Governor John Kasich has been charter-friendly, to say the least. Ohio is home to some of the nation’s most profitable charter operators. Think ECOT. Think White Hat. These charters gove generously to friendly politicians (think Kasich and the Ohio Republican Party). But now Imagine charters had some embarrassing publicity about some of their lucrative sale-leaseback deals, and even charter champions are calling them “crony capitalists.”
So ProgressOhio has called for an investigation of Imagine.
““Our ‘fiscally conservative’ governor needs to explain why he’s allowed all this money to be wasted and all these kids to be hurt. And his charter school watchdog needs to go,” said Brian Rothenberg, executive director of ProgressOhio.
“Rothenberg asked why David Hansen, who heads the state Department of Education’s charter-school accountability office, has ignored the problem, noting that he formerly served on the board of an Imagine school in Columbus and should have known about its lease arrangement.
“Hansen, husband of Kasich’s chief of staff, was on Imagine Academy of Columbus’ board and among those recommending that the school be closed because of poor academic performance. The school closed but reopened weeks later as a new Imagine school with the same lease, which directs more than half of its state aid to rent.”
And more:
“The Dispatch reported on Sunday that five Imagine schools in Franklin County received a combined $20.2 million in per-pupil state aid in the 2012-13 school year. A quarter of that money — more than $5.1 million — was spent on rent, all under long-term leases with Schoolhouse Finance, an Imagine subsidiary.
“A sixth school, Imagine Integrity Academy, spent 81 percent of its $440,009 in state aid on rent in the 2011-12 school year, the most recent audit available.”
High profit margin, no?
“Research by ProgressOhio showed that, despite Imagine’s poor academic performance, Imagine and Schoolhouse Finance collected at least $14.4 million in public money last year for their 17 Ohio schools, according to records from the schools and state auditor.
“More than half — $8.9 million — covered rent for long-term leases to Schoolhouse Finance. The $5.5 million balance went to pay “indirect costs’’ to Imagine to provide management services.
“Rothenberg said the arrangement leaves little money for classroom instruction, and administrators for some of the schools complain that low teacher salaries have caused high staff turnover, which further undermines student achievement.”
Crony capitalism? Yes. Ripoff of public funds intended for children? What do you think?
Diane Ravitch's blog 
Well, they’re not paying employees with the extra cash, that’s for sure:
” But today, I was just stunned by what the for-profit charter school operator Imagine Schools told one of their school boards yesterday. The board told Imagine that they would rather pay their teachers more money than the exorbitantly high rent they’re paying Imagine for their building. The Imagine Schools spokesman said the board should think of other ways to “celebrate” the teachers “such as having cake for them at the next board meeting.”
I’m sure the school’s teachers will appreciate their sheet cake. The $26,929 those school’s teachers make a year, by the way, is about $1,000 under the poverty line for a family of 5, and would qualify these teachers for welfare benefits in many cases. So I’m sure they will love their cake because it will help them pay the rent.”
I’m sure the employees feel very “empowered” 🙂
There isn’t anything innovative about paying people less to turn a bigger profit. That’s an old, old idea.
http://10thperiod.blogspot.com/
Let them eat cake!
So true, Dienne.
And eating cake is bad enough. Try paying your rent/mortgage, electric bill and water bill with it.
I want to know where our resident charter supporters are on threads like this? TE? Joe Nathan? WT? Is this kind of corruption okay in your book? Can you defend it? Or, if not, are you speaking out about it? Are you doing anything to combat it? If you really believe in the aspirations of charter schools, and if this sort of behavior doesn’t represent “true” charter school behavior, it seems to me that you’d be the first and loudest to condemn this sort of thing.
And please don’t deflect with some sort of false equivalence about public schools. I’m not aware of any public schools that purchase buildings and then lease back to themselves at exorbitant rent, which said rent is ending up in the hands of a private, unaccountable entity.
Dienne: their silence is deafening and suggests consent.
Thank you for your comments.
😎
I’d also like some information on their tax status. I’m a for-profit business and I pay Ohio state and federal taxes. Does Imagine? I hope they’re not ripping off Ohio citizens and public schools on both ends, when they take the profit and then again when they don’t pay taxes on it.
I wonder when our lawmakers will decide to do their jobs and regulate these entities. Imagine has schools in 11 states and DC. They’re huge. Surely the charter promoters in the state and federal government are aware of the problems with this company. They seem to have charter school conventions/promotion events every three months where they give one another awards. Is Imagine at these events selling their wares to lawmakers?
What’s the hold-up on an investigation? What’s taking so long?
“Imagine” (sincere apologies to John Lennon)
Imagine there’s no watchdog
It’s easy if you try
No state to bug us
Above us only $ky
Imagine all the charters
Living for today
Imagine there’s no authority
It isn’t hard to do
Nothing to sweat or lie for
And no regulation, too
Imagine all the charters
Living life in peace
You may say I’m a dreamer
But I’m not the only one
I hope someday you’ll join us
And our schools will cheat as one
Imagine no prosecutions
I wonder if you can
No need for trials and lawyers
A brotherhood of scams
Imagine all the charters
Ruling all the world
You may say I’m a dreamer
But I’m not the only one
I hope someday you’ll join us
And our schools will rule as one
How do you do that? You are amazing!
Agreed! Always love these.
I expect John would have liked this
Which charter companies are getting the 220 million from the Obama Administration to open new charter schools? Gosh, I hope this company isn’t on the list of federally-subsidized private providers Duncan’s “team” picked to promote and fund.
Can Ohio public schools get any piece of that pie? We haven’t done so hot under ed reform “leadership” at the state and federal level. In fact, we’ve lost funding every year under Obama/Kasich.
Obviously we’re not the preferred schools, but can we even request a piece of that funding, or is it “public schools need not apply”?