And based on board meeting minutes and interviews, the charter office in its reports said members of the Planet Abacus and Laboratory charters' boards knew little about the schools' operations and students. The boards did not analyze budgets and provided little leadership or oversight, the report said.
The School Reform Commission has not acted on the recommendations to deny the renewals. The district placed the renewals on hold July 25, hours after a grand jury indicted Brown and the others with defrauding charter schools she founded of more than $6.5 million.
The 62-count indictment returned in July contains allegations of wire fraud, conspiracy to obstruct justice, and witness tampering.
Michael A. Davis, the district's general counsel, said the district would review the indictment and conduct an inquiry to "determine the appropriate course of action."
Spokesman Fernando Gallard said Tuesday the district hopes that internal review will be done by mid-October.
Parents have been assured the charters will remain open through June.
Brown is a former district principal who founded Planet Abacus in Tacony and two other K-8 charters in Philadelphia: Laboratory, which has campuses in Northern Liberties, Overbrook, and Wynnefield; and Ad Prima in Overbrook and Frankford.
She earlier established Main Line Academy, a private special-education school in Bala Cynwyd. The administration offices for Planet Abacus, Laboratory, and Ad Prima are housed at Main Line. Main Line owns the building that Planet Abacus rents.
Besides Brown, the indictment named longtime charter administrators Joan Woods Chalker, Michael A. Slade Jr., Courteney L. Knight, and Anthony Smoot. All have pleaded not guilty to the charges.
Chalker had been chief executive officer at Planet Abacus while Slade had been CEO at Laboratory. Knight, a former CEO at Ad Prima, teaches at Laboratory. Smoot is the former business manager of Brown's schools.
Within days of the indictments, the boards of Planet Abacus and Laboratory held emergency meetings and voted to suspend Chalker and Slade with pay, pending the outcome of the case.
Attorney Scot R. Withers, who represents both charters, said Tuesday the boards named interim CEOs.
He also said the boards of the taxpayer-funded charters have agreed to cover legal costs for Chalker, Slade, and Knight.
Planet Abacus will pay up to $300,000 for Chalker's defense while Laboratory will cover a maximum of $200,000 for Slade. Ad Prima will pay up to $125,000 of Knight's fees. Laboratory, his current employer, will cover up to $125,000.
Under the terms of their agreements with the schools, Chalker, Slade, and Knight could be required to repay the money if the boards later determine they have not acted in the best interests of the schools, Withers said.
Smoot has not been employed as a business manager at any of Brown's schools for more than a year. He is represented by a public defender.
No trial date has been set.
According to district reports, Planet Abacus and Laboratory are among the highest-performing schools in the city. The schools consistently meet the standards under the federal No Child Left Behind Law.
But the district's charter office found the schools' application procedures may violate state law by discouraging special-education students and English-language learners. Parents said their children had to take placement tests when they applied.
Only 10 of Planet Abacus' 428 students in 2011-12 received special-education services. Laboratory, which enrolls 398 students, had two. At most city charter schools, at least 10 percent of students are in special education.
The district found that the charters' CEOs could provide only limited academic guidance to teachers because they were based in Bala Cynwyd.
The charter office also said it could not assess the finances of Planet Abacus and Laboratory because the schools had not provided recent audits or other information.
Withers, the schools' lawyer, said documents had been submitted since the charter office reports.
He said the schools are hopeful the School Reform Commission will approve new operating charters.
Contact Martha Woodall at 215-854-2789 or at email@example.com