There is not much to admire in Oklahoma’s penurious funding of its public schools. But there is one admirable law on the books. Schools are not permitted to spend excessive amounts on administrative overhead. And when they do, they are penalized.
Epic One on One virtual charter school has been penalized more than $530,000 for exceeding the state limit on administrative spending, a limit imposed by state statute meant to keep the bulk of state education funding in the classroom.
Epic’s superintendent, Bart Banfield, was notified of the penalty last month, according to an email obtained by The Frontier through an open records request.
The total penalty of $530,527.20 is based on Epic exceeding the allowable limits on administrative expenditures by 5.58 percent.
School districts with more than 1,500 students are not allowed to spend more than 5 percent of expenditures on administrative costs, which includes salaries for superintendent, assistant superintendent or any employee who has responsibility for administrative functions of a school district.
The amount will be deducted from Epic’s next state aid payment, according to the email to Banfield.
Thirteen school districts exceeded administration spending limits in Fiscal Year 2019, according to a report from the State Department of Education.
The penalties for the 12 other districts averaged $19,468, with penalties on school districts ranging from $27.39 to $39,514.
Epic’s penalty of more than half a million dollars is 10 times more than any penalty issued over the past three years, according to documents obtained by The Frontier.
EPIC’s CEO said it was a coding error. The state superintendent Joy Hofmeister said there was no error and the fine would be collected.
Diane Ravitch's blog 
The virtually daily presentation of fraud in the area of charters and privatization schemes should be presented by a candidate at a presidential debate…..if the inevitable screams of the non privatization public schools being just as bad could be quickly and successfully contradicted. Regular public schools are regulated…..charters, in many ways, are not. That point needs to be driven home.
Epic was already under investigation by state law enforcement agents for enrollment issues, so it appears the state superintendent isn’t interested in showering the charter with money. Virtual charters are such scams.
I am in love with Oklahoma’s law limiting administrative costs. My state of California only has guidelines, as far as I know. Funding needs to go to the classroom, not the Office of Excessive Testing and Data Driven Datalootics.
Not one dollar for Charter Schools!
And just like that another one pops up. It is like playing Whack-A-Mole
https://oklahomawatch.org/2020/02/14/online-charter-school-mails-recruitment-fliers-to-thousands-of-students-homes/
I found some more details The scam was multifaceted with some features also present in Ohio’s “Electronic Classroom of Tomorrow,” at last count an $80 million ripoff.
From the Progressive:
They allegedly recruited “ghost students” (who were technically enrolled but received minimal instruction from teachers) from homeschools and sectarian private schools “for the purpose of unlawfully diverting State Appropriated Funds to their own personal use resulting in high NFAY [not full academic year] rates and low graduation rates for the students.”
Epic established an $800-to-$1000-per-student learning fund for students who did not enroll in a public school. These students were dubbed “members of the $800 club,” and assigned to “straw teachers,” who “would receive additional pay in the form of bonuses which included student retention goals,” while “those who dropped students would see a decrease in pay.
A search warrant cited parents who received money but admitted they had no intention of receiving instruction from Epic. One family withdrew its ten children from public schools, received $8000, and allowed the kids to ride horses instead of attending school.
The warrant states, “Teachers did not take roll and determined attendance when students logged onto the computer.” This process explains why the 2018 Oklahoma report cards both showed that about 99 percent of students were “in good attendance.” https://progressive.org/public-school-shakedown/epic-charter-fraud-oklahoma-thompson-190806/
Laura,
Can you explain how the California A3 fraud worked?
Some stories said it was a $50 million fraud, others said $80 million.
I never understood how it worked.