The former principal of the shuttered Discovery Creemos Academy pleaded guilty Friday to participating in a $2.5 million scheme to inflate enrollment at the defunct charter school.
Harold Cadiz, 55, faces up to 12 ½ years in prison after pleading guilty in Maricopa County Superior Court to two counts of felony theft during the 2016-17 and 2017-18 school years. He’s scheduled to be sentenced March 27.
Cadiz is the second administrator from the Goodyear charter school, also known as the Bradley Academy of Excellence, to admit to participating in the scheme to defraud the state and federal governments by inflating the school’s enrollment by hundreds of students.
Cadiz’s plea calls for a prison sentence of 3 to 12 ½ years and up to 7 years of probation.
Arizona public schools are funded based on the number of students, meaning each additional student a school reports to the state brings more tax dollars.
Daniel K. Hughes, president and CEO of Discovery Creemos, was the first executive at the school to cut a plea bargain with the Arizona Attorney General’s Office, admitting to theft and conspiracy in November 2018. He faces a presumptive prison sentence of five years.
The school closed January 2018, just after the 100th day of the school year, ensuring it would receive as much state money as possible before it closed.
A few months before Discovery Creemos Academy closed, Hughes had assured the Charter Board that he would turn around the financially and academically failing charter school. Reviews by the Charter Board for the 2013-14, 2014-15 and 2015-16 school years found the school did not meet its financial performance recommendations.
Hughes has admitted that during the 2017-18 school year, his school reported an enrollment of 528 students, but 453 of them were fraudulent. In 2016-17, the school reported it had 652 students, but 191 were fraudulent.
CORNELIUS, N.C. – When Lakeside Charter Academy opened five years ago in this boating community outside Charlotte, it faced the same challenge that confronts many new charter schools.
It had governmental approval to operate and the tax dollars that come with it to pay for teacher salaries, supplies and other expenses. But it had no money to build a school or lease classrooms.
Like most of the 45 states with charter schools — taxpayer-funded campuses operated largely by private businesses — North Carolina provides no money to new operators for start-up or capital costs.
So Lakeside struck a devil’s bargain of sorts. It entered an agreement with an Arizona company to renovate a former church building, funded, in part, bya federal program that allows private companies to raise money by essentially selling green cards to wealthy foreign nationals.
Arizona-based Education Fund of America secured the foreign financing and its business partner, American Charter Development, of Utah, would raise the rest of the cash, build the campus and then lease the space back to Lakeside.Lakeside put no money down.
Peter Mojica, a North Carolina businessman and founding school board member, said Lakeside had few options as parents worked to get the school built around 2012.
“A charter school has no credit and can’t get the money unless they have a crazy endowment from a rich benefactor,” said Mojica, who still has a son at Lakeside. “So you have Chinese investors buying visas.”
Twenty-seven other campuses in eight states, mostly small charter schools, have struck similar deals with Education Fund of America since 2013, according to its website.
Those deals have put some of the schools in financial jeopardy, according an Arizona Republic investigation.
Two Florida schools closed after one year. Four others, including three Arizona charter schools, are in imminent danger of shutting their doors, records obtained by The Arizona Republic show. More than half of the schools who entered the deals are running budget deficits. And at least 10 have turned to high-interest loans to stay afloat. The majority have average to failing academic scores.
The Republic visited seven states to investigate charter schools and what ongoing shifts in the industry might mean for Arizona, the state with the largest share of charter school students in the nation.
Almost three decades after the first U.S. charter schools opened their doors promising to innovate and compete with traditional public schools, funding remains a daunting barrier for all but the biggest operators. The result, experts say, is small, entrepreneurial operators who were the backbone of the early charter movement are increasingly squeezed out or forced to take big financial risks.
The number of mom-and-pop charter operators is declining. Between 2014 and 2018, 61% of charter schools approved to operate nationwide were affiliated with a nonprofit or for-profit chain, according to the National Association of Charter School Authorizers.
The officials who grant charters to would-be school operators are more inclined to favor big chains with proven track records than independent startups, said Greg Richmond, who until recently was chief executive of theNational Association of Charter School Authorizers.
“The charter school field has become a little more risk-adverse,” he said.
‘MAKING A PROFIT OFF OF OUR CHILDREN’
Lakeside Charter Academy turned to Education Fund of America only after parents struck out trying to get private investors, including hedge funds, Mojica said.
The school has paid escalating rent to American Charter Development for a campus that is far from luxurious, according to interviews and records obtained by The Republic.
Lakeside has no gymnasium or lunch room and only a small playground. At the end of last school year, a parking lot that doubles as a basketball court was rendered unusable by a large sinkhole. Its roughly 300-square-foot library is mostly filled with donated books.
As of July, the school was more than $1.7 million in debt — most of it for unpaid rent — and enrollment had plummeted to 100 students, from a high of 400. The state gave it a “C” academic rating.
“All I wanted was a good school for my sons,” said Alyson Ford, whose boys attended Lakeside until she moved them over disgust with Lakeside’s finances and governing board.
“As taxpayers, we are not happy about this situation,” she said, citing companies “making a profit off of our children.”
She questions Education Fund’s claim that the school was built for $5.1 million, using $3 million in Chinese investment through the federal Employment-Based Fifth Preference Immigrant Investor Program — or EB-5 visa program. County assessor records value the property at $3.3 million….
The nation’s 7,000 charter schools educate more than 3 million children, according to the U.S. Department of Education. The share of public school students attending charter schools nationwide has risen from 1% in 2000 to 6% today.
Despite that growth, starting a charter school remains daunting.
Just seven states and the District of Columbia offer charter school facility grants, and nine have loan programs, according to the Charter School Facilities Center.
The Charter School Facilities Center, a Washington, D.C., group tied to the National Alliance for Public Charter Schools, found in a June research paper that one of the biggest challenges to the expansion of charter schools is state laws that place the burden of funding facilities on school operators who struggle to find affordable facilities.
Arizona Gov. Doug Ducey created a charter school construction lending program in 2016 that was billed as a way to help the “best public schools” expand by providing lower-cost financing with help from the state. It mostly assisted Basis Charter Schools Inc. and Great Hearts Academies — large, successful charter chains with close ties to the governor. After only one charter school received financing through the program in 2018, three Arizona charter schools used it this fall.
The federal government since 1994 has helped fund startup costs for charter schools through competitive grants and credit programs. But only a fraction of the projected $500 million this year is set aside for smaller charter schools, with most going to the large nonprofit companies that dominate the charter school industry.
The U.S. Department of Education last year distributed 32 multi-year grants to individual charter schools. The largest was for $1.25 million, far less than what is needed to build a comprehensive campus. Meanwhile, a single chain, Texas-based IDEA Public Schools, received nearly $117 million.
Operators who succeed in opening a school have a high failure rate, suggesting additional difficulty in finding long-term financing. Since 2000, at least 2,927 U.S. charter schools, or nearly 30%, have closed, federal records show.
The failure rate in Arizona, 41%, is even higher despite the Legislature providing charters with additional per-pupil funding to help with capital costs.
The Grand Canyon Institute, a private, nonpartisan think tank, found Arizona charter schools primarily fund buildings and classrooms using high-interest “junk bonds” guaranteed by schools’ projected enrollment growth. If the growth doesn’t materialize, mortgage payments will consume a greater share of the schools’ shrinking revenue, leaving less for the classroom.
Bill Honig, a researcher and California educator who runs the Building Better Schools website, found through his research that charter school closures have disrupted the instruction of at least 288,000 school kids since 2000.
Those closures take a largely overlooked toll on students.
Stanford University’s Center for Research on Education Outcomes examined school closures in 26 states over eight years, and found that fewer than 50% of students displaced by a closure ended up at a better school.
A UC Santa Barbara study, considered the definitive look at the subject, found students who changed schools between the eighth and 12th grades for any reason other than being promoted to a higher grade, were twice as likely to drop out…
Wing launched Education Fund eight years ago to help address the lack of charter school start-up funding.
“Charter schools have a massive financial disadvantage,” he said.
As a U.S. Citizenship and Immigration Services regional center for EB-5 visas, Wing’s Education Fund essentially sells green cards to wealthy foreign nationals in exchange for an investment in U.S. charter schools.
Among its first projects was to provide $2 million in foreign investment for the Learning Foundation and Performing Arts charter school, which opened in Gilbert in 2013.
Education Fund’s website shows smiling students, 28 “EB-5 financed charter schools,” and a breakdown of foreign capital and other investments.
There are about 880 regional centers. But Education Fund, which is approved to operate in 11 states, claims to be the first to raise foreign investment for charter schools.
Its work has gone largely unnoticed, even within the charter school industry. Assistant U.S. Secretary of Education Jim Blew, one of the country’s top charter school advocates, told The Republic he was unaware charter schools have been funded through the EB-5 program.
The foreign investments must create or maintain at least 10 U.S. jobs within two years. When Lakeside Academy signed on with Education Fund, investors could get a visa with a $500,000 investment provided it was for a project in a rural or high-unemployment area.
Wing declined to say how many visas Education Fund’s investors have obtained. Nationwide, about 10,000 such visas are issued annually, but not without controversy and allegations of fraud.
Reports to Congress by U.S. Government Accountability Office in 2015 and 2016 found a lack of federal oversight of the program resulted in fraud.
Sen. Chuck Grassley, R-Iowa and then-chairman of the Senate Judiciary Committee, in 2017 raised questions about an EB-5 scheme that created no jobs while allowing operators to pocket $50 million from Chinese investors.
EB-5-funded projects also have been widely criticized for gerrymandering poorer neighborhoods into regional centers to fund projects in wealthier areas. For example, New York City’s $25 billion Hudson Yards mega project, which has raised luxury towers across a swath of Manhattan, drew on more than $1 billion in EB-5 investment.
USCIS acknowledged it does not keep a “database of specific EB-5 investments” and said each regional center is responsible to “provide adequate and proper oversight, monitoring and management of its projects.”
Former Arizona Sen. Jeff Flake, who as a member of the Senate Judiciary Committee supported Grassley’s efforts to provide more oversight of the EB-5 program, said there have been numerous calls in Congress to fix it because of situations similar to the Hudson Yards project, but “we simply extend the program year after year.”
“Reforms are needed and there is pretty broad agreement on those integrity measures,” Flake said.
David North, a researcher with Washington, D.C-based Center for Immigration Studies, a think tank that favors reducing immigration, said the “stunning” lack of federal oversight allows the EB-5 program to fester while middlemen and developers enrich themselves.
“It’s a terrific business to be in, but it’s a hell of a waste of public-school monies,” he said. “The EB-5 program is a mess. Charter schools are a mess. When you put them together, it’s a messier mess.”
One of Education Fund’s investors was Erica Zhu, who said she works in foreign-funded enterprises in China.
She learned of the program when her husband saw an article about Education Fund, and invested $500,000 in one of the company’s Florida schools, St. Cloud Preparatory Academy.
Four years passed before the U.S. government approved visas for her and three family members. They plan to relocate to North Carolina. (EB-5 investors do not have to live in the same community as their investment.)
“The EB-5 program is a great program that gives foreigners a chance to immigrate to the United States,” Zhu saidin an email to The Republic.
North disagrees, saying it unfairly rewards wealthy “aliens with a handful of green cards.”…
Education Fund’s cheap foreign money only covered a third of the charter schools’ facility costs. Wing’s business partner, American Charter Development, provided high-interest, U.S. hard money loans. The combined charter school fund totaled $234 million.
Lakeside Charter Academy’s loans with American Charter Development carry interest rates up to 9.5%. The school began missing rent payments in 2017, records show.
Wing said some Education Fund schools’ financial hardships may be unrelated to their lease arrangement — for example, board infighting or declining enrollment, both of which have occurred at Lakeside.
Wing said Morley has been generous in allowing charter operators to delay rent payments.
Still, a Republic review of Education Fund’s financing of charter schools — including a review of more than 1,000 records and dozens of interviews — found widespread financial problems at the schools:
Half of Education Fund’s schools have budget deficits, with one Arizona operator, the Learning Foundation and Performing Arts charter school in Gilbert,nearly $2.8 million in the red.
Education Fund charter operators of at least 10 schools in Arizona, Florida, Georgia and North Carolina have borrowed money from other lenders at interest rates of up to 23%.
Independent auditors for three Education Fund charter operators in metro Phoenix have raised doubts to state regulators about whether the schools will remain open. All three, Learning Foundation and Performing Arts, Champion Schools and Painted Desert Montessori Academy, have experienced high and escalating rent payments.
Two Florida schools that raised money through Education Fund closed within a year of opening.
More than half of Education Fund’s charter schools have average to failing letter grades, with just three receiving an “A….”
Frank Yanez, who has worked in the charter school industry for two decades, wanted to open a Montessori-style school in Buckeye for his grandkids and other children.
He turned to Education Fund, which raised $2.5 million from Chinese investors for the $5.6 million Painted Desert Montessori Academy. Yanez, who has worked as a consultant to Education Fund, put no money down.
Yanez sipped a latte as he greeted students and parents with hugs on the first day of classes in early August.
He wore a smile for the students, but he’s worried about the school’s finances.
The school, which is beginning its fourth school year, has paid nearly $2 million in rent to one of Morley’s companies, he said. That’s about what he receives annually from the state of Arizona to teach 370 kids in the K-8 charter school.
Yanez is $1.4 million in debt, and deferred $436,633 in rent during the 2018-19 school year. Some of the borrowed money was used last year for teacher pay raises.
Things were so dire this past year he leveraged future payments from the state as collateral to borrow operating cash. The loan had interest rates up to 23%.
This year, he said, he can’t afford to give raises even though the Arizona Legislature and Ducey approved a budget to provide all teachers with a 5% boost in pay.
“With the money on the rent, they are making money,” Yanez said of Wing and Morley. And when he buys the school, instead of paying them rent, “they will make a few million dollars, and that’s a good return on their investment,” he said.
Yanez also is on the board of Champion Charter Schools, a charter chain that financed two campuses through Education Fund in Chandler and San Tan Valley.
Carolyn Sawyer, who runs Champion, said the schools’ rent is so high she had to defer $800,000 in lease payments last year.
The nonprofit company that runs the schools, including a south Phoenix campus built without EB-5 investment, had a $1.9 million deficit last year.
She said using the EB-5 program was her only option.
Sawyer recalled a woman from Shanghai showing up several years ago when the campus on McQueen Road in Chandler was still under construction. The two put on hard hats and took a tour.
The woman returned several times to check on the school’s progress.
“She decided to invest in American school children,” Sawyer said. “These people have helped us build beautiful schools.”
The far-right Goldwater Institute has filed a lawsuit claiming that the state has no right to regulate how parents spend their voucher money, the money that is paid by taxpayers. Goldwater says that if the parents misspent the money, it should be refunded to parents so they can try again. The Goldwater Institute, along with the DeVos family and Charles Koch, have sponsored efforts to expand the voucher program to cover all students in the state. They began with the “camel’s nose” under the tent, offering vouchers for students with disabilities (who abandon their federally-protected rights when they go to private schools); then added students in foster care; then added students in “failing” public schools; then students on reservations; then students from military families. They won’t be satisfied until every student in the state gets a voucher to leave public schools for a private school.
The Goldwater Institute, a conservative think tank, has filed suit against the state Department of Education contending it doesn’t have the authority to enforce rules governing Arizona’s school voucher program.
The suit — which was filed in Maricopa County Superior Court and names the state attorney general as a defendant — alleges the Department of Education didn’t follow the state’s rule-making process when it created the ESA handbook, a set of rules that outlines the Empowerment Scholarship Account program. The ESA program grants parents money to send their children to private school.
The suit also contends the Department of Education does not have the authority to require that parents who have misspent ESA money reimburse the state for those funds. It is demanding the Department of Education instead put that misspent money back into parents’ accounts.
Finally, the lawsuit claims the department has no right to make funding conditional on parents filing expense reports to document how they spent the taxpayer money. It calls the quarterly reports “cumbersome and time-consuming” and says as a result payments to participants are often late, breaching their contract and causing them to miss payments to private schools.
Under the ESA program, parents receive 90% of the state funding that would otherwise go to their local public school districts. Children in six categories, such as those with special needs, in foster care, from failing schools and others, are allowed to enroll in the program.
The voucher money, loaded on debit cards, is intended to cover specific education expenses such as private- or religious-school tuition, home-school expenses and education-related therapies.
Dawn Penich-Thacker, spokeswoman for Save Our Schools Arizona, which has opposed expansion of the ESA program, said the suit is really about stripping power from Kathy Hoffman, the Democratic superintendent of public instruction elected in 2018.
“They (Goldwater) don’t want her having any say over it,” Penich-Thacker said.
Parents have complained about the expense reports for years but Goldwater only now filed suit, Penich-Thacker said.
Last year, two bills in the Arizona Legislature would have stripped oversight of the ESA program from Hoffman and given it to the Treasurer’s Office, which is overseen by Republican Kimberly Yee.
“Suddenly, this is when the school choice community is up in arms,” Penich-Thacker said. “Parents are saying this is happening since day one, but it took the election of 2018 for anything to actually become a problem.”
The Goldwater Institute has been involved in shaping the ESA program since before the voucher program became law in 2011.
It was a big backer of the universal voucher expansion that would have allowed all 1.1 million Arizona public school students to use public money to go to private school. The number of students receiving the funds would have been capped at 30,000. Voters overturned the voucher law in November 2018 by a vote of 65% to 35%.
Goldwater also has wielded an “iron-like grip level of influence” behind the scenes with the Department of Education, attempting to dictate how the program should be implemented and acting as if it retained ownership of the program.
It has not been a good year for vouchers. The research continues to show that they don’t “save poor kids from failing schools.” They are in fact more likely to cause their academic performance to decline.
Pastors for Texas Children has led the effort to block vouchers in Texas and SOS Arizona led the effort to block voucher expansion in Arizona.
Voucher advocates (Koch-funded) are coming back with new legislation for 2020, and Arizona SOS has pledged to beat them again.
There are heroes among us.
December 2019
PRIVATE SCHOOL VOUCHERS: AN UNSUCCESSFUL EFFORT TO OVERTURN THE WILL OF VOTERS IN ARIZONA AND GROWING SUBURBAN OPPOSITION IN TEXAS
This is the third in our series, Private School Vouchers: Analysis of 2019 State Legislative Sessions. Read the first and second parts.
In 2017, the Arizona Legislature passed, and the Republican Governor, Doug Ducey, signed, a bill expanding the state’s existing Education Savings Account (ESA) voucher program. The legislation created one of the most expansive voucher programs in the nation, opening the existing ESA voucher, first established in 2011, to all students statewide. The program had been limited to students with disabilities, several Native American Tribes, and students in “low-performing” public schools.
Shortly after the bill’s passage, public school advocates collected more than 111,000 signatures to put an initiative on the ballot to overturn the ESA voucher expansion. In November 2018, Arizonans voted against the voucher expansionby an overwhelming margin: 65% to 35%. Following the vote, Beth Lewis, co-founder of Save our Schools Arizona, the grassroots group that led the effort to collect signatures, said, ”This result sends a message to the state and the nation that Arizona supports public education, not privatization schemes that hurt our children and our communities.”
However, just a few months after the public referendum, during the 2019 legislative session, Republican lawmakers introduced a number of bills to again expand the ESA voucher program. These bills would have added new student eligibility categories, including families below a certain income threshold and students who are victims of crimes or harassment. Two of these bills passed the relevant committees but were not considered by the full House or Senate. The remaining bills were not taken up at all.
While the proposed private school voucher bills did not pass in 2019, Arizona demonstrates that public school supporters can never assume their work is done, even when the public has resoundingly spoken against privatization. A day after the defeat of the expanded voucher program at the ballot box, voucher advocates publicly redoubled their efforts to expand the ESA program.
In Texas, where a Democrat has not been elected statewide since 1994, every bill introduced in the Legislature to establish a private school voucher program has failed to become law. As in several other conservative states, a bipartisan coalition of Democrats and rural Republican legislators in Texas has consistently opposed these bills. However, unlike many of these other states, more suburban Republican legislators are joining the opposition to vouchers, preferring to focus on funding for public schools.
In the 2018 election, Democrats picked up a number of seats in the suburbs of the state’s large cities, including those previously held by several strong voucher proponents. Additionally, during primary elections, several pro-voucher legislators lost to candidates who were more supportive of public education. As the head of the Texas American Federation of Teachers, Louis Malfaro, said, “….almost categorically the Republicans who ran as friends of public education prevailed over those who said we need more school choice, we need more vouchers, so I don’t see appetite on either side of the aisle.”
During the 2019 legislative session, Republican leaders, including the governor, notably did not include private school vouchers among their education priorities. Perhaps in response to electoral losses in the suburbs and a lack of support for vouchers, legislative leaders emphasized improving the state’s public school financing system instead.
Curtis Cardine, former superintendent of both public and charter schools, is the preeminent expert on charter schools in Arizona. He created the Grand Canyon Institute to study education issues, and it keeps a close eye on charter malfeasance.
Cardine has written two books that are well worth reading to learn about the failures of the charter industry in Arizona. He is an expert in school finance, and he demonstrates in detail how charter operators are ripping off the public.
I quote that book extensively in my own new book SLAYING GOLIATH.
Cardine’s second book, recently published, is Schooling Alone, in which he compares the atomization of society caused by school privatization, and likens its effects to sociologist Robert Putnam’s classic study of social disintegration, Bowling Alone.
Cardine recently prepared a review of Arizona charter school closures and their relation to the bond debt incurred by charters.
Read his letter to two Arizona state senators here.
American Leadership Academy, an East Valley charter school chain, paid this past fiscal year at least $46.8 million to companies owned or co-owned by founder Glenn Way or his relatives, newly released financial records show.
The payouts include more than $30 million to the management company that employs the schools’ teachers and staff, millions to another firm for operational services, and almost half a million to an apparel firm for school or athletic uniforms. Way or one of his relatives is a co-owner in all of those businesses.
In total, the payments to so-called related parties made up more than half of ALA’s annual $79 million budget.
Arizona is fortunate to have the Arizona Republic looking out for frauds and corruption because the state doesn’t care.
Arizona also has Curtis Cardine of the Grand Canyon Institute, a former superintendent of both public and charter schools. Cardine became so incensed about endemic corruption that he has studied the finances of every charter school in the state (except those that keep their book secret). He reported in a book called Carpetbagging America’s Public Schools that nearly 3/4 of the state’s charter schools do business with “related” companies, companies connected or owned by the charter owner.
The hard-right Governor Doug Ducey is a stand-in for the Koch Foundation. His elections were funded by the Koch brothers, the DeVos family, and other billionaires who hope to eliminate public education.
Parents and teachers managed to defeat their last attempt to expand vouchers by fighting for a referendum, in which vouchers were overwhelmingly rejected by voters.
Someone needs to demand accountability and transparency for charters.
Arizona is the only state that openly endorses for-profit charters. The other states ban for-profits, but allow for-profit management companies to operate nonprofit charters, which is a shell game.
When a new Secretary of State (aDemocrat in a Koch-owned State) was elected in November 2018 in Arizona, she discovered that her predecessor had signed a long-term contract with a private company to store public records.
The state’s storage facility sat empty while the private company collects millions.
One former state official described the warehouses as something out of “Indiana Jones,” with stack after stack of boxes.
A few years ago, the hulking facility just down the street from the Arizona Capitol was filled with government records, from the files of prison inmates to old meeting minutes.
Today, its three warehouses sit mostly empty.
Instead of storing records here, the state agreed in 2017 to ship each box to the warehouses of a storage and information management company, Iron Mountain.
Then-Secretary of State Michele Reagan, a Republican, touted the deal in a news release as saving money.
But her Democratic successor, Katie Hobbs, says the financial implications of the decision have been staggering. And the state appears stuck with the deal for years under a contract awarded without competition.
Hobbs published a proposed budget Thursday that calls for an infusion of funds into her office for 2020, the coming election year. She pointed to the Iron Mountain contract as a major drain on the office’s finances, describing the deal as part of what she called “severe mismanagement and irresponsible oversight of public resources” under Reagan’s administration.
Under the contract with Boston-based Iron Mountain, the price for each box is only going up. The Secretary of State’s Office says the costs of storing government records has nearly doubled from the year before the contract took effect.
At the same time, the state is paying to maintain its mostly vacant complex of warehouses, which remain government property.
The contract runs for 10 years.
In all, the records management program will cost the Secretary of State’s Office about $1.6 million this fiscal year, even considering that the state slashed the number of staff positions in records management from 11 to three after initially implementing the contract.
Meanwhile, the fees from other government agencies are expected to total $900,000.
In addition, the state pays $400,000 a year for its own empty storage facilities.
Under the contract, the price for storing each carton of documents will increase annually starting next year.
Not only do the fee schedules in the contract call for higher prices year after year, Iron Mountain could add a surcharge on the cost of each trip it makes to pick up government records if fuel prices rise over a certain level. And if the state wants to transfer the records to another company or to its own warehouses for storage, the government will have to pay for the move, too.
Do the math. The state is paying about $3 million a year to store its records. That cost is expected to rise in each year of a ten-year contract. The state saves by cutting the jobs of eight employees, who were probably making less than $100,000 a year, probably $60,000 a year, filing records.
This top education official insisted that Tucson’s University High is a charter school.
When he was corrected by a reporter after his news conference, he continued to insist that the public high school was a charter school.
Like his boss, Betsy DeVos, Mr. Stump is on an “Education Freedom Tour” to point out the great achievements of every school that is not a public school.
That is the U.S. Department of Education’s “back to school” message: Abandon public schools.
Never mind that Arizona has what is possibly the most corrupt charter industry in the nation (excepting Florida).
Never mind that Arizona is the only state that legally allows for-profit charters (the others ban for-profit charters but allow for-profit managers to operate nonprofit charters).
Never mind that Arizona charter law permits nepotism and conflicts of interest among members of the board and the management company.
In Arizona, corruption is legal.
Never mind that Betsy DeVos and the Koch brothers poured millions into elected Governor Doug Ducey and a rightwing legislature.
To enter University High, students must pass an entrance exam, so of course the school has high test scores.
But it is not a charter school.
It is a public school, governed by the elected Tucson school board. Unlike a private charter school, it is fully accountable and transparent to the public, not to a private board.
Read this article by E.J. Montini in the Arizona Republic to learn how the Koch-funded ALEC controls Governor Doug Ducey and the state legislature in Arizona. ALEC was behind the voucher legislation that was overturned by voters earlier this year.
He writes:
About 30 of Arizona’s Republican state lawmakers, along with Gov. Doug Ducey, attended the annual convention of the American Legislative Exchange Council (ALEC) in Austin, Texas, this month.
For the politicians, membership in ALEC is like joining one of those meal kit delivery services, only in this case lawmakers are presented with ready-made, easy to introduce legislation guaranteed to satisfy the special interests who came up with the political recipes, and to give regular citizens indigestion.
Earlier this year an investigation by USA Today, the Arizona Republic, and the Center for Public Integrity found that from 2010 to 2018, bills based on ALEC legislation were introduced nearly 2,900 times across all 50 states.
Arizona ranked second among states for the highest number of ALEC bills introduced and passed during those years, with more than 200 bills introduced and 57 enacted. Only Mississippi had more.
‘Chefs’ are lobbyists and executives
ALEC is the HelloFresh of politics, except what they cook up isn’t good for you. Instead the group produces ready-to-introduce legislation for politicians more interested in serving special interests and promoting their own careers than in serving their constituency
The school was closed in 2018 because of misuse of its money.
Now the founder is in court, where she is being sued to replenish the money she misused.
But there are no criminal charges for embezzling taxpayers’ money.
Ryan W. Anderson, an attorney representing the bankruptcy trustee suing McCarty, said this case is “one of the worst” cases of inappropriate use of school funds he’s seen.
“You don’t usually see allegations of misappropriation at this level,” he said.
Bankruptcy court documents detail suspect purchases from 2016 until early 2018, which include $3,500 to a beach hotel in Hawaii and $500 to the “home of the largest quartz crystal in North America, and Master John Douglas, a spiritual healer and clairvoyant…”
This is not a fraud case, Anderson said. Instead, the suit claims McCarty inappropriately spent money for personal use while StarShine Academy plunged further into debt.
When asked if she would pay the funds back, the defendant said the school owed her money.
I am reminded of the case in Pennsylvania where the founder of the state’s first virtual charter school was convicted of not paying taxes on millions of dollars that he embezzled and went to jail for evading taxes. But he never faced criminal charges for embezzlement.
On the other hand, the founder of a charter school in Los Angeles was convicted and sent to prison for 30 months for using her school’s funds for personal expenses.
