Former director of Capital City Charter School reaches financial settlement

  • Stephanie Alicea talks with interested students and parents inside the former Bon-Ton space that she transformed into the Capital City Charter School at the Steeplegate Mall in Concord on July 24, 2018. Monitor file

  • Commissioner of the Department of EducationFrank Edelblut talks with student at the Capital City Charter School in the Steepgate Mall on Thursday, November 7, 2019. GEOFF FORESTER

  • Commissioner of the Department of EducationFrank Edelblut talks with student at the Capital City Charter School in the Steepgate Mall on Thursday, November 7, 2019. GEOFF FORESTER

  • Stephanie C. Alicea, the Capital City Charter School’s founder and head in the library of the school at the Steeplegate Mall is looking forward to expanded the school to include high school students. GEOFF FORESTER

  • Stephanie Alicea talks with interested students and parents inside the former Bon-Ton space that she is transforming into the new Capital City Charter School at the Steeplegate Mall in Concord on July 24, 2018. (ELIZABETH FRANTZ / Monitor staff) ELIZABETH FRANTZ

Monitor staff
Published: 10/5/2022 5:13:22 PM

The former director of Capital City Charter School and her mother have agreed to pay $80,000 as part of a settlement agreement in a bankruptcy lawsuit accusing them of misusing funds for personal use.

Stephanie Alicea, founder and former director of Capital City Charter School and her mother Caroletta Alicea, a trustee of the school, reached a settlement with Michael Askenaizer, trustee of the school’s estate, in federal bankruptcy court on Sept. 28. In the settlement, the Aliceas agreed to pay two installments of $40,000, one within the next 60 days and one within the next six months. As the trustee of the estate, Askenaizer is responsible for distributing the money to the school’s creditors in order of priority.

“It was a settlement intended to bring the matter to a conclusion for a highly-respected, successful 77-year-old woman based on the anticipated cost of winning the case,” said defense attorney Bill Gannon, referring to Caroletta Alicea who is a New Hampshire state representative.

Askenaizer had filed a complaint against the Aliceas in January accusing them of misusing federal funds distributed to the charter school by the Department of Education to cover start-up costs. The school was given a $223,000 grant in 2018, but Askenaizer said that Stephanie Alicea spent almost $154,000 of that on personal expenses including transportation, restaurant meals and payments to Caroletta Alicea, according to court documents. Askenaizer had originally sued for $128,837.98.

Stephanie Alicea maintains that the business and financial problems the school experienced were beyond her control and that the school’s grant funding was delayed for months, forcing her and Caroletta Alicea to lend a significant amount of their own money to cover the school’s expenses. Alicea said the discrepancies in financial documentation can be attributed to data loss that occurred during a switch in accounting software programs, and that the school’s initial audit by accounting firm Plodzik & Sanderson “misinterpreted the compensation arrangement” between Alicea and the school.

The Capital City Charter School, which operated from 2018 to 2020 in the former Bon Ton space at the Steeplegate Mall, was based on the idea of service learning – an educational model that integrates community service with instruction. Its opening was greeted with enthusiasm as an example of how charter schools can take alternative approaches, like its decision to locate in the mostly-empty mall. The state Board of Education began to raise questions about its financial records soon after it opened, pointing to missing state and federal financial audits and “excess” grant reimbursements.

The school surrendered its charter in February 2021, and filed for bankruptcy in March 2021.


Eileen O

Eileen O'Grady is a Report for America corps member covering education for the Concord Monitor since spring 2020. O’Grady is the former managing editor of Scope magazine at Northeastern University in Boston, where she reported on social justice issues, community activism, local politics and the COVID-19 pandemic. She is a native Vermonter and worked as a reporter covering local politics for the Shelburne News and the Citizen. Her work has also appeared in The Boston Globe, U.S. News & World Report, The Bay State Banner, and VTDigger. She has a master’s degree in journalism from Northeastern University and a bachelor’s degree in politics and French from Mount Holyoke College, where she served as news editor for the Mount Holyoke News from 2017-2018.



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