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Will Anyone Stop Charter School Corruption?

While touted as a market-based solution to education, charter schools are often plagued by the problems of under-regulation and low accountability.

When politicians and pundits take to the barricades to defend “wonderful charter schools,” is this what they’re thinking of?

A recent article in a Minnesota newspaper reported about a change in state law that could imperil the existence of a charter school that serves a student body sorely in need of heroic efforts. According to the reporter, “Nine out of 10 of the school’s 275 high schoolers meet the legal definition of ‘highly mobile,’ meaning they do not have stable housing; 109 are flat-out homeless. Some couch-surf. Some sleep in cars, some in bus stations. Often they spend the night in small groups, for safety. Poverty – a given – is usually the least of their worries. To teens forced to support themselves, a diploma is a life raft.”

The schools founder and chief operator is quoted: “We have kids who are one credit away from graduating … We are one of the first consistent things in their lives.”

A compelling story for sure and likely one example, among others, that was in the minds of most in Congress when the U.S. House of Representatives recently passed controversial legislation to expand federal funds for more charter schools without placing any substantial new regulations on those schools.

What lawmakers in Washington had been told, of course, was that starting up lots and lots of charter schools was going to create a “marketplace of education,” where the problem of “quality” would take care of itself as “bad” charters “go out of business,” and the wonderful ones that do such great things for the most unfortunate children get picked up and replicated all over the world.

For sure, there were those on “the outside” who advocated against expanding charter schools without taking into account steps toward stricter regulation. As The Nation’s Zoe Carpenter pointed out, the bill’s emergence in the House coincided with publication of a report by the Center for Popular Democracy and Integrity in Education that documented “shocking misuses of the federal funds being funneled into the poorly regulated charter industry.”

Nevertheless, the charter sector won the Hill that day and has continued to ascend in state capitals around the country since. Meanwhile, real evidence of “the good charters” remains mostly anecdotal, as financial corruption and poor education results from “bad ones” continue to mount with every passing month.

Just look at Ohio.

Buckeye State Boondoggle

The Buckeye State, where charter schools have operated for well over a decade, has had loose regulations, business-minded state governance, and a Beltway-based conservative think tank serving as a charter sponsor. According to a recent report in the Akron Beacon, “Enrollment in Ohio charter schools now stands at more than 120,000 in nearly 400 schools, with seven more schools expected to open next year. These quasi-public schools enroll less than 7 percent of Ohio’s students and receive $912 million in state tax dollars, about 11 percent of all state funds set aside for primary and secondary education.”

According to charter school enthusiasts at the Center for Education Reform, Ohio is a “Top Ten” state – number 3, in fact – on its rating scale for states that provide “parent power” – something that is, apparently, in abundance when lots of charter and virtual schools and just about anything else but good traditional public schools are prevalent. (Vermont, which has one of the top performing school systems in the country, based on the National Assessment of Education Progress, is number 47 in “parent power.”) Contributing significantly to Ohio’s top rating no doubt is the state’s citation for “providing even more growth” in the charter school sector. But nowhere on the CER site is there a hint of how all this choice and growth have actually benefited Ohio students and taxpayers.

For that information, you have to turn to the progressive state group Innovation Ohio, which earlier this year found that, in the 2011-2012 school year, the state’s enthusiastic support of charter schools had resulted in a transference of $774 million from the public school system to charter schools that tend to perform worse on the state’s school performance rating system.

Since that report, very little to any improvements seem to have occurred. As a recent series of reports appearing in the Akron Beacon Journal revealed, one of the states’ most popular charter school chains, run by White Hat Management, has enjoyed such carte blanche operation that Ohio lawmakers approved additional funding for about 77 of those schools and exempted them from “full accountability until at least 2017.” The legislation passed despite the fact that dropouts are so prevalent at these schools that many of them report “single-digit graduation rates.” The Beacon Journal reporter found that during the last school year, more students dropped out of these schools than attended on the average day.

Anther Ohio newspaper, the Cleveland Plain Dealer, carried a recent editorial explaining that the primary beneficiary of the loophole legislation favoring White Hat-run charter schools is not the state’s students nor its taxpayers but the charter school operator, Akron businessman David Brennan, who “has poured more than $4 million into the coffers of Republican candidates in Ohio during the last decade.”

In the face of lagging academic results, higher dropout rates and the aroma of crony corruption, what do Ohio charter promoters do to improve their performance? Amp up their marketing. As another recent Beacon Journal report found, “State audits suggest that some Ohio charter schools spend more than $400 in public money per student to attract them away from public schools.” Using keywords such as “free, flexible, one-on-one and find your future,” Ohio charter school companies are “advertising on television, radio, billboards, handbills and even automated telephone messages to entice students away from public schools.”

You have to wonder if this is how the taxpayers in Ohio like to see their hard-earned money spent.

In the meantime, one state over in Pennsylvania, the situation with charter schools doesn’t look any better.

Quaker State Cash Cow

In the Quaker State, charter schools have long competed for funds with traditional public schools on an uneven playing field that exempts them from serving the full range of student abilities and revealing financial details of their operations to the public. Despite all this freedom from regulation, according to the Pennsylvania School Board Association, “Charter schools continue to academically underperform traditional public schools, with less than half of the brick and mortar charter schools meeting acceptable benchmark scores … None of the cyber charter schools met the mark. Nearly three-quarters of traditional public schools, however, earned passing scores in the first year of the new measuring system.”

Despite poor academic results, Pennsylvania scores a 12 on the reform index contrived by CER. But what CER calls “parent power” in Pennsylvania is actually “no real oversight” according to the Keystone State Coalition, a “non-partisan public education advocacy group of several hundred locally elected, volunteer school board members and administrators from school districts throughout Pennsylvania.” That organization’s recent report tallied exorbitant costs associated with charter school operations and lavish CEO salaries and bonuses for charter school operators, despite vastly underperforming the state’s traditional public schools.

A more recent KSC report revealed how Pennsylvania charters have gamed the system for special education funding, resulting in annual profits of $200 million to the schools. As one local Pennsylvania blogger explained, “Charter schools collected $350,562,878 last year for special education funding and spent $156,003,034 for special education! Where did the other $200 million go? The fact of the matter is that charter schools are not obligated to spend special education funding for special education purposes. That money can be spent for numerous miscellaneous reasons.” (emphasis original)

A KSC video that education historian Diane Ravitch linked to on her blog explained how Pennsylvania charters also game the special education financial process by luring away students from public schools who are classified special education in the least expensive disability categories, which would include relatively mild disabilities such as speech impairment, and neglect to educate students with more severe disabilities, such as autism.

This is especially devastating to school districts such as Philadelphia, where budgets are in perennial crisis. As the local news outlet The Notebook reported, “Philadelphia charter schools received more than $175 million last year to educate special education students, but spent only about $77 million for that purpose … nearly $100 million gap at a time when city education leaders are considering raising some class sizes to 41 students and laying off 800 more teachers.”

To fix a funding system that rewards charter schools for services they do not provide, Pennsylvania lawmakers from both parties introduced a bill (HB 2138 and SB 1316) to fund each district based on the actual number of students with disabilities it has and on each child’s needs. Charter advocates responded to this proposed legislation by opposing it.

As bad as the situation is with charter schools in Ohio and Pennsylvania, it may be even worse in Michigan.

The Great Lakes Robbery

In the Great Lakes State, a series by the Detroit Free Press this month reported, “Michigan taxpayers pour nearly $1 billion a year into charter schools – but state laws regulating charters are among the nation’s weakest, and the state demands little accountability in how taxpayer dollars are spent and how well children are educated.”

The yearlong investigation found, “Wasteful spending and double-dipping. Board members, school founders and employees steering lucrative deals to themselves or insiders. Schools allowed to operate for years despite poor academic records. No state standards for who operates charter schools or how to oversee them.”

Meanwhile, “38 percent of charter schools that received state academic rankings during the 2012-13 school year fell below the 25th percentile, meaning at least 75 percent of all schools in the state performed better. Only 23 percent of traditional public schools fell below the 25th percentile.”

For-profit corporations are permitted to run 61 percent of charter schools in Michigan even though over a third of those schools are in the bottom 25 percentile for academic performance.

The variety of scams at work in the Michigan charter sector make your head spin. In one example, a real estate/investment firm bought property for $375,000 that it sold six days later to a charter school, for $425,000. The quick $50,000 profit went to founders of the firm – one the president of the school’s management company, the other married to the school’s top administrator.

At another charter school, members of the founder’s family were paid to provide meals and maintenance to the school,” and “family members still rent the building to the school or collect a management fee for running it.”

How does the charter industry respond to such damning evidence of failure and corruption? With a marketing campaign, of course.

As the local Michigan blog Eclectablog noted, just as the Detroit Free Press series was unfolding, the state’s largest for-profit charter chain, National Heritage Academies, sprung into action and proceeded to purchase nearly all of the available ad space on the newspaper’s website.

And by the way, the “parent power” ranking CER gives Michigan is 11, commending the state for its “robust charter law.”

The unchecked charter school chicanery is not limited to the northern Midwest.

Sunshine State Scam

A new investigation by the Orlando Sun Sentinel found, “Unchecked charter-school operators are exploiting South Florida’s public school system, collecting taxpayer dollars for schools that quickly shut down … virtually anyone can open or run a charter school and spend public education money with near impunity.”

Examples cited in the series include a man who received $450,000 in tax dollars to open two new charter schools just months after his first collapsed. The schools closed in seven weeks. Another example: A man with “a history of foreclosures, court-ordered payments, and bankruptcy received $100,000 to start a charter school.” It closed in two months.

Sun Sentinel reporters found an elementary charter school that “sometimes had no toilet paper, soap or paper towels in the student bathrooms … Students sometimes ate hours after their designated lunchtimes, often from fast-food restaurants.”

School districts have little to no recourse when charters fail to submit financial reports – “some don’t file them or turn in unreliable paperwork.” And management companies that run two-thirds of South Florida’s charter schools add to the problems of transparency and financial disclosure.

Despite these problems, charter schools continue to “pop up within blocks of each other – or in the same building – offering similar programs as neighboring schools. With such wild growth, district officials say, many new charters no longer fill a niche or offer innovation. Yet Florida lawmakers repeatedly have declined to tighten charter-school regulations.”

Florida’s score in the CER ranking: 2.

Someone Please Say, “Stop!”

Despite this cavalcade of corruption – most of which has been published in just the past two months, mind you – must we now pay homage to the “wonderful” charter schools?

Take that charter program for homeless children cited above. Do we demand more of those schools to be replicated? Do we ask whether we need an outside, unregulated vendor to reveal the unsurprising conclusion that it’s important to pay attention to the special needs of children? Do we ask why these children aren’t being accommodated in local schools and take the necessary steps to ensure they are? Or do we ask, why the hell do we have record numbers of homeless school children in this country to begin with?

Good questions, for sure. Yet in the meantime, at the urging of charter school advocates and others promoting “school choice,” lawmakers around the country are proposing and enacting new policies to feed more children into an increasingly corrupt charter chain pipeline.

And in Washington, that House legislation that would expand federal funding to these sorts of schools has been joined by a Senate version that is now steaming toward bipartisan consideration.

Certainly, faced with such a growing calamity, it’s not being “negative” or “oppositional” or a “status quo defender” to stand in the pathway and yell, “Stop!”

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