The state of Oregon accuses two men of scamming the taxpayers by inflating enrollment figures in their online charter schools.
The schools–at least ten of them–were opened in conjunction with local school boards.
Apparently no one was supervising their claims.
The state wants the pair to repay $17 million plus nearly $3 million in costs and damages.
This is the danger of deregulation. There may be superintendents who would steal if they had the opportunity but they are watched by too many eyes. Maybe they get away with some thousands, but never millions.
Diane Ravitch's blog 
Will there be jail time to go with the monetary penalty?
Stealing from tax payers and ultimately students surely must still be against the law.
In both scenarios it is NOT OK to steal either millions or thousands. Fiscal oversight of publicly funded education is abysmal.
Fiscal oversight is abysmal???
Please explain how and why.
In any organization there’s bound to be some degree of “skimming”, where money meant for one purpose is used by employees or officers for a more personsal benefit. Often, the amounts are small enough, and the use debatable enough, to slip past audits. Such behavior is common in both corporations and public institutions. I’m sure it’s not hard to bring enough office supplies home to run up a bill in the hundreds or thousands of dollars over time.
Of course this is stealing and it’s wrong. But I think Diane’s point is that it’s hard to catch and, relative to the budgets involved in most school districts, small potatoes.
But don’t fool yourself. Having worked in corporations and served on a school board, this behavior is not unusual. And yes, on my board anyway, we pay quite a lot of attention to our budget. But you can’t really account for every penny in a multi-million dollar budget. Again, it’s the same in business too. It’s just that in business there is a lot of incentive to hide the abuse to protect existing management, and the public has no power to discover the abuse as they can in a public institution like a school.
Since public school teachers spend hundreds and thousands every year out of pocket BRINGING office and school supplies INTO schools, perhaps it evens out. It seems that some charter schools have unlimited budgets for supplies. Interesting.
Shame on teachers for not looking into their school districts budgets to see where the money for textbooks and instructional materials and supplies goes. These are the two line items in California for this issue. The reason we got Schiff-Bustamente in California which added $1.5 billion over 3 years to those two line items is because I did research for 10 years on this subject at LAUSD. What I found is that for 10 years LAUSD budgeted and did not spend $250,000,000/year. That is a total of $2.5 billion. Is it any wonder there were not any books or supplies. It took a year to convince the L.A. Times to do the story “In a Book Bind” which created the Schiff-Bustamente legislation. Do your homework teachers. It is only 5th grade math after all. Teachers you will stop getting screwed when you organize and understand budgets so that you know where the money goes. My experience is that they and their unions do not do the work necessary and are totally ignorant or do not care at all. Otherwise, what I just described could not happen. I am not a teacher and do not make money from education and I found this out. Just as we recently learned that at the new Barack Obama Prepatory Middle School they did not have books for the first 2 months. How can that happen when there is a specific line item in the bonds for this called “Other?” And then the principal is blamed for the lack of immediate progress? What kind of a weird world do we really live in?
Diane, can you add a link to the story? Thanks.
The state AG filed racketeering charges against the two executives running the charters:
Click to access AllPrep-FILED%20COMPLAINT-1-3-13.pdf
I love it.
We need more prosecutions of school employees especially administrators. In California administrators are the ones who break the child abuse laws more than anyone else. They are also involved in the false charges against teachers and for not following due process in employees legal situations. I actually had LAUSD audited in 1997 for the district falsely charging teachers with child abuse for whistleblowing. This audit is on the Calif. State Auditors website it is Oct. 1997, 96121 for you non believers. Falsely charging teachers with crimes is now worse than before even though LAUSD made a deal with the state of California to not do this anymore. LAUSD is now being taken to court on some of these issues. On top of this UTLA, the teacher union, does nothing to assist teachers in these illegal issues. In fact, they assist LAUSD in destroying teachers lives and careers and enriching the UTLA attorneys.
They are “non-profits” completely in business for the public good. (haha)
In 2010, AllPrep academies, Oregon’s home-grown charter founded by educational entrepreneur Tim King (a former North Clackamas School District teacher) began having financial problems. A decade previously, King founded three charter schools in that district: New Urban High, Clackamas Middle College and Clackamas Web Academy. In 2008, he left to start the AllPrep and other charter schools in a half-dozen small districts across the state, from Sheridan to Estacada to Sisters to Burns. http://www.oregonlive.com/education/index.ssf/2010/05/allprep_charter_school_network.html
In 2009, Whitney Grubbs (then dissemination grant coordinator for Clackamas Web Academy) wrote this opinion piece in the Portland Tribune.
http://portlandtribune.com/component/content/article?id=51075
“As controversy surrounding the proper role of on-line education in Oregon’s K-12 system began to mount, Clackamas Web Academy principal Brad Linn knew what he had to do. ‘I was very confident that we had a great program that was serving the needs of a diverse group of kids in our community, ‘ said Linn, a first-year principal. ‘But I knew if we really wanted people to stand up and take notice of our small charter school, we had to improve our test scores.’ ”
King’s legacy still exists with Clackamas Web Academy. The Oregonian puts their test scores in the bottom tier.
http://www.edline.net/pages/Clackamas_Web_Academy
http://schools.oregonlive.com/district/North-Clackamas/
http://schools.oregonlive.com/school/North-Clackamas/Clackamas-Web-Academy/
Director of Head Start in Portland since 1975, Ron Herndon wrote one year ago, “follow the money.” As the governor’s ill-advised proposal became law, we must “keep tabs on how many ’30 pieces of silver’ and well-connected committee members are rewarded from state coffers.”http://portlandobserver.com/2012/01/proven-educators-not-called-upon/
Whitney Grubbs, a former Stand for Children team leader and an attorney, had already advanced up the ranks. She is Governor Kitzhaber’s P-20 policy advisor under Dr. Rudy Crew, Kitzhaber’s appointed Chief Education Officer, who heads the Oregon Education Investment Project and replaced our elected State Superintendent of Education.
http://dasapp.oregon.gov/statephonebook/display.asp?agency=12100&division=12105
For more: http://www.facebook.com/OregonSaveOurSchools/posts/462571257118317
As Scott Mercier said, “This really is a story bigger than Lance. It’s bigger than cycling. It really goes to the core of (the fact that) ethics matter, (and) doing things the right way matter. It seems whether it’s business, academics, politics, I think the country is fed up. Hopefully we’re seeing a cultural shift that how you do things is more important than the result.’’
I hate to disagree with you, Dr. Ravitch, because I agree with nearly everything you say. However, public school districts can and DO “get away with some thousands,” and sometimes millions.
Four or five years ago in my large school district, a husband and wife team who worked for the district embezzled three MILLION dollars by providing cheap, photocopied books at a “less cost” from a company that they owned. They were convicted, but never spent any time in jail and didn’t pay back most of the money they stole from us.
Bureaucracies are a problem, no matter if they are public or private.
Charter schools are all about percentages. In their favor that is.