In the Matter of the Proposed Quest Academy Charter School of Montclair Founders Group (070972) ( 2013 )


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  •                                                      SYLLABUS
    
    (This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the
    convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the
    interest of brevity, portions of any opinion may not have been summarized).
    
          IMO Proposed Quest Academy Charter School of Montclair Founders Group (A-12-12) (070972)
    
    Argued September 9, 2013 -- Decided December 16, 2013
    
    LaVECCHIA, J., writing for a unanimous Court.
    
             In this appeal, the Court considers the standard of review applicable to the Commissioner of Education’s
    decision to deny a charter school application and the propriety of that decision.
    
              The Charter School Program Act of 1995 (the Act), N.J.S.A. 18A:36A-1 to -18, authorizes the
    establishment of charter schools in New Jersey. The Act charges the Commissioner of Education (Commissioner)
    with the responsibility to establish a program to “provide for the approval and granting of charters to charter schools
    pursuant to [the Act].” N.J.S.A. 18A:36A-3. The application process is governed by the Act, see N.J.S.A.
    18A:36A-4, -4.1, -5, and implementing regulations, see N.J.A.C. 6A:11-2.1. Each charter school application must
    be submitted not only to the Commissioner, but also to the local board of education for a recommendation to the
    Commissioner. The Commissioner has the “final authority to grant or reject a charter application.” N.J.S.A.
    18A:36A-4(c). Although the statutory and regulatory programmatic requirements provide no guidance to the
    Commissioner on how to assess an application, case law requires the Commissioner to (1) avoid segregation
    resulting from the grant of a charter school application and (2) evaluate the impact that loss of funds would have on
    the local school district’s ability to deliver a thorough and efficient education. In re Grant of Charter Sch.
    Application of Englewood on the Palisades Charter Sch. (Englewood on the Palisades II), 
    164 N.J. 316
     (2000).
    
               On October 15, 2010, Tracey Williams, on behalf of a group of founders, submitted an application to the
    Commissioner to open Quest Academy, a proposed charter high school in Montclair. On December 6, 2010,
    Williams received an email response from the State Department of Education (Department) stating that certain
    sections of the application were incomplete, insufficient, or unclear, pointing out specific deficiencies in the
    application, and providing an opportunity to address the deficiencies through the submission of further information.
    Also on December 6, 2010, Dr. Frank Alvarez, Superintendent of the Montclair Public Schools, provided the
    Commissioner comments on the Quest Academy application on behalf of the local board of education. Dr. Alvarez
    addressed the negative financial impact that the proposed charter school would have on the Montclair School
    District and criticized the application for containing inadequate and unclear information on course requirements,
    graduation requirements, and curriculum development. Quest Academy submitted additional materials on
    December 14, 2010. On January 18, 2011, the Commissioner sent a brief, form-like letter to Williams stating that,
    “based on recommendations and my review, I am denying your request because of the deficiencies in your
    application.” Although there was no further detail regarding the deficiencies, the letter informed Williams that the
    Department had additional information regarding her application and invited her to arrange an appointment with
    staff to review the additional information and to register for a Department training program on preparing charter
    school applications.
    
              Williams filed a notice of appeal with the Appellate Division on February 24, 2011. On June 6, 2011, the
    Commissioner submitted an amplification of reasons for the denial to the Appellate Division. The Commissioner
    characterized Quest Academy’s education plan as weak and discussed content and programmatic deficiencies,
    including that Quest Academy failed to present a comprehensive and fully integrated educational program and that
    its strategies were neither connected to, nor supportive of, the proposed educational program. The Commissioner
    added that, from her own experience, stand-alone charter high schools were particularly difficult to open and operate
    successfully. She also expressed concern that a charter school might interfere with the existing desegregation order
    that applies to the Montclair public schools. Finally, the letter cited criticisms voiced by Dr. Alvarez and
    community members who had written unsolicited letters of opposition to the proposed charter school. The
    Appellate Division affirmed the Commissioner’s denial. The appellate panel stated that, because the Commissioner
    did not act in a quasi-judicial capacity, it did not review the Commissioner’s decision under the substantial-credible-
    evidence standard, but rather under the standard of whether the decision is arbitrary, capricious, or unreasonable.
    The panel found that the Commissioner’s denial of Quest Academy’s application was not arbitrary, capricious, or
    unreasonable. The Court granted Williams’s petition for certification. 
    212 N.J. 288
     (2012).
    
    HELD: The arbitrary, capricious, or unreasonable standard of review is applicable to the Commissioner’s decision to
    grant or deny a charter school application. The Commissioner’s decision to deny Quest Academy’s charter school
    application was amply supported by the record and was not arbitrary, capricious, or unreasonable.
    
    1. Because the Act does not confer a right to an administrative hearing for charter school applications, applicants
    cannot claim the right to a quasi-judicial administrative hearing as a “contested case” under the Administrative
    Procedure Act (APA), N.J.S.A. 52:14B-1 to -15. However, that does not end all inquiry into the nature of the
    proceedings before the Commissioner. The labels of “quasi-judicial” and “quasi-legislative” typically are used to
    determine whether an agency is obligated to provide an administrative adjudicative hearing, regardless of whether
    the matter would merit the designation of a “contested case” under the APA. If the matter centers on the resolution
    of disputed adjudicative facts, if the parties are adverse, or if credibility determinations must be made, more formal
    adjudicatory-type proceedings must be provided (hence the quasi-judicial designation). The quasi-judicial and
    quasi-legislative labels have limits to their usefulness, however, because agencies must retain the ability to provide
    various informal, flexible procedures for determining certain issues that may not fit easily into either
    characterization. Importantly, the labels do not result in a meaningful difference in the role played by judicial
    review of administrative determinations. (pp. 17-20)
    
    2. Reflecting the need to respect agency action taken pursuant to authority delegated by the Legislature, an appellate
    court may only reverse an agency decision if it is arbitrary, capricious, or unreasonable. In other words, a court may
    intervene when it is clear that the agency action is inconsistent with its mandate. That standard is applicable to
    administrative agency actions regardless of whether they are quasi-legislative or quasi-judicial. In addition, it is
    inarguable that the arbitrary, capricious, or unreasonable standard requires that the administrative decision be
    supported by the evidence in the record. (pp. 20-23)
    
    3. The Commissioner’s decision to deny Quest Academy’s application was amply supported by the record. The
    Court does not second guess the educational judgments expressed in the Commissioner’s amplification. Moreover,
    the analysis provided by Dr. Alvarez, which is required by the Act, was properly included in the record and was
    appropriately part of the Commissioner’s determination. It was also appropriate for the Commissioner to consider
    the existing desegregation order pursuant to Englewood on the Palisades II. Finally, the Court finds no error in the
    Commissioner’s consideration of unsolicited letters from local citizens or her reliance on her own expertise in
    assessing the overall viability of the proposed charter school. Case law has recognized the value that administrative
    expertise can play in making predictive or judgmental determinations. The Commissioner’s decision demonstrates a
    thoughtful and thorough weighing and judgment of the merits of Quest Academy’s application and does not warrant
    judicial intervention. (pp. 23-27)
    
    4. Rule 2:5-1(b) permits the filing of an amplification of reasons after an appeal has been filed and no objection was
    raised on the basis of the Rule’s time frames for such submissions. In addition, the Court accepts the
    Commissioner’s explanation for the manner of her initial response to the application. Although the letter of denial
    did not detail the application’s deficiencies, it offered instead a face-to-face meeting to review the application in
    detail. In reviewing a complex proposal for a charter school, there is a benefit to offering a discussion, instead of a
    written cataloguing, of mistakes or deficiencies in the application that has been rejected. The Court does not fault
    the Commissioner for choosing a dialogue involving constructive criticism as her preferred approach for producing
    approvable applications when resubmitted. (pp. 27-28)
    
             The judgment of the Appellate Division is AFFIRMED.
    
          CHIEF JUSTICE RABNER, JUSTICES ALBIN and PATTERSON, and JUDGES RODRÍGUEZ
    and CUFF (both temporarily assigned) join in JUSTICE LaVECCHIA’s opinion.
    
    
    
    
                                                               2
                                           SUPREME COURT OF NEW JERSEY
                                             A-12 September Term 2012
                                                      070972
    
    
    
    IN THE MATTER OF THE
    PROPOSED QUEST ACADEMY
    CHARTER SCHOOL OF MONTCLAIR
    FOUNDERS GROUP.
    
    
    
    
              Argued September 9, 2013 – Decided December 16, 2013
    
              On certification to the Superior Court,
              Appellate Division.
    
              Michael J. Confusione argued the cause for
              appellant Tracey Williams a member of Quest
              Academy Charter School of Montclair Founders
              Group (Hegge & Confusione, attorneys).
    
              Michelle Lyn Miller, Assistant Attorney
              General, argued the cause for respondent The
              Commissioner of Education (John J. Hoffman,
              Acting Attorney General; Lewis A.
              Scheindlin, Assistant Attorney General, of
              counsel; Diana C. Sierotowicz and Geoffrey
              N. Stark, Deputies Attorney General, on the
              briefs).
    
    
        JUSTICE LaVECCHIA delivered the opinion for the Court.
    
        The Charter School Program Act of 1995 (the Act), L. 1995,
    
    c. 426, §§ 1 to 18 (codified as amended at N.J.S.A. 18A:36A-1 to
    
    -18), authorizes the establishment of charter schools in New
    
    Jersey.   See N.J.S.A. 18A:36A-2 (finding that charter schools
    
    “can assist in promoting comprehensive educational reform” and
    
    
                                     1
    that their establishment “is in the best interests of the
    
    students of this State”).   The Act charges the Commissioner of
    
    Education (Commissioner) with the responsibility to establish a
    
    program to “provide for the approval and granting of charters to
    
    charter schools pursuant to [the Act].”    N.J.S.A. 18A:36A-3.
    
    The application process is governed by the Act, see N.J.S.A.
    
    18A:36A-4, -4.1, -5, and implementing regulations, see N.J.A.C.
    
    6A:11-2.1.   Review of applications is conducted in accordance
    
    with prescribed timing requirements that promote batched reviews
    
    tied to school cycles.   See N.J.A.C. 6A:11-2.1(b)(5), -2.1(f).
    
    Ultimately, the Commissioner has the “final authority to grant
    
    or reject a charter application.”    N.J.S.A. 18A:36A-4(c); see
    
    also N.J.A.C. 6A:11-2.1(a).
    
        In this matter, petitioner is one of the founders of the
    
    proposed Quest Academy Charter School of Montclair (Quest
    
    Academy), which sought licensure pursuant to N.J.S.A. 18A:36A-4
    
    to operate as a charter school for high school students.    The
    
    Commissioner denied the application in a writing that was short
    
    on detail with respect to the application’s deficiencies.
    
    Instead, an offer to meet and discuss the application’s
    
    shortcomings was extended, as well as the opportunity to
    
    participate in a training program for preparing an application
    
    for the upcoming application deadline.    Following petitioner’s
    
    filing of a notice of appeal to the Appellate Division, the
    
                                     2
    Commissioner issued a written amplification of reasons for
    
    denial of the application.   The Appellate Division upheld the
    
    Commissioner’s action on the grounds that the decision was not
    
    arbitrary, capricious, or unreasonable.
    
        We granted certification to consider petitioner’s claim
    
    that the Appellate Division misconstrued the standard of review
    
    applicable to the Commissioner’s decision.    We now affirm the
    
    judgment of the Appellate Division.   For clarity’s sake, we
    
    restate the standard applicable in appellate review of agency
    
    actions and what is encompassed in that review; however, we
    
    discern no error in the appellate panel’s performance of its
    
    review function here.   Further, like the Appellate Division, we
    
    see no basis for interfering with the Commissioner’s use of a
    
    written amplification of reasons for her denial after
    
    petitioner’s appeal had been filed.
    
                                    I.
    
        On October 15, 2010, petitioner Tracey Williams, on behalf
    
    of a group of founders, submitted an application to the
    
    Commissioner to open Quest Academy, a proposed charter high
    
    school to serve pupils in grades nine through twelve with
    
    approximately eighty pupils per grade.    We digress briefly to
    
    explain the regulatory process required for charter schools
    
    before addressing the Commissioner’s response to the Quest
    
    Academy application.
    
                                     3
                                   A.
    
        Pursuant to the Act, a charter school application minimally
    
    must include the following information:
    
             a. The   identification      of     the   charter
             applicant;
    
             b. The name of the proposed charter school;
    
             c. The proposed governance structure of the
             charter school including a list of the
             proposed members of the board of trustees of
             the charter school or a description of the
             qualifications    and   method    for    the
             appointment or election of members of the
             board of trustees;
    
             d. The educational goals of the charter
             school, the curriculum to be offered, and
             the methods of assessing whether students
             are meeting educational goals.       Charter
             school students shall be required to meet
             the same testing and academic performance
             standards   as   established   by  law   and
             regulation   for   public  school  students.
             Charter school students shall also meet any
             additional assessment indicators which are
             included within the charter approved by the
             commissioner;
    
             e. The admission policy and criteria for
             evaluating the admission of students which
             shall   comply  with  the  requirements of
             [N.J.S.A. 18A:36A-8];
    
             f. The age or grade range of students to be
             enrolled;
    
             g. The   school   calendar    and    school   day
             schedule;
    
             h. A description of the charter school staff
             responsibilities     and     the    proposed
             qualifications of teaching staff;
    
    
                                    4
             i. A description of the procedures to be
             implemented to ensure significant parental
             involvement in the operation of the school;
    
             j. A description of, and address for, the
             physical facility in which the charter
             school will be located;
    
             k. Information   on  the   manner in which
             community groups will be involved in the
             charter school planning process;
    
             l. The financial plan for the charter school
             and the provisions which will be made for
             auditing   the   school   pursuant  to   the
             provisions of [N.J.S.A. 18A:23-1];
    
             m. A description of and justification for
             any waivers of regulations which the charter
             school will request; and
    
             n. Such    other    information      as     the
             commissioner may require.
    
             [N.J.S.A. 18A:36A-5.]
    
    Regulations impose additional requirements, including completion
    
    of the Department’s “New Jersey Charter School Application.”
    
    N.J.A.C. 6A:11-2.1(b)(1); see N.J. Dep’t of Educ. Office of
    
    Charter Sch., Phase One Request for Applications (2013),
    
    available at
    
    http://www.nj.gov/education/chartsch/app/2013PhaseOneCharter
    
    SchoolApplication.pdf.   The initial application form is made
    
    available no later than August 31 of each year.    N.J.A.C. 6A:11-
    
    2.1(b)(1).
    
    
    
    
                                     5
         Significantly, the application process proceeds in two
    
    phases.1   In phase one, the application must include
    
               i.   The   name   of   the    proposed   charter
               school;
    
               ii.   Mission;
    
               iii. Educational program overview;
    
               iv.   Applicant and founder information;
    
               v.    Enrollment and admission information;
    
               vi.   Demonstration of need; and
    
               vii. Community and parent involvement.
    
               [N.J.A.C. 6A:11-2.1(b)(2).]
    
         The Commissioner determines whether the applicant is a
    
    “qualified applicant” that advances to phase two of the
    
    evaluation process.    See N.J.A.C. 6A:11-2.1(b)(3), (c).     In
    
    order to advance to phase two, the applicant must have
    
               submitted an application that[: 1] has a
               clear, focused, and results-oriented mission
               statement that aligns with all parts of the
               application; [2] demonstrates understanding
               of the population that the school is likely
               to serve; [3] has an educational program
               that is likely to be effective for the
               student population; [4] has strong and
    
    1
      The process is further separated into standard applications and
    expedited applications. Standard applicants may submit the
    phase one application no later than March 31 of the year before
    the school seeks to open. N.J.A.C. 6A:11-2.1(b)(5). Applicants
    with “demonstrable experience operating an educational
    institution” may submit applications by October 15 for expedited
    review. N.J.A.C. 6A:11-2.1(g). Quest’s application seeking
    expedited review was filed in accordance with the October 15
    deadline.
                                      6
             diverse leadership; and [5] has           strong
             financial planning and management.
    
             [N.J.A.C. 6A:11-2.1(b)(3)(ii).]
    
    In phase two, the applicant must submit additional detailed
    
    information addressing the following:
    
             (1) Educational program;
    
             (2) Goals and objectives;
    
             (3) At-risk populations;
    
             (4) Staffing information;
    
             (5) Financial plan;
    
             (6) Governance and organizational plan;
    
             (7) Facilities;
    
             (8) Daily and annual schedule;
    
             (9) Requested waivers; and
    
             (10) All required documentation as set forth
             in   the  phase     two   application.      Such
             documentation shall include, but not be
             limited to: course and curriculum outlines,
             graduation requirements, school scheduling
             information,   professional     backgrounds   of
             administrators     and    staff,    professional
             development    and     evaluation    plans,   an
             organizational chart, and documentation of
             fiscal and legal compliance.
    
             [N.J.A.C. 6A:11-2.1(b)(3)(iii).]
    
    Following receipt of the required phase two information, the
    
    Commissioner schedules the applicant for “an in-depth interview”
    
    with the Commissioner or a designated representative.       N.J.A.C.
    
    6A:11-2.1(b)(3)(iv), (e).
    
                                    7
         Each charter school application must be submitted not only
    
    to the Commissioner, but also to the local board of education
    
    or, if the district is being operated under State intervention,2
    
    the State district superintendent.   N.J.S.A. 18A:36A-4(c).     The
    
    board or district superintendent must review the application and
    
    recommend to the Commissioner whether she should grant or deny
    
    the application.   See ibid. (requiring board of education in
    
    which proposed charter school is to be located to review
    
    application and to forward to Commissioner recommendation on
    
    application’s merit); N.J.A.C. 6A:11-2.1(d)(1)-(2) (requiring
    
    same and setting forth specified time frames dependent on phase
    
    of review).   The information clearly is intended to assist the
    
    Commissioner in her consideration of the application.
    
         Despite all their detail, the statutory and regulatory
    
    programmatic requirements provide no guidance to the
    
    Commissioner on how to assess an application.   Case law imposes
    
    two requirements, however.   First, “the Commissioner must assess
    
    the racial impact that a charter school applicant will have on
    
    the district of residence in which the charter school will
    
    operate” and “must use the full panoply of [her] powers to
    
    avoid” segregation resulting from the grant of a charter school
    
    
    2
      N.J.S.A. 18A:7A-34 permits the State Board to place a failing
    school district under State control. The State Board appoints a
    State district superintendent to run such a district. See
    N.J.S.A. 18A:7A-35.
                                     8
    application.   In re Grant of Charter Sch. Application of
    
    Englewood on the Palisades Charter Sch. (Englewood on the
    
    Palisades II), 
    164 N.J. 316
    , 329 (2000).   Second, if the local
    
    school district “demonstrates with some specificity that the
    
    constitutional requirements of a thorough and efficient
    
    education would be jeopardized by [the district’s] loss” of the
    
    funds to be allocated to a charter school, “the Commissioner is
    
    obligated to evaluate carefully the impact that loss of funds
    
    would have on the ability of the district of residence to
    
    deliver a thorough and efficient education.”   Id. at 334-35; see
    
    N.J. Const. art. VIII, § 4, ¶ 1 (“The Legislature shall provide
    
    for the maintenance and support of a thorough and efficient
    
    system of free public schools for the instruction of all the
    
    children in the State between the ages of five and eighteen
    
    years.”).
    
                                    B.
    
         On December 6, 2010, approximately six weeks after Quest
    
    Academy submitted its October 15 application, Ms. Williams
    
    received an email response from a representative of the State
    
    Department of Education, stating that certain sections of the
    
    application were incomplete, insufficient, or unclear.      The
    
    response informed Quest Academy of specific deficiencies in its
    
    application and afforded it the opportunity to address the
    
    concerns raised through the submission of further information.
    
                                     9
        Also on December 6, 2010, in accordance with the Act, Dr.
    
    Frank Alvarez, Superintendent of the Montclair Public Schools,
    
    provided comments on the Quest Academy application to the
    
    Commissioner on behalf of his local board of education.     Dr.
    
    Alvarez addressed the negative financial impact that the
    
    proposed charter school would have on the Montclair School
    
    District in light of recent reductions in state aid and the
    
    District’s reliance on local property taxes.   Substantively, Dr.
    
    Alvarez criticized the application for lacking clear information
    
    on course requirements, inadequately addressing state high
    
    school graduation requirements, and failing to specify a process
    
    of curriculum development in the nine areas of the state’s core
    
    curriculum content standards.
    
        Quest Academy submitted additional materials on December
    
    14, 2010, in response to the December 6 departmental request.
    
    Thereafter, on January 3, 2011, Department representatives met
    
    with Quest founders to discuss the application as augmented by
    
    the addenda.
    
        On January 18, 2011, the Commissioner sent a brief and
    
    rather form-like letter to Williams denying Quest Academy’s
    
    application.   In it, the Commissioner referred to the forty-five
    
    applications that had been reviewed in the application cycle as
    
    “present[ing] varying degrees of readiness to successfully
    
    implement exciting and educationally innovative models to
    
                                    10
    enhance student achievement,” but tersely informed Williams
    
    that, “based on recommendations and my review, I am denying your
    
    request because of the deficiencies in your application.”       There
    
    was no further detail on those deficiencies in the denial
    
    letter.
    
        The letter provided other important information, however.
    
    It advised Williams of her right to appeal the Commissioner’s
    
    denial.   It informed Williams that the Department had additional
    
    information regarding Quest’s application and invited her to
    
    call to arrange an appointment with staff to review the
    
    additional information.   The letter further informed Williams
    
    that training was available to assist individuals with
    
    preparation of charter school applications for the next charter
    
    school application deadline, which was March 31, 2011.    The
    
    letter invited Williams and the founders to register for the
    
    training program offered by the Department for the upcoming
    
    application deadline.
    
        Williams, acting pro se, filed a notice of appeal with the
    
    Appellate Division on February 24, 2011.
    
        On June 6, 2011, the Commissioner submitted to the Clerk of
    
    the Appellate Division an Amplification of Reasons for the
    
    denial in the form of a letter from Carly Bolger, Director of
    
    the Department’s Office of Charter Schools.   According to the
    
    Amplification, the Commissioner denied the application based on
    
                                    11
    its overall lack of quality, as expressed in the initial letter.
    
    In the Amplification, the Commissioner expanded upon her
    
    concerns.
    
        The Commissioner characterized Quest Academy’s education
    
    plan as weak, discerning content and programmatic deficiencies
    
    in several aspects of the proposed program.    Specifically, the
    
    Commissioner noted that
    
                Quest’s educational plan . . . incorporated
                many different strategies, programs, and
                philosophies, but failed to present these
                varied ideas as a comprehensive and fully
                integrated educational school program.     In
                particular,   the    goals   and   objectives
                presented in the plan were weak. . . .
                Moreover, the Commissioner found that the
                strategies presented by Quest were neither
                connected   to,   nor   supportive  of,   the
                proposed educational program.
    
        The Commissioner added that, from her own experience, she
    
    believed that stand-alone charter high schools were particularly
    
    difficult to open and operate successfully.    She questioned the
    
    ability of the school to attract sufficient students in the
    
    small community of Montclair, and expressed concern that a
    
    charter school might interfere with Montclair’s desegregation
    
    efforts.    The letter cited criticisms voiced by Dr. Alvarez and
    
    community members who had written unsolicited letters of
    
    opposition to the proposed charter school.    Those criticisms
    
    questioned the capacity and qualifications of Quest’s founders;
    
    the potential negative impact on the quality of programs and
    
                                     12
    educational offerings at Montclair public schools; a lack of
    
    community support for, or interest in, a charter school and,
    
    conversely, strong community support for the public high school;
    
    and the lack of an adequate facility to house the proposed
    
    charter school.
    
        According to the Amplification, based on the entirety of
    
    those considerations, the Commissioner had determined that
    
    Quest’s application did not have a high probability of success.
    
    She therefore had denied the application.
    
                                    C.
    
        On appeal before the Appellate Division, petitioner’s
    
    criticisms focused on the Commissioner’s review procedures and
    
    the specific information used by the Commissioner in her
    
    evaluation of the application, including the information
    
    provided through Dr. Alvarez’s evaluation, the citizen letters,
    
    and the existing desegregation order that applied to the
    
    Montclair public schools.   In addition, petitioner contended
    
    that the federal No Child Left Behind Act, 20 U.S.C.A. § 6316,
    
    required the Commissioner to approve charter school applications
    
    in districts, like Montclair, that had been identified as in
    
    need of improvement.
    
        In response, the Commissioner addressed the propriety of
    
    the information that she had considered in connection with the
    
    application, countered the argument that the No Child Left
    
                                    13
    Behind Act had applicability in this setting, and urged the
    
    Appellate Division to affirm her determination because the
    
    administrative decision was not arbitrary, capricious, or
    
    unreasonable.
    
        The Appellate Division affirmed the Commissioner’s denial
    
    in an unpublished decision.   The court noted that a deferential
    
    standard of review applied to its review of the Commissioner’s
    
    action in this matter.   Quoting In re Grant of Charter Sch.
    
    Application of Englewood on the Palisades Charter Sch., 320 N.J.
    
    Super. 174, 217 (App. Div. 1999), aff’d as modified, 
    164 N.J. 316
     (2000), the court stated that, because the Commissioner
    
    “[did] not act in a quasi-judicial capacity,” the appellate
    
    panel “‘[did] not review the Commissioner’s decision under the
    
    substantial-credible-evidence standard, but rather under the
    
    standard of whether the decision is arbitrary, capricious or
    
    unreasonable.’”
    
        Turning to the record that the Commissioner considered in
    
    making her determination, the appellate panel found that the
    
    Commissioner did not act improperly in considering Dr. Alvarez’s
    
    views, the opposition letters from Montclair citizens, or the
    
    desegregation order.   The panel held that, based on the record,
    
    the Commissioner’s denial of Quest Academy’s application was not
    
    arbitrary, capricious, or unreasonable.   The court specifically
    
    rejected petitioner’s argument that the federal No Child Left
    
                                    14
    Behind Act, 20 U.S.C.A. § 6316, requires the Commissioner to
    
    approve charter school applications in districts identified as
    
    in need of improvement.   Petitioner’s other arguments were
    
    summarily rejected.
    
        With the assistance of counsel, Williams filed a petition
    
    for certification, which was granted.   
    212 N.J. 288
     (2012).
    
                                    II.
    
        Before this Court, petitioner’s arguments are refined.
    
    Focusing primarily on the standard of review, she zeros in on
    
    two sentences in the Appellate Division’s decision and claims
    
    that the panel reviewed the Commissioner’s determination under a
    
    misapprehension of the correct standard for appellate review.
    
    She contends that an appellate court reviewing a denial of a
    
    charter school application must consider whether the decision
    
    was supported by “substantial credible evidence,” not simply
    
    whether it was “arbitrary, capricious or unreasonable” as the
    
    Appellate Division said in its decision.   She further argues
    
    that the Commissioner should be required to provide written
    
    reasons for a denial at the time the decision is made, and that
    
    an Amplification of Reasons given after a decision is appealed
    
    should not be allowed.    Consistent with those criticisms,
    
    petitioner claims that due process was violated because the
    
    decision, when issued, was not supported by substantial credible
    
    evidence.
    
                                     15
        The Commissioner argues that the Appellate Division
    
    correctly applied an arbitrary and capricious standard of
    
    review.    She further argues that the panel appropriately
    
    determined that the Commissioner’s denial procedurally was
    
    compliant with law and substantively was not arbitrary,
    
    capricious, or unreasonable.
    
        More specifically, the Commissioner characterizes her
    
    decision to deny a charter school application as quasi-
    
    legislative, distinguishing it from quasi-judicial actions.      The
    
    Commissioner points out that the Act does not require the
    
    Commissioner to conduct a hearing and none is required by due
    
    process.   The Commissioner and the applicant do not have an
    
    adversarial relationship and the Commissioner is not required,
    
    in deciding whether to grant a charter school application, to
    
    weigh opposing parties’ evidence or make credibility
    
    determinations.   Therefore, the Commissioner maintains that this
    
    appeal does not involve review of quasi-judicial action.
    
    Instead, she relies on case law that states that quasi-
    
    legislative decisions are reviewed under the arbitrary,
    
    capricious, or unreasonable standard.   Further, the Commissioner
    
    contends that, subsumed in that standard, are the requirements
    
    that the Commissioner’s decision demonstrate a thorough review
    
    of the record and that the decision reached have sufficient
    
    support in the record to sustain it.    Both requirements, she
    
                                     16
    contends, are met here.   Further, in response to petitioner’s
    
    objection to the Commissioner’s amplification of reasons for her
    
    decision, the Commissioner cites Rule 2:5-1(b), which permits a
    
    judge, officer, or agency to file an amplification of a prior
    
    decision if it is appealed, as authority for her action.
    
                                    III.
    
                                     A.
    
        Judicial review of administrative agency action is a matter
    
    of constitutional right in New Jersey.   See N.J. Const. art. VI,
    
    § 5, ¶ 4 (allocating relief from agency actions to “the Superior
    
    Court, on terms and in the manner provided by rules of the
    
    Supreme Court, as of right”).   Rule 2:2-3(a)(2) provides for
    
    review of “final decisions or actions of any state
    
    administrative agency or officer” in the Appellate Division of
    
    the Superior Court.
    
        Through N.J.S.A. 18A:36A-4(c), the Legislature has decreed
    
    that the Commissioner is the final administrative decision-maker
    
    on the grant or rejection of a charter school application.
    
    Thus, an applicant has the right to appeal the Commissioner’s
    
    rejection of a charter school application pursuant to Rule 2:2-
    
    3(a)(2).   The Act also confers on an unsuccessful applicant a
    
    statutory right to appeal.   See N.J.S.A. 18A:36A-4(d)
    
    (conferring statutory right to appeal to Appellate Division of
    
    Superior Court on charter school applicant and local board of
    
                                     17
    education).
    
         While the Act grants to a denied applicant a statutory
    
    right to appeal, it does not confer a right to an administrative
    
    hearing.   That has the consequence of denying a rejected
    
    applicant the ability to claim the right, under the
    
    Administrative Procedure Act (APA), N.J.S.A. 52:14B-1 to -15, to
    
    a quasi-judicial administrative hearing governed by APA
    
    standards for a “contested case.”    See N.J.S.A. 52:14B-2
    
    (defining “contested case” as “a proceeding . . . in which the
    
    legal rights, duties, obligations, privileges, benefits or other
    
    legal relations of specific parties are required by
    
    constitutional right or by statute to be determined by an agency
    
    by decisions, determinations, or orders, addressed to them or
    
    disposing of their interests, after opportunity for an agency
    
    hearing”).3   However, that does not end all inquiry into the
    
    nature of the proceedings before the Commissioner when reviewing
    
    an application to operate a charter school.
    
         The labels of “quasi-judicial” and “quasi-legislative”
    
    typically are used to determine whether the agency is obligated
    
    to provide an administrative adjudicative hearing, regardless of
    
    whether the matter would merit the designation of a “contested
    
    case” under the APA.   See Cunningham v. Dep’t of Civil Serv., 69
    
    
    3
      The applicant has not asserted a substantive constitutional
    right.
                                    
    18 N.J. 13
    , 20 (1975) (using such labels in explaining when,
    
    outside of APA requirements, right to trial-like hearing exists
    
    as matter of fundamental fairness and administrative due
    
    process).   If the matter centers on the resolution of disputed
    
    adjudicative facts, if the parties are adverse, or if
    
    credibility determinations must be made, more formal
    
    adjudicatory-type proceedings must be provided (hence the quasi-
    
    judicial designation).   See, e.g., High Horizons Dev. Co. v.
    
    N.J. Dep’t of Transp., 
    120 N.J. 40
    , 49-51 (1990) (discussing
    
    when need arises for trial-like, adjudicatory process).       The
    
    most important procedural rights in such proceedings are
    
    adequate notice, a chance to know opposing evidence, and the
    
    opportunity to present evidence and argument in response.         Id.
    
    at 52-53.
    
        Such labels as quasi-adjudicative and quasi-legislative
    
    have limits to their usefulness.     Indeed, this Court has
    
    recognized that agencies must retain the ability to provide
    
    various informal, flexible procedures for determining certain
    
    issues or taking certain actions.     Ibid.   In all instances,
    
    fundamental due process requirements of notice and opportunity
    
    to be heard must be satisfied, even though the contours of their
    
    satisfaction may vary.   See id. at 51-54 (reviewing property
    
    owner’s criticism of procedural fairness in Commissioner of
    
    Transportation’s handling of application for highway access
    
                                    19
    permit).     As in the matter presently before this Court, High
    
    Horizons involved a due process challenge in a matter that did
    
    not fit easily into classifications of whether an agency was
    
    acting in a judicial or “quasi-judicial” capacity, or in a
    
    legislative or “quasi-legislative” capacity.      Id. at 50-51.
    
    Importantly, the labels do not result in a meaningful difference
    
    in the role played by judicial review of administrative
    
    determinations.    The “core value[] of judicial review of
    
    administrative action is the furtherance of accountability.”
    
    Id. at 53.
    
                                      B.
    
        Reflecting the need to respect agency action taken pursuant
    
    to authority delegated by the Legislature, the standard for
    
    judicial review of administrative agency action is limited:       An
    
    appellate court may reverse an agency decision if it is
    
    arbitrary, capricious, or unreasonable.      See In re Petition for
    
    Rulemaking, 
    117 N.J. 311
    , 325 (1989).      In other words, a court
    
    may intervene when “it is clear that the agency action is
    
    inconsistent with its mandate.”    Ibid.    Indeed, the test often
    
    is expressed in the negative.    See, e.g., Brady v. Bd. of
    
    Review, 
    152 N.J. 197
    , 210 (1997) (“Unless a Court finds that the
    
    agency’s action was arbitrary, capricious, or unreasonable, the
    
    agency’s ruling should not be disturbed.”).      The test, although
    
    deferential, does not lack content.    As this Court has stated on
    
                                      20
    many occasions,
    
                 [a]lthough sometimes phrased in terms of a
                 search for arbitrary or unreasonable agency
                 action, the judicial role [in reviewing an
                 agency action] is generally restricted to
                 three inquiries: (1) whether the agency’s
                 action    violates   express   or   implied
                 legislative policies, that is, did the
                 agency follow the law; (2) whether the
                 record contains substantial evidence to
                 support the findings on which the agency
                 based   its action; and (3) whether in
                 applying the legislative policies to the
                 facts, the agency clearly erred in reaching
                 a conclusion that could not reasonably have
                 been made on a showing of the relevant
                 factors.
    
                 [Mazza v.   Bd.   of   Trs.,   
    143 N.J. 22
    ,   25
                 (1995).]
    
    See, e.g., In re Stallworth, 
    208 N.J. 182
    , 194 (2011); N.J.
    
    Soc’y for Prevention of Cruelty to Animals v. N.J. Dep’t of
    
    Agric., 
    196 N.J. 366
    , 384-85 (2008); In re Carter, 
    191 N.J. 474
    ,
    
    482-83 (2007); Dennery v. Bd. of Educ., 
    131 N.J. 626
    , 641
    
    (1993); In re Petition for Rulemaking, supra, 117 N.J. at 325;
    
    Henry v. Rahway State Prison, 
    81 N.J. 571
    , 579-80 (1980).
    
         The standard is applicable to administrative agency actions
    
    regardless of whether they are quasi-legislative or quasi-
    
    judicial.4    Examples demonstrate the test’s applicability to a
    
    quasi-legislative rulemaking context, see, e.g., N.J. Soc’y for
    
    4
      Some cases have made this standard for judicial review of
    agency action a four-part inquiry. See, e.g., Brady, supra, 152
    N.J. at 210-11 (separating duty to follow law into two
    inquiries, one legislative and one constitutional). We adhere
    to the test as formulated in Mazza.
                                         21
    Prevention of Cruelty to Animals, supra, 196 N.J. at 384-85; In
    
    re Petition for Rulemaking, supra, 117 N.J. at 325; Public Serv.
    
    Elec. & Gas Co. v. N.J. Dep’t of Envtl. Prot., 
    101 N.J. 95
    , 103
    
    (1985), as well as to a quasi-judicial context, see, e.g.,
    
    Mazza, supra 143 N.J. at 25; Dennery, supra, 131 N.J. at 641;
    
    Exec. Comm’n on Ethical Standards v. Salmon, 
    295 N.J. Super. 86
    ,
    
    96-97 (App. Div. 1996).
    
        In this matter, both parties concede that the arbitrary,
    
    capricious, or unreasonable standard applicable in the review of
    
    administrative agency decisions subsumes the need to find
    
    sufficient support in the record to sustain the decision reached
    
    by the Commissioner.   The point is beyond argument, for a
    
    failure to consider all the evidence in a record would perforce
    
    lead to arbitrary decision making.   See, e.g., Close v. Kordulak
    
    Bros., 
    44 N.J. 589
    , 599 (1965) (noting that “the proofs as a
    
    whole” must be considered); Green v. State Health Benefits
    
    Comm’n, 
    373 N.J. Super. 408
    , 415 (App. Div. 2004) (finding
    
    agency decision that failed to address issues raised in key
    
    documents in record arbitrary and capricious).   Moreover, a
    
    decision based on a complete misperception of the facts
    
    submitted in a record would render the agency’s conclusion
    
    unreasonable.   See, e.g., Clowes v. Terminix Int’l, Inc., 
    109 N.J. 575
    , 588-89 (1988) (stating that appellate court should
    
    intervene where agency’s “finding is clearly a mistaken one”);
    
                                    22
    Constantino v. N.J. Merit Sys. Bd., 
    313 N.J. Super. 212
    , 218
    
    (App. Div.) (reversing board’s decision where findings were
    
    unsupported by record, based on “total disregard” of facts,
    
    against “overwhelming weight” of testimony, and based on record
    
    “skew[ed]” by administrative law judge), certif. denied, 
    157 N.J. 544
     (1998).     Plainly, the standard requires that the
    
    administrative decision be supported by the underlying record,
    
    regardless of the manner in which due process requires that the
    
    record be created.    The obligation that there be substantial
    
    evidence in the record requires a sifting of the record, and the
    
    ability to find support for the conclusions reached by the
    
    Commissioner under the statutory framework within which she must
    
    act.
    
                                     IV.
    
                                      A.
    
           The statutory and regulatory scheme for the approval of
    
    applications to operate a charter school functions under tight
    
    time frames as cycle after cycle of charter school applications
    
    are submitted seeking approval to open in the ensuing school
    
    year.   N.J.A.C. 6A:11-2.1(b)(1).      The regulatory scheme operates
    
    under the expectation that an application either will be
    
    approved through phases one and two of the review process and
    
    move on for implementation in the upcoming school year, or will
    
    require retooling and resubmission.       N.J.A.C. 6A:11-2.1.   The
    
                                      23
    Department, as noted in Quest’s denial letter, assists
    
    applicants with the application process by offering training
    
    programs in how to prepare applications for review.
    
           That said, the applications arrive in batches and must be
    
    reviewed and resolved in a timely fashion in order to proceed to
    
    implementation in the next school year.     See ibid.   At oral
    
    argument, the Attorney General, arguing for the Commissioner,
    
    represented to the Court that the Commissioner is exceedingly
    
    careful in the approval of charter schools because of the impact
    
    that a wrong decision will have on students who attend a charter
    
    school that falters, or worse, fails to provide an educational
    
    program that satisfies the constitutional standard of a thorough
    
    and efficient education.    See Englewood on the Palisades II,
    
    supra, 164 N.J. at 323, 336 (stating obligation to provide
    
    “thorough and efficient system of education” and holding that
    
    Commissioner must assess economic impact of proposed charter
    
    school on district of residence).     We are appreciative of the
    
    importance that must be ascribed to the Commissioner’s approval
    
    of a charter school and that, nevertheless, such reviews must
    
    proceed expeditiously.
    
           Turning to the merits of the Commissioner’s determination
    
    in respect of Quest Academy’s application, we find that the
    
    Commissioner’s decision was amply supported by the record before
    
    her.    We do not second guess the educational judgments expressed
    
                                     24
    in the Amplification letter issued on behalf of the
    
    Commissioner, such as her findings that Quest Academy “failed to
    
    present . . . a comprehensive and fully integrated educational
    
    program” and that “the strategies presented by Quest were
    
    neither connected to, nor supportive of, the proposed
    
    educational program.”    Moreover, as envisioned by the
    
    Legislature, that record properly included relevant submissions
    
    necessary for proper consideration and allowance of a charter
    
    school to operate.    Specifically, we refer to the analysis
    
    provided by the local superintendent of schools, which is
    
    required to be submitted by N.J.S.A. 18A:36A-4(c) and N.J.A.C.
    
    6A:11-2.1(d).   In addition, in Englewood on the Palisades II,
    
    supra, we stated that the Commissioner was obliged to consider
    
    whether an impacted local school district had demonstrated “with
    
    some specificity that the constitutional requirements of a
    
    thorough and efficient education would be jeopardized by [the
    
    district’s] loss” of the funds to be allocated to a charter
    
    school, and that the Commissioner was “obligated to evaluate
    
    carefully the impact that loss of funds would have on the
    
    ability of the district of residence to deliver a thorough and
    
    efficient education” when considering whether or not to approve
    
    the charter school.     164 N.J. at 334-35.   The information in Dr.
    
    Alvarez’s submission was appropriately part of the
    
    Commissioner’s determination.    We add that Quest Academy was
    
                                      25
    entitled to respond to it by way of argument, at the least,
    
    within the tight time frames permitted in the review process,
    
    and through any subsequent resubmission of the application.
    
        In addition, petitioner’s objection to the Commissioner’s
    
    reliance on the existing desegregation order as a factor to
    
    consider in rejecting the application lacks merit.    Again, in
    
    Englewood on the Palisades II, supra, we stated that “the
    
    Commissioner must assess the racial impact that a charter school
    
    applicant will have on the district of residence in which the
    
    charter school will operate” and “must use the full panoply of
    
    [her] powers to avoid” segregation resulting from the grant of a
    
    charter school application.   164 N.J. at 329.
    
        Finally, we see no error in the Commissioner’s
    
    consideration of unsolicited letters from local citizens or her
    
    reliance on her own expertise in assessing overall viability of
    
    this proposed charter school.   In making predictive or
    
    judgmental determinations, case law has recognized the value
    
    that administrative expertise can play in the rendering of a
    
    sound administrative determination.   Judicial deference is at a
    
    high when reviewing such findings.    See, e.g., Golden Nugget
    
    Atl. City Corp. v. Atl. City Elec. Co., 
    229 N.J. Super. 118
    ,
    
    122-23 (App. Div. 1988).
    
        The Commissioner’s decision -- but only as it was amplified
    
    -- demonstrates a thoughtful and thorough weighing and judgment
    
                                    26
    of the merits of the Quest Academy application.    There is no
    
    right to operate a charter school.    There is only the
    
    opportunity to apply for approval to operate one if the
    
    application demonstrates proper merit.    The burden is on the
    
    applicant to show that it can meet the requirements for
    
    obtaining permission to educate public school children in a
    
    charter school setting.    The Commissioner’s review and rejection
    
    of this application is sustainable on the record she had before
    
    her.    There is no basis for judicial intervention.
    
                                     B.
    
           We add only a brief comment about the Commissioner’s
    
    amplification.   Rule 2:5-1(b) expressly permits its filing after
    
    a notice of appeal has been filed.    Indeed, the Rule anticipates
    
    that amplification may occur after an appeal has been filed.      To
    
    the extent that there are time frames for its submission set
    
    forth in the Court Rule, we note that no objection was raised on
    
    the basis of the Rule’s time frames for such submissions, which
    
    are designed to prevent delay in the processing of appeals.
    
           We add that we accept the Commissioner’s explanation for
    
    her manner of responding to applicants.    Although the letter of
    
    denial did not detail the deficiencies found in the application,
    
    it offered instead a face-to-face meeting to review in detail
    
    the shortcomings in the application that Quest Academy
    
    submitted.    According to the Commissioner, the large number of
    
                                     27
    applicants (forty-five) who were reviewed in the batch with
    
    Quest Academy rendered lengthy written responses difficult and
    
    taxing of precious departmental resources.   While it would be
    
    naturally preferable from the applicant’s perspective to receive
    
    initially more than a generic form letter denying an
    
    application, here Quest Academy received a bit more than that.
    
    Some information about the application’s shortcomings was
    
    provided in the denial letter, and the subsequent amplification
    
    fully detailed those issues.   In reviewing as complex a proposal
    
    as that required for a newly proposed charter school, there is a
    
    benefit to offering a discussion, instead of a written
    
    cataloguing, of mistakes or deficiencies in the application that
    
    has been rejected.   We do not fault the Commissioner for
    
    choosing a dialogue involving constructive criticism as her
    
    preferred approach for producing approvable applications when
    
    resubmitted.
    
                                    V.
    
        The judgment of the Appellate Division, affirming the
    
    Commissioner of Education’s denial of the charter school
    
    application of Quest Academy, is affirmed.
    
         CHIEF JUSTICE RABNER, and JUSTICES ALBIN and PATTERSON, and
    JUDGES RODRÍGUEZ and CUFF (both temporarily assigned) join in
    JUSTICE LaVECCHIA’s opinion.
    
    
    
    
                                    28
                 SUPREME COURT OF NEW JERSEY
    
    NO.   A-12                               SEPTEMBER TERM 2012
    
    ON CERTIFICATION TO        Appellate Division, Superior Court
    
    
    
    
    IN THE MATTER OF THE
    PROPOSED QUEST ACADEMY
    CHARTER SCHOOL OF MONTCLAIR
    FOUNDERS GROUP
    
    
    
    
    DECIDED       December 16, 2013
                 Chief Justice Rabner                      PRESIDING
    OPINION BY        Justice LaVecchia
    CONCURRING/DISSENTING OPINIONS BY
    DISSENTING OPINION BY
    
    
    CHECKLIST                           AFFIRM
    CHIEF JUSTICE RABNER                  X
    JUSTICE LaVECCHIA                     X
    JUSTICE ALBIN                         X
    JUSTICE PATTERSON                     X
    JUDGE RODRÍGUEZ (t/a)                 X
    JUDGE CUFF (t/a)                      X
    TOTALS                                 6
    
    
    
    
                                                  1