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A Minnesota charter school that has been a magnet for Muslim students -- and controversy -- appears to be on the brink of closure after a judge's decision and a state ruling that left it unable to comply with a new state law.

Tarek ibn Ziyad Academy (TiZA), which serves 540 students at its campuses in Inver Grove Heights and Blaine, has been embroiled for several years in a high-profile lawsuit from the American Civil Liberties Union of Minnesota over claims that the public school has promoted religion.

But the blow that could prove fatal to the school is the loss of its authorizer, a nonprofit that provides legally required oversight. A new law that takes effect on Friday forbids out-of-state authorizers, which disqualifies TiZA's.

Without oversight, TiZA ceases to exist as a public school in the eyes of state officials, who have given the school instructions on how to shut down and are cutting off state aid.

On Thursday afternoon, TiZA responded with a surprise bankruptcy filing, and could also challenge the state's decision in the Minnesota Court of Appeals.

But TiZA parents, many of whom are Muslim immigrants, are already wondering where their kids will go to school, with some lamenting the loss of rigorous lessons and a haven from religious discrimination.

"I'm sad and frustrated and wondering what to do next," said Burnsville mother Krista Siddiqui, who has three children at TiZA.

Despite a high student poverty rate, the school has posted high scores on state tests. TiZA's low-income students in particular, Siddiqui said, "were getting an amazing education where they were in an environment that was safe, that was comfortable."

School director Asad Zaman struck a defiant tone. "If they want us to shut down, they're going to have to come down and ask the kids to leave," he said.

The school plans to continue summer school on Tuesday, and administrators will meet with parents at 6 p.m. Friday at its Inver Grove Heights campus, he said.

It's unclear how TiZA's closure would affect the ACLU lawsuit.

"It's hard to imagine a months-long or five-week trial over a principle that's not a live principle anymore," ACLU attorney Peter Lancaster said this week.

Hopes dashed on final day

The key decisions from Education Commissioner Brenda Cassellius and U.S. District Court Judge Donovan Frank came hours before the effective date of the new authorizer law.

The school had challenged the law in a federal suit against Cassellius and its current authorizer, the nonprofit Islamic Relief USA. Attorneys for TiZA asked Frank on Tuesday for a preliminary injunction and temporary restraining order that would have allowed the school to stay open while they made their case.

But Frank denied both requests, saying the school showed little evidence that it could prove its claims.

"If TiZA is required to close its doors, the harm to its students, families and staff will obviously and sadly be great," the judge wrote. But "the court ... considers the public's interest in a transparent and accountable public charter school system and in maintaining the integrity of the state statutes."

TiZA had also tried to switch authorizers, but the state denied the request shortly before midnight on Wednesday.

In her denial, Cassellius said the school's would-be overseer, Novation Education Opportunities, had shown a "lack of candor," in part by not disclosing apparent conflicts of interest with the school.

She said that TiZA parents have "expressed concern about the future of their school in light of misinformation the TiZA administration had provided them about conflicts of interest between the school's administration and other entities."

Among other problems, Novation also lacked an adequate plan for resolving concerns about the school raised by Islamic Relief, she wrote.

Many of those issues were uncovered by the ACLU's lawsuit. Among the concerns listed by Cassellius: A lack of transparency in TiZA's governance, conflicts of interest, an Arabic curriculum with sectarian content and the submission of unauthorized documents about the school to the state.

The school shot back that the Education Department "has wrongly pre-judged TiZA, callously using disputed information from the ACLU's lawsuit ... [and] ignoring information favorable to TiZA on the very same issues."

The ACLU trial hasn't taken place, but the state is using contested facts to act as "judge, jury and executioner -- without a hearing," said TiZA attorney Shamus O'Meara.

In light of Frank's ruling, the school withdrew its federal challenge of the state law on Thursday, O'Meara said.

State officials sent documents to TiZA Wednesday night outlining the expected closure process, which O'Meara said included a demand for redistribution of school funds and an audit.

School says it's bankrupt

The school filed for bankruptcy under Chapter 11, which businesses typically use to seek protection from creditors while attempting to reorganize. It was the school's only way to "protect its mandatory financial obligations to its staff and to properly address the many issues it now faces," the school said in a statement.

Lancaster, the ACLU attorney, speculated that TiZA made the move because of the "freeze period" that kicks in under Chapter 11 proceedings, in which adverse actions against an entity are halted while a judge sorts out which claims should proceed.

Asked whether he sees the school's move as an attempt to stay open permanently, Lancaster said, "No, it can't possibly achieve that."

He said it could bring about "an orderly distribution of whatever money they have."

Sarah Lemagie • 952-882-9016