Fresno’s ACEL Charter School will close immediately, due to financial problems. The charter school is $300,000 in debt and can’t get a loan, so it is shutting its doors. It started in 2008.
Students are upset and bewildered. Seniors are two months away from graduation and wondering how they will get a diploma.
“Many of the cash problems are being blamed on the unnamed company the board contracted to monitor its finances. Recently, the massive funding deficit was revealed.”
Charter schools come and go, like other businesses.
Diane Ravitch's blog 
Accountable? That’s just about the bottom line.
I want to know who’s responsible for this mess and what penalties and sanctions they are going to endure because of their irresponsibility.
Or perhaps is this what the self-proclaimed “education reform” movement is really all about: excuse after excuse after excuse about why they can’t be held to answer for their toxic failures.
I’m just waiting for someone to try to pin this on public schools…
😒
LikeLike
If it had been a Gulen charter as with the Magnolia charters in LA that the BoE wanted to shut down for this same kind of monetary loss, some would say possibly planned finagling of the books, there would have been a judge to issue an injunction keeping the charter open to let the maligned students have a place to go to school. And then Gulen hired a notorious new Director for Magnolia schools who was for a brief term on the LAUSD BoE even though she has made a fortune running charters.
Point being, it could have been worse.
LikeLike
Uh, maybe a REAL CIVIL RIGHTS legal team should step up and sue the State on their behalf.
LikeLike
Thems the breaks. Businesses go out of business.
LikeLike
Medical clinics and hospitals are usually private, often for-profit companies. Does anyone know if they are required to have any provisions to either keep the business going or else a plan to provide for patient welfare in the event of a closure and if, so, what those provision entail? I would think mandatory insurance to cover the costs to be able to operate long enough to wrap up business and make sure all patients are adequately referred and cared for elsewhere would be one thing.
If you start up a new restaurant or retail business and you go bust, you don’t hurt anyone but yourself. But no business that deals with helping people should be allowed to start up without a plan for what to do in the case of failure. Especially businesses which receive public funding. At the very least charters should have to be re-authorized every year and demonstrate that they have the resources and/or insurance coverage to make it through the school year.
LikeLike
In the mining industry of NYS, operators of quarries and sand and gravel pits are required to purchase remediation bonds to pay for restoration of the site to a productive use, IN THE EVENT the owner goes out of business. NYS can then use the money to to the restoration themselves.
Perhaps since charters aren’t committed to long term existence each school can purchase a bond equivalent to the cost of operating the charter for one school year, so that in the event they fold mid-year, there will be cash to cover expenses until the end of the school year.
Expensive? Sure!, but it’s all about the kids, right? The public can count on the public school being there, year after year without fail. Not so with these charters. The bond I describe is simply insurance for the public (and the students) that no one is harmed by a charter closing except the owners.
LikeLike
“But no business that deals with helping people should be allowed to start up without a plan for what to do in the case of failure. ”
But they do have a plan, or the people who write the charter laws have a plan.
The backup plan is public schools. That’s the security. That’s the “bond”.
They would have had to regulate charter schools much more extensively without a public school system acting as a safety net.
The public school “sector” makes the risk-taking in the charter school sector possible.
LikeLike
Chiara, I do understand the point you make.
I suspect that the days of the non-regulated charters are drawing to a close. Not immediately, not quick enough for me, but soon.
And when that happens, when the public knowledge of how charters misuse public funds reaches a critical mass, then ideas like mine might be part of the solution.
LikeLike
“Charter schools come and go, like other businesses.”
YEP! That’s the “free hand” of the marketplace doing it’s dirty business as needed, then it doesn’t use any TP, doesn’t wash that hand and still holds it out to greet you (the government which is of, by and for the people) to get more moolah!
LikeLike
I’m sure those kids learned grit while there. They’ll do alright. Hopefully the lesson the public learns is that they can’t count on charters to do anything but take their tax dollars without oversight.
LikeLike
Well if I was one of those students (or parents) I’d get myself over to the closest public school and see if something could be worked out, after abandoning said school so many years ago. I sure it can because unlike charters…public schools are there to serve the public, not the investors!
LikeLike
Luckily there’s a public school system to pick them up.
Ohio had 17 close in one city, over one year:
“At the beginning of 2013, one long-struggling charter school closed. Over the summer, five more did. And in the fall, 11 more Columbus charters closed their doors, most of them brand new.
That’s 17 charter schools in Columbus closed in one year, which records show is unprecedented.”
The reason ed reformers have been able to act so recklessly is because the much-maligned public school system acts as a safety net for their “innovations”. They couldn’t run these experiments without public schools acting as a backstop.
So it isn’t, actually, “like a business” at all.
The public system absorbs all the risk generated by the charter sector.
http://www.dispatch.com/content/stories/local/2014/01/12/charter-failure.html
LikeLike
Really on the mark about the risk management function of the public system. The number of charter frauds in Columbus Ohio is astonishing. Who is authorizing these scams?
LikeLike
I really think this function should be recognized by politicians. They can’t be stupid enough not to recognize that a universal system IS a system. They know these kids are going somewhere. They know “public education” under Ohio law guarantees a “seat”.
Imagine 17 “public” schools closing in one year in one year in Columbus without a system in place to act as a backstop. That wouldn’t happen because it couldn’t happen. People in government would lose their jobs for taking that kind of risk, and rightfully so. They don’t lose their jobs because the risk they took is absorbed by the public system.
I worry about a kind of “death spiral”. That happens when risk is shifted to a public system. The public system takes all the adverse consequences, shoulders all the risk, and eventually fails.
LikeLike
When charters pick up their temporary tents, lock their doors and flee the scene, everything is locked up, including school records, personal items and teacher paychecks…etc.
The chaos created for each student and their family must be unreal. Returning to public schools, which are educating children in overcrowded classes (esp. w/ 17 charters & system starvation in place) must now gather all records – if possible, welcome the students, plan their course of study, and…you guessed it >>>their teachers will be evaluated on the students’ test scores.
During the Katrina Crisis, most of their students came to new schools/states without one document. Schools were not able to retrieve old record, and those students often had to take classes again or more classes to meet new state graduation requirements. 12th graders were bumped into night schools due to age requirements, and I can guess, many may have quit school. Too much is just too much.
I almost want to slap these Harvard privileged Best/Brightest when they lecture about GRIT. They havn’t a clue what many of our families and their children experience.
TFAtypes play school, learn about their own GRIT when they have to do their own laundry while living with mom & dad. Oh, pleeeeeease!
All this is creating such pain, stress and $M of corporate profit.
By design!
America’s new Industry Created the CHARTER BUBBLE!
Are we crazy?
LikeLike
It looks like Diane is saying that the CMO was “unnamed”. Has the identity of the CMO really been kept secret by the charter?
This is the Wild West!
LikeLike
They had 3 different “financial advisers” over 3 years. The last was a university professor, so that’s a nice little side gig for her. Adviser to charter schools.
I don’t know about California, but in Ohio the charter sector generates a lot of “private sector” jobs that are 100% publicly funded.
LikeLike
Ed reformers are pulling out of Milwaukee. Not enough ROI:
“We have decided to make grants where we can have the highest impact, which means working in the places that we believe are most ripe for improving our education system.”
Read that sentence and you know that it isn’t coming from someone happy with the education landscape in Milwaukee.
In fact, the statement is from the Walton Family Foundation, the huge philanthropy of the family of the founders of Wal-Mart Stores Inc. The foundation is pulling back from a long, strong commitment to “education reform” in Milwaukee.
But it is also important in a broader context. Walton is joining a significant list of national players who in one way or another have entered the Milwaukee scene and then departed or reduced their interest.”
Thank goodness there’s a public school system, huh? The investor class is packing up and heading off to greener pastures. The people of Milwaukee are not meeting expectations. Good luck getting Scott Walker to support those schools now. Not interested.
http://www.jsonline.com/news/education/walton-family-foundation-stepping-back-from-milwaukee-education-scene-b99452073z1-294537391.html
LikeLike
Maybe Milwaukee is so saturated with charters and vouchers that there’s nothing more for the Waltons to disrupt. And there is the in invenient fact that all that choice has not improved the public system and has not saved any children
LikeLike
Once again I ask: Why aren’t charters required to carry insurance to cover one year of expenses so they won’t have to close mid-year.?
LikeLike
As Chiara pointed out above, they do have insurance.
It’s called the public school system.
As long as they have that backup, there is little risk to investors. Sorta like the thinking that went on among the banksters and their bought and paid for politicians seven years ago.
You remember, right? The banks that destroyed our economy were too big to fail, so they got bailouts, their employees got bonuses, and the rest of us got the…Right?
LikeLike
They don’t need insurance. There are no consequences for failure. What do they care whether their students have another easily accessible option.
LikeLike
The wonders of the free market. Of course these parents choose poorly. Survival of the fittest, the NeoLibs war cry. But over time the market will correct itself, it always does. The invisible hand. A much better charter will be along to pick up the slack.
I plan on getting a charter school myself. I have to be as qualified as that kid that got one in Rochester NY. My plan is to suck up as much money as possible, spend as little money as possible, pay myself an outrageous “consulting fee” and close the doors as quickly as possible. Better than an investment Ponzi scheme, as I wont go to jail.
LikeLike