Metro

Shady charter ‘$trips’

The city approved a politically connected charter school — whose founder went to prison and principal was once accused of fixing grades — to issue up to $23 million in tax-exempt bonds to relocate to a former Bronx strip club.

With the tax breaks, the Golden Lady, a shuttered jiggle joint, will be demolished and rise as the South Bronx Charter School for International Culture and the Arts, a K-5 school for just over 400 students, records show.

Assemblywoman Carmen Arroyo, whose grandson founded the nonprofit school in 2005, and her daughter, Councilwoman Maria del Carmen Arroyo, urged BuildNYC, an arm of the city Economic Development Corp., to authorize the sale of bonds.

The school’s founder and former board chairman, Richard Izquierdo-Arroyo, left in 2009 after he was caught embezzling nearly $200,000 from an Arroyo-connected housing nonprofit. He served a year in prison.

Izquierdo-Arroyo spent the stolen funds on his grandmother’s Assembly campaign office and staff, according to court papers. He also treated her and his councilwoman aunt to dinners, shopping and trips to Puerto Rico.

Robert McLaughlin, an attorney for the school, said Izquierdo-Arroyo has no current ties to the school.

His lawmaker relatives touted the achievement record of the charter school, saying it “continually outperformed” other public schools in District 7. Over 62 percent of the charter’s students passed the city’s standardized reading test in 2012, compared to on 39 percent of students at neighboring PS 49. In math, 68 percent of the charter’s kids met standards, above the 62 percent at PS 49.

The school is helmed by Principal Evelyn Hey, who was accused by then-Special School Investigator Ed Stancik in 1999 of inflating grades at PS 234 by giving students help on test day. Scores rose 22 points in one year when she was principal. The charges were dropped in 2002.

Councilwoman Arroyo directed $1.5 million in capital funds to the charter in 2008, but the school decided in 2011 not to accept it, its attorney said.

BuildNYC spokesman Patrick Muncie said the charter’s history was thoroughly investigated during a vetting process.

“In the case of South Bronx Charter School, after thorough due diligence, Build NYC determined the project to be worthy of support, helping this important educator to invest in the students of its underserved area,” he said.

The bonds are expected to go on sale in May. The bonds will be purchased by private investors, but when redeemed, the city, state and federal government will not collect taxes. Muncie said that city exemptions will total $580,000 over 30 years.

Funds will be used for demolition, construction and purchase of equipment for the building.