U.S. Department of Education Awards $253 Million in 2017 Charter Schools Program Grants

Last week, Betsy DeVos’s much touted priority for school privatization became a greater reality at the federal level, but not through her favorite vouchers and tuition tax credits and education savings accounts.  These vehicles that use public money for scholarships for children to attend private schools seem to be making their way into state law via the model bills that state legislatures are pulling off the shelf at the American Legislative Exchange Council, but there has been no indication that Congress is sympathetic to adopting vouchers.  Congress rejected Title I Portability during the 2015 debate on the Every Student Succeeds Act, and neither the Senate nor the House has shown any inclination to appropriate money for a federal voucher program.

There is another way, however, that Betsy DeVos is expanding privatization at the federal level.  The federal Charter Schools Program has slowly and persistently expanded.  While the U.S. Department of Education made Charter Schools Program Grants to states of $157 million in 2015 and to states and charter management organizations of $245 million in 2016, last week the Department announced awards of over $253 million in 2017.

When Congress passed ESSA in December of 2015, it endorsed the Charter Schools Program and added new categories by which the federal government can make grants to incentivize the startup and expansion of charter schools.  Nonprofit Charter Management Organizations (CMOs) became eligible under ESSA to receive direct grants, and in another category the U.S. Department of Education was permitted to make grants to agencies that enhance the credit of charter schools to construct and renovate facilities.

Last week the Department granted $144,680,792 to what federal jargon calls SEAs, state education agencies (which are, in reality the states’ Departments of Education) to expand charter schools in nine states.  The largest grants went to Texas ($38,034,535), Wisconsin ($37,954,114), Indiana ($24,002,291) and Minnesota ($22,381,611).  Five states won smaller federal awards—New Mexico, Maryland, Oklahoma, Mississippi, and Rhode Island.

This year 17 nonprofit Charter Management Organizations will split $52,412,924, with the largest of these a grant of over $26 million  to IDEA Public Schools, a Texas CMO, and the second largest, $5 million, to Rocketship Education, the controversial schools featuring blended learning. Two New York CMOs won the third and fourth biggest federal grants in the CMO category: Ascend Learning won a grant of over $3.5 million and Success Academy Charter Schools will receive $3,225,240.  Success Academies is the NYC chain that pays its CEO, Eva Moskowitz an annual salary of over half a million dollars.

The Charter Schools Program grants to enhance credit for charter schools to buy or renovate facilities total $56,250,000 and have been awarded to development groups in seven states and the District of Columbia.

Twice, the U.S. Department of Education’s own Office of Inspector General (OIG) has issued scathing reports on the Department’s operation of the Federal Charter Schools Program in 2012 and again in 2016.  In 2012, the OIG declared: “We determined that OII (the Office of Innovation and Improvement that operates the Charter Schools Program) did not have an adequate process to ensure SEAs (state education departments) effectively oversaw and monitored their subgrantees.” And in 2016, the OIG charged: “Specifically, we found that 22 of the 33 charter schools in our review had 36 examples of internal control weaknesses related to the charter schools’ relationships with their CMOs (Charter Management Organizations) concerning conflicts of interest, related-party transactions, and insufficient segregation of duties.”

The Ohio Department of Education has received grants from the federal charter schools program.  Innovation Ohio and the Ohio Education Association, through a joint project, knowyourcharter.com, slammed the program in May of 2016 in a report called Belly Up that reviewed grants made to Ohio: “At least 108 of the 292 charter schools that have received federal CSP (Charter Schools Program) funding (37 percent) have either closed or never opened, totaling nearly $30 million. Of those that failed, at least 26 Ohio charter schools that received nearly $4 million in federal CSP funding apparently never even opened and there are no available records to indicate that these public funds were returned… A recent state audit of 44 Ohio charter schools found 15 percent attendance discrepancy. Of these 44 charters, 17 had received CSP grants totaling $6.6 million in federal funding and one of these schools—the London Academy—had only 10 of the 270 students in attendance.”

The Charter Schools Program is part of the U.S. Department of Education’s Office of Innovation and Improvement. During the tenure of Arne Duncan as Secretary of Education it became obvious that the emphasis of the program was Duncan’s priority for innovation and that Duncan and his staff were far less attentive to accountability.  I have never seen any kind of published report that would indicate that during the Obama administration, the Department cleaned up the Charter Schools grant program during Duncan’s tenure through 2015 or John King’s 2016 tenure.

And I have seen nothing to indicate that Betsy DeVos, a persistent opponent of regulation, has implemented careful procedures for oversight of the grants being made in 2017 to state education agencies, CMOs  or other agencies receiving grants.  I will be delighted if someone can provide evidence that the Charter Schools Program, condemned by the Department’s own Office of Inspector General, has been cleaned up.

But there a much deeper concern.  Why is the U.S.Department of Education encouraging states to expand school privatization instead of creating incentives for states to invest more in their public schools and to distribute funding more equitably?

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