Ceria M. Travis Academy, Inc., Petitioner-Respondent,
Tony Evers, State Superintendent of Public Instruction, Respondent-Appellant.
from orders of the circuit court for Milwaukee County Cir.
Ct. No. 2015CV601 DANIEL A. NOONAN, Judge. Reversed and cause
Kessler and Brash, JJ., and Daniel L. LaRocque, Reserve
The Department of Public Instruction (DPI) appeals orders of
the circuit court in which the court determined that a
Settlement Agreement (the Agreement) entered between DPI and
Travis Technology High School (Travis Tech) allowing Travis
Tech to remain in the Milwaukee Parental Choice Program
(MPCP) is unenforceable based on two provisions in the
Agreement. The Agreement was entered into to avoid a
preliminary decision by DPI to bar Travis Tech from
participation in the MPCP because the school failed for
several years to file the requisite financial documents in a
timely manner. The circuit court ordered DPI to release
withheld funds and to allow Travis Tech to remain in the
MPCP. We conclude that the provision of the Agreement in
which DPI and the school agree to a surety bond and the
provision by which Travis Tech waived its right to judicial
review are enforceable. Accordingly, we reverse the circuit
court's decision and remand the matter to the DPI.
The underlying facts in this case are not in dispute and are
taken primarily from the circuit court's written
decision. Ceria M. Travis Academy, Inc. (Travis Inc.) is a
nonprofit organization in Milwaukee that operates two
schools, Ceria M. Travis Academy and Travis Tech. Both
schools were participants in the MPCP pursuant to WIS. STAT.
§ 119.23 (2013-14). The MPCP was created in 1989 to
subsidize private education for children from low-income
families in the City of Milwaukee. Under the program, DPI
pays each Choice school a statutorily-authorized amount on
behalf of the parents, based on the number of students each
school has in attendance. See WIS. STAT. §
119.23(4); WIS. Admin. CODE § PI 35.05(3)
(2012).DPI makes payments in four equal
installments in September, November, February, and May of
each school year. See WIS. STAT. §
119.23(4)(c). Participating schools are required to provide
DPI with annual Financial Information Reports, detailing the
schools' revenues and expenses for the previous year.
Financial Information Reports must be submitted
"[a]nnually by September 1 following a school year in
which a private school participated in the [MPCP]
program." Wis.Stat. § 119.23(7)(am)1. (2011-12).
Following submission of the Financial Information Report, DPI
determines whether a school received any overpayments for the
previous school year. Wis. Admin. Code § PI
35.045(1)(g). In the event of an overpayment, the school must
reimburse DPI within a specified time period. See
§§ PI 35.04(8), (9)(f); 35.045(1)(g)3. If a school
fails to comply with the financial reporting requirements,
DPI may impose a variety of sanctions, including, but not
limited to, barring the school from participating in the
MPCP. Wis.Stat. § 119.23(10)(a)2.
As relevant to this appeal, Travis Tech submitted a Financial
Information Report on September 22, 2014, for the 2014-15
school year, three weeks past the September 2, 2014 deadline.
It was the fourth consecutive year Travis Tech submitted a
late financial report. Also on September 22, 2014, DPI issued
notice of its preliminary decision to bar Travis
from participation in the MPCP and to withhold future
payments. On October 22, 2014, counsel for Travis Tech asked
DPI to vacate its preliminary decision. DPI declined and
Travis Tech appealed the preliminary decision. Thereafter,
Travis Tech and DPI entered into settlement discussions.
Ultimately, the parties reached a Settlement Agreement,
whereby, as relevant here: (1) DPI required Travis Tech to
obtain a surety bond equal to twenty-five percent of the
total MPCP payment for the 2014-15 academic year; (2) DPI
would withhold its November 2014 payment until Travis Tech
obtained the bond; and (3) Travis Tech agreed to waive all
rights to an appeal in the event DPI barred Travis Tech from
the MPCP because of the school's failure to comply with
the terms of the Agreement. Specifically, the Agreement
Department and the School agree to the following:
3) The School shall submit to the Department all reports
fully completed and on a timely basis. In order to be
considered timely, a report shall be sent to the Department
on or before the date, as computed under [Wis. Stat. §]
990.001(4), established by statute, administrative rule, or
other communication from the Department. A request by the
Department for additional, supplemental information not
required by the report shall not render a report incomplete.
The Department shall determine, in its sole discretion,
whether a report is complete and timely.
4)The School shall contract, at its own expense, with the
Wisconsin Religious and Independent Schools Accreditation
("WRISA") to conduct an in-person review of the
School…. The review shall determine the following: (i)
whether the School meets private schools requirements under
Wis.Stat. § 118.165(1); (ii) whether the School meets
the hours of instruction requirements under Wis.Stat. §
119.23(2)(a)8 for each grade; and (iii) whether the School is
in compliance with Wis.Stat. § 119.23(2)(a)6. The
School's contract with WRISA shall require WRISA to
provide a copy of its findings directly to the Department. A
copy of WRISA's findings must be received by the
Department on or before November 17, 2014.
6) On or before December 17, 2014, the School shall obtain a
surety bond equal to 25 percent of the total current fiscal
year Choice payment amount, as determined under Wis.Stat.
§ 119.23(4). The surety bond shall be made payable to
the State of Wisconsin. The purpose of the bond shall be to
protect the Department and the taxpayers of Wisconsin against
loss in the event the School is unable to return Choice
overpayments to the Department under Wis. Admin. Code
§§ PI 35.04(9)(f) or 35.045(1)(g)3, or the School
fails to comply with paragraph three (3) of this agreement.
The Department shall not release the School's November
Choice payment until the School obtains the aforementioned
7) If the School fails to comply with any of the requirements
in paragraphs three (3), four (4), or six (6), the Department
may, in its sole discretion, issue an order under Wis.Stat.
§ 119.23(10) and Wis. Admin. Code § PI 35.05(12) to
bar the school from participation in the MPCP and withhold
payments from the School. The School expressly waives all
appeal or other rights it may have including those under
Wis.Stat. Chapt. 227, to challenge such an order. The order
issued shall become effective on the date it is signed on
behalf of the Department.
Agreement also stated:
The parties had equal opportunity to review, revise, and
negotiate the terms of this agreement. The parties
acknowledge that they have read this agreement and have had
the opportunity to consult with their respective attorneys
concerning its contents and legal consequences. The parties
further acknowledge they have ...