Charter Schools: Deregulation and Lack of Oversight

The National Education Policy Center (NEPC) at the University of Colorado publishes reviews of studies and reports by education think tanks.  Recently NEPC published a review by Gary Miron of Western Michigan University, and Bill Mathis and Kevin Welner of the University of Colorado at Boulder of a policy document from the National Alliance for Public Charter Schools (NAPCS) called, “Separating Fact & Fiction: What You Need to Know about Charter Schools.”  NEPC’s authors believe that “Separating Fact & Fiction” is largely a glowing fictional account of what NAPCS would like the story of charter schools to be.

For instance,  NEPC’s authors quote the claim of the National Alliance for Public Charter Schools: “Charter schools introduce an unprecedented level of accountability into public education.  If a public charter school is not improving student achievement as laid out in its foundational charter agreement, it can be closed down.”  

Here is Miron, Mathis and Welner’s response to that claim: “This assertion, which is frequently repeated by charter advocacy groups, is based on how charter schools are supposed to work rather than actual practice.  The core bargain underlying charter school policies is that these schools would be freed from various governmental regulations and collective bargaining agreements, and in turn the schools would have to demonstrate strong performance, set forth in each specific charter…  But saying they can be closed is not the same as saying they are closed.”

Marian Wang for ProPublica reports that most states have neither regulated charter schools well enough to protect the needs of children nor to prevent fraud and widespread waste of public dollars that were historically spent for better regulated traditional public schools.  Most states leave oversight up to an array of authorizers: “Known as ‘authorizers,’ charter regulators have the power to decide which charter schools should be allowed to open and which are performing so badly they ought to close.  They’re supposed to vet charter schools, making sure the schools are giving kids a good education and spending public money responsibly.  But many of these gatekeepers are woefully inexperienced, under-resourced, confused about their mission or even compromised by conflicts of interest. And while some charter schools are overseen by state education agencies or school districts, others are regulated by entities for which overseeing charters is a side job, such as private colleges and nonprofits….”

Wang describes the “sponsor hopping” that Indiana law fails to prohibit.  Imagine Schools, which Wang describes as “a national charter school operator trailed by a track record of questionable financial dealings at schools in multiple states,” looked for a charter authorizer to oversee its opening of schools in Indianapolis.  After rejection from the office of Indianapolis’ mayor, who could have authorized opening a school, Imagine Schools went to Ball State University, got approval, and opened a number of schools.  Later, Ball State did shut down three of Imagine’s schools due to poor academic records, but Trine University, whose “charter school office is headed by Lindsay Omlor, who prior to this job had spent six years working for Imagine,” stepped in to become the authorizer.

Then there is the situation in Ohio where nonprofit organizations can authorize charter schools.  Ohio law provides that authorizers get to keep 3 percent of the dollars the state provides for each of the charter schools they authorize.  These funds are supposed to cover administrative costs, but there is evidence that some nonprofit organizations use these funds as “walking around money” rather than to support or oversee the school.  One Ohio authorizer, St. Aloysius Orphanage of Cincinnati, formerly an orphanage but according to Wang, now a mental health agency, sponsors 43 schools across the state of Ohio.  Wang reports that St. Aloysius Orphanage contracts out regulation and management of its schools to a for-profit vendor, Charter School Specialists. “Charter School Specialists reviews the schools’ finances and conducts school site visits on behalf of St. Aloysius.  It writes the required annual report on behalf of St. Aloysius, running through how the charter schools are doing.  But Charter School Specialists also sells services to charter schools, such as handling accounting, payroll or even providing schools with treasurers.  In other words, it’s a for-profit middleman paid by both the regulator and the regulated.  For the former orphanage, authorizing brought in $2.6 million in fees paid by charter schools, the group’s 2013 tax filing shows.  In the same year, St. Aloysius paid Charter School Specialists $1.5 million, leaving the nonprofit an extra $1.1 million. It’s not clear exactly, what St. Aloysius has done to earn the difference….”

Wang also examines Michigan, where Grand Valley State University sponsors charter schools, as one of the state’s largest authorizers.  For-profit National Heritage Academies (NHA), with 80 schools across several states, operates a third of Grand Valley State’s charter schools in Michigan.  According to Wang, however, “that’s not the extent of the relationship between the university and the company.  NHA’s founder and chairman, J.S. Huizenga, serves as a director at the Grand Valley State University Foundation.  And though he’s not an alumnus, he’s in a special class of donors that have given $1 million or more to the university, which also oversees more of his schools than any other regulator in the state.”

Miron, Mathis and Welner explore the contention of many charter school supporters that charter schools are in fact public schools: “It is true that federal and many state laws define charter schools as public schools.  Further, charter schools are funded primarily with public funds.  But the actual legal status, in any meaningful policy discussion, is much less clear… Most charter schools are governed by nonprofit boards.”  “It is increasingly the case that charter school buildings are privately owned by the charter’s founders, by an affiliated private company, or by a private trust.  In schools operated by private education management organizations (EMOs), the materials, furniture and equipment in the schools are usually privately owned by the EMO and leased to the school. Except for a small number of states that require teachers to be employees of the charter school, it is common for teachers to be ‘private employees’ of the EMO.  Although most charter schools have appointed nonprofit boards intended to represent the public.., a growing portion of charter schools are operated by private EMOs, and key decisions are made at corporate headquarters, which are often out-of-state. Public schools, like other public entities, are subject to transparency laws.  Charter schools and their private operators increasingly refuse to share information and data in response to public requests… Thus, while claiming to be ‘public,’ and while having some elements that are public (most importantly, public funding for a no-tuition education), their operations are basically private.”

Those who prevail in such a system are charter operators who can hire the lawyers to help them comply with the letter of regulatory law, if not its intention, and those who can contribute campaign cash to the legislators who refuse to oversee what has become a privatized education marketplace.  Once again, we benefit from reading a warning from Benjamin Barber’s Consumed: “The transfer of public power to private hands often is associated with a devolution of power; but in fact privatizing power does not devolve but only commercializes it, placing it in private hands that may be as centralized and monopolistic as government, although usually far less transparent and accountable, and also pervasively commercial.” (Consumed, p. 145)

One thought on “Charter Schools: Deregulation and Lack of Oversight

  1. An excellent article, Jan, that summarizes many of the major issues hovering around and over the charter school movement and its ongoing threat to education in America.

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