Superintendent of W-H indicted; He calls tampering case misunderstanding; 2nd official also charged

By Joshua Benton
Staff Writer

Page 1A

Charles Matthews, superintendent of the troubled Wilmer-Hutchins schools, was indicted Thursday on charges that he tampered with evidence in an ongoing investigation.

The district’s maintenance director, Wallace Faggett, also was indicted by a Dallas County grand jury on the same charge. Evidence tampering is a third-degree felony with a maximum penalty of 10 years in prison.

The troubled southern Dallas County district is the target of a major criminal investigation into corruption allegations. Officials said more employees of the school district, which has more than 2,800 students, could be indicted.

“Maybe this is just the first step in getting the quality of education that we’d all like to see those children have,” Dallas County District Attorney Bill Hill said.

Dr. Matthews said Thursday afternoon that the indictments were a result of a misunderstanding. He said he had only wanted some documents thrown out because they made the place look untidy.

“I look forward to my day in court,” he said.

Mr. Faggett was contacted by phone but declined to comment.

The charges are based on evidence that Dr. Matthews ordered Mr. Faggett to destroy purchase orders and other documents that bear the name of Gerald Henderson, the district’s former maintenance director. Mr. Henderson’s role in the district was among the subjects of a Texas Education Agency audit into the district’s finances.

Mr. Henderson’s signature continued to appear on district documents for more than a year after he stopped working for the district and became too ill to sign his name legibly. His name and salary also appeared in the district’s budget after he no longer worked in the district.

Wilmer-Hutchins has been the subject of dozens of investigations over the last decade by education officials and a long list of law-enforcement agencies. Among the current investigators are the FBI, the Texas Rangers, state and federal grand juries, the TEA, and as of this week, the Internal Revenue Service.

‘New beginnings’

But Thursday’s indictments are thought to be the first against district employees.

“It’s a day for new beginnings in the district,” said Wilmer-Hutchins Police Chief Cedric Davis, who has made public charges about corruption in the district since spring.

The current round of troubles in Wilmer-Hutchins began when a storm in June tore holes in the district’s high school and officials did not properly repair the damage. Students could not attend classes in the main high school building for more than a month after school was scheduled to start.

Then the district ran out of money, just a few months after reporting a $1.6 million fund balance. On Aug. 25, the district could not meet its monthly payroll, and many teachers went without pay. Troubled by the missing money and other allegations of corruption, the Texas Education Agency sent an audit team to the district Aug. 30.

Two days later, Dr. Matthews was accused of ordering Mr. Faggett to gather up any documents bearing Mr. Henderson’s name and destroy them.

At the time, Mr. Faggett’s administrative assistant, Walterine Hardin, told The Dallas Morning News that she had gathered up the documents at Mr. Faggett’s request.

She said he told her “the superintendent wanted us to destroy some documents.” Mr. Faggett “tore them up in front of us,” she said.

Ms. Hardin later reported the incident to Wilmer-Hutchins ISD police. Police and TEA officials found the torn documents, including a stack of purchase orders, in a trash bin behind the district’s maintenance building.

Dr. Matthews said Thursday that he had done nothing wrong. He said that the maintenance office had a lot of extra paper lying around and that he wanted Mr. Faggett to “tidy it up.” He said the maintenance department’s secretary was “really sloppy.”

“I told him, ‘You need to clean up your area, get rid of the old stuff,'” he said. “It was filthy down there. It was untidy.”

TEA audit

Tom Canby, the TEA’s managing director of financial audits called the charges “very serious matters.”

“We hold public officials to a high level of professionalism because they have responsibility over large amounts of public funds,” he said.

The TEA could take over the school district within two weeks.

Mr. Canby said this was, to his knowledge, the first time a school official has faced indictment for obstructing a TEA audit investigation. He has been at the TEA since 1978.

The charges filed Thursday carry a penalty of between two and 10 years in prison and a fine of up to $10,000.

Both men are allowed 24 hours to surrender to authorities and post bail.

The multi-agency criminal investigation into corruption in Wilmer-Hutchins continues. Mr. Hill said he hopes the charges will increase public confidence in the district.

“Certainly the students and kids at Wilmer-Hutchins deserve the finest education they could possibly have,” the district attorney said. “Certainly that means having an administration that’s free of corruption and crime.”

Dr. Matthews said he probably would represent himself in court.

“I won’t need an attorney,” he said. “Truth is on my side.”

He said he had no plans to step aside as superintendent.

Mr. Faggett continues as maintenance director, but the department was placed under the supervision of Lew Blackburn, the district’s human resources director. Dr. Blackburn is also a Dallas school trustee.

Dr. Blackburn said he did not know whether it was district policy to suspend district employees under indictment.

“We’ve got to make that decision,” he said.

Board President Luther Edwards, a supporter of Dr. Matthews, said it was premature to discuss what would happen to the superintendent.

“He will have his day in court,” he said.

He said the school board would discuss the matter at its meeting Monday, probably in a closed session.

But trustee Joan Bonner, a long-standing Matthews opponent, said she thinks Dr. Matthews should step down.

“It’s long past due,” she said. “This proves the legal system can work.”

Staff writer Robert Tharp contributed to this report.

Superintendent of W-H indicted; He calls tampering case misunderstanding; 2nd official also charged

By Joshua Benton
Staff Writer

Page 1A

Charles Matthews, superintendent of the troubled Wilmer-Hutchins schools, was indicted Thursday on charges that he tampered with evidence in an ongoing investigation.

The district’s maintenance director, Wallace Faggett, also was indicted by a Dallas County grand jury on the same charge. Evidence tampering is a third-degree felony with a maximum penalty of 10 years in prison.

The troubled southern Dallas County district is the target of a major criminal investigation into corruption allegations. Officials said more employees of the school district, which has more than 2,800 students, could be indicted.

“Maybe this is just the first step in getting the quality of education that we’d all like to see those children have,” Dallas County District Attorney Bill Hill said.

Dr. Matthews said Thursday afternoon that the indictments were a result of a misunderstanding. He said he had only wanted some documents thrown out because they made the place look untidy.

“I look forward to my day in court,” he said.

Mr. Faggett was contacted by phone but declined to comment.

The charges are based on evidence that Dr. Matthews ordered Mr. Faggett to destroy purchase orders and other documents that bear the name of Gerald Henderson, the district’s former maintenance director. Mr. Henderson’s role in the district was among the subjects of a Texas Education Agency audit into the district’s finances.

Mr. Henderson’s signature continued to appear on district documents for more than a year after he stopped working for the district and became too ill to sign his name legibly. His name and salary also appeared in the district’s budget after he no longer worked in the district.

Wilmer-Hutchins has been the subject of dozens of investigations over the last decade by education officials and a long list of law-enforcement agencies. Among the current investigators are the FBI, the Texas Rangers, state and federal grand juries, the TEA, and as of this week, the Internal Revenue Service.

‘New beginnings’

But Thursday’s indictments are thought to be the first against district employees.

“It’s a day for new beginnings in the district,” said Wilmer-Hutchins Police Chief Cedric Davis, who has made public charges about corruption in the district since spring.

The current round of troubles in Wilmer-Hutchins began when a storm in June tore holes in the district’s high school and officials did not properly repair the damage. Students could not attend classes in the main high school building for more than a month after school was scheduled to start.

Then the district ran out of money, just a few months after reporting a $1.6 million fund balance. On Aug. 25, the district could not meet its monthly payroll, and many teachers went without pay. Troubled by the missing money and other allegations of corruption, the Texas Education Agency sent an audit team to the district Aug. 30.

Two days later, Dr. Matthews was accused of ordering Mr. Faggett to gather up any documents bearing Mr. Henderson’s name and destroy them.

At the time, Mr. Faggett’s administrative assistant, Walterine Hardin, told The Dallas Morning News that she had gathered up the documents at Mr. Faggett’s request.

She said he told her “the superintendent wanted us to destroy some documents.” Mr. Faggett “tore them up in front of us,” she said.

Ms. Hardin later reported the incident to Wilmer-Hutchins ISD police. Police and TEA officials found the torn documents, including a stack of purchase orders, in a trash bin behind the district’s maintenance building.

Dr. Matthews said Thursday that he had done nothing wrong. He said that the maintenance office had a lot of extra paper lying around and that he wanted Mr. Faggett to “tidy it up.” He said the maintenance department’s secretary was “really sloppy.”

“I told him, ‘You need to clean up your area, get rid of the old stuff,'” he said. “It was filthy down there. It was untidy.”

TEA audit

Tom Canby, the TEA’s managing director of financial audits called the charges “very serious matters.”

“We hold public officials to a high level of professionalism because they have responsibility over large amounts of public funds,” he said.

The TEA could take over the school district within two weeks.

Mr. Canby said this was, to his knowledge, the first time a school official has faced indictment for obstructing a TEA audit investigation. He has been at the TEA since 1978.

The charges filed Thursday carry a penalty of between two and 10 years in prison and a fine of up to $10,000.

Both men are allowed 24 hours to surrender to authorities and post bail.

The multi-agency criminal investigation into corruption in Wilmer-Hutchins continues. Mr. Hill said he hopes the charges will increase public confidence in the district.

“Certainly the students and kids at Wilmer-Hutchins deserve the finest education they could possibly have,” the district attorney said. “Certainly that means having an administration that’s free of corruption and crime.”

Dr. Matthews said he probably would represent himself in court.

“I won’t need an attorney,” he said. “Truth is on my side.”

He said he had no plans to step aside as superintendent.

Mr. Faggett continues as maintenance director, but the department was placed under the supervision of Lew Blackburn, the district’s human resources director. Dr. Blackburn is also a Dallas school trustee.

Dr. Blackburn said he did not know whether it was district policy to suspend district employees under indictment.

“We’ve got to make that decision,” he said.

Board President Luther Edwards, a supporter of Dr. Matthews, said it was premature to discuss what would happen to the superintendent.

“He will have his day in court,” he said.

He said the school board would discuss the matter at its meeting Monday, probably in a closed session.

But trustee Joan Bonner, a long-standing Matthews opponent, said she thinks Dr. Matthews should step down.

“It’s long past due,” she said. “This proves the legal system can work.”

Staff writer Robert Tharp contributed to this report.

Illegal pay in W-H; Auditors: Schools chief must return $16,000 in post-contract salary

By Joshua Benton
Staff Writer

Page 1B

Wilmer-Hutchins Superintendent Charles Matthews received more than $16,000 in illegal pay last year, according to investigators.

The Texas Education Agency now says he’ll have to pay back the money, which violates a clause of the Texas Constitution. But Dr. Matthews said Wednesday that he wasn’t convinced he had to.

“I’ll have to look at the legal aspects of it,” he said. “If I don’t have to pay it, I won’t. If I do have to pay it, I will.”

The illegal pay is one of several findings in the preliminary audit report generated by TEA investigators. They arrived in the troubled district Aug. 30, after the district ran out of money and couldn’t afford to pay its teachers. On Monday, the district announced that it would have to lay off nearly 20 percent of its workforce in the coming months to remain solvent.

Among the report’s other findings:

*The district illegally funneled $500,000 from its bond fund into general revenues as officials realized they were running out of money.

*Despite a hiring freeze – instituted as part of a plan to recover from previous financial mismanagement – the district hired new employees and gave some raises.

*Without immediate action, the district will have a deficit of $5.3 million for the current school year.

Dr. Matthews’ disputed pay dates to his hiring in October 2002. According to board president Luther Edwards, Dr. Matthews initially negotiated a salary of $175,000.

That was substantially higher than his predecessor, Harvey Rayson, although it’s unclear how much Mr. Rayson was actually paid. Mr. Edwards said Mr. Rayson made $125,000. State records indicate his salary was actually $95,100.

In any event, Dr. Matthews agreed to a $175,000 salary. But Mr. Edwards said the district didn’t want to pay that amount immediately. “I wanted to wait until after we did the budget,” he said. So Dr. Matthews accepted a $125,000 salary initially.

In April 2003, the district gave him a $50,000 raise, retroactive to his date of hire. Mr. Edwards didn’t say at the time that the raise had been prenegotiated – he said it was the result of a six-month performance review.

At the time, Dr. Matthews defended the raise. “Less-experienced superintendents are cheaper,” he said. “You get what you pay for. I’m here to take Wilmer-Hutchins to new heights academically.”

But according to the preliminary audit report, that raise violated the Texas Constitution, which prevents extra compensation for a public official once his contracted period of service has begun.

As a result, the audit report lists as a “required action” Dr. Matthews repaying the $16,666.64 he received retroactively.

Mr. Edwards said he had not had enough time to examine the audit report in full. But he said that if the district finds the agency is correct, Dr. Matthews will repay the money. Under TEA rules, Dr. Matthews and the district have until Nov. 3 to respond to the preliminary audit. Once the district responds, TEA will file a final audit report. At that point, the agency could choose to take over the district or institute other sanctions.

W-H to lay off 20% of staff; Process will start next week; 30 teachers could be lost in district

By Joshua Benton
Staff Writer

Page 1B

Nearly 20 percent of Wilmer-Hutchins employees will have to be laid off in the coming months, many of them as soon as next week, school district officials said. That total could include more than 30 teachers.

“You’ll have to choose between several unpleasant alternatives,” James Damm, a financial consultant, told the school board Monday night. “They’re not going to be easy decisions.”

The district’s financial consultants say the school district could run out of money again by March if swift measures aren’t taken. The school board voted 7-0 Monday night to declare a financial emergency, which sets the layoff process in motion.

Meanwhile, a preliminary audit of the district’s finances by the Texas Education Agency says Wilmer-Hutchins broke state law by taking out an illegal $500,000 loan this spring.

According to Mr. Damm, the district currently has 406 employees, 206 of them teachers. He said he recommended at least two – possibly three – separate layoffs.

“I don’t think you can reduce enough of your budget this year” alone, he said. “That would be draconian. This will be unpopular enough.”

The first layoff will begin next week, after the school board meets to decide who will be let go. The second will occur after the school year ends. That summer layoff will involve eliminating 25 positions, some of which could be shed through attrition, Mr. Damm said.

He said it had not been determined how many people will have to be laid off next week. But Mr. Damm said “it could be twice that number,” or 50 positions.

Mr. Damm said the total number of jobs lost could be reduced if administrators or other high-paid employees are laid off. If lower-paid workers are the primary targets, it will take more jobs lost to make up the amount Wilmer-Hutchins needs to cut. Mr. Damm put that amount at “several million dollars.”

“It didn’t happen overnight,” Mr. Damm said about the district’s problems. “The district’s resources have been overtaxed and overspent.”

In addition, Mr. Damm said that the district, “in future years,” should adjust to a lower overall staffing level – about 10 students per staff member and about 17 students per teacher.

Further cuts

At current enrollment levels, that would mean further cuts of an additional 47 positions. In total, the district’s workforce would be 30 percent smaller than it is today.

Even with all these cuts, the consultants said, the district would still have to seek a new loan, backed by tax revenues, in order to pay back a $3.8 million loan due in March. He said the district should seek a loan that would be paid back over five to eight years.

Mr. Damm said that by his analysis, the district has too many employees. That same pattern occurred in Superintendent Charles Matthews’ previous school district, Karnack ISD. Karnack’s enrollment dropped steadily after Dr. Matthews’ arrival there in 1998, but the district did not cut spending accordingly.

As a result, Karnack’s spending per pupil increased from $6,245 to $8,052. That plunged the district from a healthy fund balance to a serious deficit.

Dr. Matthews did not comment on the layoff recommendations during Monday’s meeting.

But by at least one measure, Wilmer-Hutchins’ staffing levels are not particularly unusual. According to data from the 2002-03 school year – the last for which statewide information is available – Wilmer-Hutchins’ staffing levels were only slightly above average for a school district its size.

That year, Wilmer-Hutchins had 6.8 students per employee. The state average for districts its size was 6.9 students per employee. The gap was similar for student-teacher ratio: 13.9 students per teacher in Wilmer-Hutchins, 14.3 statewide.

Possible answers for where the money went could come in the multiple criminal investigations under way in the district. Two grand juries, the Texas Rangers, the FBI and others are investigating allegations of criminal wrongdoing, including misappropriation of funds.

In August, the district ran out of money and couldn’t pay all of its teachers. A fund balance of $1.6 million disappeared in the span of three months, and it has not yet been explained where the money went.

Trimming costs

Meanwhile, the district is trying a number of other ways to trim back on cost, including turning off the lights inside the district’s soda machines. The district was only paying invoices once they are 45 days old because it can’t afford to pay new ones.

Luther Edwards, the board’s president, said he wanted to make sure the layoffs were done according to the letter of the law. “Every time we do a reduction in force, people want to sue,” he said, referring to layoffs the district had to make in the mid-1990s, the last time Wilmer-Hutchins was in dire financial straits.

Information about the allegedly illegal $500,000 loan was included in the TEA’s preliminary financial audit, which was given to board members Monday. The loan was allegedly illegal because it was paid back with money from the district’s bond fund. The district did not have enough regular tax revenue to pay it back.

The audit report says Wilmer-Hutchins had to pay $20,000 in issuance costs to a Utah bank in order to obtain the loan. “The fees paid for this loan raise questions about the district’s efforts to obtain competitive notes,” the report states.

The report also says that some district employees received raises this year – despite a district policy banning raises. That ban was put in place as part of a cost-reduction plan mandated by TEA after Wilmer-Hutchins overspent its annual budget by $1.9 million in 2001-02.

Missing check plates reappear in W-H offices

By Joshua Benton
Staff Writer

Page 7B

Two check signature plates mysteriously reappeared in Wilmer-Hutchins administration offices Monday, answering one question but leaving open many others.

The plates, which according to a Dallas police report disappeared in late July, were used to automatically print board members’ signatures on district checks. They disappeared just as it was becoming apparent the district was rapidly running out of money.

On Monday afternoon, a district employee found them in a compartment of her desk.

“Someone put them there over the weekend,” said Jean Cox, the district’s payroll clerk. “I reached over into my cubbyhole, and I felt something. I said, ‘What is this?'”

Ms. Cox said she checks that spot in her desk regularly. “They were definitely not there on Friday.”

Charles Matthews, the district’s superintendent, did not return a phone call seeking comment Monday evening.

The missing plates have been one of the subjects of the Texas Rangers’ investigation into corruption allegations in Wilmer-Hutchins. Representatives of the district’s police force took possession of the plates Monday afternoon and turned them over to the Rangers, who will interview district employees about them today.

The signature plates had been missing since July 26, according to a Dallas police report filed by district officials, but it wasn’t reported until Aug. 2.

“It just disappeared,” Phillip Roberson, the district’s chief financial officer, said last month. Dr. Roberson has since been suspended with pay from his post.

He said at the time that the district has required handwritten signatures on all checks since the plates went missing. At that time, the plates had not been used to write checks, he said.

In the last year, Wilmer-Hutchins schools have gone from a $1.6 million fund balance to a net deficit. In August, the district ran out of money and couldn’t pay its teachers for several weeks.

Those financial problems and a host of other allegations have attracted scrutiny from a number of investigative bodies, including the FBI, the Rangers, the U.S. Department of Education, and state and federal grand juries.

At the time of the plates’ disappearance, Ms. Cox was on suspension. On July 8, Dr. Matthews suspended her with pay because of unspecified “possibly illegal payroll practices.” The suspension came one day after Ms. Cox had turned over subpoenaed documents to a Dallas County grand jury investigating payroll fraud in the district.

Ms. Cox said that Dr. Matthews had demanded that she sign a letter admitting illegal activities. “I hadn’t done anything,” she said. “They were trying to intimidate me.”

On Sept. 10, Ms. Cox received a letter from the district asking her to return to work. She said no one has told her the reason her suspension was lifted. “They couldn’t pin something on me,” she said.

But she said she doubted that the signature plates were really missing. “They know that wasn’t true,” she said. “That’s why they didn’t find them.”

High praise at W-H; Despite ongoing turmoil, elementary gets exemplary rating

By Joshua Benton and Herb Booth
Staff Writers

Page 1B

In the swirl of bad news that has surrounded Wilmer-Hutchins schools the last few months, the new state ratings provided a welcome bit of optimism.

One of the district’s elementary schools, Alta Mesa Elementary, had test scores high enough to be exemplary, the state’s highest rating. Two others, Wilmer and C.S. Winn elementaries, earned recognized status.

“You’ll find that there’s a lot of teaching and learning transpiring in our district,” said Superintendent Charles Matthews. “It’s time for you all to say Wilmer-Hutchins is one of the best districts around.”

But the district’s middle school and high school continued to produce some of the lowest academic performances in the state. Both avoided the state’s lowest rating, “academically unacceptable,” because of new rules that excuse low scores at some schools.

Wilmer-Hutchins has been in turmoil since the announcement in early August that the high school was in such poor condition that it could not open for classes. It finally opened a month later.

But in the meantime, criminal investigations were launched into the district’s finances and allegations of corruption. Among the agencies investigating Wilmer-Hutchins: the FBI, the Texas Rangers, the Dallas County district attorney, the U.S. attorney’s office.

Two grand juries are hearing evidence. A team of Texas Education Agency auditors is poring over the district’s finances. And at one point in August, the district ran out of money and couldn’t pay its teachers.

Against that backdrop, the solid performance of the district’s elementary schools was welcome.

“We start out with the belief that every student make measurable academic growth,” said Jata McCollister, Alta Mesa’s principal. She said the school uses teacher training, field trips and community support to achieve success.

Dr. Matthews said the elementary schools have been successful because of a strong commitment to early childhood education, begun when he was previously superintendent in 1986.

“You know, probably in the next couple of years, the nation will be focused on Wilmer-Hutchins on how to teach students – especially minority children,” he said.

Results were not so strong with older children. Wilmer-Hutchins High and Kennedy-Curry Middle had TAKS passing rates low enough to be rated unacceptable. Only 102 of the state’s 7,813 schools earned that tag.

But both were bumped up to “acceptable” status because of new rules introduced this year. The high school was deemed acceptable because its math scores, while still among the state’s lowest, were substantially better than last year’s. The middle school was granted a special exception that allows some low scores to be excused.

In addition to Alta Mesa, Wilmer and C.S. Winn, two other elementary schools were given high ratings, but not through any doing of their own. Neither A.L. Morney nor Bishop Heights Elementary teaches any students old enough to take the TAKS test – both stop at first grade.

But for ratings purposes, they are each paired with other Wilmer-Hutchins schools. So Bishop Heights was automatically assigned Alta Mesa’s exemplary rating, and Morney shared C.S. Winn’s recognized status.

Alta Mesa has been lauded for high test scores before. After years of middling performance, Alta Mesa’s passing rate began to rise in the mid-1990s. The school’s rating jumped from acceptable to recognized in 1996 and stayed there through 1998.

But a Texas Education Agency inquiry in 1999 found evidence of widespread cheating between 1996 and 1998. The agency found “abnormally high” numbers of erasures on test forms – incorrect answers being erased and replaced by correct ones before tests were sent away for grading.

TEA sent monitors to Alta Mesa in 1999 to monitor the administration of the TAAS test. With state officials watching, only 50 percent of Alta Mesa’s students passed all sections of the TAAS. The year before, without monitors, 83 percent had passed.

But the district’s internal investigation found no evidence of wrongdoing. Alta Mesa has been rated acceptable every year since until this year’s exemplary rating.

Alta Mesa’s scores increased substantially in the transition from TAAS to TAKS – a time when most schools saw movement in the opposite direction.

In 2002, the last year of TAAS, 3,837 elementary schools took the TAAS test. Alta Mesa’s passing rate was only the 3,075th highest in the state.

This year, only 12.1 percent of elementary schools scored highly enough to be exemplary, as Alta Mesa was. The school’s passing rates in reading, math and writing were all 98 percent – better than many wealthy suburban schools.

Ms. McCollister said Alta Mesa’s results were solid. “There was no cheating,” she said.

Instead, she credited strong support from parents and the hard work of teachers.

“We’re not talking about something that happened overnight. You have to nurture and build that kind of community rapport and student success.”

TEA spokeswoman Suzanne Marchman said the agency has received no reports of cheating and does not investigate testing until it receives a formal letter of complaint.

New ratings push many schools off top of ladder; TAKS results hurt suburbs, but changes lift low scorers

By Joshua Benton and Terrence Stutz
Staff Writers

Page 1A

Suburban pride took a hit Thursday.

Across Texas, hundreds of schools used to being rated exemplary – the state’s top marker of quality – looked a little more middling when the state released its 2004 school ratings.

“I know many schools are very, very disappointed,” said Shirley Neeley, Texas’ education commissioner. “Their hearts are broken because many of their ratings dropped.”

Meanwhile, urban schools used to life at the bottom got a boost. That’s in part because of better academic performance. But it’s also because of two new wrinkles in the ratings system that excuse low scores at some schools.

The new ratings are the first based on the more-rigorous TAKS test and the first issued under a system with higher bars set for schools and districts.

The biggest pain is in the suburbs, where earning a top school rating had become as routine as a manicured lawn and a quiet cul-de-sac. Statewide, just 517 campuses were rated exemplary this time. In 2002 – the last year ratings were issued – 1,918 earned the title.

Irving was typical. Until Thursday’s announcement, 20 Irving schools were rated exemplary or recognized, the state’s second-highest rating. Now, only one recognized campus remains. Every other campus in the district dropped to acceptable.

“It is disappointing, sure,” Irving Superintendent Jack Singley said.

Dealing with change

Highland Park, the wealthiest district in North Texas, dropped from its traditional exemplary rating to recognized because of the test scores of its special education students. It’s the first time the district’s test scores have fallen short of exemplary since 1993.

State ratings serve as the main marker of quality for schools. Superintendents point to them with pride. Real estate agents use them to push houses. Parents evaluate educational options with them.

As ratings have improved over the last decade, many districts have made the one-word labels a centerpiece of their public image. Their Web sites and stationery proudly declare their status as “A Recognized District.” Some ask receptionists, when answering phones, to mention the district’s high rating even before saying “hello.”

This year’s lower ratings have left some districts with a public relations job to do.

“We can’t sweep that fact under the rug,” said Mark Thomas, spokesman for the Birdville district in Tarrant County, which dropped from recognized to acceptable. “It’s important to our community. The state has made it important.”

Mr. Thomas said he wasn’t sure what the district would do with the large banner outside district headquarters that promotes the formerly high ratings of the district and its schools.

In Highland Park, Superintendent Cathy Bryce posted a message on the district’s Web site explaining the reasons for the drop. “The bottom line for us is the quality of education that is offered in our schools,” she wrote. “That level of excellence has not changed.”

She also said Highland Park, in what has become a fall ritual for many districts, would appeal its rating to the Texas Education Agency on the basis that the state should consider the district’s overall strength.

Under the old ratings, all 17 traditional schools in Grapevine-Colleyville were considered exemplary. Now, only five are.

“It’s a source of pride,” said parent Darlene Bodish, speaking of the old exemplary status. “It’s on the Web site. They mention it at parent meetings.”

She said recognized – the new rating for most of the district’s schools – is still good. “It’s just that exemplary is wonderful,” Ms. Bodish said.

The new ratings are the first based on the Texas Assessment of Knowledge and Skills, which debuted in 2003 and replaced the easier Texas Assessment of Academic Skills. With TAKS came lower passing rates in most grades.

The new system also counts more tests in more subjects than the old ratings did. Science proved to be the downfall of many schools. The subject didn’t count toward ratings before this year.

Tripped up by science

In Collin County, administrators in Frisco, Allen, McKinney and Plano blamed science for their weaker performances, even though the state set lower standards for the science and math tests than for other subjects.

“We do not want to appear to be making excuses,” said Debra Nelson, assistant superintendent for curriculum and instruction in Frisco, which dropped to acceptable because of low science scores. “However, I can’t help but believe this is a flawed system if missing one standard of 36 makes you acceptable.”

Middle and high schools were mostly likely to get snagged by the new system’s rules. Unlike the TAAS test, TAKS produces substantially higher failure rates for older children.

As a result, 11.4 percent of elementary schools statewide earned exemplary ratings. But only 1.3 percent of middle schools and 0.9 percent of high schools are exemplary.

The news was better in poorer-performing schools. In 2002, 166 schools were tagged with the state’s lowest label, low performing. This year, only 102 schools were labeled academically unacceptable, the state’s new name for low performing. In North Texas, schools in Dallas, Fort Worth, Garland and Grand Prairie got the label.

But those numbers would have been substantially higher if not for two new mechanisms to protect poor-performing schools from a low rating.

The first is called “required improvement.” It excuses poor scores if TEA determines that a school is making enough progress to meet current standards within two years.

For example, Wilmer-Hutchins High School scored poorly in math, with only 30 percent of students passing the TAKS. Normally, that would be low enough to be unacceptable.

But the school had done even worse in 2002: an 18 percent passing rate. The increase from 18 percent to 30 percent meant Wilmer-Hutchins High was pushed into acceptable territory despite its low scores.

Statewide, 50 schools that would have been unacceptable became acceptable through the required improvement provision.

The other “get out of jail free” card available to schools is called an exception. Under the old system, a low passing rate in just one student subgroup on one test was enough to earn a low rating. For instance, a school with a very low passing rate among Hispanic students on the math TAAS was automatically considered low performing – even if the school fared well in every other subgroup and every other subject.

But the new ratings system allows for exceptions under certain conditions. That means a low-scoring school can be excused from a few low passing rates and still be considered acceptable under certain conditions.

Statewide, 61 schools were rated acceptable even though they all scored poorly enough to be declared unacceptable. Of those, six are in Dallas. Fort Worth, Mesquite, Wilmer-Hutchins and Royse City each had one school make the “acceptable” cut as exceptions to the rule.

Nearly half of the state’s 274 independent charter schools avoided performance ratings. That’s because they were allowed to be evaluated under an alternative system that is still being developed. Two years ago, 89 of 230 charter schools were low-performing.

Parents can be excused for being confused about the new ratings. TEA released them one day after announcing that 199 Texas schools were considered poor performers under federal adequate yearly progress rules – a separate ratings system from the state system.

AYP and the state system share some characteristics, like being primarily based on test scores. But they differ in other ways, such as which students’ scores are counted and in what subjects. It’s possible for a school to fare well in AYP but not in the state system – or vice versa.

“It’s confusing,” said Suzanne Marchman, a TEA spokeswoman. “We feel like the state system is a very good gauge of schools. But that’s not to say AYP isn’t good, too.”

Staff writers Valerie Fields Hill, Kristen Holland, Mike Jackson and Russell Rian contributed to this report.