AZ lawmakers think they can pull a fast one on AZ voters: They’re trying to force through Senate Bill 1452, a gigantic expansion of ESA vouchers that robs funds from public education in ways even more harmful and wide-ranging than any of their previous attempts. SB1452, sponsored by Senate Education Committee Chair and *charter school teacher* Paul Boyer (Republican, Legislative District 20), is a “kitchen-sink” voucher expansion bill that would gut public schools hurting low-income areas the most. Bottom line: This will drain hundreds of millions more dollars out of Arizona public schools every year, and will drain Prop 208 funds out as fast as voters can put them in. Public school teachers are frantically cleaning classrooms, simultaneously teaching online and in-person, reusing PPE, and putting buckets under leaks — while these lawmakers try to siphon away tax dollars that voters intend for our neighborhood schools. THIS IS WRONG. We need you to GET LOUD.Call bill sponsor Paul Boyer at 602-926-4173 and email pboyer@azleg.gov and ask him to withdraw SB1452Tell Senator Boyer to respect Arizona voters—we want MORE public school funding, not LESS. Call Senate President Karen Fann (602-926-5874, kfann@azleg.gov) and ask her to hold SB1452In 2018, AZ voters said #NoNewVouchers and we meant it. 95% of Arizona families choose public schools, and we want those schools funded. Call and email today. Then call again tomorrow, and again on Sunday, Monday and Tuesday. The education committee will consider this bill on Tuesday, February 2, at 2 p.m. This is a bill that dark-money special interests and greedy profiteers want, not Arizona voters. #WeSaidNoNewVouchersIt’s in our name: Save Our Schools Arizona
The federal CARES Act included the Paycheck Protection Program to help struggling small businesses and nonprofits survive the pandemic. Lobbyists for the charter industry slipped in a provision enabling charter schools to apply for PPP funding, even though they experienced no financial losses. Charter schools got a share of the $13.2 billion allotted to the nation’s early 100,000 public schools. The average public school received about $135,000 to meet the expenses of the pandemic. On the advice of their lobbyists, some 1200 charters also sought and won PPP funding. Thus charters drew funding from two sources; public schools were not eligible for PPP funding. Charters that applied for PPP funding won six times as much federal money as public schools.
Primavera online charter school, like many businesses this spring, sought help from the federal Paycheck Protection Program to weather the economic disruption of the COVID-19 pandemic.
The Chandler-based school received a PPP loan of nearly $2.2 million, the largest forgivable loan among the 132 Arizona charter schools that obtained them.
But Primavera’s loan appears to have been more of a bonus than a lifeline.
The school, which like all Arizona public schools didn’t lose state funding because of the pandemic, ended its fiscal year on June 30 with $8.8 million in the bank — almost double the annual payroll costs for its 85 teachers, records show.
The school also shipped $10 million to its lone shareholder: StrongMind, an affiliated company owned by Primavera’s founder and former CEO Damian Creamer.
The school’s annual audit indicates Creamer controls both Primavera and StrongMind, noting he has “the ability to influence the school’s operations for the benefit of StrongMind.” Primavera paid StrongMind nearly $23 million this past fiscal year for software and curriculum services, records show.
Creamer declined to comment.
An Arizona Republic review of more than 100 charter school financial records, audits and federal Small Business Administration documents found the overwhelming majority of the Arizona charter schools that obtained PPP loans didn’t need the money.
John Todd, a longtime auditor of Arizona charter schools, said there are numerous problems with fully funded charter schools getting PPP loans intended to help struggling businesses.
“The PPP loans are taxpayer dollars intended to help the needy, not the greedy,” Todd said.
A few charters, including Legacy Traditional Schools, repaid several million dollars worth of PPP loans after The Republic reported in August that Legacy and other operators had millions of dollars in the bank when they received loans.
Most charters that got loans didn’t need them
The Republic found that most of the charter schools getting PPP funds padded their cash balances (savings accounts), and a few for-profit charter operations, like Primavera, gave money away to shareholders that matched or exceeded their PPP loan amounts.
Further, The Republic found that PPP loans didn’t significantly enhance teacher pay at schools that received them. The 132 Arizona charter school loan recipients, on average, paid their teachers several thousands dollars less than the statewide average.The 132 charter schools receiving PPP loans increased teacher pay by an average of 5% — an amount similar to all 555 charter operations and 263 school districts.
Arizona public schools saw no major job losses or layoffs this year because the state Legislature fully funded schools and gave them additional money to raise teacher pay.
Creamer is among the prominent figures who’ve made millions of dollars operating Arizona charter schools. His online alternative school boasts more than 20,000 full- and part-time students. Primavera paid Creamer $10.1 million in 2017 and 2018.
A spokesman for StrongMind declined to say how much the company paid Creamer.
Ian Kidd, superintendent of Pima Prevention Partnership, said financially strong charter schools that took PPP loans open themselves to criticism and scrutiny.
“I don’t subscribe to making money off of students. It’s not appropriate,” Kidd said.
Kidd said he obtained PPP loans for his three charter schools, but the money was used to cover social and behavioral services for low-income, at-risk kids. His three charters had a combined negative $7,031 in cash balances, even after getting PPP loans.
The SBA, under pressure from news outlets, recently released specific figures for all PPP loan recipients. Previously, it released only the names of the borrowers and loan ranges above $150,000.
The earlier SBA records had indicated about 100 Arizona charter schools had received up to $100 million in PPP loans. The new data shows about 30 more charter schools got loans.
Several watchdog groups, including Accountable.Us, have panned the loan program for enriching companies that didn’t need the money while shutting out many minority- and women-owned businesses.
Kyle Herrig, president of Accountable.Us, which compiled a database of all PPP recipients, said there has been widespread fraud and abuse of the program, including celebrities and wealthy companies getting loans.
“The Trump administration’s faulty design and mismanagement of the Paycheck Protection Program let thousands of mom-and-pop businesses slip through the cracks without adequate aid while charter schools cashed in,” Herrig said…
Arizona Schools Superintendent Kathy Hoffman, who also is a member of the Charter Board, said she was astonished by The Republic’s findings.
“It saddens me those dollars are not going to students,” she said. “It’s very excessive. These dollars should be going where they are needed most, and that’s the students and instructional needs.”
Hoffman, a Democrat, said Republican Gov. Doug Ducey and the GOP-controlled Legislature should consider reducing state funding for full-time virtual charter schools like Primavera, which receives nearly the same per-student funding as brick-and-mortar schools that have more costs.
Ducey, at a news conference Wednesday, declined to answer questions regarding Hoffman’s proposal. He also declined to answer whether charter schools that received the PPP loans should return the money or have their state funding reduced by an amount equal to the loans.
Ducey said the PPP loans were a federal issue, but added: “I want to make sure all public schools have available funding.”
Creamer has been a major political donor to Ducey, records show.
Creamer spent at least $137,650 during the past two elections to mostly help conservative Republicans retain control of the Legislature. Among his political giving was $50,000 in December 2019 to the Republican Legislative Victory Fund, state campaign finance records show.
There has been no significant effort by Republicans in the Legislature to change the funding formula for online charter schools. A few of those lawmakers have financial interests in charter schools…
Paying shareholders, boosting reserves
In addition to Primavera, at least three other charter school operators that received PPP loans paid distributions to shareholders. Most of the rest put large sums in savings.
• The year-end cash balance for the 132 Arizona charter schools that received $51.8 million in PPP loans in April and May, increased by $62.6 million. Individually, cash balances increased for 87% of the loan recipients.
• Twenty-one charter schools that received PPP loans increased their cash reserves by at least $1 million, with Primavera seeing a $3.3 million increase.
Educational Options Foundation of Peoria, which got a $278,292 loan, saw its cash balance increase by $2 million to $13.7 million. The school has enough money to operate for four years without additional money. The state Charter Board only requires schools to have one month of cash liquidity. A call to the school was not returned.
• For-profit charters Humanities and Sciences Academy in Tempe and Accelerated Learning Center in Phoenix made shareholder distributions of $388,770 and $230,000 this past fiscal year, respectively. Both amounts exceed the charters’ PPP loans.
The Montessori Schoolhouse of Tucson gave a shareholder distribution of $92,372, equal to about 72% of its PPP loan.
Calls to the three schools were not returned.
Jim Hall, a former public school administrator who runs Arizonans for Charter School Accountability, compiled financial records from charter schools that received PPP loans and said he concluded that they didn’t need the money.
Hall said those loans should have gone to small businesses that have struggled to make payroll or mortgage payments. He said several of the charter operators engaged in “unmitigated greed.”
But attorneys representing the election officials being sued convinced the judge to reject the request after arguing the public “has a right to know how flimsy Plaintiffs’ evidence actually is.”
The Trump campaign filed the lawsuit on Saturday alongside the Republican National Committee and the Arizona Republican Party, claiming Maricopa County poll workers had disregarded procedures designed to give voters a chance to correct ballot mistakes on Election Day.
Voters approved a measure to raise the taxes of the wealthiest by 3.5% for the benefit of public schools.
Proposition 208 passed with 52% of the vote. It will produce nearly $1 billion annually for public schools. Fifty percent will be used to raise teachers’ salaries.
The “YES” vote on Prop. 208 will impose a 3.5% income tax surcharge on taxable annual income over $250,000 for single persons or $500,000 for married persons filing jointly.
Jennifer Berkshire writes in this post about the educational awakening in Arizona, the result of #red4ed and the teachers’ revolt of 2018.
Proposition 208 is on the ballot. It calls for a 3.5% tax increase on people earning over $250,000 a year, to be used to raise teachers’ salaries and hire more teachers. Surprisingly, 60% of voters appear to favor the measure, including a sizable number of Republicans.
She writes:
That taxing the rich to pay for schools would emerge as a cause with bipartisan support in 2020 is not a complete surprise. More Arizonans now identify education, not immigration, as the top priority facing the state, reflecting mounting concern with schools that are notoriously underfunded, teachers who are poorly paid, and a teacher shortage crisis so severe that 28 percent of the state’s classrooms lack a permanent teacher.
Education has become a potent political issue since #RedforEd protests shone a harsh light on the condition of Arizona’s schools in 2018. After a historic teacher strike, educators doubled down on electoral organizing. Democrats gained four seats in the state House of Representatives that year. Now they’re poised to tip the House and possibly the Senate in their favor. If they succeed, voter dissatisfaction with the GOP’s embrace of controversial policies aimed at dismantling, defunding, and privatizing education will be a major reason.
A similar pattern is playing out in other key battleground states, including Michigan and Texas. In these states and others, the gulf between voters who believe in taxpayer-funded public education and GOP candidates who are hostile to it has created an opening for Democrats.
For decades, Arizona has been a petri dish for free market education experiments. Charter schools, publicly funded private schools, education savings accounts that allow parents to spend taxpayer funds on a dizzying array of education “options” with little state oversight or accountability—the Grand Canyon State has them all...
As school choice offerings in the state have ballooned, they have increasingly competed for funding with traditional public schools. “It all comes out of the same funding bucket, and the bucket wasn’t that big to begin with,” said Sharon Kirsch, research director for the grassroots public education advocacy group Save Our Schools Arizona...
That hands-off, regulation-free vision is precisely what an array of deep-pocketed interest groups in Arizona are pushing. Organizations like the Americans for Prosperity, funded by Charles Koch and the American Federation for Children, founded by Education Secretary Betsy DeVos, are a major presence in the state. More recent arrivals to the school choice lobbying space include Yes Every Kid, which is another Koch project, and Love Your School, an offshoot of the right-wing Center for Arizona Policy.
Said Kirsch: “I’m not sure most people have any idea that these groups are essentially running education policy in Arizona...”
Berkshire points out that teachers are running for office, and their prospects look good. Arizona may be about to throw off the shackles of one-party rule that has crippled the state’s public schools and turned it into a free-market for privatizers, religious zealots, rightwing nuts, libertarians, and profiteers.
Arizona Governor Doug Ducey, who is often called a Koch puppet because the Koch network donated heavily to his elections, denounced Proposition 208, which would increase taxes to raise teachers’ salaries. Secretary of Education Betsy DeVos stood by his side, presumably pleased with his attack on higher wages for the state’s teachers. He made his remarks while visiting a charter school and lauding charter schools for innovation.
Gov. Doug Ducey delivered a scathing rebuke of Proposition 208, the Invest in Education Act, while visiting a school on Thursday with U.S Education Secretary Betsy DeVos.
The proposal on November’s ballot would add a 3.5% surcharge on income tax for individuals with taxable income of $250,000 or more or couples making $500,000 or more. The revenue would go largely to raising school staff salaries.
“It would make us the equivalent of Bernie Sanders’ Vermont, or New York state or Washington, D.C.,” he said in response to a question about U.S. Sen. Bernie Sanders’ endorsement of the measure.
Sanders, I-Vt., endorsed Proposition 208 in a news release on Thursday morning.
“Let’s address the decades of cuts to education funding in Arizona and invest in our schools, teachers, and kids,” he wrote in a statement.
Ducey is opposed to new taxes which he says will harm small businesses and be bad for the economy.
Proponents of Invest in Ed say that the average tax increase for someone who earns from $250,000-$500,000 a year would be $120.
The Joint Legislative Budget Committee, a third-party state entity that analyzes the financial impact of ballot propositions, estimates that Proposition 208 would raise $827 million for education, about $100 million less than Invest in Ed’s initial estimate.
The measure would send the money to the following areas:
50% of the money would go to hiring and raising the salaries of teachers and other certified employees, such as counselors and nurses.
25% would go to hiring and increasing the salaries of student support staff, including classroom aides and bus drivers.
12% would go to career and technical education programs.
10% would go to programs dedicated to retaining and mentoring teachers.
3% would go to scholarships for the Arizona Teachers Academy, which waives college tuition for teachers-in-training who commit to work in Arizona schools after graduation.
The former principal of a closed charter school in Arizona was sentenced to 3.75 years in prison for participating in a scheme to loot $2.5 million by inflating enrollment. The principal was a high school graduate, which is okay in Arizona, where credentials don’t matter. The principal and his associates forged documents for phantom students.
Craig Harris of the Arizona Republic wrote:
The former principal of a closed West Valley charter school was sentenced to 3.75 years in prison on Monday, after pleading guilty to engaging in a $2.5 million enrollment-inflation scheme.
Harold Cadiz, 56, expressed contrition and took responsibility for his actions before Maricopa County Superior Court Judge Jay Ryan Adleman, but Cadiz placed much of the blame on two co-defendants who also face prison sentences in the fraud case.
“I’m tremendously sorry,” Cadiz said. “The state is so short-funded for kids, and for this to happen is appalling … The state has suffered because of my involvement. I knew it was wrong.”
Cadiz, who has a high school education, said he was “dragged” into the scheme. Charter schools, unlike traditional school districts, do not require advanced degrees for those running the publicly funded but privately operated campuses.
Cadiz’s plea deal with the state Attorney General’s Office had called for a prison sentence of between 3 and 12½ years with up to 7 years of probation, but Adleman settled on the lower ended and ordered that Cadiz also be placed on 5 years of probation after his release from prison. Cadiz and the two other defendants also must repay $2.5 million.
The judge noted in making his sentencing decision that there were mitigating factors, including that Cadiz was not personally enriched from the scheme other than keeping his job at the charter school.
Two sheriff’s deputies took Cadiz into custody immediately after the roughly 30-minute hearing in downtown Phoenix.
Cadiz is the first Discovery Creemos Academy executive to face prison time. Three former executives admitted to defrauding the state and federal governments by inflating the Goodyear charter school’s enrollment numbers by hundreds of students from 2016 to 2018.
Arizona public schools are funded based on their enrollment, meaning each additional student a school reports to the state brings more tax dollars.
Former Vice Principal Joann Vega is slated to be sentenced Sept. 23. She faces up to 8.75 years in prison.
Daniel Hughes, the former president and CEO of the charter school, is scheduled to be sentenced Nov. 16.
Harris says that Hughes is likely to get a sentence of five years in prison.
Nancy Bailey writes here about Secretary of Education Betsy DeVos’ contempt for the time-honored tradition of separation of church and state. She has made clear her strong preference for religious schools and her low opinion of public schools. We have never in our history had a Secretary of Education (or before the Education Department was created in 1980, a Commissioner of Education) who was so flagrantly hostile to public schools. Reagan’s second Secretary of Education Bill Bennett was a cheerleader for “choice,” but in the early 1980s, he didn’t have the wind behind his back nor did he have Betsy’s billions to advance the cause.
The United States is a very diverse nation, where people are associated with scores of different religions or none at all. The Founders wrote the First Amendment to prohibit the establishment of any official religion and to protect the free exercise of religion. They knew the dangers of state-sponsored religion. In our time, rightwing libertarians and anti-government ideologues are using their political clout to support government funding for religious schools.
It’s worth noting that every state referendum on vouchers for religious schools has gone down to a decisive defeat, most recently in Arizona, where 65% said no to vouchers.
DeVos has taken advantage of the pandemic to divert billions of dollars to private and religious schools, usually at the expense of public schools, which enroll the students with the greatest needs.
One good reason to vote for Joe Biden is to send DeVos home to Michigan.
He can’t possibly appoint anyone worse than DeVos.
Arizona charter schools that received up to $100 million in federal Paycheck Protection Program forgivable loans can keep the money and not have any of their state funding cut, the Arizona Auditor General’s Office has determined.
At issue is a rarely enforced state charter school law that prohibits taxpayers from paying “twice to educate the same pupils.”
The law requires a school that has been twice compensated to have their base-level funding reduced by an equal amount if additional federal or state monies received by the school were “intended for the basic maintenance and operations of the school.”
But Auditor General Lindsey Perry concluded the state law “does not apply to loan proceeds charter schools” obtained through the federal PPP program.
Her office ruled the loans — despite being 100% forgivable with minimal justification to show that the money was needed — were not “monies received from a federal or state agency” as described in state law.
Eli Saslow of the Washington Post interviewed Arizona Superintendent Jeff Gregorich about the prospect of opening schools in his district with the coronavirus still active in the region. The article causes me to wonder why decisions about when to open schools are made by politicians, not scientists, medical experts, and educators.
Gregorich was candid, blunt, worried.
This is my choice, but I’m starting to wish that it wasn’t. I don’t feel qualified. I’ve been a superintendent for 20 years, so I guess I should be used to making decisions, but I keep getting lost in my head. I’ll be in my office looking at a blank computer screen, and then all of the sudden I realize a whole hour’s gone by. I’m worried. I’m worried about everything. Each possibility I come up with is a bad one.
The governor has told us we have to open our schools to students on August 17th, or else we miss out on five percent of our funding. I run a high-needs district in middle-of-nowhere Arizona. We’re 90 percent Hispanic and more than 90 percent free-and-reduced lunch. These kids need every dollar we can get. But covid is spreading all over this area and hitting my staff, and now it feels like there’s a gun to my head. I already lost one teacher to this virus. Do I risk opening back up even if it’s going to cost us more lives? Or do we run school remotely and end up depriving these kids?
This is your classic one-horse town. Picture John Wayne riding through cactuses and all that. I’m superintendent, high school principal and sometimes the basketball referee during recess. This is a skeleton staff, and we pay an average salary of about 40,000 a year. I’ve got nothing to cut. We’re buying new programs for virtual learning and trying to get hotspots and iPads for all our kids. Five percent of our budget is hundreds of thousands of dollars. Where’s that going to come from? I might lose teaching positions or basic curriculum unless we somehow get up and running.
I’ve been in the building every day, sanitizing doors and measuring out space in classrooms. We still haven’t received our order of Plexiglas barriers, so we’re cutting up shower curtains and trying to make do with that. It’s one obstacle after the next. Just last week I found out we had another staff member who tested positive, so I went through the guidance from OSHA and the CDC and tried to figure out the protocols. I’m not an expert at any of this, but I did my best with the contact tracing. I called 10 people on staff and told them they’d had a possible exposure. I arranged separate cars and got us all to the testing site. Some of my staff members were crying. They’ve seen what can happen, and they’re coming to me with questions I can’t always answer. “Does my whole family need to get tested?” “How long do I have to quarantine?” “What if this virus hits me like it did Mrs. Byrd?”
We got back two of those tests already — both positive. We’re still waiting on eight more. That makes 11 percent of my staff that’s gotten covid, and we haven’t had a single student in our buildings since March. Part of our facility is closed down for decontamination, but we don’t have anyone left to decontaminate it unless I want to put on my hazmat suit and go in there. We’ve seen the impacts of this virus on our maintenance department, on transportation, on food service, on faculty. It’s like this district is shutting down case by case. I don’t understand how anyone could expect us to reopen the building this month in a way that feels safe. It’s like they’re telling us: “Okay. Summer’s over. It’s been long enough. Time to get back to normal.” But since when has this virus operated on our schedule?
I dream about going back to normal. I’d love to be open. These kids are hurting right now. I don’t need a politician to tell me that. We only have 300 students in this district, and they’re like family. My wife is a teacher here, and we had four kids go through these schools. I know whose parents are laid off from the copper mine and who doesn’t have enough to eat. We delivered breakfast and lunches this summer, and we gave out more meals each day than we have students. I get phone calls from families dealing with poverty issues, depression, loneliness, boredom. Some of these kids are out in the wilderness right now, and school is the best place for them. We all agree on that. But every time I start to play out what that looks like on August 17th, I get sick to my stomach. More than a quarter of our students live with grandparents. These kids could very easily catch this virus, spread it and bring it back home. It’s not safe. There’s no way it can be safe.
If you think anything else, I’m sorry, but it’s a fantasy. Kids will get sick, or worse. Family members will die. Teachers will die.
SB1452, sponsored by Senate Education Committee Chair and *charter school teacher* Paul Boyer (Republican, Legislative District 20), is a “kitchen-sink” voucher expansion bill that would gut public schools hurting low-income areas the most. Bottom line: This will drain hundreds of millions more dollars out of Arizona public schools every year, and will drain Prop 208 funds out as fast as voters can put them in. Public school teachers are frantically cleaning classrooms, simultaneously teaching online and in-person, reusing PPE, and putting buckets under leaks — while these lawmakers try to siphon away tax dollars that voters intend for our neighborhood schools. THIS IS WRONG. We need you to GET LOUD. Call bill sponsor Paul Boyer at 602-926-4173 and email pboyer@azleg.gov and ask him to withdraw SB1452Tell Senator Boyer to respect Arizona voters—we want MORE public school funding, not LESS. Call Senate President Karen Fann (602-926-5874, kfann@azleg.gov) and ask her to hold SB1452In 2018, AZ voters said #NoNewVouchers and we meant it. 95% of Arizona families choose public schools, and we want those schools funded. Call and email today. Then call again tomorrow, and again on Sunday, Monday and Tuesday. The education committee will consider this bill on Tuesday, February 2, at 2 p.m. This is a bill that dark-money special interests and greedy profiteers want, not Arizona voters. 
Diane Ravitch's blog 