UPDATE: Board of Directors and accused board member contests money misuse accusations surrounding Kinston charter school

KINSTON, N.C. (WITN) – A charter school member at the center of a scathing Department of Public Instruction report is defending herself in a statement.

On Thursday, WITN shared DPI’s report alleging money misuse by Children’s Village Academy in Kinston and Vice Board Chair Dr. Peggy Carr.

One of the issues raised in the report includes a loan of $188,000 to the school by Carr. Carr, the report estimates, will have received $155,505 in interest from the loan once it’s paid off.

WITN has worked since Thursday to get an interview with Carr. Instead, a representative for Carr sent a lengthy statement to WITN in which she disputes DPI’s findings.

We’ve requested an on-camera interview with Carr and are waiting to hear back:

Statement of Dr. Peggy Carr on the North Carolina DPI Report 12.14.23

Education has been the touchstone of my family, especially for my mother. She was a civil rights and education advocate, and she insisted that my sister integrate our local school before forced integration. Years later, she started the Children’s Village Academy to provide some of North Carolina’s most disadvantaged students with a good education. She asked our family for support, and we were enthusiastic about supporting her in this important endeavor.

What is being reported by DPI is not accurate. Here are the facts:

• Everything I have done for and with the school has been in the best interest of the school and its students. Rather than seek personal gain, in fact, I did this at a personal financial loss. My reward was seeing the academic improvement of the students.

• My engagement with the school has been an open book. I have completed all required reports on my outside activities.

• When the school fell on hard times in 2008, during the recession, my family stepped up to the plate to help, and we did so at our own personal expense.

• My husband and I took out a loan on our home, and I tapped my 401K retirement account, to lend the school money. My mother and sister used their personal credit cards to get money to help the school sustain itself.

• Even though the school was struggling financially, it has provided a solid education for its students. The students had shown solid academic progress. In fact, by 2022, it had the 3rd highest academic growth in all of Lenoir County.

• It took several years for the school to be able to start repayment of our loan. When the school couldn’t pay my family back as planned, we let them take their time; even though we still had to pay for the loans we took out to help them. We did not gain by this, in fact, I lost money because I still had to pay off my personal loans.

• At the same time, my husband and I made significant monetary donations to the school.

• We relied on the school’s auditors to make sure that everything was done in accordance with accounting principles, and the school has clean audit reports to back that up. These consistent clean audit reports gave us confidence that the school was operating consistent with industry standards.

• The school is located on family property, as NC charter schools could not buy property using government funds at the time the school was established, most schools rented. The properties in question are used solely for school purposes. This includes two buildings on the property that are used all year round in relation to school activities, including meetings, student workshops, tutoring, and more. The school also uses the building for storage space. My mother thought it was important to provide these facilities next to the school because they provide a safe haven for student activities in an area bordered by crime. The school has a clear advantage in that it doesn’t pay rent all year for these buildings; it pays rent for only two months; again, a gift from the family to the school.

The focus of the school needs to be on the education of its students, and I do not want to be a distraction. I will forgive any further loan payments from the school and consider the balance due to me and my family as a donation to the school.

In addition to Carr’s statement, the school’s board of directors also released a statement to WITN on Friday, supporting Carr and pushing back against the report from the Department of Public Instruction, saying they believed the original accusations against the school, which they say were filed anonymously, came from a disgruntled ex-employee of the School who is known to have boasted that he would get the school closed down.

WITN has also requested an on-camera interview with school officials and is waiting to hear back from them as well.

12/15/2023

Statement of Children’s Village Academy Board Concerning North Carolina DPI internal reports

The Children’s Village Academy (“CVA”) has been honored to serve the children and the community of Lenoir County for more than nearly 30 years. We are proud of the academic achievements of our students, have received clean audits by an independent auditor, and respect the contributions of so many in our community, especially the Carr family.

Across generations, the Carr family has worked tirelessly to improve access to a quality education and to improve outcomes for children and families in Lenoir County. The matriarch of the family urged integration of public schools before it was forced. And in the late 90′s, she started the Children’s Village Academy to offer hope and opportunity for her children, her neighbors, and the greater Kinston community.

In 2008, amid a growing recession, the Children’s Village Academy sought financial help from banks. Like so many in our community, we faced challenges. We were unable to secure banking lending, so the Carr family pooled together personal resources to secure the needed finances. Members leveraged personal credit, mortgaged a home, depleted checking, savings, and tapped retirement accounts to survive a turbulent time in the school’s history. This was after the family had already given the Academy a home on property that they owned.

On December 12, 2023, officials of the North Carolina Department of Public Instruction (“DPI”) presented reports to the North Carolina Charter School Review Board concerning inquiries those officials made based on anonymous complaints filed with the Office of State Auditor and with DPI. It is believed that the complaints were filed by a disgruntled ex-employee of the School who is known to have boasted that he would get the school closed down.

None of the allegations were substantively upheld by DPI, officials; yet their report is silent in that regard. However, because their investigations probed beyond the allegations, these officials issued findings related to various matters not directly related to the allegations. The Carr family DID NOT benefit financially from the loan or engage in fraud, self-dealing, or other malicious or selfinterested motive. To the contrary, the family, including the current Vice Chair who incurred significant debt to help keep the school open. In fact, the family forgave some loans or simply provided funding without expectation of repayment. (CVA will be submitting supporting documentation to this effect.)

A 2008 loan to the school by the Vice-chair and family when the school was in financial peril called for a short-term repayment ” “if possible.” However, the period was extended far beyond the original agreement to accommodate the school’s limited resources. The school deferred the payments for more than two years, then made payments lower than necessary to pay off the loan expeditiously. The interest actually paid over the years was far greater than originally intended due to the delayed repayment. The school always had the option to pay down the loan sooner to avoid increased interest obligations but was unable to do so.

State mandated annual independent audit reports reported clean audits about the school’s finances for many, many years, including 2023. Moreover, the school followed the recommendations of a certified auditor in setting up the conditions for repayment of the loan throughout those years. In retrospect, the CVA Board recognizes that these audit reports could have reflected the full repayment obligation, not just annual obligations.

The CVA Board also acknowledges the validity of other corrective actions recommended by DPI officials. These pertain to various internal operating practices that need to accord better with general accounting and best practices. After so many years, DPI has now identified many such issues (despite prior monitoring and corrective actions required and satisfied); similarly, the CVA Board, understand the need to make such corrections promptly and fully. The Board does not believe any of these issues involve willful, fraudulent, or other improper motive or self-dealing.

The Board believes ALL the facts in this matter, not selective ones, need disclosure to avoid misleading portrayals and innuendo of wrongdoing.

We are all working to ensure a better future for the children and families in our at-risk community. It’s been nearly 30 years of persistent and hard work at CVA. We have done the improbable. We’ve overcome many obstacles. For example, CVA students had the third highest academic growth score in Lenior County and achieved the Top 50 percent category for all of NC in 2022. They should be applauded. The student body of Children’s Village deserves to have such a school to focus on them and their precious educational endeavors.

Challenges are only opportunities for us to move forward. Yes, there may be work to be done to improve our internal accounting processes and controls, but we stand with our arms wide open to those who can help and share our mission. We will address each of the findings, with full disclosure and detail.

The CVA Board of Directors is dedicated to building upon the vision the Carr matriarch has as the ultimate purpose of this Academy – supporting our next generations through sound, equitable education opportunities.

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