Chester Upland’s new receiver is supported by a charter that sought to take over district schools

In a development that appeared to take state and school district lawyers by surprise, a Delaware County judge has appointed a new receiver to oversee the Chester Upland School District who is favored by a charter operator that recently sought to take over district schools.

The judge’s selection of Nafis Nichols, the chief financial officer for the city of Chester, over Michael Pladus, a retired superintendent nominated by the Pennsylvania Department of Education, has worried teachers and community members concerned about further erosion of a district already heavily dominated by charters.

The move has also attracted the attention of others in the education world who have been closely watching Chester, where charter schools have expanded their reach as the broader charter movement has grown. One-third of Philadelphia public school students attend charter schools, including some who travel to Delaware County to go to Chester Community Charter, the state’s largest brick-and-mortar charter school.

Nichols, who starts Wednesday and was named interim receiver earlier this month after submitting his own name for consideration, was endorsed by Chester Community Charter. The school indicated it will raise objections to the former receiver’s decision not to convert district schools to charters and is also currently battling the district for millions of dollars in a dispute over how much it should be paid for educating Chester students.

“It feels like a big conflict of interest,” said Claudia De Palma, a lawyer for the Public Interest Law Center, which has been representing Chester parents in the charter conversion process.

While the district’s previous receiver, Juan Baughn, in June rejected proposals from Chester Community Charter and two other charters to take over district schools, “we are concerned that a new receiver could start this process over again and come to a different conclusion,” said De Palma, who also voiced concern that Nichols has not previously worked in education.

Pladus formerly led the Upper Dublin and Interboro districts.

The embattled district has been under court-monitored receivership for almost a decade — oversight initiated by the state in response to financial challenges.

Teachers in the district “are in an uproar” over Nichols’ appointment, said Maggie Grasty, a second-grade teacher and president of the Chester Upland Education Association, which represents more than 200 teachers and professional staff. “They just think this is like a sneak attack from the charter to do another roundabout to take us over.”

» READ MORE: Charter takeover rejected in Chester Upland — for now

A Pennsylvania Department of Education spokesperson declined to comment, as did a lawyer for the district.

A spokesperson for Chester Community Charter School, Max Tribble, said that Nichols was “far more experienced in dealing with municipal and distressed finance” and that the charter had no conflict of interest in taking a position on a new receiver. He also said more than 70% of K-8 students in the district were attending charters.

“The charter schools represent those families and their voices and the charter schools should be heard,” Tribble said.

During an Aug. 5 hearing to consider the Education Department’s nomination of Pladus — who has been serving as Chester Upland’s chief recovery officer — Delaware County Judge Barry Dozor said he had received a letter from Nichols asking to be considered for the receiver position.

Lawyers for the Education Department and the Chester Upland district both said they hadn’t seen Nichols’ letter — which was accompanied by letters of support from Chester Mayor Thaddeus Kirkland and State Sen. John Kane. The day before the hearing, a group that serves as landlord for Chester Community Charter filed a motion requesting that Nichols be selected.

A lawyer for the charter, Francis Catania, told Dozor during the hearing that the school’s board had authorized him to endorse Nichols.

“We’re concerned that the receivership process has been hijacked and is simply used as a mechanism to wage a war against charter schools,” Catania said, according to a hearing transcript.

The role of charter schools, which are paid by the district based on enrollment, has been a continued source of tension — in particular around Chester Community Charter, which already enrolls more than half of the district’s 7,000 students and has sought to expand its footprint in the distressed city.

The charter — which won an unprecedented nine-year renewal from a past receiver in 2017 — petitioned the court in 2019 to solicit proposals from charters to take over district schools, a move the court later endorsed in ordering a new financial recovery plan. Chester Community Charter was one of three that submitted proposals, pledging to build two new elementary schools while saving the district money.

» READ MORE: Charter school pushes for takeover of Chester Upland’s elementary schools

At the same time, it has been arguing in court to keep $7 million that the district says it overpaid the charter, in violation of a 2015 settlement agreement for the charter to accept a lesser payment rate than it would otherwise be entitled to.

The agreement was reached between the district and other brick-and-mortar charters in light of the district’s financial distress. Now Chester Community Charter is arguing that the state and district didn’t have the right to reduce the payment rate established under state law.

Letting the charter “choose who they get to litigate against ... is putting the fox in the henhouse,” Jacquie Jones, a lawyer for the Chester Upland district, said during the hearing.

Dozor said there were “so many different issues that affect” the district’s finances.

“This is just one small piece of the pie,” he said.

Chester Community Charter is managed by CSMI, a company led by Gladwyne lawyer Vahan Gureghian. The charter, which took in $84 million in revenue last year, sent $23 million to CSMI, according to tax filings.

In an email to The Inquirer, Nichols said he became aware of the receiver position “due to my extensive involvement in the community.” Before serving as Chester’s chief financial officer, he was a project director for Crozer-Chester Wellness Center, where he worked on programs with the school district.

“I saw this as a prime opportunity to advance my desire to keep improving the place where I’ve grown,” said Nichols, a Chester High graduate. He added that “there’s almost no situation where everyone will agree unanimously on an appointment like this.”

During the hearing, Nichols said he had not reviewed the district’s financial recovery plan and didn’t know much about the federal Title 1 program, which applies to districts with large shares of low-income students. “It’s something that I most certainly can learn and get caught up to speed on,” he said.

While he attended Delaware State University, he did not graduate. In his email, Nichols said he intended to complete a final semester needed for a degree.

In an Aug. 13 order, Dozor said Nichols provides “municipal and government experience and expertise.” He also said that “community support” for the receiver was important, and that Nichols exhibited strengths of collaboration and communication.

Though local officials had endorsed Nichols, “I don’t believe that the community that day realized what was happening in the courtroom,” said A. Jean Arnold, a longtime Chester activist who was “very, very surprised, and frankly, disappointed” by Dozor’s decision.

“Would we have given the Marple school district to Mr. Nichols? I think that we would have not done that,” Arnold said. “That suggests to me there are two different standards being applied here.”

She said she hoped Nichols would support former receiver Baughn’s rejection of the charter proposals.

“I would be very troubled to learn there is some effort to reverse that decision,” she said.

Staff writer Chris A. Williams contributed to this article.