This article was published a year ago. It remains timely. It tells the story of the charter schools (one in particular) that bankrupted one of Pennsylvania’s poorest school districts.
While the public schools have been bankrupted and taken over by a receiver, the owner of the biggest charter became very rich selling goods and services to his charter corporation. He is active in Republican politics. He was on Governor Tom Corbett’s transition team for education. Governor Wolf has approached him with care. His charter has fattened on special education payments, which were $40,000 per student, even for those with the mildest speech disabilities, leaving the most disabled students to the bankrupt public schools.
Governor Wolf was able to negotiate a lowering of the special education payment to $27,000.
To put some noteworthy flaws of Pennsylvania’s charter law in stark relief, one need look no further than the Chester-Upland School District, a desperately poor enclave in generally well-off Delaware County.
As the state’s most distressed district, it is so unable to meet its students’ needs that it is under the control of a receiver.
Nearly half of the students in Chester Upland attend charter schools, and 46 percent of its budget goes to charter payments. Most charter students there are enrolled in the Chester Community Charter School (CCCS). The K-8 school has 2,900 students, nearly as many as the 3,300 K-12 students in the district. The state’s largest brick-and-mortar charter by far, CCCS was founded and is operated for profit by a company owned by businessman Vahan Gureghian, a major supporter of former Gov. Tom Corbett and other Republican candidates and causes.
CCCS and its management company, Charter School Management Inc., have built a reputation for taking maximum advantage of the financial opportunities built into the charter school law, while strenuously resisting any public scrutiny about where that money goes.
Until court-sanctioned action that lowered payments this year, the state’s special-education funding formula required Chester-Upland to send its charters more than $40,000 for every special education student. How much of that actually went to student services is not known, in part because the charter law does not require CCCS or any other charter to make that information public.
What is known, however, is that CCCS spends a healthy chunk of its budget on fees paid to Gureghian’s management company. Gureghian won’t open his books, but about 10 years ago, the school spent an estimated 40 percent of its revenue on management, as opposed to the state average for charters of about 16 percent.
What is also known is that the Chester Upland district’s payments to CCCS for special education have a profound effect on the district’s budget. “Unfair and excessive special education payments are bankrupting the District,” wrote Chester Upland officials in their recent recovery plan. Last summer, Gov. Wolf asked a judge to intervene and bring special education payments more in line with special education expenses.
A hallmark of the CCCS approach is that the school identifies large numbers of students as needing special education, usually in relatively low-cost categories.
For instance, in the 2014-15 school year, more than 27 percent of the special education students were classified as having a “speech and language impairment,” the least expensive classification of disability, which generally requires speech therapy once or twice a week. That is close to twice the state rate of 15.4 percent and more than 11 times the Chester Upland district rate of 2.4 percent for that category.
When the state tried to adjust the formula for special education reimbursements to reflect the level of student needs, charter lobbyists descended to fight it. And nothing changed.
By the way, the owner of the Chester Community Charter School has his mansion in Palm Beach for sale. He dropped the price last May by $5 million. You can pick it up for a mere $64.9 million. Quite the steal, never lived in.
For some reason, the Chester Community Charter School has a high rate of “safety incidents” and suspensions, more than any other school in Delaware County.

Chester-Upland School District predicament is a direct result of the crooked dealings of the Corbett administration, and a legacy of a legislature totally captured by the charter lobby. The only solution is for the people to vote out the complicit, corrupt politicians, and change the system that defunds public schools.
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I just don’t “GET” people who don’t support our public schools and public school teachers. Are they brain-dead?
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Oh forgot, it’s about money and power, not our young and democracy.
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Ed reform in Pennsylvania, Ohio and Michigan is an unmitigated disaster.
I see David Osborne out promoting his privatization book and I find it amazing he can completely ignore these massive failures in whole states and still be taken seriously.
How is this in any way “rigorous”? Why do these people get away with ignoring the results in a big chunk of the country?
I mean, public school advocates could do this too. They could write books about what a big success public schools are in Massachusetts and Vermont and pretend that’s the whole country but no one would take that seriously.
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You can tell the “portfolio model” is very grass roots and local because it was designed and is promoted by the exact same people and billionaire backers who design and promote every single other ed reform:
“Author David Osborne is sure that his vision for improving schools is the right one: “If you discovered a cure for cancer, but it was politically difficult with your union, would you avoid it?”
Neerav Kingsland, another proponent of the idea known as the “portfolio” model, is also optimistic but more cautious. “There’s enough evidence to try it in eight to 10 cities and see if we get good results,” said Kingsland, who leads one foundation’s efforts to parcel out funding for the approach.
“This reform effort might work and so I think it’s really worth trying,” Kingsland said. “We just need to be sober with the evidence.”
As with many education policies, the portfolio model is gaining adherents even while an research base is still being built. Those philanthropists, nonprofit groups, and policymakers — like Kingsland at the Arnold Foundation and Osborne, on a multi-city book tour promoting the approach — are betting big on the idea that schools should be managed more like stocks in a portfolio, where successful ones should expand and failing ones should close.”
How is privatization different if they call it the “portfolio model” instead of the prior strategy of “replace all schools with the charter schools we prefer” model?
Can someone tell me why this is new and different? It’s exactly the same people, the same idea, and the same financial backers.
They figured out there was increasing resistance to this agenda so they simply re-labeled it and now they run the Walton money thru a local agency instead of delivering it directly.
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Do local people in these cities believe the Walton Foundation will contribute ONE DIME to supporting an existing public school if that public school is unionized whether or not the school is a good school?
Not on your life. No way. The public schools will be treated as second tier safety net schools until they can be replaced with charters. That’s vital information for public school families! They need to know that so they transfer their kids out of the disfavored public school sector and into the charter sector that is supported.
It isn’t fair to tell the public you’re an “agnostic” when in fact you are not and that’s WHY it isn’t fair.
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“On Thursday, Gov. Eric Holcomb said the Indiana Virtual School’s “unsatisfactory” performance — which includes two years of F grades, low ISTEP scores and high student-teacher ratio — requires policymakers to get involved.”
Ignore the headline and read it to the end. It’s a meaningless proclamation. They specifically rule out any new legislation to regulate charters and since Indiana’s charters are not regulated, nothing will happen to the online giants.
Ohio still hasn’t regulated their giant for-profit online charters and they’ve been yammering about doing it for ten years. They can’t. They all took huge donations from the companies – they’re bought and they’ll stay bought.
It’s embarrassing in Ohio. No one can get the money back- not the attorney general, not the governor, not courts. They’re apparently powerless. ECOT calls the shots in this state. They boss John Kasich around and why wouldn’t they? They bought him.
https://www.chalkbeat.org/posts/in/2017/12/07/gov-eric-holcomb-says-indianas-low-rated-online-charter-schools-need-immediate-attention-and-action/
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