Bruce Baker and Gary Miron have written an important new study of the business of charters. It was released overnight by the National Education Policy Center at the University of Colorado. The report proposes regulation of charter schools to remove the corruption and money-making that is currently an embarrassment to the charter sector. So far, so good. As I have told the authors, I don’t agree with their proposal that states declare charter schools to be public schools and to regulate them as public schools. Several states already have labeled them public schools and don’t regulate them. In those states where the governor and the legislature have been captured by charter industry financiers, it is not likely that there will be either regulation, transparency, or accountability because the lobbyists will never accept it. Nonetheless, this is an important report because it lays out the specific ways in which charter operators have gamed the system for the sake of lucre.
The Lucrative Side of Charter Schools
New report puts first pieces together on how charter schools are profiting through the privatization of public assets
Contact:
William J. Mathis, (802) 383-0058, wmathis@sover.net
Bruce D. Baker, (848) 932-0698, bruce.baker@gse.rutgers.edu Gary Miron, (269) 599-7965, gary.miron@wmich.edu
URL for this press release: http://tinyurl.com/py94cuk
BOULDER, CO (December 10, 2015) – Charter schools are educational providers, but they are also businesses. A large portion of them are run by private corporations, and receive taxpayer dollars to provide their services. Yet there is very little public understanding of the often- convoluted ways these companies use those dollars and take advantage of laws in ways that enrich owners, officers, and investors.
A new research brief from Bruce Baker and Gary Miron details some of the ways that individuals, companies, and organizations secure financial gain and generate profit by running charter schools, leading them to operate in ways that are sometimes at odds with the public interest. In The Business of Charter Schooling: Understanding the Policies that Charter Operators Use for Financial Benefit, they explore the differences between charters and traditional public schools, and they illustrate how charter school policies sometimes function to promote profiteering and privatization of public assets.
The authors explain, for example, how charter operators working through third-party corporations can use taxpayer dollars to purchase buildings and land. The seller in these purchases is sometimes the public school district itself. That is, taxpayer dollars are used to purchase property from the public, and the property ends up being owned by the private corporation that operates or is affiliated with the charter school.
“This particular type of transaction is usually legal and it can be very logical from the perspective of each of the parties involved,” said Baker. “But we should be troubled by the public policy that allows and even encourages this to happen.”
“In addition,” Miron explained, “less than arm’s-length leasing agreements and lucrative management fees are extracting resources that might otherwise be dedicated to direct services for children.”
The authors conclude with eight recommendations for policies to help ensure that charter schools pursue their publicly established goals and that protect the public interest.
Diane Ravitch's blog 
Reblogged this on David R. Taylor-Thoughts on Education.
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The taxpayer should not accept the unnecessary cost of monitoring and enforcement for a parallel school system that enriches schemers and attracts exploiters.
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Gary Miron is a former charter supporter who is an expert on Michigan charter schools. I think it’s really interesting how he’s never quoted in all those national pieces lauding charter schools. Instead we get Harvard economists and former Obama Administration people- people who wouldn’t know a Michigan charter school if they fell over one.
It’s as if we are forbidden to talk about actual charter schools in the midwest, and must discuss Boston and New York. It’s nuts. Makes absolutely no sense.
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I disagree. He has been for over a decade one of the best critics of charters. I remember talking to him when Washington State’s first initiative on charters was on the ballot.
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I’d love to see a map illustrating these property transfers, from public to private ownership, in charter-heavy places:
“The authors explain, for example, how charter operators working through third-party corporations can use taxpayer dollars to purchase buildings and land. The seller in these purchases is sometimes the public school district itself. That is, taxpayer dollars are used to purchase property from the public, and the property ends up being owned by the private corporation that operates or is affiliated with the charter school.”
They are quite literally transferring publicly-owned assets to private title. They’re stealing from us. In exchange for a tangible asset we get a service contract, which we also pay for.
No one in their right mind would make this deal, yet our politicians are doing them on our behalf. Would you exchange the equity in your home for a chance to rent your home, oh, and you’ll also be paying the rent on the asset you no longer own? Of course not. That’s insane.
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Chiara: your third paragraph—
TARGO!
😎
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The report contains a significant error on page 8–the claim that for-profit EMOs dominate the charter school sector in New York State simply isn’t true.
A 2010 revision to NYS’s charter school law made for-profit EMOs illegal. The 34 charters that were available at that time (28 of which were issued) were grandfathered in. I don’t know what became of those 6 unissued charters, but let’s assume they were all granted and are now operational.
As of June 2015 there were 251 charter schools operating in NYS. A little less than half of those were independent/self-managed. Of the 130 or so schools that were contracting with a management organization, 96+ did so with a nonprofit.
So at most 14% of charter schools in NYS contract with an EMO. This number will only get smaller and smaller as all new charters coming on line will be indies or use non-profit organizations.
This is dominating the sector?
I trust that the authors will correct and update the report as soon as possible.
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Tim,
I communicated with authors and they made the correction.
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It truly is the most wonderful time of the year. Thank you.
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“Ohio Senate Minority Leader Joe Schiavoni (D-Boardman) will introduce legislation in non-voting session today to stop charter schools from spending tax money on any advertising, recruiting or promotional materials. The legislation would level the playing field with traditional public schools that are currently prohibited from using state funds on advertising.
“Charter schools should play by the same rules as other public schools,” said Senator Schiavoni. “It’s time we end this double standard and focus state funding on learning and not advertising.”
The legislation is in response to a radio advertising campaign launched recently by some charter schools to change the evaluation process for state report cards, to be released in late February, so they can avoid bad grades”
I actually don’t think lawmakers can stop them from spending student funds on advertising. The management companies are private, and they could successfully challenge this proposal based on their right to advertise- speech.
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