Politicians Are Discovering They Can No Longer Ignore Charter School Outrages

In Wednesday’s Washington Post‘s Laura Meckler traces fading support for charter schools among Democrats who are running for President:

“Democrats have long backed charter schools as a politically safe way to give kids at low-performing schools more options… The presidential contest is proof that’s no longer the case. If the candidates say anything about charter schools, it’s negative… Instead, the Democratic candidates are pitching billions of dollars in new federal spending for schools and higher pay for teachers, with few of the strings attached that marked the Obama-era approach to education. It adds up to a sea change in Democratic thinking, back to a more traditional Democratic approach emphasizing funding for education and support for teachers and local schools.”

Except that major political change is excruciatingly slow and difficult.  And, in education, the policy that most directly affects schools happens in state legislatures, where the American Legislative Exchange Council wields the power.

Just this week in West Virginia, for example, the state legislature passed an omnibus bill which combines added state investment in public schools with the launch of charter schools.

Nearby in Pennsylvania, the Philadelphia Inquirer published a scathing critique of the state legislature’s ongoing debate of bills that would supposedly regulate charter schools: “Last week, the Pennsylvania House passed a set of bills proffered to ‘fix’ Pennsylvania’s charter school law. Yet the bills fail to address necessary charter school funding reform, and two of the bills… specifically allow charters to expand without adequate oversight… Statewide, in 2016, state school districts paid $1.5 billion… in charter school tuition payments.  Charter schools receive this funding regardless of whether their students are making the grade. Worse yet, in 2012-13 they were paid over $200 million more for special education services than they spent on these services for our students.”

Jeff Bryant explores in more detail just how Pennsylvania charter school funding is destroying local school districts’ capacity to fund their public schools.  Bryant quotes the Pennsylvania Association of School Business Officials: “‘Charter school tuition is one of the largest areas of mandated cost growth for school districts.’ With the current cost of charter growth at 10 percent annually, PASBO calculates at least $0.37 of every new dollar raised in property taxes in 2017-18 went directly to charters… Because the state does virtually nothing to help alleviate these costs, school districts are forced to turn to property taxes… To stave off the decimation, ‘school districts shifted resources from other areas of the budget, cut programs, and raised property taxes to cover the difference’ created by rising charter school costs.”

Meckler is correct, however, that the tide seems to be turning against charter schools. She quotes Democratic candidates for President who, once enthusiastic supporters of charter schools, have carefully been changing their message—Cory Booker especially, and also Joe Biden.  After the Network for Public Education released a scathing report on the appalling absence of oversight in the federal Charter Schools Program, Bernie Sanders increased the pressure on other candidates by “calling for a halt to all federal funding for charter schools.”

So… what is shifting public opinion away from support for charter schools and forcing Democratic candidates to recalculate their messaging?

  • Meckler names a year of teachers’ strikes and wildcat walkouts as an important factor: “The shift was reinforced last year by teacher strikes that focused public attention on educators’ low pay.”  But it is not only attention to the collapse of teachers’ salaries that we have have been watching. Teachers have drawn attention to the implications of  their low salaries—teachers leaving for states where salaries are better supported, teachers unable to find housing in the communities where they work. Teachers have also shown us their despicable working conditions and school districts forced to lay off nurses, counselors, librarians and social workers.
  • Academic research economists like Gordon Lafer and Bruce Baker have documented that charter school expansion leaves school districts with very significant fixed costs when children carry away their funding to a charter school—fixed costs that are large enough to devastate public school services and eliminate enrichments that are needed for the majority of children who remain in the public schools.
  • Teachers’ unions are deliberately working with candidates—encouraging them to talk with local school teachers who help them understand the damage test-and-punish school reform policies and the expansion of charter schools have inflicted on the public schools where teachers cope with the consequences day after day.  Meckler explains: “The American Federation of Teachers has been hosting candidate forums throughout the country, inviting contenders to spend a day with teachers and then answering questions town hall-style.”
  • Finally, the press along with advocates for investing in the public schools have relentlessly exposed the theft of public dollars by unscrupulous charter operators and for-profit charter management companies; the violation of students’ rights when charters push out vulnerable students or neglect to provide services for English language learners or children with special needs; the failure of state governments to regulate charter schools in the public interest; and the outrageous mismanagement of the federal Charter Schools Program, which has made grants totalling over a billion dollars since 1994 but without sufficient oversight.  The U.S. Department of Education’s own Office of Inspector General has condemned the management of this program in biennial reports for years, but nothing has been done to improve regulation of the schools which were seeded or expanded with large federal grants.

The Network for Public Education (NPE) has done some of the most notable work to expose the abuse of the public interest in the federal Charter Schools Program. Three months ago, NPE released Asleep at the Wheel, a major report documenting that over a billion in federal Charter Schools Program dollars has been wasted since 1994, when the program was launched, on charter schools that never opened or subsequently shut down. NPE has been updating that report by digging deeper into the state-by-state problems with charter schools that were started up or expanded with the federal grants.

On Monday, the Washington Post‘s Valerie Strauss  published the newest findings from Carol Burris, the Network for Public Education’s executive director and one of the authors of the Asleep at the Wheel report: “The Network for Public Education… continued investigations, going state by state, documenting the failed and never opened charter schools that received grants. To date, we have analyzed the lists of grants given from 2009 to 2014 in 15 of the 40 recipient states.  Some of the states received multiple grants, others few.  We have found 1,203 charter schools in those 15 states alone that either never opened or have closed.  This represents 40 percent of the total grantees… It appears we underestimated the waste in the report—the percentage of failed schools is higher than the 30 percent that we reported, and given the limited number of states and years analyzed so far, it is likely that waste will exceed our estimate of $1 billion.”

In Michigan, Burris reports the Asleep at the Wheel report caused the Michigan Board of Education to slow down on dispersing the federal funds: “Just this spring, based on the history of failed grants, the Michigan Board of Education voted to stop the disbursement of funds from a new federal $47 million dollar grant while it investigates what happened to the funds given to charter schools that never opened or quickly failed.”  Burris adds: “Eighty percent of Michigan charter schools are run by for-profit companies.”

Deeper investigation by NPE has revealed that, “Maryland had 54 schools in the 2009-2014 federal data set that never opened.  Overall, the percentage of Maryland charters that received federal grants but never opened or failed is an astounding 55 percent.  Those schools, together, had received $7,901,164 in federal Charter Schools dollars. Forty-two percent of the Pennsylvania charter schools that received grants either never opened, closed or may not have ever been a charter school at all… Other states with grantee failure rates above 50 percent are Delaware (57 percent), Arkansas (52 percent) and Georgia (57 percent).”

The National Center for Education Statistics assigns a name and a 12 digit code to all public and charter schools and has updated its school-locator tool through the 2017-2018 school year.  Burris reports: “Most of the time, the charter schools that received grants but never opened had not been assigned an NCES number in the database. However, we found numerous cases in two states where the school not only did not have a NCES number, it did not even have a name. Tennessee, which has a 49 percent grantee failure rate, gave 38 (federally funded) grants of $10,000 each to schools that not only did not have a NCES number, they also did not have a listed name. Where did that $380,000 go? Apparently, the Department of Education has no idea. Nor do they (or taxpayers) know where 18 grants to Arkansas ‘no name and no NCES ID’ charter schools went. Two of those grants were for $50,000.”

Burris further explores outrageous scandals in several charter schools and charter school chains seeded originally with federal Charter Schools Program grants. In California, 11 people associated with the online  Academic, Arts and Action Charter Academies, known as A3 Education, were indicted a few weeks ago on criminal charges of grand theft, conspiracy, personal use of public money and financial conflict of interest. (This is the scandal involving Steve Van Zant, Jason Schrock, Eli Johnson, and Sean McManus). It is alleged that over $50 million was stolen. “And who gave the seed money to start this adventure? The U.S. Department of Education’s Charter Schools Program did.” Burris further explores scandals in charters originally set up with federal Charters Schools Program dollars in Pennsylvania and Texas.

Burris concludes: “It appears that Sean McManus of the California online A3 charter scam has left the country.  But the multimillion-dollar heist of federal and California taxpayers’ funds for which he allegedly is responsible pales in comparison to the hundreds of millions of dollars in waste we are finding in our investigation of the U.S. Department of Education’s Charter Schools Program.”

Thanks to this kind of investigation—along with the outcry from public school teachers and the work of economists showing that charters steal essential dollars from public school districts—politicians are beginning to realize they can no longer ignore the problems with charter schools.

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Federal Charter Schools Program Wasted Nearly $36 Million on Ohio Schools That Never Opened or Soon Closed

Several weeks ago the Network for Public Education (NPE) released Asleep at the Wheel, a major report on the lack of accountability and subsequent waste and fraud in the federal Charter Schools Program. At the end of last week as part of a letter addressed to Secretary of Education Betsy DeVos (and published by Valerie Strauss in the Washington Post), Carol Burris the executive director of NPE, and Diane Ravitch began releasing state-by-state lists of never-opened or eventually shut-down charter schools that received seed money between 2006 and 2014 from the federal Charter Schools Program (CSP). The numbers are shocking. In my state, Ohio, between 2006 and 2014, the amount of Charter Schools Program money spent on charter schools that never opened or eventually closed amounts to nearly $36 million.

Here is a brief review of the Network for Public Education’s findings in last month’s Asleep at the Wheel report.  A series of federal administrations—Clinton, Bush, Obama, and Trump have treated the Charter Schools Program (part of the Office of Innovation and Improvement in the U.S. Department of Education) as a kind of venture capital fund created and administered to stimulate social entrepreneurship—by individuals or big nonprofits or huge for-profits—as a substitute for public operation of the public schools. Since the program’s inception in 1994, the CSP has awarded $4 billion in federal tax dollars to start up or expand charter schools across 44 states and the District of Columbia, and has provided some of the funding for 40 percent of all the charter schools across the country. The CSP has lacked oversight since the beginning, and during the Obama and Trump administrations—when the Department of Education’s own Office of Inspector General released a series of scathing critiques of the program—grants have been made based on the application alone with little attempt by officials in the Department of Education to verify the information provided by applicants. The Network for Public Education found that the CSP has spent over a $1 billion on schools that never opened or were opened and subsequently shut down: “The CSP’s own analysis from 2006-2014 of its direct and state pass-through funded programs found that nearly one out of three awardees were not currently in operation by the end of 2015.”

I suppose the idea is that if you scatter hundreds of seeds across a state, they’ll grow and enrich the educational environment.  But as I examine Ohio’s list of failed or never-opened, CSP-funded charter schools, I can see that the seeds were scattered so widely that they weren’t particularly noticeable even when they came up. Unless there was a splashy scandal or a school was widely advertised on the side of city buses, nobody would have had any idea of the existence or failure of most of the seeds that did come up. And anyway a lot of them never sprouted at all.  Because the Charter Schools Program has lacked oversight from the U.S. Department of Education and because Ohio’s charter schools are poorly regulated by a large number of nonprofit agencies that serve as sponsors, the Ohio press has—until NPE’s Asleep at the Wheel report—not to my knowledge reported that the U.S. Department of Education is funding a lot of failed or never-opened schools. Until now, the failure of this program has been virtually invisible.

In the the list of failed or never-opened Ohio charter schools released last Friday by the Network for Public Education, NPE reports: “Two hundred ninety-three Ohio charter schools were awarded grants through the U.S. Department of Education’s (U.S. DOE) Charter Schools Program (CSP) from money that the U.S. Department of Education gave to the states between 2006-2014.  At this time, at least 117 (40%) of those (Ohio) charter schools were closed or never opened at all.” NPE explains that 20 of the Ohio charter schools on the list never opened; ninety-seven of the Ohio charter schools receiving CSP grants opened but subsequently shut down.

I suspect that like me, hardly anybody in Ohio has heard of most of the 20 schools that received CSP funding but never opened. Here are their names: Academy for Urban Solutions; Buckeye Academy; Central Ohio Early College Academy; Cleveland Arts and Literature Academy; Cleveland Lighthouse Charter Community School West; Columbus Entrepreneurial Academy; Cuyahoga Valley Academy; Medina City Schools Technology School; New Albany School for Performing Arts Middle School 6-8; Phoenix Village Academy Secondary 2; Rising Star Elementary School; School of Tomorrow; Summit Academy Community Schools in Alliance, Marion, Massillon, Columbus, and Cincinnati; Technology and Arts Academy of Cleveland; Vision into Action Academy-South Columbus; and WinWin Academy.  It is difficult to tell from the names of most of these schools even where it was intended that they would be located.

Ninety-seven CSP-funded schools in Ohio have shut down, but from the list, it is not possible to discern whether they were shut down by their sponsors for conflicts of interest or fraud, or whether their sponsors determined they were failing their students academically, or whether they just went broke. Most of the CSP grants awarded to closed or never-opened schools were in the six figure range—$150,000 or more.  Two of the schools that failed or were never opened had been awarded CSP grants over $700,000; three had been granted between $600,000 and $700,000; two had received between $500,000 and $600,000; and 25 had been awarded between $400,000 and $500,000.

The federal Charter Schools Program is neoliberal by design.  It awards public funding to private operators—individuals and companies—to run schools in competition with the traditional public schools. One primary problem with the CSP along with other schemes to privatize the public schools is that oversight is lacking to protect the rights of the students and to protect the stewardship of tax dollars.

The late political philosopher, Benjamin Barber explains that lack of oversight, absence of transparency, waste and fraud are predictable when public programs and services are privatized: “It is the peculiar toxicity of privatization ideology that it rationalizes corrosive private choosing as a surrogate for the public good. It enthuses about consumers as the new citizens who can do more with their dollars and euros and yen than they ever did with their votes. It associates the privileged market sector with liberty as private choice while it condemns democratic government as coercive…  Privatization is a kind of reverse social contract: it dissolves the bonds that tie us together into free communities and democratic republics. It puts us back in the state of nature where we possess a natural right to get whatever we can on our own, but at the same time lose any real ability to secure that to which we have a right. Private choices rest on individual power… personal skills… and personal luck.  Public choices rest on civic rights and common responsibilities, and presume equal rights for all. Public liberty is what the power of common endeavor establishes, and hence presupposes that we have constituted ourselves as public citizens by opting into the social contract. With privatization, we are seduced back into the state of nature by the lure of private liberty and particular interest; but what we experience in the end is an environment in which the strong dominate the weak… the very dilemma which the original social contract was intended to address.” (Consumed, pp. 143-144)

The new Ohio report released last Friday by the Network for Public Education documents that between 2006 and 2014, Ohio charter schools were awarded $35,926,693 from the federal Charter Schools Program, money that disappeared when the intended recipient schools never opened or eventually shut down. The entire scheme has lacked oversight at both federal and state levels and entirely lacked transparency.  Most of us in Ohio were aware neither of the operation of this federal program nor its propensity to fund experiments that failed to serve Ohio’s children.

In last Friday’s letter to Betsy DeVos, Burris and Ravitch also share reports on schools that never opened or were soon shut down in Michigan, Louisiana, California, and Florida. They explain: “In the coming weeks, we will continue the process of identifying all of the closed and ‘ghost’ schools in every state, posting the names of those schools and issuing state reports.”

Congress Should Defund the Charter Schools Program and Invest the Money in Title I and IDEA

The Network for Public Education published its scathing report on the federal Charter Schools Program three weeks ago, but as time passes, I continue to reflect on its conclusions. The report, Asleep at the Wheel: How the Federal Charter Schools Program Recklessly Takes Taxpayers and Students for a Ride, is packed with details about failed or closed or never-opened charter schools.  The Network for Public Education depicts a program driven by neoliberal politicians hoping to spark innovation in a marketplace of unregulated startups underwritten by the federal government. The record of this 25 year federal program is dismal.

Here is what the Network for Public Education’s report shows us. The federal Charter Schools Program (CSP) has awarded $4 billion federal tax dollars to start or expand charter schools across 44 states and the District of Columbia, and has provided some of the funding for 40 percent of all the charter schools that have been started across the country. Begun when Bill Clinton was President, this neoliberal—publicly funded, privatized—program has been supported by Democratic and Republican administrations alike.  It has lacked oversight since the beginning, and during the Obama and Trump administrations—when the Department of Education’s own Office of Inspector General released a series of scathing critiques of the program—grants have been made based on the application alone with little attempt by officials in the Department of Education to verify the information provided by applicants.  Hundreds of millions of dollars have been awarded to schools that never opened or that were shut down: “We found that it is likely that as many as one third of all charter schools receiving CSP grants never opened, or opened and shut down.”  Many grants went to schools that illegally discriminated in some way to choose their students and served far fewer disabled students and English language learners than the local pubic schools.  Many of the CSP-funded charter schools were plagued by conflicts of interest profiteering, and mismanagement. The Department of Education has never investigated the scathing critiques of the program by the Department’s Office of Inspector Genera; neither has the Department of Education investigated the oversight practices of the state-by-state departments of education, called State Education Agencies by CSP, to which many of the grants were made. Oversight has declined under the Department’s leadership by Betsy DeVos.

One of the shocking findings in the Asleep at the Wheel report is that a series of federal administrations—Clinton, Bush, Obama, and Trump have treated this program as a kind of venture capital fund created and administered to stimulate social entrepreneurship—by individuals or big nonprofits or huge for-profits—as a substitute for public operation of the public schools. This use of the Charter Schools Program as a source for venture capital is especially shocking in the past decade under Presidents Obama and Trump, even as federal funding for essential public school programs has fallen. The Center on Budget and Policy priorities reports, for example, that public Title I formula funding dropped by 6.2 percent between 2008 and 2017.

The authors of the Network for Public Education’s Asleep at the Wheel report explain that the Department of Education itself justifies the high failure rate of schools receiving Charter Schools Program grants because the program’s purpose is to provide start-up money for entrepreneurs to experiment with innovative ideas for schools:  “CSP’s explanation for the high cost of failure was, ‘As with any start-up, school operators face a range of factors that may affect their school’s opening.  And as with any provider of start-up capital, the department learns from its investments.'”

Late in March, when the current Secretary of Education was questioned by members of the House Appropriations Committee about the findings in the Network for Public Education’s Asleep at the Wheel report, the Washington Post‘s Laura Meckler quotes Betsy DeVos herself justifying the high rate of charter school failure with an argument that basically the Charter Schools Program provides venture capital to support entrepreneurship and innovation: “When you have experimentation, you’re always going to have schools that don’t make it, and that’s what should happen.”

The Department of Education took a big leap toward support for social entrepreneurship (and diminished attention to the Department’s traditional programming) under the leadership of Arne Duncan, who served as Secretary of Education between 2009 and  December of 2015.  To lead the Department’s Office for Innovation and Improvement, Duncan hired Jim Shelton.  Before joining the department, Shelton had, according to a Department of Education biography, earned two master’s degrees from Stanford in business administration and education.  He developed computer systems, then joined McKinsey & Company in 1993 before moving to the education conglomerate founded by Mike and Lowell Milken, Knowledge Universe, Inc.  In 1999, he founded LearnNow, later acquired by Edison Schools and then worked for Joel Klein to develop and launch his school strategy in New York City that closed public schools and opened more and more charter schools.  He became a partner in the NewSchools Venture Fund and then in 2003 joined the Bill and Melinda Gates Foundation as the program director for its education division.

To be hired at the U.S. Department of Education, Shelton had to be waivered from a federal law that bans people from moving into governmental positions in which they will work directly with their former employer.  In Shelton’s case, the danger was not that he would shower his former employer with federal government largesse, but instead that he would import the priorities and practices of his former employer—the Gates Foundation—directly into government. Shelton oversaw not only the Charter Schools Program but also Race to the Top, which made large federal stimulus grants to states, which had each been given (by the Gates Foundation) a quarter of a million dollars apiece to hire grant writers to develop creative ways to invest federal stimulus money to support the turnaround of so-called failing schools. To qualify, the states had to agree to Duncan’s prescribed turnaround plans and also promise to remove caps on the authorization of new charter schools. There is now widespread agreement that Race to the Top failed to fulfill its stated goal of improving school achievement. After leaving the department, Duncan and Shelton both continued their careers in grant-funded social entrepreneurship; at least their work has no longer been publicly funded. Shelton ran education programming for the Chan-Zuckerberg Initiative, and Duncan has been working for Laurene Powell Jobs’ Emerson Collective.

Meanwhile, Betsy DeVos now leads the U.S. Department of Education, and her leadership has further reduced oversight, according to the Asleep at the Wheel report: “Under the current administration, while Congressional funding for the CSP rises, the quality of the applications and awardees has further declined.”

The Charter Schools Program is the only one of DeVos’s school privatization initiatives whose budget Congress has increased.  The Network for Public Education traces its funding history: “The program was appropriated at $219 million in 2004.  The budget went up to $256 million in 2010, $333 million in 2016, then to $342 million in 2017, $400 million in 2018 and is now at $440 million for FY 2019.”  In his proposed FY 2020 budget, President Trump has asked Congress to add another $60 million.

When Organizations like the NewSchools Venture Fund or today’s mega-foundations experiment with educational innovation, the risk is underwritten by private capital or philanthropic grants from the Walton, Gates, or Broad Foundations, for example. And if the experiments fail, the money lost is private.  In the case of the federal Charter Schools Program, the Department of Education has been gambling with $4 billion of our tax dollars—money desperately needed by the public schools in our nation’s poorest communities—money that could have been invested, for example, in Title I for schools serving concentrations of poor children or in implementation of programs to meet the mandates of the IDEA.  At their inception, Congress promised to fund a significant part of the cost of both Title I and IDEA, but Congressional appropriations have chronically fallen short.  Senator Chris Van Hollen (D-Maryland) has currently introduced the “Keep Our PACT Act,” which if passed would significantly increase the federal commitment to supporting federal these priorities. Van Hollen explains: “Title I, which gives assistance to America’s highest-need schools, is a critical tool to ensure that every child, no matter the zip code, has access to a quality education. However, it has been deeply underfunded, shortchanging our most vulnerable students living in poverty… (T)he Title I formula was underfunded by $347 billion from 2005-2017… Similarly, IDEA calls on the federal government to fund 40 percent of the cost of special education, but Congress has never fully funded the law. Currently, IDEA state grants are funded at just 14.7 percent.”

The Asleep at the Wheel report’s authors conclude: “The CSP’s grant approval process appears to be based on the application alone, with no attempt to verify the information presented.  Hundreds of schools have been approved for grants despite serious concerns noted by reviewers… The… lack of rigor and investigation in the review process, and the seeming willingness of the CSP program to offer grants despite concerns expressed by reviewers raise questions about whether this program is truly committed to jump-starting schools that hold the greatest promise of success, or whether simply letting 1,000 flowers bloom, and accepting the chaos and waste of repeated failure is really the operational model.”

For 25 years, the U.S. Department of Education has enabled, and Congress has funded, a failed, neoliberal, market-based, and unregulated charter school experiment.  In an article he published last spring, the McMaster University education theorist, Henry Giroux said it best: “Public schools are at the center of the manufactured breakdown of the fabric of everyday life. They are under attack not because they are failing, but because they are public….”

This blog has previously explored the Asleep at the Wheel report here and here.