A recent article in the Akron Beacon Journal raises the question of whether Ohio has the worst charter sector in the nation.
Reporter Doug Livingston delves into the charterindustry and what he finds is a nearly unbroken record of failure. Does anyone in the state government care?
He summarizes:
Ohio’s charter schools …
Drawing state dollars from local school districts, charter schools presented a cheaper, market-driven alternative to government-run schools.
■ Ohio law allowed for the first charter schools in 1998.
■ Nearly 40 percent of the 595 charter schools that ever opened in Ohio have closed. Financial difficulty is cited three times as often as academic failure. More than half the time, closure is voluntary, according to a state directory of shuttered charter schools.
■ Ohio’s charter schools rank among the lowest in the nation in advancing student learning.
He describes the intricate financing deals that enables charter operators to make a profit. Those who haven’t mastered the financing and political games are not likely to survive.
The financial transactions are complex:
“Through a public records request, the Beacon Journal reviewed hundreds of invoices, property lease and purchase agreements, vendor contracts, board minutes, court filings and other financial documents detailing how Cambridge spends much of the more than $30 million in state funding its managed schools will receive this academic year.
The paper also toured the company’s flagship school — Towpath Trail High School — and attended its latest board meeting to question the board and its legal counsel about their contract with Cambridge.
The company was born in 2012, founded by Marcus May, a former White Hat executive. Cambridge’s first three customers — dropout recovery high schools, like Towpath Trail, which is geared toward struggling 16- to 21-year-old students — had rebelled against White Hat after persistently low test scores and failing to get answers about how money was spent.
May saw unrest between White Hat and 10 schools over the next year as an opportunity. Without another company to help the breakaway schools acquire buildings and staff, “they would have drowned,” the schools’ attorney said.
May tapped friendships fostered through the years. School Warehouse, a Cincinnati business formed by Steve Kunkemoeller, a business associate of May’s, became the preferred vendor to furnish the schools. Most school boards sign no contract with School Warehouse, which holds a gentlemen’s agreement with Cambridge (enforced by May) to be the one-stop shop for all things furniture. The company serves as a middle man, marking up the price of desks and chairs in exchange for favorable financing terms that are hard to come by. Many banks, noting the high failure rate of charter schools, consider it too risky to lend them money. So Cambridge and Ohio charter schools find themselves turning to familiar faces or independent lenders that inflate interest rates to cover riskier loans.
Searching for vendors when the boards asked for bids, May took matters into his own hands. He founded Rearden Capital and d’Anconia Development to provide financing and line up private investors to purchase school property, often with an option for the schools to buy the property later.
“Rearden” and “d’Anconia” are the neoliberal protagonists in Atlas Shrugged, Ayn Rand’s ode to an unfettered free-market capitalism. Such is the philosophy May and others bring to public education.
For technology, a key component to deliver curriculum in dropout recovery schools, May turned to Suranjan Shome, who he met while launching a marketing firm named Mindgrab in the Akron Business Incubator. Shome built Epiphany Management Group (EMG) then bought May’s marketing firm. EMG now outfits Cambridge managed schools with technology.
Despite having an office in Fairlawn, the hub of activity for Cambridge is Towpath Trail at 275 W. Market St. May helped board members acquire and turn the old office building into a modern school. At the time of the property transfer, Donald Cureton, a board member at other Cambridge managed schools, was a part owner of the property through Bee Investments, according to records at the Summit County Fiscal Office.
A similar inside deal, involving unknown investors wrangled by May, was behind the purchase and opening of Wright Preparatory School in Canton this school year. The new Canton school board, which borrows members from sister schools, had no capital to buy the property. It turned to Cambridge, which called May for help.
These close-knit arrangements involving transactions that often lead back to May smack of self-dealing, so much so that a grand jury in Florida indicted School Warehouse and Newpoint Education Partners, May’s version of Cambridge in Florida, on charges of grand theft, money laundering and aggravated white-collar crime. A court filing details $40,000 in timed withdrawals and deposits that bounce between unknown bank accounts. The source and destination of the transactions remain a mystery as stakeholders in Ohio, including the schools’ boards, keep a close eye on the Florida case.”
I offered a congratulatory note….There are differences between Ohio and Missouri regarding charter schools. In Missouri, as little information as possible is given to the general public, except in cases like KIPP where fifteen bankers can pound their chests with pride. The Gulen school has 68% white children in the slps district which is 81 black student population. The few schools which perform relatively well are as damaging in different ways from the run of the mill failures. But the gigantic difference: this is an Akron newspaper reporting about Ohio charters. In Missouri, we simply do not have Missouri papers furnishing information about charters unless it is praise.
I am glad the charters get some realistic media coverage in Ohio.
Realistic coverage sheds light but, makes no difference. “Progressive” senator Sherrod Brown endorses privatizing U.S. Secretaries of Education. And, he asked for and received $71 mil. of federal taxpayer money to expand charters in the state, last year. The gerrymandered Republican state politicians serve the charter operators, who fill their coffers. The Walton’s and Gates funded the loudest cheerleaders, for charter schools.Then, after the huge mess, including taxpayer fleecing and “mostly truant” students, developed, they stopped funding advocacy (at least for that big cheering squad).
The Ohio Senate Education Committee Chair’s sister reportedly works for a Fordham Gates-funded organization.
I also offered a note of appreciation and sent off another blast to Senator Sherrod Brown who feeds on funds from charter operators.
And, there must be an 11th commandment that prohibits Ohio newspapers from identifying who funds the ubiquitously -quoted Fordham.
Fordham is funded first by the amazing portfolio of Thomas B Fordham of Dayton, who bought blue chip stocks many decades ago and never sold them. It also gets money from Gates, Broad, Walton and other foundations.
Thanks. I wasn’t aware of the portfolio. It’s similar to NBER. Reportedly, NBER’s portfolio was funded by men like Schaife.
Emeritus Fordham board member, Craig Kennedy, was quoted as saying there is a shortage of good ideas to soak up philanthropic money in the USA. Kennedy could get the foundation, he’s currently associated with, to fund a threatened great idea, pubic education.
Same song in many cities/states: “…we simply do not have Missouri papers furnishing information about charters unless it is praise.” It is this falsely enthusiastic message spread by pro-reform newspapers/media which seriously hurts public schools — public schools not spending a massive amount of money on endlessly advertising themselves.
“Reform” as we know it is is a corporate driven pack of lies. All they have shown is that if you choose the best and brightest, they will be able to achieve. Public schools know this too, but they aspire to educate all students, not just the strivers. The corporate owned media mostly covers charter success while they rarely mention all the waste and fraud. That is why I try to cross post this blog to friends, family and the public. It is important to spread the word. Privatization is a corrupt system that buys our representatives so they can help to turn public funds over to private entities. While I understand that there may be some schools that are trying to help students, the for-profit chains are in the business of making profit any way they can. They often falsify records and engage in crooked management and supply deals. However, mainstream media only reports the “success” of charters.
I think Ohio gets all the attention, but that’s partly because we have actual local newspapers who have worked the last decade to delve into this.
I would put Ohio up against Michigan and Pennsylvania for “worst” any day of the week.
Ohio’s not a one-off. We’ve had ed reform longer and we have a competitive local media environment. That matters. People don’t know about it unless someone reports on it.
I knew Ohio had jumped the shark on ed reform when the Columbus Dispatch started picking up the investigatory work other newspapers were doing. There is no bigger cheerleader for ed reform than the Columbus Dispatch. If THEY’RE admitting it it’s obvious and can no longer be ignored.
Ohio literally adopts every single ed reform fad and gimmick. They are incapable of saying “no”. If it comes out of the ed reform echo chamber they put it in place. It’s gotten so bad that when they finally surveyed the public the biggest complaint was “too much reform”. People are sick to death of being jerked around by this fad-following.
If we had taken all the money we’ve pumped into 5000 ed reform fads and concentrated on doing one or two things WELL with the schools we have we would have been a lot better off, but that’s not sexy and “innovative” enough for the Best and Brightest.
Local school districts can do a lot more to push back against this. They can’t do anything about mandates that come out of DC or Columbus, but they can do a better job resisting ed reform sales jobs. We simply don’t have to do whatever these people say. There’s no law that says anyone has to buy this crap on the local level. Be critical. Ask questions. Be wary. Get independent advice.
The same people who sold Ohio charter schools should NOT be directing what happens in public schools. They don’t have a solid track record. Send them packing.
When DeVos parachutes in selling garbage “online learning” and waves around federal funding, say “no”. Show us you can do your own thinking. Take back your schools. We hired YOU locally, not any of these national ed reform lobbyists.
These three lines from the linked piece [the second and third immediately follow the first] jumped out at me: 1, “■ Ohio law allowed for the first charter schools in 1998” and “■ Nearly 40 percent of the 595 charter schools that ever opened in Ohio have closed. Financial difficulty is cited three times as often as academic failure.”
Note the date: 1998. Note the failure rate: nearly 40%. Note the closure reasons.
In September 2013 Bill Gates said:
“It would be great if our education stuff worked, but that we won’t know for probably a decade.”
Link: https://www.washingtonpost.com/news/answer-sheet/wp/2013/09/27/bill-gates-it-would-be-great-if-our-education-stuff-worked-but/?utm_term=.69ba1f10277b
It’s 2017. Going by the words of one of the most influential and defining figures of corporate education reform, they’ve had nearly two decades aka approx. 2 x 10 years to show in practice in Ohio just how well charters & the ‘free market’ fill the role of being the “rising tide that lifts all boats” and “doing more with less” and providing viable “choice.”
Quite revealing that when the numbers & stats don’t add up in Ohio or Detroit PS or New Orleans the rheephormsters go silent.
This from the same folks that claim to be all in for DataDrivenDecisionMaking [DDDM].
Go figure…
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Well-said. Evidence-smevidence, all the same with the rephormers, who are out to make a buck, by cannibalizing the kids of the middle and lower classes.
PR bragging about “charity” yet, the rich never shift, in their status, on the “richest lists”. Tells us a lot.
“DDDM-DV”* will be a new diagnosis category for the new DSMVI.
*Data Driven Decision Making-Disease Variant
The following is from a couple years ago, so it seems a little prophetic.
Even the pro-charter, Eli-Broad-funded, Fordham Institute, run by Mike Petrilli, has also been critical these aspects of the charter school/school privatization industry. Terry Ryan, an analyst and writer over at Fordham (and a guy… I got that wrong once before), wrote an article recounting how he expressed criticism — to a Dayton newspaper reporter — of the excessive charter school executive salaries, rampant self-dealing in contracts with companies owned by the same operators, and nepotism where family members and close associates are given jobs with excessive salaries.
In response to Ryan’s public voicing of these concerns, Ryan and Fordham have gotten slammed back by charter school operators, who otherwise have been, and continue to be Fordham’s allies.
Ryan weighed in on the controversy of self-dealing that is rampant in the charter school industry, where charter executives are in charge of charter school orgs that are technically non-profit, but they nevertheless contract out services to for-profit companies for which those executives (or their relative(s)) are the sole or partial owners. That’s a lot MORE money on top of a charter school executive’s already excessive salary.
Ryan also condemned the problem of nepotism, where multiple family members of a charter school CEO (or some other charter school higher-up) are each hired at six-figure salaries to work at nebulous-sounding jobs with unreported hours.
What’s interesting is the charter school industry’s response to Ryan’s expressions of dismay at these phenomena — and at the outrageous charter school executive compensation in general.
The otherwise enthusiastically pro-charter Ryan — and Fordham in general — warns his charter buddies that, when the public gets wind of these corrupt practices, such revelations will damage the charter school industry’s brand with the general public, without which the charter industry will fail to survive, or at least expand.
Ryan’s words of caution are below, and, as he relates, they were met with severe blowback from “tone-deaf” (Ryan’s words) charter school executives kvetching back:
“None of your business, Terry! Or anyone else’s business!! So butt the-hell out!”:
http://edexcellence.net/commentary/education-gadfly-daily/ohio-gadfly-daily/2012/should-we-care-how-much-money.html
– – – – – – – – –
TERRY RYAN:
“Charter schools also need to be equally aware about what leaders receive in compensation, and how this will be perceived in the larger community, which leads me to the recent story in the Dayton Daily News. That paper ran a story on the compensation paid to a family running a charter management organization that serves about 2,000 kids in seven Ohio charters.
“The paper reported that …
” ‘Tax records obtained by the Daily News show CEO Pammer-Satow received a base pay of $168,466 in 2010 along with a $60,000 bonus and other compensation valued at $25,573. Her husband, COO Clinton Satow, received a base pay of$126,000, bonus of $45,000 and $14,000 in other compensation. Other members of the family are also employed by the management company in various capacities.’
“The Dayton Daily News reporter called me and asked for my reaction about ‘a couple making over $400,000 a year’ to run seven charter schools?
“I said, ‘That’s tough to defend.’ I also went on to comment, ‘At a minimum they (those high-paid charter executives) are politically tone-deaf to the realities of perception out in the community.’
“My comments have upset some in Ohio’s charter community who argue that as the schools perform decently, why should I or anyone else care what the leaders are paid (or whether family members are hired at six-figure salaries .. JACK)?
“My reaction to this question is that charter schools are only viable as long as they receive political support. As such, do stories about families paying themselves more than $400,000 a year in public tax dollars to run a handful of charters hurt support for charter schools?
“I think they do, but I’d value receiving comments back from readers. Should we care how much money charter leaders make?”
“Only viable as long as they receive political support.” Is there a plan for the oligarchy to end? If a business makes false advertising claims, there’s recourse. While the propaganda machine for charters, fulfills racist Georgia Gov.Talmadge’s plan, while taxpayers are fleeced and students are “mostly truant”… no recourse.
Rheephormsters promise to “do more with less.”
So a couple running seven charter schools serving about 7,000 students made over $400,000 in a year? Each of them made a little over $200,000 in a year?
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The NYC Schools Chancellor, Carmen Fariña, makes a little over $200,000 a year and she is responsible for 1.1 million students.
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Do I really need to spell this out?!?!?!?
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In the face of all of this evidence in Ohio you would think the legislature would do something about it. At the very least you might believe they would seek to recoup the $60,000,000 a court decided ECOT stole last year alone. While they are at it they could also pursue the $5,000,000 Betsy DeVos and her group owe the state from a decade ago. Instead the chairman of the Education Committee in the state legislature proposes a manifesto that would completely destroy public education in Ohio. His plan would move the funding of schools to the state level and allow vouchers for all students. Rather than reflect collaboration with teachers, administrators, constituents, and other legislators, Andy Brenner’s scheme seems like something he concocted while speaking with Milton Friedman and Ayn Rand in a dream. Brenner also happens to be the rep in my area and our local school district. Our local school board has sucked up to Brenner for years in hopes of an increase in state funding for the district. As it stands today, the state sends about $550 per student back to our district each year. That means the other $9000 spent per child comes from local property taxes. If that same child leaves our district and goes to a charter or private school, the state actually sends $1500 along with them. Yes, charter and private schools receive $1000 more if one of our kids attends than my public school would receive for the same child. Well our local board has sucked up to Brenner for years in hopes of simply receiving the same funding as private and charter schools from the state. Rather than fight to even up that funding, Brenner introduced a plan that would destroy public education. At the very least, it is my sincere hope that the people of his district show Brenner the door in a few years. Unfortunately, that leaves him plenty of time to erode and work to destroy public schooling in the meantime.
I found it interesting that the Akron Beacon Journal is owned by Black Press Group Ltd. a Canadian privately owned publisher of prominent daily newspapers in Hawaii and Ohio in the US and numerous non-daily newspapers in Albert and British Columbia, Canada.
Correct me if I’m wrong, but the most accurate reporting in the media often takes place outside the six BIG corporations that own and control 90 percent of the traditional media in the U.S.
Black Press is the largest publisher of newspapers in British Columbia and Washington state. It also owns several weeklies associated with its daily properties in Alberta and Hawaii.
Thanks for the info. I subscribed to a small town newspaper, in my state, until it started featuring libertarian views, exclusively, after it was bought by a right wing investor from Connecticut.
The U.K.’s Guardian has honest reporting (as did Al Jazeera before it shut down).
Another story to add to the pile of Ohio charter garbage: http://www.cleveland.com/metro/index.ssf/2017/01/i_can_charter_schools_could_be_sold_to_accel_network_run_by_former_ceo_of_k12_inc.html#incart_river_home
In the never ending battle between Ohio and Michigan, this Show Me Stater has to give Michigan the edge.
Chiara offered this…and I do not challenge her…”I would put Ohio up against Michigan and Pennsylvania for “worst” any day of the week.” But I still hope somehow, some way, somebody would take a look at just how much damage was done to Hillary, and whether several years of destruction of democrats up and down the tickets occurred in places where democrats stopped considering teachers…especially union teachers…to be valuable allies in shaping the thrust of what was considered important to be talking about. Places where charters gained a lot of strength with not much opposition….who would question Bill Gates?….are places where democrats became weaker.