John Merrow says that Baker Mitchell of North Carolina could teach Jesse James a few tricks about making money.

Lesson one: Open charter schools.

Lesson two: become the sole supplier of most of the things they must purchase.

Lesson three: Keep your books closed because your for-profit corporation is private.

Lesson Four: remember to say you are doing it for the kids.

Lesson Five: Go to the bank: “Even though none of his publicly-funded schools is set up to run ‘for profit,’ about $19,000,000 of the $55,000,000 he has received in public funds has gone to his own for-profit businesses, which manage many aspects of the schools.”

Merrow writes:

“Mr. Mitchell seems to have experienced a learning curve. At first he billed his own charter schools for only two line items: ‘Building and equipment rental’ and ‘Management fees,’ for a total of just $2,600,878 in FY2008 and $2,325,881 in FY2009.

But apparently he was learning how the system works. In FY 2010 he added an innocuous sounding line item, “Allocated costs,” for which he billed $739,893, cracking the $3,000,000 barrier.

In FY2011 he added more line items:

Staff development & supervision: $549,626
Back office & support: $169,357
Building rent-classrooms: $965,740
Building rent-administration offices: $82,740, and
Miscellaneous equipment rent: $317,898.

The grand total for FY2011 was $3,712,946.

Jesse James was shot by a member of his own gang; if he were alive today, he might be dying from envy.

Mr. Mitchell broke the $4,000,000 barrier in FY2012, when the same line items totaled $4,137,382.

According to the audited financial statements for FY2013, Mr. Mitchell’s companies received $6,313,924, as follows:

16% management fee: $2,047,873
Administrative support: $2,796,943
Building and equipment rental: $1,474,108

“Dig into the audited statements (here and here) and you get some idea of where the $6,313,924 did not go. For example, the schools spent only $16,319 on staff development [4], which works out to less than three-tenths of one percent. They report spending just $28,060 on computers and technology, which is also about three-tenths of one percent.”

It’s all for the kids.