           NOT FOR PUBLICATION WITHOUT THE
          APPROVAL OF THE APPELLATE DIVISION

                            SUPERIOR COURT OF NEW JERSEY
                            APPELLATE DIVISION
                            DOCKET NO. A-3416-15T1
                                       A-4384-15T1
                                       A-4385-15T1
                                       A-4386-15T1
                                       A-4387-15T1
                                       A-4388-15T1
                                       A-4398-15T1
IN RE RENEWAL APPLICATION
OF TEAM ACADEMY CHARTER
                                    APPROVED FOR PUBLICATION
SCHOOL.
                                           May 7, 2019
IN RE RENEWAL APPLICATION              APPELLATE DIVISION
OF ROBERT TREAT ACADEMY
CHARTER SCHOOL.

IN RE RENEWAL APPLICATION
OF NORTH STAR ACADEMY
CHARTER SCHOOL OF NEWARK.

IN RE AMENDMENT REQUEST
TO INCREASE ENROLLMENT OF
MARIA L. VARISCO-ROGERS
CHARTER SCHOOL.

IN RE AMENDMENT REQUEST
TO INCREASE ENROLLMENT OF
UNIVERSITY HEIGHTS CHARTER
SCHOOL.


IN RE AMENDMENT REQUEST
TO INCREASE ENROLLMENT
OF GREAT OAKS LEGACY
CHARTER SCHOOL.
IN RE AMENDMENT REQUEST
TO INCREASE ENROLLMENT
OF NEW HORIZONS COMMUNITY
CHARTER SCHOOL.


       Argued January 16, 2019 – Decided May 7, 2019

       Before Judges Alvarez, Nugent, and Mawla.

       On appeal from the New Jersey Department of
       Education.

       David G. Sciarra argued the cause for appellant
       Education Law Center (Pashman Stein Walder
       Hayden, PC and Education Law Center, attorneys;
       Michael S. Stein, Brendan M. Walsh, Ranit S. Shiff,
       David G. Sciarra, Elizabeth A. Athos, and Jessica A.
       Levin, on the briefs).

       Thomas O. Johnston argued the cause for respondents
       TEAM Academy Charter School, Robert Treat
       Academy Charter School, North Star Academy
       Charter School of Newark, University Heights Charter
       School, Great Oaks Legacy Charter School, and New
       Horizons Community Charter School (Johnston Law
       Firm LLC, attorneys; Thomas O. Johnston, of counsel
       and on the brief; Rula Alzadon Moor, on the brief).

       Adam S. Herman argued        the cause for respondent
       Maria L. Varisco-Rogers       Charter School (Adams
       Gutierrez & Lattiboudere,    LLC, attorneys; Adam S.
       Herman, of counsel and       on the brief; Daniel A.
       Schlein, on the brief).

       Geoffrey N. Stark, Deputy Attorney General, argued
       the cause for respondent Commissioner of Education
       (Gurbir S. Grewal, Attorney General, attorney;
       Melissa Dutton Schaffer, Assistant Attorney General,
       of counsel; Geoffrey N. Stark, on the brief).

                                                               A-3416-15T1
                                2
       The opinion of the court was delivered by

ALVAREZ, P.J.A.D.

       The Education Law Center (ELC), on behalf of Abbott1 school children,

appeals the Commissioner of Education's (Commissioner) February 18, 2016

and February 29, 2016 final decisions approving increases in enrollment and

expansions of physical plants for seven Newark charter schools. The schools

and the Commissioner are the respondents. We affirm.

                                        I.

       ELC is a non-profit organization which, for many years, has litigated on

behalf of children in the State's poorest school districts. Educ. Law Ctr. v. N.J.

Dep't of Educ., 198 N.J. 274, 279 (2009). Abbott school children, whom ELC

claims to represent in this case, include the residents of thirty-one urban school

districts in New Jersey that the Supreme Court long ago found were not

receiving the "thorough and efficient" education guaranteed by our State

Constitution. Abbott II, 119 N.J. at 394. Efforts to extend to those students

that basic right and to adequately fund the process, have sparked years of

litigation and legislative action. See, for example, Abbott v. Burke (Abbott

XXI), 206 N.J. 332, 340-41 (2011).



1
    Abbott v. Burke (Abbott II), 119 N.J. 287, 394 (1990).


                                                                         A-3416-15T1
                                        3
         The Newark School District (District), formerly an Abbott school

district, is now a New Jersey Schools Development Authority (SDA) District.

The designation guarantees particular benefits, such as 100% facilities

funding. See Educational Facilities Construction and Financing Act (EFCFA),

N.J.S.A. 18A:7G-1 to -48. For the school year 2013-2014, as cited by the

seven charter schools in support of their applications, the District's sixty-four

traditional schools had the following demographics:

Demographic         Free or   Special   LEP 2    Asian    Black   Hispanic     White   Other
                    reduced    Ed.                                                     Ethnic
                      price                                                            Group
                     lunch
    Percentage        84%      18%      9%        1%      51%      40%          8%       0%



         The State Board of Education returned full operating authority to the

District in 2018, after approximately twenty-three years.                    Shortly after the

State's takeover of the District, the Legislature authorized the establishment of

charter schools. The first one opened in Newark in 1997. As of the 2017 -2018

school      year,     nineteen    charter       schools   were    open   in     the    District.

https://www.nj.gov/education/chartsch/ (last visited April 12, 2019).                       The

Charter School Act (the Act), N.J.S.A. 18A:36A-1 to -18, defines an initial

charter term as four years. The schools are required to renew for subsequent



2
    Limited English Proficiency student.


                                                                                       A-3416-15T1
                                                  4
five-year periods.     N.J.S.A. 18A:36A-17.         The Act authorized "the

establishment of not more than 135 charter schools during the 48 months

following the effective date" of the law state-wide, with a minimum of three

charter schools allocated to each county. N.J.S.A. 18A:36A-3(b). During that

time, enrollment could not exceed "500 students or greater than 25% of the

student body of the school district in which the charter school is established,

whichever is less." N.J.S.A. 18A:36A-4(e). The Commissioner was directed

to "actively encourage the establishment of charter schools in urban school

districts with the participation of institutions of higher education." N.J.S.A.

18A:36A-3(b).

      Charter schools are "open to all students on a space available basis[.]"

N.J.S.A. 18A:36A-7. A charter school may not discriminate in its admissions

policies and practices, but "may limit admission to a particular grade level or

to areas of concentration of the school, such as mathematics, science, or the

arts." Ibid. Preference for enrollment must be given to students who reside in

the school district in which the charter school is located, and the school cannot

charge tuition. N.J.S.A. 18A:36A-8(a). "If there are more applications to

enroll in the charter school than there are spaces available, the charter school

shall select students to attend using a random selection process." Ibid.




                                                                           A-3416-15T1
                                       5
      Funding for charter schools comes from the local school district, and

state and federal aid, but is not equivalent to traditional public school per pupil

funding. N.J.S.A. 18A:36A-12(b). At first, Charter School Senate Bill S.

1796, § 13 (1995), provided for 100% of the local levy budget per pupil. In re

Grant of the Charter Sch. in re Englewood on the Palisades Charter Sch. , 164

N.J. 316, 332 (2000).     During the three public hearings conducted by the

Senate and Assembly Education Committees on the proposed bill, "[t]he most

frequently expressed objection was charter schools would divert tax dollars

from existing districts without any corresponding decrease in their costs." In

re Grant of Charter Sch. in re Englewood on Palisades Charter Sch., 320 N.J.

Super. 174, 189-90 (App. Div. 1999), aff'd as modified, 164 N.J. 316 (2000).

Therefore, the Legislature moderated the impact charter schools would have on

funding for traditional public schools by reducing the per-pupil amount

payable by the District to 90%. Englewood, 164 N.J. at 333; School Funding

Reform Act of 2008 (SFRA), N.J.S.A. 18A:7F-43 to -63.

      In addition to the concern regarding the financial impact charter schools

have on traditional public schools, see In re Proposed Quest Academy Charter

School of Montclair Founders Group, 216 N.J. 370, 377 (2013), the statute and

the Supreme Court direct that in evaluating charter school applications, the

Commissioner must consider "the racial impact that a charter school applicant



                                                                          A-3416-15T1
                                        6
will have on the district of residence[.]" Ibid. (quoting Englewood, 164 N.J.

at 329).   Once an applicant makes the requisite preliminary showing, the

Commissioner must also "evaluate carefully the impact that loss of funds

would have on the ability of the district of residence to deliver a thorough and

efficient education." Id. at 377-78 (quoting Englewood, 164 N.J. at 334-35).

      The Commissioner annually assesses whether a charter school is meeting

the goals of its charter. N.J.S.A. 18A:36A-16(a). The Commissioner also

scrutinizes "the student composition of a charter school and the segregative

effect that the loss of the students may have on its district of residence."

N.J.A.C. 6A:11-2.2(c). To facilitate that review, charter schools must submit

an annual report to the Commissioner, local board of education, and the county

superintendent of schools. N.J.S.A. 18A:36A-16(b); N.J.A.C. 6A:11-2.2. The

Commissioner may revoke a charter at any time if the school has not fulfilled

or has violated any of the conditions of its charter. N.J.S.A. 18A:36A-17.

                                      II.

      Applications to renew a charter are governed by N.J.S.A. 18A:36A-17

and the implementing regulation, N.J.A.C. 6A:11-2.3.        The Commissioner

shall grant or deny the renewal based upon a comprehensive review of the

school, including the annual reports, recommendation of the district board of

education or school superintendent, and student performance on statewide



                                                                        A-3416-15T1
                                       7
tests. N.J.A.C. 6A:11-2.3(b). "The notification to a charter school that is not

granted a renewal shall include reasons for the denial." N.J.A.C. 6A:11-2.3(d)

(emphasis added).

      A charter school may also apply to the Commissioner for an amendment

to the charter. N.J.A.C. 6A:11-2.6(a). The amendment, as in this case, can

include an expansion of enrollment and the opening of new satellite campuses.

N.J.A.C. 6A:11-2.6(a)(1)(i) and (iv).

      Similar to the initial approval process, boards of education in the district

of residence can submit comments in response to the amendment application.

N.J.A.C. 6A:11-2.6(c).      Furthermore, "[t]he Department shall determine

whether the amendments are eligible for approval and shall evaluate the

amendments based on" the Act and implementing regulations.              N.J.A.C.

6A:11-2.6(b). "The Commissioner shall review a charter school's performance

data in assessing the need for a possible charter amendment."         Ibid.   The

Commissioner shall notify charter schools of the decision to approve or deny

an amendment request.       If approved, the amendment becomes effective

immediately unless a different effective date is designated.             N.J.A.C.

6A:11-2.6(d).

      ELC appeals the Commissioner's decisions to approve the respondent

schools' applications to expand their charters. ELC argues:



                                                                         A-3416-15T1
                                        8
            POINT I
            THE     COMMISSIONER  VIOLATED  HIS
            AFFIRMATIVE OBLIGATION TO EVALUATE
            THE IMPACT OF THE CHARTER SCHOOL
            APPLICATIONS FOR EXPANSION ON A
            THOROUGH AND EFFICIENT EDUCATION IN
            THE NEWARK DISTRICT.

            A.    The Commissioner Failed to Evaluate the Loss
            of the District Funding from the Proposed Charter
            School Expansions.

            B.   The Commissioner Failed to Evaluate the
            Segregative Effects of the Proposed Charter
            Expansions.

            C.   There is No Support in the Record for the
            Commissioner's Decisions to Approve the Charter
            Expansions.

            POINT II
            THE COMMISSIONER VIOLATED THE ACT BY
            APPROVING     CHARTER      EXPANSIONS
            REQUIRING MULTIPLE SCHOOLS UNDER ONE
            CHARTER.

                                     III.

      Preliminarily, respondents contend that ELC lacks standing to challenge

the Commissioner's decision.    "Standing 'refers to the plaintiff's ability or

entitlement to maintain an action before the court.'" In re Adoption of Baby T,

160 N.J. 332, 340 (1999) (quoting N.J. Citizen Action v. Riveria Motel Corp.,

296 N.J. Super. 402, 409 (App. Div. 1997)). Standing is a threshold issue that

"neither depends on nor determines the merits of a plaintiff's claim." Watkins



                                                                       A-3416-15T1
                                      9
v. Resorts Int'l Hotel & Casino, 124 N.J. 398, 417 (1991). "Unlike the Federal

Constitution, there is no express language in New Jersey's Constitution which

confines the exercise of our judicial power to actual cases and controversies.

U.S. Const. art. III, § 2; N.J. Const. art. VI, § 1." Crescent Park Tenants Ass'n

v. Realty Equities Corp., 58 N.J. 98, 107 (1971).

      Our Courts do not, however, render advisory opinions, function in the

abstract, or consider actions brought by plaintiffs who are "merely interlopers

or strangers to the dispute." Ibid. (citation omitted). "To possess standing in a

case, a party must present a sufficient stake in the outcome of the litigation, a

real adverseness with respect to the subject matter, and a substantial likelihood

that the party will suffer harm in the event of an unfavorable decision." In re

Camden Cty., 170 N.J. 439, 449 (2002) (citation omitted).

      Insofar as standing to intervene in the charter school approval process,

N.J.S.A. 18A:36A-4(d) provides only that "[t]he local board of education or a

charter school applicant may appeal the decision of the commissioner to the

Appellate Division of the Superior Court."      Similarly, N.J.A.C. 6A:11-2.5,

which governs the "charter appeal process," states: "[a]n eligible applicant for

a charter school, a charter school, or a district board of education or State

district superintendent of the district of residence of a charter school may file

an appeal according to N.J.S.A. 18A:6-9.1." When a charter school board of



                                                                         A-3416-15T1
                                       10
trustees' response to a complaint is unsatisfactory, an individual or group may

"present that complaint to the commissioner who shall investigate and

respond[.]" N.J.S.A. 18A:36A-15.

      Only the district board of education and the charter school appear to

have statutory standing to challenge the Commissioner's decisions. N.J.S.A.

18A:36A-4(d). ELC as an individual or group can present a complaint to a

charter school's board of trustees, and then to the Commissioner, but has no

express right to appeal the Commissioner's decisions. N.J.S.A. 18A:36A-15.

      But our courts take "a liberal approach to standing to seek review of

administrative actions[.]" In re Camden Cty., 170 N.J. at 448. "A party has

standing to challenge an administrative agency's decision when the party has 'a

sufficient stake in the outcome of the litigation, a real adverseness with respect

to the subject matter, and a substantial likelihood that the party will suffer

harm in the event of an unfavorable decision.'" In re Grant of Charter to Merit

Preparatory Charter Sch. of Newark, 435 N.J. Super. 273, 279 (App. Div.

2014) (quoting In re Camden Cty., 170 N.J. at 449).

      "[W]hen an issue involves a 'great public interest, any slight additional

private interest will be sufficient to afford standing.'" Ibid. (quoting Salorio v.

Glaser, 82 N.J. 482, 491 (1980)). "'[I]t takes but slight private interest, added

to and harmonizing with the public interest to support standing to sue.'"



                                                                          A-3416-15T1
                                        11
People For Open Gov't v. Roberts, 397 N.J. Super. 502, 510 (App. Div. 2008)

(quoting Hudson Bergen Cty. Retail Liquor Stores Ass'n v. Bd. of Comm'rs,

135 N.J.L. 502, 510 (E. & A. 1947)).

      "[T]he standing of nonprofit associations to litigate in varying contexts

has historically been upheld in New Jersey." In re Ass'n of Trial Lawyers of

Am., 228 N.J. Super. 180, 185 (App. Div. 1988). Nonprofit organizations

have representative standing to pursue claims on behalf of their members that

are of "common interest" and could not more appropriately be pursued by

individual members. Crescent Park Tenants Ass'n, 58 N.J. at 109.

      The ELC, as a nonprofit law center, has historically represented the class

of Abbott school children in the Abbott litigation, Abbott v. Burke (Abbott V),

153 N.J. 480, 527 (1998), and in ongoing litigation focused on funding for

education to "the State's poorest school districts." Educ. Law Ctr., 198 N.J. at

279. It represents the class of students in poorer urban districts, including

Newark, who might be prevented from receiving a thorough and efficient

education as a result of the Commissioner's decisions. Therefore, it contends,

it has a sufficient stake in the outcome.

      Respondents argue it is improper to allow ELC standing because the

members of the represented class include all of Newark's school children—a

group including charter school students and those who wish to enroll, but



                                                                        A-3416-15T1
                                        12
cannot because of lack of available space. Additionally, respondents further

argue that allowing ELC to pursue the matter essentially permits individual

students, contrary to N.J.S.A. 18A:36A-4(d), to appeal a decision by the

Commissioner.     Lastly, they assert that ELC should not be permitted to

challenge the decision when the affected District does not oppose the proposed

expansion.

      ELC responds that the class of Abbott students it represents includes

only traditional public school students, whose right to a thorough and efficient

education is jeopardized by the Commissioner's action. Further, all District

students, in charter schools or not, have a direct interest in obtaining adequate

funding and in ameliorating the effect of student segregation within the

District. Without its participation, traditional public school students would

lose their voice, as the State cannot be expected to challenge its own decision s.

      Given our State's goal of providing a thorough and efficient education to

all public school students, ELC's standing seems clear. That the statute does

not explicitly allow for organizations such as ELC to appeal the

Commissioner's decisions is inconsequential. The unfortunate reality is that,

despite systemic improvements, public school children in Abbott districts

continue to need representation in order to ensure their constitutional right to a

thorough and efficient education is enforced.       At no time has the overall



                                                                         A-3416-15T1
                                       13
statutory scheme regarding education expressly granted standing to entities

such as ELC, yet ELC has over many years successfully litigated on behalf of

New Jersey's school children. To coin a phrase, if not ELC, then who?

      The issues raised in this appeal, notably the effect of a substantial

increase in charter school enrollment on traditional schools in a former Abbott

school district, are of "great public interest[.]" Merit Preparatory, 435 N.J.

Super. at 279 (quoting Salorio, 82 N.J. at 491).        Thus, even if ELC had

demonstrated only a "slight additional private interest," it has standing. Ibid.

                                       IV.

      Four of the charter schools, Great Oaks, University Heights, TEAM, and

North Star, participate in a universal enrollment system in which students rank

their preferred schools (both public and charter) and are then assigned pursuant

to an algorithm overseen by the District. Students with the highest needs, that

is, those who have an Individualized Education Program (IEP) 3 or are eligible

for free lunch, are given greater preference to attend the school of their choice.

There is no "cap"—the system does not stop filling seats with high needs

students once a certain percentage of available seats have been filled. Students


3
   Disabilities of students with IEPs include a specific learning disability,
communication impairment, intellectual disability, autism, other health
impairments, an emotional disturbance, or those eligible for speech and
language services.


                                                                          A-3416-15T1
                                       14
have a neighborhood preference for grades pre-K through eighth (although that

preference does not take priority over high-need student preferences), and

preference is given for siblings of already-enrolled students. All of the charter

schools have the ability to serve special needs and LEP or English Language

Learners (ELL) students.

      Newark's charter schools are party to a "Compact" 4 agreeing to serve "all

students in the city, especially the highest need students requiring special

education services, students who are [ELL], students who qualify for free or

reduced-price lunch, and other underserved or at-risk populations[.]" Each of

the schools, either through One Newark Enrolls, or through its own marketing

and recruitment efforts, attempts to reach parents through their websites,

flyers, ads, open houses, and billboards. The Department of Education (DOE)

oversees the charter school's "access and equity" for "highest needs students."

      The mere fact that the demographics of the charter schools do not mirror

the demographics of the District does not alone establish a segregative effect.


4
   The Compact, which was forged by the Newark Charter School Fund, is
available at https://ncsfund.org/schools (last visited April 23, 2019) and
https://www.nj.gov/education/chartsch/equity/NewarkCharterCompact.pdf
(last visited April 23, 2019). According to the Newark Charter School Fund's
website, to date, five of the seven charter schools (Team, North Star, Treat,
Great Oaks, and University Heights) have signed the Compact, while two
schools       have     not    (Varisco-Rogers        and   New    Horizons).
https://ncsfund.org/schools (last visited April 23, 2019).


                                                                        A-3416-15T1
                                       15
See In re Red Bank Charter Sch., 367 N.J. Super. 462, 476-77 (App. Div.

2004).   Thus, ELC has not created a record that demonstrates the schools

engage in enrollment practices that worsen the District's racial, ethnic, or

special needs balance.

                                     A. TEAM

      The DOE ranks TEAM as a Tier 1 school based on its academic

standings within the State's Academic Performance Framework for charter

schools. Seventy-seven percent of its students attend college, and in 2014, the

school "sent more African American students to college than any other high

school in Newark." Its students outperform 62% of schools statewide and 83%

of students from schools with similar demographics.

      TEAM's October 15, 2015 application to renew its charter initially

sought a maximum enrollment expansion from 4120 to 9560 students through

the 2020-2021 school year.          At the time, it served 3252 students in

kindergarten through grade twelve, including 194 students from other school

districts. It had 1891 students on its waiting list. It reported the following

demographics for the 2015-2016 school year:

Demographic   Free or    Special   LEP    Asian   Black   Hispanic   White     Other
              reduced     Ed.                                                  Ethnic
                price                                                          Groups
               lunch
 Percentage     88%       12%      ≤ 1%   ≤ 1%    89%       6%       ≤ 1%        5%




                                                                             A-3416-15T1
                                          16
      The District 5 opposed TEAM's request for expansion, but recommended

an alternative outcome of partial approval:       "State is requesting a revised

expansion request with lower enrollment; net increase is based on straight

articulation except backfill at [fif]th grade to 315." ELC opposes TEAM's

enrollment expansion because it had not applied for an amendment to open a

satellite location, and instead sought "substantial increases in enrollment over

the next five years, to be accommodated in numerous new facilities in

unidentified locations in the district."

      By letter dated January 30, 2016, TEAM submitted a revised expansion

request to 2696 new students, with a maximum enrollment of 6816 students. It

also sought permission to open a fifth and sixth elementary school, a fourth

middle school, and a second high school "in order to complete the existing

feeder pattern for current students," but abandoned its request to seek approval

to open a pre-kindergarten, a fifth and sixth middle school, and a third high

school.

      The Commissioner issued a final decision approving TEAM's

application for renewal based on the DOE's comprehensive review of the

school's   "application,   annual    reports,   student   performance   on   state

5
   The Newark School District was a State-operated school district in 2015,
when each of the seven charter schools at issue in this appeal applied for
increases in enrollment.


                                                                         A-3416-15T1
                                           17
assessments, site visit results, public comments, and other information[.]" The

Commissioner found that the school, in operation for fourteen years, had

              a history of providing a high-quality education to its
              students. From 2011-12 to 2013-14, the school
              received a Tier Rank of 1, the highest rank possible
              based on the standards within the Performance
              Framework. In the 2014-15 school year, based on
              [Partnership Assessment of Readiness for Collect and
              Careers (PARCC)] results, the school outperformed its
              home district of Newark in English language arts in
              elementary, middle and high school. Additionally, on
              January 30, 2016, the school submitted a letter
              revising its expansion request.

      Based on the Commissioner's evaluation, he confirmed the school's

maximum approved enrollment, as follows:6

Grade Level    2016-2017    2017-2018    2018-2019     2019-2020       2020-2021
     K              480          600          720           720             720
     1              480          600          720           720             720
     2              480          600          720           720             720
     3              480          600          720           720             720
     4              480          600          720           720             720
     5              360          480          600           720             720
     6              360          480          480           600             720
     7              360          480          480           480             600
     8              360          480          480           480             480
     9              211          360          480           480             480
    10              182          211          360           480             480
    11              155          182          211           360             480
    12              137          155          182           211             360
   Total           4525         5828         6873          7411            7920


6
  It is not clear from the record why the above configuration included in the
commissioner's February 18, 2016 renewal letter differs so substantially from
TEAM's January 30, 2016 revised expansion request. Notwithstanding,
appellant only challenges expansion generally and does not focus on these
specific numbers.


                                                                          A-3416-15T1
                                        18
                                   B. NORTH STAR

        North Star is classified as a Tier 1 school. Its students have consistently

outperformed other students in the District across all grade levels, and it has a

science partnership for high school seniors with Seton Hall University and

other local universities.

        When North Star submitted its charter renewal application on October

15, 2015, it served 3998 students in kindergarten through twelfth grade, with a

maximum enrollment of 4950, and operated eleven campuses in Newark, with

three more campuses scheduled to open beginning in the 2016-2017 school

year.    It had 2535 students on its waiting list.         It reported the following

demographics for the 2015-2016 school year:

Demographic    Free or   Special    LEP    Asian   Black    Hispanic   White     Other
               reduced    Ed.                                                    Ethnic
                 price                                                           Groups
                lunch
 Percentage     85.5%       8.4%    0.4%   0.4%    84.6%      8.7%     2.0%       4.4%

        North Star proposed expansion of maximum enrollment from 4950 to

6216 students through the 2020-2021 school year, with 540 students in each of

grades kindergarten through eighth. After discussions with the DOE, North

Star revised the maximum enrollment expansion to 6550 students by the

school year 2020-2021, noting that the 540 seats in kindergarten through fifth

grade had previously been approved during the 2010 charter renewal.



                                                                               A-3416-15T1
                                           19
      The District did not offer a recommendation regarding North Star's

application, noting only that, "[n]et increase based on [kindergarten] increase

of 90, net [fif]th [grade] increase to 540 (as requested), remaining grades

articulate upward."

      The Commissioner's final decision approved North Star's application for

renewal based on the DOE's comprehensive review of the school's

"application, annual reports, student performance on state assessments, site

visit results, public comments, and other information[.]" The Commissioner

found that the school, in operation for nineteen years, had

              a history of providing a high-quality education to its
              students. From 2011-12 to 2013-14, the school
              received a Tier Rank of 1, the highest rank possible
              based on the standards within the Performance
              Framework. In the 2014-15 school year, based on
              PARCC results, the school outperformed both the state
              and its home district of Newark in English language
              arts and in mathematics in elementary, middle and
              high school. Through the renewal process, it has been
              determined that the school is performing well
              academically and is organizationally and fiscally
              sound.

      The Commissioner thus approved the following maximum enrollment:

Grade Level    2016-2017    2017-2018    2018-2019     2019-2020       2020-2021
     K              540          540          540           540             540
     1              450          540          540           540             540
     2              450          450          540           540             540
     3              426          450          450           540             540
     4              425          426          450           450             540
     5              540          540          540           540             540
     6              450          540          540           540             540



                                                                          A-3416-15T1
                                        20
    7             360            450            540         540           540
    8             340            360            450         540           540
    9             312            340            360         450           540
    10            193            312            340         360           450
    11            140            193            312         340           360
    12             86            140            193         312           340
   Total          4712           5281           5795        6232          6550

                                C. ROBERT TREAT

      Robert Treat, a Tier 1 school, applied for renewal of its charter on

October 15, 2016. At the time of the application, Robert Treat served 651

students in grades kindergarten through eighth grade, with a maximum

approved enrollment of 695.       It had 898 students on its waiting list, and

reported the following demographics for the 2015-2016 school year:

Demographic   Free or Special    LEP    Asian    Black   Hispanic White   Other
              reduced  Ed.                                                Ethnic
                price                                                     Groups
               lunch
 Percentage     74%     6%       0.5%    1%      33%      60%      4%       2%



      Robert Treat sought to expand from 695 students for the 2015-2016

school year, to 860 students for the 2020-2021 school year, conditioned on

relocation of the school.

      The District recommended approval, noting a "[n]et increase in [2016 -

2017] due to straight articulation; [r]ecommend approval of [2017-2018]

expansion request only for [kindergarten]."

      The Commissioner approved Robert Treat's application based on the

DOE's comprehensive review of the school's "application, annual reports,

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                                         21
student performance on state assessments, site visit results, public comments,

and other information." The Commissioner found that Robert Treat had a

              history of providing a high-quality education to its
              students. From 2012-13 to 2013-14, the school
              received a Tier Rank of 1, the highest rank possible
              based on the standards within the Performance
              Framework. In the 2014-15 school year, based on
              PARCC results, the school outperformed both the state
              and its home district of Newark in English language
              arts and in mathematics on PARCC in elementary and
              middle high school. Through the renewal process, it
              has been determined that the school is performing well
              academically and is organizationally and fiscally
              sound.

      The Commissioner confirmed the maximum approved enrollment, as

follows:

Grade Level    2016-2017    2017-2018    2018-2019     2019-2020       2020-2021
     K              80           108          108           108             108
     1              80           108          108           108             108
     2              80           80           108           108             108
     3              80           80           80            108             108
     4              80           80           80            80              108
     5              80           80           80            80              80
     6              80           80           80            80              80
     7              80           80           80            80              80
     8              80           80           80            80              80
   Total            720          776          804           832             860

                             D. VARISCO-ROGERS

      Varisco-Rogers, also a Tier 1 school, serves 484 students in kindergarten

through eighth grade and has a waiting list of 529 students.       It is a high

performing school, and for grade levels third through eighth, its students

outperformed the District in both math and language arts literacy. The school

                                                                          A-3416-15T1
                                        22
utilizes two teachers in each classroom to maintain a ten-to-one student-

teacher ratio. It reported the following demographics for the 2013-2014 school

year:

Demographic    Free or   Special   LEP   Asian    Black   Hispanic   White   Other
               reduced    Ed.                                                Ethnic
                 price                                                       Groups
                lunch
 Percentage      83%      6%       6%     5%      13%      81%        1%      0%

        On December 8, 2015, Varisco-Rogers submitted an application

pursuant to N.J.A.C. 6A:11-2.6(a)(2)(ii), to amend its charter to increase

enrollment for the 2016-2017 school year to sixty students in each grade, for a

maximum enrollment of 540 students.              It represented the increase was

necessary to meet the growing needs of the community and to offer more

students with an opportunity for school choice. The District recommended full

approval of the expansion.

        The Commissioner issued a final decision approving Varisco-Rogers's

application for expansion based on the DOE's review of the school's

"academic, operational, and fiscal standing as well as an analysis of public

comments, fiscal impact on sending districts, and other information[.]" The

Commissioner found that Varisco-Rogers had

              a history of providing a high-quality education to its
              students. In the 2012-13 and 2013-14 school years,
              the school received a Tier Rank of 1, the highest rank
              possible based on the standards within the


                                                                             A-3416-15T1
                                         23
              Performance Framework. In the 2014-15 school year,
              based on PARCC results, the school significantly
              outperformed its home district of Newark in English
              language arts and in mathematics in elementary and
              middle high school.

      The Commissioner confirmed the maximum approved enrollment as

follows:

Grade Level    2016-2017       2017-2018
     K              60              60
     1              60              60
     2              60              60
     3              60              60
     4              60              60
     5              60              60
     6              60              60
     7              60              60
     8              60              60
   Total            540             540

                             E. UNIVERSITY HEIGHTS

      University Heights is a Tier 2 school, serving 545 students in

kindergarten through eighth grade. Beginning in 2014, its proficiency rates

did not show an overall increasing trend in testing measures for mathematics

and language arts.            The school attributes those difficulties to its

implementation of a blended educational program. It reported the following

demographics for the 2013-2014 school year:

Demographic    Free or     Special   LEP   Asian   Black   Hispanic   White     Other
               reduced      Ed.                                                 Ethnic
                 price                                                          Groups
                lunch
 Percentage      96%        9%       1%     0%     88%      12%        0%         0%




                                                                              A-3416-15T1
                                           24
      On November 25, 2015, University Heights requested an amendment to

its charter to increase its enrollment over the next four years from two schools

with 750 students, to four schools with 1500 students; it estimated it would

need two additional facilities to accommodate the expansion. In support of the

increase, it cited to its students' achievement, strong family demand, high need

demographics, successful track record, distinctive contributions to Newark's

portfolio of school choice, developed core academic model, deep bench of

human capital, and demonstrated commitment to serve special needs students.

      The District recommended partial approval of an alternative outcome,

that is, the approval of the expansion in pre-K and kindergarten to 100

students, and denial of expansion in fifth grade. The Commissioner approved

University Heights's application, with some limitations, based on the DOE's

review of the school's "academic, operational, and fiscal standing as well as an

analysis of public comments, fiscal impact on sending districts, and other

information[.]"

      The Commissioner found that the school had a

            history of providing a high-quality education to its
            students. In the 2014-15 school year, based on
            PARCC results, the school outperformed its home
            district of Newark in English language arts in
            elementary and middle school. In mathematics, the
            school outperformed the Newark school district in the
            elementary grades but underperformed the district in
            middle school. The Department also reviewed the

                                                                        A-3416-15T1
                                      25
              school's submission, which included detailed
              information regarding the proposed expansion.

        Nonetheless, the Commissioner limited the maximum enrollment:

Grade Level    2016-2017       2017-2018     2018-2019      2019-2020
   Pre-K            75              75            75             75
     K              150             150           150            150
     1              75              150           150            150
     2              75              75            150            150
     3              75              75            75             150
     4              75              75            75             75
     5              75              75            75             75
     6              50              75            75             75
     7              50              50            75             75
     8              50              50            50             75
   Total            750             850           950           1050

                                     F. GREAT OAKS

        Great Oaks is a Tier 1 school serving 333 students in grades six through

twelve. For the 2015-2016 school year, it had 1181 applicants but space for

only 462 students. Its students consistently outperformed the District across

grade levels. It reported the following demographics for the 2013-2014 school

year:

Demographic    Free or     Special    LEP   Asian   Black   Hispanic    White     Other
               reduced      Ed.                                                   Ethnic
                 price                                                            Groups
                lunch
 Percentage      67%        13%       0%     0%     82%       17%        0%         1%



        Great Oaks sought to amend its charter to add a second middle school

campus and to increase enrollment by approximately 100 students per grade

level, or from 462 to 939 students through the 2019-2020 school year. The


                                                                                A-3416-15T1
                                            26
impetus for the application was "parent demand for more seats and ultimately

[to] allow the high school to be fully enrolled with Great Oaks students from

the two middle school campuses[.]"         It also represented it had "made

significant investments in leadership development to prepare for the expansion

and sustainability of a leadership pipeline for the future of the school."

Additionally, nineteen out of thirty-six of its staff members reside in Newark,

which, by design, cultivated commitment to the community.

      The District recommended partial approval of the request, expansion at

sixth grade to only 125 students, not 177 students, and the "straight

articulation of [the] remaining grades[.]"    Nonetheless, the Commissioner

issued a final decision approving Great Oak's request based on the DOE's

"review of its academic, operational, and fiscal standing as well as an analysis

of public comments, fiscal impact on sending districts, and other

information[.]" The Commissioner found that Great Oaks had a

            history of providing a high-quality education to its
            students. In the 2012-13 and 2013-14 school year, the
            school received a Tier Rank of 1, the highest rank
            possible based on the standards within the
            Performance Framework. In the 2014-15 school year,
            based on PARCC results, the school significantly
            outperformed its home district of Newark in English
            language arts and in mathematics in middle school and
            high school.




                                                                        A-3416-15T1
                                      27
      The Commissioner confirmed the following maximum approved

enrollment:

Grade Level    2016-2017       2017-2018      2018-2019      2019-2020
     6              177             177            177            177
     7              77              177            177            177
     8              77              77             177            177
     9              77              77             77             177
    10              77              77             77             77
    11              77              77             77             77
    12              77              77             77             77
   Total            639             739            839            939

                                 G. NEW HORIZONS

      New Horizons is a Tier 1 school serving 480 students in kindergarten

through fifth grade. Its students outperformed the District in mathematics and

language arts.    It reported the following demographics for the 2013-2014

school year:

Demographic    Free or     Special   LEP     Asian   Black   Hispanic    White     Other
               reduced      Ed.                                                    Ethnic
                 price                                                             Groups
                lunch
 Percentage      96%        8%       0%       0%     93%        7%        0%         0%

      New Horizons requested amendment to its charter to increase maximum

enrollment from 504 to 756 students to serve grades sixth, seventh, and eighth

for the 2016-2017 school year.             The request was based on a significant

decrease in fifth grade enrollment because parents chose to enroll their

children in schools that offered higher grades levels. Further, beginning in

2002, parents had petitioned for expansion to grades sixth, seventh, and eighth.



                                                                                 A-3416-15T1
                                            28
In anticipation of that expansion, New Horizons had received permits for the

construction of a new facility and had added a new wing to provide students

with state of the art learning materials.

        The District recommended denial of the request for expansion based on

New Horizons students' unimpressive results on the PARCC tests, but a partial

approval of an alternative outcome, that is, expansion to serve sixth grade

only.

        The Commissioner partially approved New Horizons' request based on

the DOE's "review of its academic, operational, and fiscal standing as well as

an analysis of public comments, fiscal impact on sending districts, and other

information[.]" The Commissioner found that New Horizons had

              a history of providing a high-quality education to its
              students. In the 2012-13 and 2013-14 school year, the
              school received a Tier Rank of 1, the highest rank
              possible based on the standards within the
              Performance Framework. In the 2014-15 school year,
              based on PARCC results, the school outperformed its
              home district of Newark in English language arts and
              in mathematics in elementary and middle school.

        The Commissioner limited the school's expansion to one additional

grade level each year and thus confirmed the following maximum approved

enrollment:




                                                                       A-3416-15T1
                                        29
Grade Level   2016-2017    2017-2018
     K             84           84
     1             84           84
     2             84           84
     3             84           84
     4             84           84
     5             84           84
     6             84           84
     7                          84
   Total          588           672

                                       V.

      ELC's main contention is the Commissioner failed to address

overwhelming proof the expansions would severely impair the District's ability

to deliver a thorough and efficient education. ELC argues the decisions were

arbitrary, capricious, and unreasonable because they lacked detailed

consideration of the effect the approvals would have on funding for District

students remaining in traditional public schools, as well as the segregative

effects—leaving the District with high concentrations of students with

disabilities and English language needs.

      Since the charter school population in Newark has nearly tripled since

2008, from 4559 to 12,885, ELC contends when the current expansion of 8499

students is complete over the next five years, approximately 50% of the

District's current total enrollment will be made up of charter school students.

In support, ELC relies upon an internal budget report it generated regarding

the lack of full funding in the District in the 2011-2012 school year and

thereafter. ELC also relies upon a Rutgers University report noting that the

                                                                       A-3416-15T1
                                       30
State's charter schools were overwhelmingly concentrated in seven urban

communities, serving a population demographically different than the host

district.

       It is undisputed that failure to consider all the evidence in the record

"would perforce lead to arbitrary decision making." Quest Acad., 216 N.J. at

386.    A decision based on misperception of the facts "would render the

agency's conclusions unreasonable." Id. at 387.

       "[T]he standard for judicial review of administrative agency action is

limited: An appellate court may reverse an agency decision if it is arbitrary,

capricious, or unreasonable." Id. at 385. Our role in reviewing an agency

action is restricted to three inquiries:

             (1) whether the agency's action violates express or
             implied legislative policies, that is, did the agency
             follow the law; (2) whether the record contains
             substantial evidence to support the findings on which
             the agency based its action; and (3) whether in
             applying the legislative policies to the facts, the
             agency clearly erred in reaching a conclusion that
             could not reasonably have been made on a showing of
             the relevant factors.

             [Id. at 385-86 (quoting Mazza v. Bd. of Trs., 143 N.J.
             22, 25 (1995)).]

"[T]he arbitrary, capricious, or unreasonable standard . . . subsumes the need

to find sufficient support in the record to sustain the decision reached by the

Commissioner." Id. at 386.

                                                                       A-3416-15T1
                                           31
      However, "[w]hen the Commissioner is not acting in a quasi-judicial

capacity," and is instead acting in his legislative capacity, as he was doing

here, he "need not provide the kind of formalized findings and conclusions

necessary in the traditional contested case." Englewood, 320 N.J. Super. at

217 (citing Bd. of Educ. of E. Windsor Reg'l Sch. Dist. v. State Bd. of Educ.,

172 N.J. Super. 547, 551-52 (App. Div. 1980)); see Red Bank, 367 N.J. Super.

at 476 (Commissioner was acting in his legislative, not quasi-judicial capacity,

in investigating a charter-school renewal application).

      The applicable arbitrary, capricious, or unreasonable standard, however,

demands only "that the reasons for the decision be discernible, the reasons

need not be as detailed or formalized as an agency adjudication of disputed

facts; they need only be inferable from the record considered by the agency."

Englewood, 320 N.J. Super. at 217; see Red Bank, 367 N.J. Super. at 476 ("the

reasons for the decision need not be detailed or formalized, but must be

discernible from the record"); E. Windsor, 172 N.J. Super. at 552 (explaining

detailed findings of fact not required by Commissioner in reducing amount

local school board sought to increase its budget).

                                      VI.

      Funding for charter schools is provided by "the school district of

residence[,]" which pays the charter school directly 90% of its program budget



                                                                       A-3416-15T1
                                       32
per pupil for each of its resident students enrolled in the school. N.J.S.A.

18A:36A-12(b). Despite the statute's limit on funding:

            if the local school district "demonstrates with some
            specificity that the constitutional requirements of a
            thorough and efficient education would be jeopardized
            by [the district's] loss" of the funds to be allocated to a
            charter school, "the Commissioner is obligated to
            evaluate carefully the impact that loss of funds would
            have on the ability of the district of residence to
            deliver a thorough and efficient education."

            [Quest Acad., 216 N.J. at 377-78 (quoting Englewood,
            164 N.J. at 334-35).]

"[T]he District must be able to support its assertions." Englewood, 164 N.J. at

336.

       The Commissioner does not, however, have "the burden of canvassing

the financial condition of the district of residence in order to determine its

ability to adjust to the per-pupil loss upon approval of the charter school based

on unsubstantiated, generalized protests."      Ibid.   "[T]he Commissioner is

entitled to rely on the district of residence to come forward with a preliminary

showing that the requirements of a thorough and efficient education cannot be

met." Id. at 334. "The legislative will to allow charter schools and to advance

their goals suggests our approach which favors the charter school unless

reliable information is put forward to demonstrate that a constitutional

violation may occur." Id. at 336.



                                                                          A-3416-15T1
                                        33
      For example, in Red Bank, 367 N.J. Super. at 482, the Board of

Education argued that the Commissioner erred in granting the charter renewal

and expansion without adequately considering the detrimental impact on its

ability to provide a thorough and efficient education. The Board alleged that

the charter school would cause the District's budget to be reduced by $720,000,

requiring the elimination of four teaching positions, resulting in bigger classes,

the elimination of courtesy busing, and the reduction of hall monitors,

instructional assistants, and cafeteria monitors. Ibid. Even in that case, we

affirmed the Commissioner's decision because "[t]he paucity of specificity in

the Board's charges is fatal." Id. at 483. Because of the clear expression of the

legislative will supporting charter schools, the proofs must be "reliable."

Englewood, 164 N.J. at 336.

      In the cases before us, the District does not join in ELC's appeal. It does

not object to the expansions on the basis of budgetary or other detrimental

effect.

      ELC did not make any showing, much less a preliminary showing, on

which the Commissioner could rely as to the effect the expansions would have

on the District's budget. Id. at 334. Furthermore, although the Commissioner

can consider unsolicited comments from local citizens, Quest Acad., 216 N.J.

at 389, there is no statutory or case law requiring the Commissioner to evaluate



                                                                         A-3416-15T1
                                       34
the potential impact of funding on the District when that assertion is made by

another entity, and not the District itself. In fact, there are sound reasons for

limiting such challenges, notably, that it is the affected district that can best

gauge the impact of charter school funding on its own budget.

      In any event, ELC did not specifically demonstrate how the District

students would be deprived of a thorough and efficient education by the

expansion. ELC represented that the District's budget crisis was caused by

both the chronic underfunding of the SFRA formula and the rapid expansion of

charter schools in Newark. See Abbott XXI, 206 N.J. at 359 ("The State made

a conscious and calculated decision to underfund the SFRA formula when

enacting the FY 2011 Appropriations Act."). ELC was required to separate the

two sources it claimed contributed to the budget crisis and failed to do so.

      ELC maintains that the District had to implement cost reductions,

including employee layoffs. It does not, however, account for the fact that the

District has to pay the charter schools only 90% of certain student funding

categories, and retains 10%—an amount designed to respond to concerns about

the loss of funding. Englewood, 164 N.J. at 333; N.J.S.A. 18:36A-12(b). On

paper, the reduced per pupil allocation should ease the budgetary pressures —

not worsen them.




                                                                         A-3416-15T1
                                       35
     ELC does not account for the fact that the legislative formula is designed

to maintain school funding at the constitutionally required level despite the

existence of charter schools. Nor does ELC address the fact that in 2011 at

least, 205 districts out of New Jersey's 560 school districts, in addition to

Newark, were similarly underfunded. Abbott XXI, 206 N.J. at 458.

     Further, under the SFRA, the District's Adequacy Budget is weighted to

reflect the number of special education and LEP students. As a result, should

the District educate more special needs students, it will be entitled to

additional funding.   The District's budget is reduced by charter school

expansion. But it is educating significantly fewer students. It is simply not

clear whether the reductions in available funds is attributable to reduced

enrollment.

     In support of its argument that the Commissioner has a heightened

obligation to scrutinize and evaluate appropriate funding in Abbott school

districts, ELC cites to Englewood. That case, however, was decided eight

years before the SFRA was enacted. Even in Englewood, the Court held that

"the Commissioner is entitled to rely on the district of residence to come

forward with a preliminary showing that the requirements of a thorough and

efficient education cannot be met." Englewood, 164 N.J. at 334.




                                                                       A-3416-15T1
                                     36
      The Court in Englewood cited to two key provisions of the Act: one that

granted the District the authority to challenge a charter school applicant's

submission, and the other, the funding provision, which then imposed a

"presumptive amount equal to 90%" on the District, L. 1995, c. 426, § 12

(subsequently amended). Ibid. As a result, when "[r]ead in combination, those

statutory provisions require a district of residence to make an initial showing

that imposition of the presumptive amount, or a proposed different amount for

the charter school applicant's pupils would impede, or prevent, the delivery of

a thorough and efficient education in that district." Ibid. However, the Court

noted that the "application of this standard in the context of an [Abbott]

district is not part of this case. We leave that question for another day." Ibid.

      ELC contends the day has arrived, and that the State, not the District,

should bear the burden of proving the District can provide a thorough and

efficient education to its public schools even if the charter schools appli cations

are approved. In the nineteen years since Englewood was decided, the Court

has reaffirmed the holding without addressing the Abbott school issue. Quest

Acad., 216 N.J. at 377-78. We have as well in former Abbott school districts.

See Bd. of Educ. of Hoboken v. N.J. State Dep't of Educ., No. A-3690-14

(App. Div. June 29, 2017) (slip op. at 20).




                                                                          A-3416-15T1
                                        37
         Most significantly, the funding provision of the Act, intended to buffer

public school students while allowing for the growth and maintenance of

charter schools, was amended after Englewood. The Commissioner no longer

has merely the discretion to reduce funding rates for charter school children;

the Commissioner must implement the SFRA formula. N.J.S.A. 18A:36A-

12(b).

         ELC has not demonstrated the reason, given the SFRA formula, that a

different standard should today be applied to former Abbott districts. See J.D.

ex rel. Scipio-Derrick v. Davy, 415 N.J. Super. 375, 378 n.1 (App. Div. 2010)

("Under the SFRA, former Abbott districts no longer receive supplemental and

parity aid."). Therefore, the Commissioner was not required to evaluate the

impact of the potential loss of funding allocated to charter schools over time

because of the District's former classification as an Abbott district, and current

status as an SDA district, in the absence of objection by the District. Districts

should continue to bear the burden to demonstrate that charter school funding

will prevent delivery of a thorough and efficient education, even in former

Abbott districts.

                                        VII.

         Segregation is strictly prohibited in our schools, and is specifically

prohibited in charter schools. See N.J.S.A. 18A:36A-7. This ban includes not



                                                                         A-3416-15T1
                                        38
just race or ethnicity, but discrimination against those with different

intellectual or athletic abilities, or proficiency in the English language. The

law further provides that although a charter school can establish reasonable

criteria to evaluate prospective students, the criteria must be included in the

school's charter and is subject to review by the Commissioner when the charter

school obtains initial approval.

      The Supreme Court has found that the "form and structure" of the

appropriate analysis when determining segregative effect is within the

discretion of the Commissioner and the State BOE. Englewood, 164 N.J. at

329. However, to advance the obligation on charter schools, the DOE has

adopted regulations requiring the Commissioner, prior to approval of a charter

and on an annual basis thereafter, to "assess the student composition of a

charter school and the segregative effect that the loss of the students may have

on its district of residence." N.J.A.C. 6A:11-2.1(j); N.J.A.C. 6A:11-2.2(c); 32

N.J.R. 3560(a), 3561 (Oct. 2, 2000).

      ELC does not suggest that any of the respondents' enrollment policies

are other than color blind, random, or keep the schools from being "open to all

students in the community[.]"      See Red Bank, 367 N.J. Super. at 478.

Similarly, there is no suggestion that post-enrollment practices deliberately

have a segregative effect. ELC's argument is that the prospective increase in



                                                                        A-3416-15T1
                                       39
numbers will result in de facto segregation, which the Commissioner must

discourage.

      However, the respondents admit students based on a random blind

lottery. Furthermore, four respondents participate in a universal enrollment

system that employs algorithms that include, and weigh in an advantageous

manner, the applicants who are eligible for free lunch, have IEPs, and those

who otherwise have higher needs. All the schools are party to a Compact

designed to provide for all students in the District, including those in the

highest at-risk populations.     There is no indication that nefarious post-

enrollment practices are engaged in by any of the charter schools.

      That the demographics of the individual charter schools do not precisely

reflect the overall demographics for the District is not sufficient to

demonstrate a segregative effect. Red Bank, 367 N.J. Super. at 476-77. Thus,

although the Commissioner did not specifically address the issue, ELC's

submissions fail to substantiate a segregative effect, either in the pre- or post-

enrollment practices, such that the Commissioner's decisions can be

characterized as arbitrary, capricious, and unreasonable.




                                                                         A-3416-15T1
                                       40
                                      VIII.

      ELC contends that the Commissioner's decisions were arbitrary,

capricious, and unreasonable because he did not address its submissions or

provide a reasoned analysis for the approvals.

      There is no statutory or regulatory requirement that the Commissioner

include reasons for granting, as opposed to denying, an application to renew or

amend. Indeed, the only requirement found in the regulations is, with regard

to initial charter school applications and applications for renewal, that "[t]he

notification to eligible applicants not approved as charter schools[,]" or "not

granted a renewal shall include reasons for the denial[s]."             N.J.A.C.

6A:11-2.1(f); N.J.A.C. 6A:11-2.3(d) (emphasis added). Relevant precedent

does require the reasons for the Commissioner's decision to be discernible

from the record. Red Bank, 367 N.J. Super. at 476.

      Here, each of the charter schools were high performing schools (six were

Tier 1), and all of the schools were in great demand with long wait lists. All of

the schools' performance data, a significant factor in assessing a request to

amend a charter, was higher than the District or State average, as represented

by students' PARCC scores. Further, all of the schools, which had for years

been submitting detailed annual reports, were organizationally sound and

fiscally viable.



                                                                         A-3416-15T1
                                       41
      The record also shows that there is a need for an increase in charter

school enrollment in Newark, as the District acknowledged in recommending

full approval of two applications, the partial approval of one application, and

the denial, with an alternative partial approval recommendation for three

applications.   Thus, the Commissioner's decision was sufficient as to each

respondent and is supported by the record.

                                      IX.

      ELC also contends in its second point that the Commissioner authorized

the creation of new charter school facilities on incomplete information and in

unidentified locations.   The District did not object to proposed enrollment

expansions by University Heights, Great Oaks, Robert Treat, North Star, and

TEAM.

      We are not bound by an agency's interpretation of a statute, applying de

novo review. US Bank, N.A. v. Hough, 210 N.J. 187, 200 (2012). In doing

so, we "defer to an agency's interpretation of . . . [a] regulation, within the

sphere of [its] authority, unless the interpretation is 'plainly unreasonable.'"

Ibid. (alterations in original) (quoting In re Election Law Enf't Comm'n

Advisory Op. No. 01-2008, 201 N.J. 254, 262 (2010)). "This deference comes

from the understanding that a state agency brings experience and specialized




                                                                       A-3416-15T1
                                      42
knowledge to its task of administering and regulating a legislative enactment

within its field of expertise." In re Election Law, 201 N.J. at 262.

      The Act requires that a school's application for a charter must include,

"[a] description of, and address for, the physical facility in which the charter

school will be located[.]" N.J.S.A. 18A:36A-5(j). A "satellite campus" is

defined as "a school facility operated by a charter school that is in addition to

the facility identified in the charter school application or charter, i f

subsequently amended." N.J.A.C. 6A:11-1.2. "A charter school may operate

more than one satellite campus in its district or region of residence, subject to

charter amendment approval, pursuant to N.J.A.C. 6A:11-2.6."            N.J.A.C.

6A:11-4.15(b). To that end, N.J.A.C. 6A:11-2.6(a)(1)(i) and (iv) provide that

in addition to seeking an increase in enrollment, a charter school may also seek

an amendment to open a new satellite campus.

      In Education Law Center ex rel. Burke v. N.J. State Board of Education,

438 N.J. Super. 108, 111 (App. Div. 2014), the ELC challenged the Board's

adoption of the amended regulations N.J.A.C. 6A:11-2.6(a)(1)(iv) and

N.J.A.C. 6A:11-1.2, permitting existing, successful charter schools to open

satellite campuses. We concluded that the Board did not exceed its statutory

authority in adopting the amended regulations and affirmed. Id. at 112.




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      In Burke, ELC unsuccessfully argued that the Act required the DOE to

conduct "a full initial review before a satellite location can be approved." Id.

at 121. We concluded that "the addition of a satellite campus is more like the

expansion of grade and enrollment levels than the opening of an entirely new

charter school." Ibid. Burke explains that

            [i]n the case of an existing charter school that seeks to
            expand into additional physical space, it makes little
            sense to require a whole new application and the
            resulting review process. While a satellite campus is
            not the same as expanding into additional physical
            space immediately adjacent to the existing facility, the
            satellite campus would still be part of the same school.
            A school is more than a building. It is an educational
            program, and the teaching, administrative, and
            operational staff that devises and runs the program.
            Site unity is an appropriate consideration in evaluating
            the potential success or problems of a proposed
            charter school, but a remote site does not make a
            wholly different school.

            [Id. at 120.]

      Further, ELC's argument that the Commissioner and the DOE could "not

adequately evaluate satellite campuses for the physical safety and suitability of

the site for educational use[,]" was rejected. Id. at 122. In proposing the

amendments to the regulations the DOE indicated, in response to comment

five, that the "[f]acilities identified by an amendment request for a satellite

campus are subject to the same review and approval procedures as for new

charter school facilities[,]" pursuant to the proposed amendment at N.J.A.C.

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6A:11-2.1(i). Ibid. (quoting 44 N.J.R. 26(a), 27 (Jan. 7, 2013)). We found

that it

               must assume the Commissioner will require an
               adequate evaluation of a proposed satellite campus
               site and reject any charter amendment that fails to
               meet appropriate standards for a school building. If a
               proposed campus presents safety concerns or is
               otherwise unsuitable for the educational needs of
               children[,] . . . interested parties should raise specific
               objections to the proposed amended charter.

               [Ibid.]

          Approval of increases in enrollment is a necessary precursor to the

addition of satellite campuses or any investment in additional structures. It is

reasonable for the Commissioner to have approved expansion before a charter

school could be expected to go through the arduous process of identifying and

securing a site.

          Additionally, prior to the opening of the satellite campus, the school

must submit to the DOE a description and address of the physical facility,

N.J.S.A. 18A:36A-5(j), and the lease, mortgage or title to the facility, a

certificate of occupancy for educational use, a sanitary inspection report with a

satisfactory rating, and a fire inspection certificate with an "Ae" (education)

code life hazard. N.J.A.C. 6A:11-2.1(i)(6)-(9). Moreover, a charter school

must obtain the Commissioner's approval before locating at a site other than

the one identified in the charter.

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      It is also possible that the Commissioner, who has specialized expertise

in this area, understood that the process of obtaining a satellite campus was

much less involved than obtaining the original site for the school.          The

Commissioner's interpretation of the regulation, which allowed for the

approval first of the expansion and only then for the approval of the satellite

campus, was therefore "not plainly unreasonable."       Once having obtained

approval for their expansions, the affected respondents were then in a position

to secure approvals for any proposed satellite locations. Nothing in this record

suggests approval would be improvidently granted.

      Affirmed.




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