dynamic Indicators of Basic Early Literacy Skills.

Qualitative Evidence The PCSB review team observed the following in support of this goal.

The review team observed evidence that the school is using formative and summative assessments to inform instruction. In many classrooms, teachers used exit tickets to assess for understanding and in one classroom, students were required to complete a graphic organizer and individually share their completed work with the class. The teacher used the share-out as an opportunity to ask the students probing and open-ended questions to gauge understanding.22

6a. To create a community of professionals dedicated to personal growth through learning and the sharing of expertise. 6b. To create a flexible school environment that supports creative student grouping, innovative use of instructional time, and common staff planning time.

Assessment: Two Rivers PCS has met these goals. The school promotes a culture of reflection for its students and teachers. Teachers participate in extensive professional development and are encouraged to reflect on and improve their teaching skills.

Professional Development Plan Process The professional development program at Two Rivers PCS fosters staff growth through its Individual Professional Development Plan Process.23 As part of this process, each staff member meets regularly 20 See Appendix A, p. 9. 21 See Appendix A, p. 10. 22 See Appendix H, pp. 5-6. 23 See p. 3 of Two Rivers PCS Teacher Evaluation Plan, attached to this report as Appendix I.

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with school leadership and the school principal. The school describes this process as “…designed to support, encourage, and evaluate the success of teachers…[as well as providing] additional guidance and support for teachers as they progress in developing their craft.”24

Professional Development Teaching staff participates in a three-week orientation before the start of each school year. Additionally, in at least three hours of professional development each week, including conferences, workshops, discussion, visits to other schools, and peer support.25

Learning Labs In its 2012-13 annual report, the school described the creation of Learning Labs, “in school opportunities for teachers to share and learn.”26 During these sessions, teachers had the opportunity to focus on their practice through shared inquiry around instructional questions around topics such as meaningful debriefs with students and flexible grouping. The school reported that teachers opened classrooms for observations by other teachers, joined conversations on the various topics of inquiry, and facilitated the labs.

Staff Presentations In 2013, Two Rivers PCS staff presented about teaching and learning at various conferences.27 Presentations included:

• Data Analysis: A Habit of Mind to Transform Your School, presented at the National Charter Schools Conference by Jessica Wodatch, Jeff Heyck-Williams, and board member Justin Jones;

• Launching Student-Led Conferences, presented at Expeditionary Learning National Conference by David Philhower and Alicia Rosenberg;

• Student Led Data Talks in Conferences, presented at the DC Data Summit by Bill Day, Steven Karig, and Alicia Rosenberg; and

• Teaching and Assessing Students’ Ability to Create and Evaluate Representations, presented at the National Council of Teachers of Mathematics Regional Conference by Jeff Heyck-Williams.


The review team observed evidence of reflection, critique, and collaboration. In many classrooms, students were observed reflecting on how they solved a problem set. In one classroom, students were given the opportunity to critique both their peers and the teacher’s work. One

24 See Appendix I, pp. 4-5. 25 See Appendix A, p. 11. 26 See Appendix A, p. 11. 27 See Appendix A, p. 12.

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student provided a solution set to a problem and another student stated he had the same answer but took a different path to answer the question.28

…

The review team observed evidence that teachers teach to the whole-child. Teachers provided multiple opportunities for students to reflect on assignments and provide feedback to their classmates. In one class, students were given multiple options with respect to how they used classroom materials, with whom they collaborated, and how they completed assignments.

…

Observers saw teachers caring about and demonstrating knowledge of students’ lives, such as when they discussed how their day was going, and when a teacher asked a particular student if the student had been practicing numbers at home with his father. Teachers used endearing phrases such as “sweetheart” to talk to students, and observers saw teachers putting a gentle hand on the shoulders of students, asking if anything was the matter.

…

The school showed evidence of creating a professional community of educators. A review team member observed, a common staff planning time. The staff met in teams and/or small groups in the first floor common area to discuss instructional practices.29

…

The review team observed evidence that the school is creating an environment that allows for innovative use of instructional time. In most classrooms observed, students participated in whole group instruction and differentiated groups.

…

The review team observed an ELA/History combined classroom that discussed an expeditionary learning concept. The additional professional staff in the classroom led various student groupings. At times, the groups were determined by students, and other times, the groups were determined by the teacher. The teachers worked with all of the small groups.

28 See Appendix H, p. 6. 29 See Appendix H, p. 8.

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…

A review team member observed a common staff planning time. The staff met in teams and/or small groups in the first floor common area to discuss instructional practices.30

7. To use portfolio assessment to demonstrate students’ knowledge, skills, and character, and as a means of understanding curriculum and instructional practice.

Assessment: Two Rivers PCS partially met this goal. Two Rivers PCS students have completed portfolios for the past three years, since 2011-12 (whereas the scope of this review is from 2009-10 to 2013-14). The school submitted process documents and samples of student portfolios in support of these portfolios.

Two Rivers PCS reports that its students present portfolios of work to parents twice a year, showing three to five pieces of work and explaining the skills, knowledge and processes needed to complete the work.31 Portfolios “are filled with examples of not just masterful work, but self-reflection by the student on their progress and growth.” 32 Seventh grade students take part in Portfolio Passage at the end of seventh grade, presenting work to Two Rivers PCS teachers. Throughout presentations, parents and teachers ask students questions, requiring students to discuss strengths and areas that need development.

8. To demonstrate the character values of responsibility, compassion, discipline, integrity, and courage in the classroom, in the larger school community, and in the community-at-large.

Assessment: Two Rivers PCS has met this goal. The school’s discipline rates are low, and qualitative evidence supports the school meeting this goal.

Discipline The following tables detail Two Rivers PCS’ discipline rates since 2009-10. PCSB has calculated the charter sector averages for these data points starting in 2011-12. Green shading indicates the school’s discipline rate is below the sector average; red shading indicates that its rate is above the sector average.

Two Rivers PCS’s out-of-school suspensions and expulsions have been consistently lower than the charter school sector or close to the sector average, as detailed in the tables on the following page.

30 See Appendix H, p. 8. 31 See Appendix A, p. 11. 32 See Appendix A, p. 11.

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Two Rivers PCS Out-of-School Suspensions

09-10 10-11 11-12 12-13 Two Rivers

PCS 5.3%

(22 students) 5.5%

(24 students) 5.1%

(23 students) 6.6%

(33 students) PK-8 Charter Sector Rate - - 11.8% 10.0%33

Two Rivers PCS Long-Term Suspensions (10+ Days)

09-10 10-11 11-12 12-1334

Two Rivers PCS 0.2% (1 student)

0.2% (1 student)

0.0% (0 students)

0.2% (1 student)

PK-8 Charter Sector Rate - - 0.9% 0.0%35

Two Rivers PCS Expulsions

09-10 10-11 11-12 12-1 Two Rivers

PCS 0.0%

(0 students) 0.7%

(3 students) 0.0%

(0 students) 0.2%

(1 student) Charter

Average36 - - 1.0% 0.5%

Qualitative Evidence The PCSB review team found the following in support of this goal.

The review team observed evidence that the school demonstrates the character values of responsibility, compassion, discipline, integrity, and courage in the classroom, in the larger school community, and in the community-at large. In most observed classrooms, students participated and volunteered to assist the teacher during the lesson and during clean-up activities. In general, students were well behaved and rarely, if at all, required more than one warning to refocus during instructional time. 88% of the teachers scored proficient or advanced in the area, “Managing Student Behavior”, with over 40% scoring exemplary.

33 2012-13 comparison is a city rate, not a charter sector rate. 34 In 2012-13, PCSB defined long-term suspension as eleven or more days. 35 2012-13 comparison is a city rate, not a charter sector rate. 36Expulsion averages are available only for the charter sector as a whole, not for specific grade bands.

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In most classrooms, the rules of behavior were visible and referenced by both students and teachers. In one classroom, rules for the students during different learning times (e.g., reading time) were posted on the wall.37

9. To foster family and community participation.

Assessment: Two Rivers PCS has met this goal. As described below, parents participate in many school activities, and the school has recently developed a Parent School Association. Two Rivers PCS families participate in several events each year.

Parent and Family Events The school involves parents by in their children’s education by regularly sharing student data with them. They hold evening meetings to discuss the school’s performance on standardized tests, and presented data to families at Back to School Night. At this event, “parents could meet with school leaders and discuss their own child’s performance.”38 Parents also discuss student data during the two parent-teacher conferences scheduled each school year.39

The school also solicits parents to volunteer in their students’ classes, and to attend the school’s weekly community meetings, and class field studies. Two Rivers PCS families attend the school’s annual math festival, literacy festival, Spanish night, end-of-the-year potluck, and family dance.40

Parents are also invited to attend their child’s Showcase of Student Learning, where students present and discuss their learning. The school met all early childhood targets related to parent attendance of this Showcase.

Early Childhood Parent Involvement


2010-11 85% of parents of preschool through second-grade children will attend the Showcase of Student Learning.

Yes 96% of parents attended their child’s Showcase.

2011-12 80% of parents of pre-kindergarten-3 through second-grade students will attend their child’s Showcase of Student Learning.

Yes 95.1% of parents attended

the Showcase.

2012-13 85% of parents of pre-kindergarten-3 through second-grade students will attend their child’s Showcase of Student Learning.

Yes 95.8% of parents attended

the Showcase.

37 See Appendix H, p. 7. 38 See Appendix E, p. 18. 39 See Appendix E, pp. 18-19. 40 See Appendix A, p. 5. 41 In 2010-11, all early childhood results were rounded to the nearest whole number. In 2011-12 and 2012-13, early childhood results were rounded to the nearest tenth decimal.

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Parent School Association In 2012-13, parents and staff collaborated to establish the Parent School Association (“PSA”).42 The PSA’s mission is to “provide a structured forum so families, in full partnership with school staff, can cooperatively contribute their time and talent towards the ongoing success of Two Rivers.”43 Parents can participate on several PSA committees in support of the school.


The school showed evidence of fostering family and community participation. The school newsletter identifies opportunities for parents to participate in school activities. Parents participated in a beautification project aimed to clean the street located in front of the school building and helped maintain the school’s gardens. Parents planted new flowers and pruned the flowerbeds. In addition, approximately 50 parents attended the Two Rivers PCS student-led community meeting. Parents were observed taking pictures of their students.44

10. To create a school that is diverse by design.

Assessment: Two Rivers PCS has met this goal. The school’s student population is diverse, and teachers and students promote a culture of diversity.

The following tables detail the school’s student diversity rates.

Two Rivers PCS Student Diversity Rates

Year African-American

Asian/Pacific Islander Caucasian Hispanic Other

2009-1045

60% 2% 33% 5% -

2010-11 51.5% 0.0% 41.5% 5.6% 1.5% 2011-12 57.6% 1.3% 34.5% 6.8% 0.0% 2012-13 62.9% 0.6% 26.8% 7.9% 1.8%

42 See Appendix A, p. 5. 43 See Appendix A, p. 5. 44 See Appendix H, pp. 7-8. 45 Sourced from 2009-10 annual report, in which data was rounded to the nearest whole number.

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Two Rivers PCS Student Diversity Rates

Year Low Income

English Language Learners

Special Education

2009-1046

32% <1% 13%

2010-11 26.9% 0.6% 16.1% 2011-12 30.0% 3.3% 18.3% 2012-13 39.3% 4.0% 21.4%


The review team observed evidence that the school promotes a culture of diversity. In several observed classrooms, teachers displayed self-portraits of students on walls, which highlighted student-identified differences.47

11a. To engage all members of the community in continuous improvement through a system of shared decision-making, a culture of revision, and ongoing school review. 11b. To promote inquiry and innovation in a culture of reflection, critique, revision, and collaboration. 11c. To involve staff, students, and parents in a collaborative community of reflective learners engaged in ongoing assessment, planning, and action to improve teaching and learning. 11d. To regularly collect and analyze data to assess progress toward a common vision, set improvement goals, and develop a comprehensive school improvement plan.

Assessment: Two Rivers PCS has substantially met these goals. The school submitted evidence fully supporting that its staff and teachers regularly and thoroughly collaborate and analyze data to reflect on the performance of Two Rivers PCS and its students, and then works together to improve this performance. The school’s expeditionary learning facilitates a culture of inquiry, reflection, and collaboration among its students. However, there is little information in the school’s record regarding parents in this process.

Two Rivers PCS leadership and staff There is significant evidence that the school’s staff meets these goals. As noted below regarding goal twelve, the school’s leadership participates in annual retreats to reflect on the school’s performance and to plan for the upcoming school year. Additionally, the school uses The New Teacher Project’s Instructional Culture Insight diagnostic tool, through which teachers complete a survey reflecting on the

46 Sourced from 2009-10 annual report, in which data was rounded to the nearest whole number. 47 See Appendix H, p. 6.

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school’s culture in several different areas – including the school’s “…common vision of great teaching, clear expectations for effective instruction, and a commitment to developing teachers.”48 The school’s leaders then review these survey results and base cultural improvements on them. Significantly, in Spring 2014 the school’s teachers reported that the school’s professional development program was very strong, with responses significantly higher than the responses across the DC sector.49 For instance, 100% of Two Rivers PCS teachers that completed this survey agreed with the statement that “[i]n the past six months, I have learned new skills that I was able to immediately use in my own classroom.”50

The school-developed model for implementing individualized learning, Data-Analysis-Strategy Loop (“DAS Loop”), promotes teacher examination and reflection of student performance data to increase individualized student learning.51 As part of the DAS Loop, during grade-level meetings teacher analyze student work to determine “the extent to which the work demonstrates understanding of the strategy and brainstorms ways to improve their teaching.”

Two Rivers PCS Students At the student level, the school’s Expeditionary Learning model (described above with goal 1) consistently focuses students on developing inquiry and reflection skills. Additionally, students lead their teacher-parent conferences, which allows them to analyze their performance and reflect on areas for improvement and how their parents and teachers can better support them.

Two Rivers PCS Parents There is limited evidence of the school’s parents being involved in achieving these goals. This school year, the school executed a “learning walk” for parents to observe how students participate in expeditionary learning.52 Additionally, the school submitted two editions of its school newspaper, which contained reflections from two parents.53

Support for these goals included in Two Rivers PCS’ Annual Reports Aside from these items, Two Rivers PCS has included in its annual reports many examples of stakeholders reflecting on and improving teaching and learning in the school, including:

• In 2009-10, the school launched a task force to look at the needs of the early childhood program and issue recommendations to improve the school’s ability to analyze early childhood data;

• In 2011-12, after an extensive review of the school’s achievement data, the leadership team decided to implement after-school tutoring, expand Achievement Network assessments to second grade, and create scope and sequence tools in math and language arts, and expand summer school.

48 The New Teacher’s Project webpage regarding Instructional Culture Insight. Accessed July 16, 2014. http://tntp.org/what-we-do/policies/in-action/insight. 49 See TNTP Instructional Culture Index for Two Rivers PCS, dated May 2014, attached to this document as Appendix N. 50 See Appendix N, p. 3. 51 See “Data-Analysis-Strategy Loop and the Use of Data in Professional Development”, attached to this report as Appendix O. 52 See Learning Walk flyer, attached to this report as Appendix P. 53 See Two Rivers PCS Gazette, attached to this report as Appendix Q.

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• In 2012-13, the school added “lab” to its schedule – “…a flexible period at the end of the school day used to provide intervention services and accelerated support for students…”54

12. To conduct an extensive annual school review.

Assessment: Two Rivers PCS met this goal. The school submitted information from school years 2009-10 to present supporting this goal.55 This documentation indicated the school’s leaders attend an annual multi-day retreat to review the school’s performance from the previous year, analyze data, and set goals for the upcoming years, among other things.

13. To develop a stable student enrollment with high rates of student retention.

Assessment: Two Rivers PCS met this goal. The school has maintained consistently high enrollment, and has reenrolled a higher percentage of students than the charter average.

Two Rivers PCS’ enrollment cap is currently 750, although the capacity of its facilities is approximately 516 students. It has submitted an amendment petition to open a second campus that would eventually serve an additional 536 students.

Two Rivers PCS Enrollment 2009-10 415 2010-11 434 2011-12 451 2012-13 502 2013-14 516

The school’s reenrollment rate is higher than the sector average, with consistently large waitlists.

54 See Appendix A, p. 14. 55 See Appendix A, pp. 11-12. See also 2012-13 Two Rivers PCS Leadership Retreat packet, attached to this report as Appendix M.

83.4% 83.1% 88.9%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

100%

2010-11 2011-12 2012-13

Two Rivers PCS Reenrollment Rates

Two Rivers PCS Charter Average

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14. To expand access continuously to funding sources from the government, corporate, and foundation sectors.

Assessment: Two Rivers PCS has met this goal. The school and its board of trustees raise a significant amount of money each year to support the school’s programming, and have expanded its access to funding sources, including:

• Each year the school holds an annual fundraising event, which has raised over $200,000 for its arts program over the course of four years.

• Each year, the school secured donations of $500 or more from numerous donors. • In 2009, the school was awarded a grant from the Walton Family Foundation that allowed the

school to expand its staffing and provide more services to middle school students; and • In 2011, the school was awarded a grant from the Philip L. Graham Fund, which it used to

purchase Smart Boards.

15a. To make careful financial decisions that further the mission of the school. 15b. To have a clean audit and balanced budget.

Assessment: Two Rivers PCS has met these goals. The school’s strong financial position supports that the school has met these goals. Over the past four years, the school has had operating surpluses, with a $334,0521 surplus in FY201. The school’s net asset position has been strong and has steadily strengthened, growing from $4.22 million in FY2010 to $5.26 million in FY 2013. The school has consistently been found to have a clean audit and balanced budget by its auditor.

16. To participate in the larger charter school community.

Assessment: Two Rivers PCS has met this goal. Two Rivers PCS school has consistently participated in the larger charter school community, supporting improved instructional practices for the wider DC education community. Some examples of this participation:

• In 2009-10, the school hosted numerous visitors from the charter school community, including representatives from Friends of Choice in Urban Schools, the University of Maryland, Gallaudet University, KIPP, and a Texas school district.56

• In July 2011, Mr. Jeff Heyck-Williams, Two Rivers PCS Instructional Guide, led a two-day math workshop for various public and public charter school educators to help participants engage in problem-based tasks to build a greater understanding of math and to learn methods for differentiating instruction to meet the needs of all learners.57

56 See Appendix E, p. 16. 57 See Appendix F, p.19.

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• During school year 2011-12, Two Rivers PCS Board Chair Ann Gosier presented at the National Alliance for Public Charter Schools’ annual conference in Minnesota, focusing on small boards and exploring strategies for engaging board members, including the challenges associated with board recruitment and retention.58

• In July 2012, the school’s instructional guide and fifth grade teacher presented at the Third Annual DC Data Summit about using student critique to improve communication of mathematical thinking.59

• In 2012-13, Two Rivers PCS leaders were invited to host sessions at the National Public Charter Schools Conference, the largest annual gathering of charter school policymakers, educators, and supporters, held in Washington, DC. Leaders presented on topics including preparation for national assessments, analyzing student data, and problem-based tasks in math.

• In 2012-13, Two Rivers PCS teachers presented at FOCUS’s DC Data Summit on topics like the school’s Data Analysis Strategy Loop, analyzing student data with math models, and giving students the opportunity to lead their own data analysis and student led conferences. 60

58 See Appendix G, p. 16. 59 See Appendix G, p.16. 60 See Appendix A, p.16

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SECTION TWO: COMPLIANCE WITH CHARTER AND APPLICABLE LAWS

The SRA requires PCSB to determine at least every five years whether a school has “committed a material violation of applicable laws or a material violation of the conditions, terms, standards, or procedures set forth in its charter, including violations relating to the education of children with disabilities.”61

Compliance with Applicable Laws The SRA contains a non-exhaustive list of applicable laws, and PCSB also monitors charter schools for compliance with additional laws in annual compliance reviews. The following table details the school’s compliance in several areas reviewed by PCSB.

Compliance Item Description School’s Compliance Status 2009-10 to present

Fair enrollment process SRA § 38-1802.06

DC charter schools must have a fair and open enrollment process that randomly selects applicants and does not discriminate against students.

Compliant

Notice and due process for suspensions and expulsions SRA § 38-1802.06(g)

DC charter school discipline policies must afford students due process62 and the school must distribute such policies to students and parents.

Compliant

Student health and safety SRA § 38-1802.04 ©(4); DC Code §4-1321.02; DC Code § 38-651

The SRA requires DC charter schools to maintain the health and safety of its students.63 To ensure that schools adhere to this clause, PCSB monitors schools for various indicators, including but not limited to whether schools: - have qualified staff members that

can administer medications; - conduct background checks for

all school employees and volunteers; and

- have an emergency response plan in place and conduct emergency drills as required by DC code and regulations.

Compliant

61 SRA § 38.1802.12(c). 62 See Goss v. Lopez, 419 U.S. 565 (1975). 63 SRA § 38.1802.04 (c)(4)(A).

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Equal employment SRA §§ 38-1802©(5)

A DC charter school’s employment policies and practices must comply with federal and local employment laws and regulations.

Compliant

Insurance As required by the school’s charter

A DC charter school must be adequately insured. Compliant

Facility licenses DC code § 47-2851.03(d); DC regulation 14-1401

A DC charter school must possess all required local licenses. Compliant

Highly Qualified Teachers Elementary and Secondary Education Act (“ESEA”)

DC charter schools receiving Title I funding must employ “Highly Qualified Teachers” as defined by ESEA.

Compliant

Proper composition of board of trustees SRA § 38-1802.05

A DC charter school’s Board of Trustees must have: an odd number of members that does not exceed 15; a majority of members that are DC residents; and at least two members that are parents of a student attending the school.

Compliant

Accreditation Status SRA § 38-1802.02(16)

A DC charter school must maintain accreditation from an SRA-approved accrediting body approved by the SRA.

Compliant

Procurement Contracts SRA §38-1802.04(c)(1) requires DC charter schools to utilize a competitive bidding process for any procurement contract valued at $25,000 or more, and within three days of awarding such a contract, to submit to PCSB all bids received, the contractor selected, and the rationale for which contractor was selected. To ensure compliance with this law, PCSB requires schools to submit a “Determinations and Findings” form to detail any qualifying procurement contract that the school has executed. PCSB is working with Two Rivers PCS to bring it in full compliance regarding these requirements.

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Year

Qualifying contracts

executed by school

Corresponding documentation

submitted to PCSB

2009-10 3 3 2010-11 3 2 2011-12 6 5 2012-13 8 8

Special Education Compliance Charter schools are required to comply with all federal and local special education laws, including, among others, the Individuals with Disabilities Education Act64 (“IDEA”) and the Rehabilitation Act of 1973. The following section summarizes Two Rivers PCS’ special education compliance from 2010-11 to the present.

References to Special Education in School Charter References in a school’s Charter to special education must comply with special education laws. Two Rivers PCS’ description of serving special education students is appropriate.

OSSE Special Education Compliance Reviews The DC Office of the State Superintendent of Education (“OSSE”) monitors charter schools’ special education compliance and publishes three types of reports detailing these findings: (1) Annual Determinations; (2) On-Site Monitoring; and (3) Quarterly Findings (also called Special Conditions Reports). OSSE’s findings of Two Rivers PCS’ special education compliance are summarized below.

Annual Determinations As required by a federal regulation, OSSE annually analyzes each LEA’s compliance with 20 special education compliance indicators, and publishes these findings in an Annual Determination report.65 Each year’s report is based on compliance data collected several years earlier. As such, OSSE does not require schools to cure any compliance issues detailed in these reports. In 2012, OSSE published its 2010 Annual Determination reports (based on the school’s 2009-10 performance).

In 2011, OSSE found that Two Rivers PCS was 95% compliant with special education requirements, with OSSE noting that the school “Meets Requirement” in fulfilling all applicable federal and local

64 20 USC §1413(a)(5). 65 As required by federal regulation 34 CFR § 300.600(c).

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special education regulations.66 In 2010, OSSE found that Two Rivers PCS was 73% compliant, and again designating the school as “Need[ing] Assistance with special education compliance.”67

On-Site Monitoring Report OSSE periodically conducts an on-site assessment of an LEA’s special education compliance with student-level and LEA-level indicators, and publishes its findings in an On-Site Monitoring Report. At the time, if a school was less than 95% compliant with a student-level indicator, it was required to implement corrections and report these corrections to OSSE (beginning in 2013, LEA’s are responsible for being 100% compliant with student-level indicators and LEA-level indicators on On-Site Monitoring Reports). 68

In 2011, OSSE published an on-site Compliance Monitoring Report of Two Rivers PCS based on the school’s performance in 2010-2011.69 The school was required to implement corrections in the following areas. OSSE has since verified that Two Rivers PCS has implemented corrections for all identified student level findings.

Student-Level Compliance LEA-Level Compliance

Compliance Area

Number of indicators where correction was

required

Compliance Area

Number of indicators where correction was

required

IEP Development 12 out of 12 Dispute Resolution 1 out of 1

Least Restrictive Environment 0 out of 3

Access to Instructional

Materials 0 out of 1

Discipline 2 out of 2 Fiscal Requirements 0 out of 14

Data Verification 6 out of 7

Total 25 out of 32 Total 0 out of 16

66 See FFY 2011 IDEA Part B LEA Performance Determination, attached to this report as Appendix J. OSSE assigns to each LEA one of the following “Determination Level”: (1) meets requirements; (2) needs assistance; (3) needs intervention; or (4) needs substantial intervention. 67 See FFY 2010 IDEA Part B LEA Performance Determination, attached to this report as Appendix K. 68 If the school was found to be less than 100% compliant with a student-level indicator that could not be cured retroactively, OSSE would identify the point of noncompliance as an LEA-level violation. 69 See 2011-12 On-Site Monitoring Report Attachments, attached to this report as Appendix L.

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Special Conditions Quarterly Reports OSSE submits quarterly reports to the U.S. Department of Education’s Office of Special Education Programs detailing District of Columbia LEAs’ compliance in three areas: (1) Initial and Reevaluation Timelines; (2) Early Childhood Transition Timelines; and (3) Secondary Transition Requirements.

Two Rivers PCS does not have any recent findings in these areas.

Blackman Jones Implementation Review With compliance requirements pursuant to the Individuals with Disabilities Education Act (IDEA) and the 2006 Blackman Jones Consent Decree, OSSE manages and oversees the Blackman Jones database that tracks each LEAs’ timely implementation of Hearing Officer Determinations (HODs) and Settlement Agreements (SAs).

As of May 2014, the Blackman Jones Database shows Two Rivers PCS has no HODs or SAs.

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SECTION THREE: FISCAL MANAGEMENT AND ECONOMIC VIABILITY

Separate and apart from the standard for charter renewal, the SRA requires that PCSB Board shall revoke a school’s charter if PCSB determines that the school:

• Has engaged in a pattern of nonadherence to generally accepted accounting principles; • Has engaged in a pattern of fiscal mismanagement; or • Is no longer economically viable.

In the following section, PCSB has analyzed Two Rivers PCS’ financial record in these areas. Over the past four years, the school exhibited a history of strong financial performance. The school has no pattern of fiscal mismanagement and no pattern of nonadherence to GAAP.

Adherence to Accounting Principles and Fiscal Mismanagement Audits of Two Rivers PCS’ federal funds establish that the school adhered to GAAP. The school had unqualified opinions on its financial statements, with no material weaknesses70 or significant deficiencies71 identified in the school’s past four audits. The school also had unqualified opinion in its single audits72 with no material weakness or significant deficiency identified in the past four audits.

Economic Viability Two Rivers PCS is economically viable based on the school’s financial performance, sustainability, liquidity, and debt burden, as described below.73

Financial Performance PCSB assesses a school’s financial performance with two key indicators. The first indicator is a school’s “operating result” – how much its total annual revenues exceed its total annual expenditures. In general, PCSB recommends that a school’s annual operating results equal at least zero. Another indicator of a school’s financial performance is its earnings before depreciation (“EBAD”)74, a financial performance measure that eliminates the effects of financing and accounting decisions.

Two Rivers PCS’s financial performance according to these two indicators has been consistent with four consecutive operating surpluses since FY2010 with the most recent one totaling $334,051 in FY2013.

70 A “material weakness” is defined as “a deficiency, or a combination of deficiencies, in in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis.” 71 A “significant deficiency” is identified as existing “when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis.” 72 Per the federal Single Audit Act of 1984, as amended by the Single Audit Act Amendments of 1996, 72 any entity that receives $500,000 or more in federal funding is required to undergo a “Single Audit” conducted by an independent, external auditor, in accordance with the Office of Management and Budget’s Circular A-133 (“OMB A-133”). 73 Two Rivers PCS financial ratios are based on the audited reports between FY2010 and FY2013. 74 EBAD is the change in net assets plus amortization and depreciation.

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The school experienced a similar trend with its earnings before depreciation in the past four years, with the most recent EBAD being $873,089 in FY2013.

Fiscal Period 2010 2011 2012 2013 Operating

Result $177,356 $269,114 $435,705 $334,051

EBAD $177,356 $716,713 $893,833 $873,089

Expenditures Two Rivers PCS’ spending decisions, illustrated in the graph below, are aligned with PCSB’s financial metrics for general education public charter schools. 75

Sustainability A school’s net assets76 and primary reserve ratio demonstrate its sustainability.77 PCSB recommends that schools accrue net asset reserves equal to three to six months of operating expenditures and PCSB would be concerned with net assets reserves below zero. Over the past four years, Two Rivers PCS’s net asset position has been strong and has steadily strengthened. The school’s net asset position grew from $4.22 million in FY2010 to $5.26 million in FY2013. The school’s FY2013 primary reserve ratio was strong at 0.60, meaning that its net asset reserves equal 60% of its annual expenditures. The table below details the school’s net assets and primary reserve ratios over the past four years.

75 Note that the percentage does not equal 100% because expenditures exceeded revenues on average. 76 Net Assets equals total assets minus total liabilities. 77 Primary Reserve Ratio equals total net assets divided by total annual expenses.

59% 7% 17% 13%

0% 20% 40% 60% 80% 100%

Two Rivers PCS: Expenditures as % of Revenues (FY2010 - FY2013 averages)

Personnel expenses

Direct student costs

Occupany expenses

Office and General expenses

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Fiscal Period 2010 2011 2012 2013

Net Assets $4,222,365 $4,491,479 $4,927,184 $5,261,236

Primary Reserve Ratio 0.64 0.62 0.63 0.60

Liquidity Two indicators of a school’s short-term economic viability are its current ratio78 and its days of cash on hand.79 A current ratio greater than one indicates a school’s ability to satisfy its immediate financial obligations. Two Rivers PCS’s current ratio has been greater than one over the past four years, except for FY2012. In FY2012, the school had two outstanding loans with a total balloon payment of $13.98 million due on June 30, 2013. This resulted in the school’s current liabilities being unusually high in FY2012 and its current ratio dropping significantly in FY2012. During FY2012, the school had begun the process of refinancing both loans and completed the process in FY2013. The school’s FY2013 current ratio of 4.7 indicates that the school can meet its short-term financial obligations with current assets.

Typically, 90 days or more of cash on hand indicates a school can satisfy immediate obligations with cash. Less than 30 days of cash on hand is a liquidity concern. Two Rivers PCS’ days of cash on hand has been strong over the last four years, with the school’s days of cash at 205 in FY2013. The school’s current ratio and days of cash on hand trends are detailed in the table below.

Fiscal Period 2010 2011 2012 2013 Current Ratio 2.8 5.0 0.3 4.7

Day Cash on Hand 159 144 170 205

Cash flow from operations indicates whether a school produces adequate cash flow to meet its operating needs. Since FY2009, Two Rivers PCS has produced positive cash flow from operations in the past four years with approximately $1.1 million in FY2013, as detailed in the below table.

Fiscal Period 2010 2011 2012 2013 Cash Flow from

Operations $881,402 $2,683 $926,653 $1,102,197

78 Current assets divided by current liabilities. Current refers to the 12 months or normal operating cycles that a school can convert certain assets into cash or use up or settle certain obligations. 79 “Cash on hand” equals unrestricted cash and cash equivalents divided by total expenditures divided by 360 days.

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Debt Burden A school’s debt ratio80 indicates the extent to which a school relies on borrowed funds to finance its operations. A debt burden ratio in excess of 0.92 is a source of concern to PCSB. Two Rivers PCS’s debt burden has been stable over the past four years, as detailed in the table below. In 2006, the school secured two loans to finance the purchase of its 1234 4th Street, NE building and 1227 4th Street NE building. These loans were set to mature with balloon payments on June 30, 2013. The school paid the outstanding amount of the loans and refinanced the loan debt with bond financing of $14.5 million in FY2013.

Fiscal Period 2010 2011 2012 2013 Debt Ratio 0.78 0.76 0.74 0.74

80 Debt ratio equals total liabilities divided by total assets.

two rivers pcs review report

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