Archives for category: Charter Schools

Thomas Ultican, the chronicler of the Destroy Public Education movement, writes here about the calculated destruction of the Oakland Public School District, which has suffered at the hands and by the wallets of billionaires.

In 2003, the district had a deficit of $37 million.

The state forced the district to take out a loan of $100 million.

In return, the state took control of the district.

After six years of state control, the district’s deficit increased from $37 million to $89 million.

Unfortunately for Oakland, the billionaire Eli Broad decided to turn the district into his petri dish.

Oakland Mayor Jerry Brown welcomed the state takeover.

The Broadies romped.

A California central coast politician named Jack O’Connell was elected California’s Superintendent of Public Instruction in 2002. He selected Randolph Ward, a Broad Academy graduate, to be Oakland’s state administrator. When O’Connell ran for state superintendent, his largest campaign donors had been Netflix CEO Reed Hastings ($250,000), venture capitalist John Doerr ($205,000), and Eli Broad ($100,000). Brown described the state takeover as a “total win” for Oakland.

The Broadies of Oakland

2003-2017 Broad Academy Graduates and Superintendents of OUSD

Broad Academy graduates are often disparagingly called Broadies.

The OUSD information officer in 2003 was Ken Epstein. He recounts a little of what it was like when Ward became the administrator:

“I remember a school board meeting where Ward and the board were on stage. Each item on the agenda was read aloud, and Ward would say, “passed.” Then the next item was read. In less than an hour, the agenda was completed. At that point, Ward said, “Meeting adjourned” and walked out of the board room and turned out the lights, leaving board members sitting in the dark.”

When Ward arrived in Oakland, the district was in the midst of implementing the Bill Gates sponsored small school initiative which is still causing problems. The recently closed Roots that caused so much discontent in January was one of the Gates small schools. Ward opened 24 of them (250-500 students) which in practice meant taking an existing facility and dividing it into two to five schools. He closed fourteen regularly sized schools.

When Ward arrived in Oakland there were 15 charter schools and when he left for San Diego three years later there were 28 charter schools…

Kimberly Statham, who was a classmate of Ward’s at the Broad Academy, took his place in 2006. The following year a third Broad Graduate, Vincent Mathews took her place.

After a short period of no Broadie in the superintendent’s seat, Antwan Wilson was hired in 2014. Shortly after that, the New York Times reported that the Broad Foundation had granted the district $6 million for staff development and other programs over the last decade. The Broad Center also subsidized the salaries of at least 10 ex-business managers who moved into administrative jobs at the district office.

Kyla Johnson-Trammell, an Oakland resident who and educator with OUSD, was named to replace Antwan Wilson in 2017. When he left to lead the Washington DC’s schools, he left a mess in Oakland. Mother Jones magazine says Wilson saddled the district with a $30 million deficit. They continue, “A state financial risk report from August 2017 concluded that Oakland Unified, under Wilson, had ‘lost control of its spending, allowing school sites and departments to ignore and override board policies by spending beyond their budgets.”’

The preponderance of the problems in OUSD are related to the state takeover, FCMAT and the leadership provided by Broad Academy graduates.

The usual billionaires have selected several of the OUSD board members and showered them with donations from out-of-district and out-of-state.

The fundamental problem is Oakland has a dual education system with 37,000 students in public schools and 15,000 in charter schools. It costs more to operate two systems. Every school district in California that has more than 10% of their students in charter schools has severe financial problems. Oakland has the largest percentage of charter school students in the state with 29% so financial issues are the expectation.

This is an education crisis that was manufactured by the super wealthy and implemented by neoliberal politicians.

 

 

The New York Times reports that the Sackler family, one of the nation’s wealthiest families, busily transferred assets to themselves as the opioid crisis worsened

The Sacklers derived most of their billions from Purdue Pharma, prominent manufacturer and marketer of Oxycontin.

Jonathan Sackler is a major supporter of charter schools. He underwrote charter schools in Connecticut, created ConnCAN, then 50CAN, and the many state affiliates of that group. At this very moment, GeorgiaCAN is pushing charters on the receptive Atlanta school board (whose president is ex-TFA).

The Times reports:

As scrutiny of Purdue Pharma’s role in the opioid epidemic intensified during the past dozen years, its owners, members of the Sackler family, withdrew more than $10 billion from the company, distributing it among trusts and overseas holding companies, according to a new audit commissioned by Purdue.

The amount is more than eight times what the family took out of the company in the 13 years after OxyContin, its signature product, was approved in 1995. The audit is likely to renew questions about how much the Sacklers should pay to resolve more than 2,800 lawsuits that seek to hold Purdue accountable for the opioid crisis.

The family has offered to contribute at least $3 billion in cash as part of a settlement to resolve thousands of lawsuits brought by state and local governments against Purdue. But 24 states, led by Massachusetts and New York, have refused to sign onto the agreement, arguing that the Sacklers should pay more.

The new report, a 350-page forensic accounting prepared by Alix Partners, a consulting firm that Purdue has hired to help guide the company through Chapter 11 restructuring, was filed in bankruptcy court in White Plains, N.Y., Monday evening.

Sarah Darer Littman wrote about Jonathan Sackler’s long involvement in the charter school movement.

She says he brought his knowledge of marketing opioids to the charter school industry.

He is on the Board of Directors of the Achievement First charter school network. Until recently, Sackler served on the board of the New Schools Venture Fund, which invests in charter schools and advocates for their expansion. He was also on the board of the pro-charter advocacy group Students for Education Reform.

Through his personal charity, the Bouncer Foundation, Sackler donates to the abovementioned organizations, and an ecosystem of other charter school promoting entities, such as Families for Excellent Schools ($1,083,333 in 2014, $300,000 in 2015according to the Foundation’s Form 990s) Northeast Charter School Network ($150,000 per year in 2013, 2014 and 2015) and $275,000 to Education Reform Now (2015) and $200,000 (2015) to the Partnership for Educational Justice, the group founded by Campbell Brown which uses “impact litigation” to go after teacher tenure laws. Earlier this year, the Partnership for Educational Justice joined 50CAN, which Sackler also funds ($300,000 in 2014 and 2015), giving him a leadership role in the controversial—and so far failing cause—of weakening worker protections for teachers via the courts.

Just as Arthur Sackler founded the weekly Medical Tribune, to promote Purdue products to the medical professional who would prescribe them, Jon Sackler helps to fund the74million.org, the “nonpartisan” education news website founded by Campbell Brown. The site, which received startup funding from Betsy DeVos, decries the fact that “the education debate is dominated by misinformation and political spin,” yet is uniformly upbeat about charter schools while remarkably devoid of anything positive to say about district schools or teachers unions.

Charter chains are known for their lavish rallies, paid organizers, and “swag.”

These are techniques learned from the Sacklers and Purdue, writes Littman.

The description of “lavish swag” will sound familiar to anyone who has witnessed one of the no-expenses-spared charter school rallies that are a specialty of Sackler-funded organizations like Families for Excellent schools. Then there is the dizzying array of astroturf front groups all created for the purpose of demanding more charter schools. Just in Connecticut, we’ve had the Coalition for Every Child, A Better Connecticut, Fight for Fairness CT, Excel Bridgeport, and the Real Reform Now Network. All of these groups ostensibly claim to be fighting for better public schools for all children. In reality, they have been lobbying to promote charter schools, often running afoul of ethics laws in the process.

Take Families for Excellent Schools, a “grassroots” group that claims to be about parent engagement, yet was founded by major Wall Street players. In Connecticut, the group failed to register its Coalition for Every Child as a lobbying entity and report a multimillion-dollar ad buy expenditure and the costs of a rally in New Haven. 

In Massachusetts, Families for Excellent Schools-Advocacy (FESA) recently had to cough up more than $425,000 to the Massachusetts general fund as part of a legal settlement with the Office of Campaign and Political Finance, the largest civil forfeiture in the agency’s 44-year history. Massachusetts officials concluded that FESA violated the campaign finance law by receiving contributions from individuals and then contributing those funds to the Great Schools Massachusetts Ballot Question Committee, which sought to lift the cap on the number of charter schools in the state, in a manner intended to disguise the true source of the money. As part of the settlement, the group was ordered to reveal the names of its secret donors. Jonathan Sackler was one of them.

In addition, Purdue heiress Madeleine Sackler directed the pro-charter film “The Lottery” about Eva Moskowitz and her Success Academy charter chain.

The Sacklers have used their vast wealth, derived from the opioid crisis, to burnish their family reputation and to destroy public schools.

As the Times reports, they are doing their best to get their money out of the company before it is bankrupted by lawsuits.

 

 

 

Indiana is a swamp of school choice corruption.

If you read this post, your hair might catch on fire if  you are sensitive to things like ethics, honesty, and responsible stewardship of public money.

Seven years ago, the state superintendent of Indiana was a school choice firebrand named Tony Bennett. There was nothing he wouldn’t do to transfer public money from public schools to charter operators or religious schools. He was briefly riding high–the Thomas B. Fordham Institute named him the “reformiest of all reformers.” But then he came a cropper. An AP reporter unearthed the fact that he raised the grade of a charter school owned by one of his campaign donors. That was too much, even for the corrupt swamp overseen by Indiana Republicans. Bennett was defeated when he ran for re-election.  Bennett promptly became State Commissioner of Florida. That gig lasted only weeks, and he had to resign because of the ethics problem he left behind in Indiana.

One of his decisions during his tenure in Indiana was to hand over three low-performing schools in Indianapolis to the for-profit chain called Charter Schools USA, which is owned by a pal of Jeb Bush. The chain was supposed to “turn” those schools around.

As Indiana blogger Steve Hinnefeld writes, the schools continued to struggle. An extraordinary number of their students decided to homeschool, which boosted the graduation rate of the schools.

Lewis Ferebee, then the superintendent of Indianapolis, now the superintendent in D.C., was happy to work with Charter Schools USA.

Hinnefeld writes:

Charter Schools USA is a for-profit Florida company that operates over 80 schools in six states, according to its website. Its founder and long-time CEO, Jonathan Hage, has played influential roles in Florida Republican politics, including serving on Gov. Ron DeSantis’ education transition team.

Sherry Hage, who is married to Jonathan Hage, is founder and CEO of Noble Education Initiative, the nonprofit that would operate the three Indianapolis schools under a charter issued to ReThink Forward Indiana. There’s also ReThink Forward, a CSUSA arm that’s active in Tennessee; its vice chair is Tony Bennett, the former Indiana superintendent of public instruction.

Noble Education Initiative’s director of educational development and partnerships, Byron Ernest, is on the Indiana State Board of Education. Ernest worked for CSUSA as principal of Emmerich Manual for two years after the state took it over. (He has recused himself from state board decisions about CSUSA).

‘Turnaround academies’

Schools taken over by the state and turned over to managers like CSUSA are called turnaround academies. But they haven’t turned around quickly. T.C. Howe earned six more consecutive F’s under Indiana’s grading system after being taken over. Emma Donnan earned five F’s, then a C.

That’s despite approximately $22.3 million in federal School Improvement Grants that the State Board of Education has awarded to CSUSA for the schools. In recent years, the board has rejected recommendations from the Indiana Department of Education and its leader, Superintendent of Public Instruction Jennifer McCormick, to give a bigger share to district-run public schools that were struggling.

Charter Schools USA asked the Indiana charter board to turn the three Indianapolis schools into charters that it could add to its chain.

Shockingly, the charter board voted 4-3 NOT to give the schools to Charter Schools USA. 

As Chalkbeat reports,

Indiana Charter School Board denied charters Friday for three Indianapolis turnaround schools — a stunning move that could spell the end to the Florida-based Charter Schools USA’s operations in Indianapolis.

As a result, the three Indianapolis schools — Howe High School, Manual High School, and Emma Donnan Middle School — face the prospect of another rocky transition to new management, or even possible closure.

But the board’s 4-3 votes against the charters, which elicited gasps from the audience, marked a major victory for Indianapolis Public Schools, which could win back the three schools that have been under state takeover since 2011. (Two members of the charter board were not present for the vote.)

IPS could reclaim the three schools or close them.

But Charter Schools USA, despite its money and political influence, lost three juicy plums.

(Hint: the state schools’ chief Jennifer McCormick is secretly a friend to genuine public schools. Don’t tell the governor or the legislature.)

 

 

Every blogger who has written about MSNBC’s Public Education Forum expressed gratitude that a big cable network paid attention to our most important democratic institution.

Nancy Bailey is angry about the issues that were ignored, the ones that threaten the future of students, teachers, and public education.

She is also streamed that the program was not on live TV. Public education not important enough for live TV? 50 million children are in public schools. They have parents. Quite an audience to overlook.

Good work, Nancy!

She writes (in part, read it all):

Candidates talked about making the wealthy pay their fair share of taxes to help schools, but no one mentioned Bill Gates, the Waltons, Eli Broad, Mark Zuckerberg or any of the corporate reformers who are taking control of public schools.

They didn’t mention Common Core or the failure of the initiatives funded by the Gates Foundation and taxpayers. Nor did they speak about portfolio schools, the latest corporate endeavor to push choice and charters.

No one mentioned using Social Impact Bonds or Pay for Success to profit off of public schools. See: “Wall Street’s new way of making money from public education — and why it’s a problem” by Valerie Strauss.

CEO Tom Steyer mentioned corporate influence towards the end, but it was brief, and no moderator attempted to explore what he said.

Ed-Tech

No one mentioned what might be the biggest threat to public education, the replacement of teachers and brick-and-mortar schools with technology.

Disruption was initially described by Clayton Christensen and Michael Horn in their book Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns. This is seen as the revolution by those in business and the tech industry and is being played out in online charter schools like Summit and Rocketship. Summit also has an online virtual school.

Many students across the country get school vouchers to be used for substandard online instruction like K12 and Connections Academy.Preschoolers are subjected to unproven Waterford UPSTART.

The candidates might want to review Tultican’s “Ed Tech About Profits NOT Education.”

Wrench in the Gears is another blog good at describing the threat of technology.

Teach for America

Teach for America corps members with little training have taken over classrooms, and they run state departments of education!

Do Democratic candidates have Teach for America corps members as consultants on their campaigns? It’s troubling if they do. They should not be wooing teachers with professional degrees and experience while relying on TFA behind the scenes.

Other insidious reform groups are also about replacing education professionals. Relay Graduate School, The New Teacher Project, New Leaders are a few.

This needs to be addressed, sooner, not later.

Betsy DeVos et al.

I don’t know anyone who doesn’t enjoy hearing Democratic candidates say they’re going to boot Education Secretary Betsy DeVos out.

But President Obama had individuals from the Bill & Melinda Gates Foundation, and other corporate reform groups, working in the U.S. Department of Education. Arne Duncan was no friend to teachers or public schools.

So, while applause against DeVos are justifiable, now’s the time to address the role Democrats have played (and continue to play) in corporate school reform.

The fact is, many groups and individuals are working to end public education, who wear Democratic name tags. It’s imperative that Democratic candidates address this.

 

IT WON’T BE OFFICIALLY PUBLISHED UNTIL JANUARY 21, BUT YOU CAN PRE-ORDER YOUR COPY FROM YOUR BOOKSELLER OR AN ONLINE BOOK DEALER (PLEASE PATRONIZE INDEPENDENT BOOKSTORES, IF YOU STILL HAVE ONE NEAR YOU!).

I PROMISE YOU WON’T BE DISAPPOINTED!

IF YOU COME TO THE ANNUAL MEETING OF THE NETWORK FOR PUBLIC EDUCATION IN PHILADELPHIA MARCH 28-29, I WILL PERSONALLY INSCRIBE YOUR COPY OF THE BOOK!

 

EDUCATION

Slaying Goliath: The Passionate Resistance to Privatization and the Fight To Save America’s Public Schools

Knopf. Jan. 2020. 352p. ISBN 9780525655374. $27.95. ED
COPY ISBN

In this incisive, meticulously researched book, Ravitch (education, New York Univ.; The Death and Life of the Great American School) argues persuasively that the U.S. school privatization movement has resulted in poor test scores, the closure of public schools, and attacks on the teaching profession. Ravitch blames the so-called school reformers, whom she renames the disruptors, such as Bill Gates, Alice Walton, Michelle Rhee, Mark Zuckerberg, and Eli Broad, who spend millions to replace public schools with charter schools and private institutions that are run like businesses. Though disruptors view themselves as opposing the status quo, Ravitch contends that they are doing everything they can to maintain it. She devotes most of her book to the resisters, or the teachers, parents, and union leaders who have taken on the disruptors and are working to keep their local public schools open. Through this lens, Ravitch discusses the Common Core teaching standards, standardized testing, the Obama administration’s Race to the Top grant program, and Teach for America.

VERDICT This extensive analysis is required reading for anyone concerned about American education. [See Prepub Alert, 7/8/19.]

Carol Burris led the delegation from the Network for Public Education at the Public Education Forum in Pittsburgh. Here are her reflections on the candidates;

 

 

There were roughly 1000 attendees at yesterday’s Public Education Forum 2020.  The group was diverse in both race and age. Students accompanied by parents sat side by side with senior citizens. It was a captivated audience, the vast majority of whom stayed until the end at around 4:00 pm. 

 

Outside the forum there was a small protest. When I entered the building in the morning, I counted 35 people. One news report said that the protest grew to 100. Michael Bennet was the only candidate who engaged with the protestors—that encounter can be viewed here.

 

Support was voiced by the candidates for community schools, increased school funding for Title I schools, increased pay for teachers, support for unions, fully-funded pre-schools, increasing the number of teachers of color, student loan forgiveness, and other equity issues which have commonly appeared in candidates’ platforms. In short, it was a positive agenda that acknowledged that resources do matter and recognized the complex difficulties that our schools and our teachers face.

 

It is not my intent to influence anyone’s vote with this account. What follows is my review of the candidates’ performance by giving each the award I believe they most deserve based on what I heard during the forum as well as with speaking with others afterwards. 

 

My award for Best Performance is shared by Elizabeth Warren and Amy Klobuchar. I thought their answers were the sharpest, but I am willing to acknowledge I may see the world through my gender lens. 

 

Upon entering the stage, Elizabeth Warren received cheers. Many stood and applauded. Warren stood her ground when the interviewer claimed she wanted to defund charter schools (she does not). She logically argued her platform on charter schools and ended by saying, “Public school money needs to stay in public schools,” which earned loud applause. She argued throughout for increased funding for public education, funded by her proposed wealth tax.

 

Klobuchar won hearts with the story of her mom who taught elementary school until she was 70 years old. Her mom would dress up as a Monarch butterfly every year when teaching a unit on butterflies. Klobuchar recounted how a former student with a disability came to her mother’s funeral due to the kindness mom had extended to him long after he left her class. She was warm and encouraging when a nervous student came to the microphone to ask a question. Many in the audience who were not familiar with the candidate were impressed. 

 

The You Still Don’t Get it Award goes to Michael Bennet. 

 

The first audience question came from a New Orleans student, Maria Harmon, who expressed concerns about charter schools, which she said are “targeting black and brown children without delivering on their promise of equity.” Maria referred to the Washington Post’s story on our Network for Public Education report, Still Asleep at the Wheel. Her question on charter school accountability received loud applause. 

 

Bennet claimed that in Denver only the Denver School Board can authorize a charter school. What he did not mention is that the Denver Board’s decision to not authorize a charter school can be overturned by the state board. From the Colorado State Board of Education website—

 

“The State Board may also, upon its own motion, decide to review any charter decision of a local board of education. Under the act, the State Board has the authority to direct the local board to grant, deny, or revoke the charter.”

So much for local control. Like other pro-charter Democrats, Bennet tried to create a false distinction between “private” and “public” charter schools, saying there are only public charter schools in Denver. “We don’t have private charters,” he said. Denver’s charters are managed by private boards. In addition, Denver allows charter schools to be managed by for-profit CMOs. For example, Life Skills Denver Charter School, was operated by the notorious for-profit White Hat Management Corporation. It was open throughout Bennet’s term as superintendent and was finally shut down by his successor, Tom Boasberg. I have no idea how Bennet’s defines a “private” charter school.

 

During the interview he defended his merit pay program, which has been largely abandoned, as well as the evaluation of schools by growth scores. 

 

Bennet’s suggestion that the school year be longer and that students attend school six days a week was not well received by students and teachers in the audience. 

 

Bennet told us he was “against privatization” and then left to meet with the charter school parents who were protesting the event. 

 

The Most Loved Award goes to Bernie Sanders

 

When Bernie came on the stage, nearly everyone was on their feet applauding. He made a vigorous case against high-stakes testing (it was noted by the moderators that he had voted against NCLB) as well for increased funding for public schools. Bernie was Bernie, and the crowd loved it.  His refusal to sit down resulted in the moderators getting up from their chairs to ask their questions. 

 

The award for Best DFER in Disguise goes to Pete Buttigieg 

 

Mayor Pete’s melodious even-toned voice was soothing, but no one I spoke with seemed impressed. He received polite applause. When he told the audience that a guy on his policy team (I assume Raj Chetty with whom he attended college) had done a study that showed the positive impact of “great teachers” on students’ economic futures, eyebrows went up. That study was often used by Arne Duncan to justify the evaluation of teachers by test scores.  His teacher training plan sounded an awful lot like Teach for America to me. Rachel Cohen recently reported that prominent charter schools supporters have been doing fundraisers for Mayor Pete.  With Booker and Bennet tanking, it is likely DFERs are looking to Buttigieg as their candidate. 

 

The James Joyce Award goes to Joe Biden 

 

Biden was animated and immersed in his usual stream of consciousness style. Listening to Biden is rather like reading Joyce’s Ulysses. You are just not quite sure where his inner Molly Bloom is going next. 

 

While he did not distance himself from Race to the Top, which I believe was not mentioned at all throughout the forum, I think he said he was against high-stakes testing (sometimes it is hard to tell with Joe). He got a smile from me with his line, “If I’m president, Betsy DeVos’ whole thing from charter schools to ignoring sexual harassment is done.” He was warmly received and frequently applauded. Afterwards many I spoke with said that although he is not their first choice, they would support him if he were the candidate or seemed to have the best chance of beating Trump. 

 

The Nice Guys Finish Last Award goes to Tom Steyer

 

Those I spoke with characterized the billionaire activist as a well-meaning guy whose funds would be better spent supporting a candidate with progressive ideas. My assessment is that he cares and wants to make a difference. He demonstrates none of the know-it-all arrogance of Bill Gates or Michael Bloomberg. I hope he will remain on the side of public schools when the campaign is over. 

 

All in all, the forum was a day well spent. 

 

Charter enrollment declined in Utah for the first time in at least a decade, and no new charters opened.

Enrollment at Utah’s charter schools — which have seen explosive growth in the past as they’ve attempted to be “education’s disruptors” — declined this year for the first time in at least a decade.

The dip is largely unexpected but follows a particularly chaotic year for charters in the state. One was forced to close with millions in debts owed to overseas investors. Another filed for bankruptcy. A third was ordered to shut down after less than two years in operation…

In addition to some schools closing, no new charters opened this fall — which is also a first in the state for at least a decade, Peterson added, and likely contributed to the enrollment decline. Two or three were slated to enroll students in August but pushed back their starting dates over lease, land and building issues.

Royce Van Tassell, executive director of the Utah Association of Public Charter Schools, said the price of land has gone up in Utah and has put new charters in a challenging spot…

Van Tassell also pointed to the closure of the American International School of Utah, or AISU, for the dip. The Murray charter shut its doors in August in the face of mounting debts. The school owed the state and federal government nearly half a million dollars in misspent funds, according to an audit of its books.It also still faces potentially millions of dollars in other unspecified debt, according to its former spokesman, most of which was spent overseas. It’s likely that will never be repaid.

I was glad to see the reporter refer to charters as”disrupters,” which they are, and not as “reform,” which they are not.

Michigan has been Betsy DeVos’ Petri dish for school choice for 20 years. The state theoretically has no for-profit charters but in reality, 80% of its charters are run by for-profit management companies.

Michigan also has the largest number of charters that received millions from the federal Charter Schools Program but never opened. These are “ghost schools.” Carol Burris identified them in the NPE report Asleep at the Wheel.

Reporter Allison Donahue investigated to see where the money went.

The study highlighted how the money was spent at four of Michigan’s “ghost schools”:  The Harris Academy, The Great Lakes Anchor Academy, Cultivating Growth and Warren Classical Academy.

Although the inspiration to open these charters differs from developer to developer, a common thread was found within these ghost schools’ invoices ─ for-profit consultants and education management organizations.

Betsy DeVos gave Michigan another $47 million to add more charters, but the state board of education rejected the grant. However the state attorney general said the state education Department was required to disperse the funds.

DeVos wants more charters-in Michigan, Alabama, New Hampshire, Texas, everywhere— and as the saying goes in D.C., she is shoveling the money out the door as fast as she can.

Needed or not, here come more charters!

There are many ways in which nonprofit charters make a profit. Most involve complex real estate transactions and such things as “triple net leases” which are hard for the public to understand. Such deals often involve a charter operator owning or leasing the real estate and renting it to the charter school at exorbitant rates, with the public footing the bill.

Michael Kohlhaas has discovered another ingenious way that allegedly nonprofit charter operators extract money from their operations. 

He describes the case of a charter operator in Los Angeles who sold his “receivables” soon after getting his charter.

Kohlhaas writes:

The idea is very simple. A charter school has guaranteed future income in the form of payments from the state. They sell those payments to a finance company at a discount.

The finance company also charges a transaction fee. So for instance, if a charter has enrollment worth $1,000,000 they might sell those future payments for $980,000 now, which is less 2%. That means that $20,000 of public money, meant to educate children, has just evaporated into some zillionaire’s pocket for no reason, with no social benefit, nothing.2

This is usury. Payday loans for putatively public institutions. It’s textbook predatory lending with the unique distinction that both the borrower and the lender are teaming up to prey on a third party, which is the public. And, as I said, none of this is theoretical. Excelencia Charter Academy actually did this last year, which was their first year in operation.

It was obviously part of the plan all along, because founder Ruben Alonzo began arranging the sale within six weeks of receiving his approval from LAUSD. Read the details in this email chain. And keep this story in mind next time some charter minion starts burbling on about putting kids first and the putative efficiency of the private sector. Their financial model includes skimming a percentage of public money for no reason other than to enrich their cronies. This, friends, is not what efficiency looks like.

The company that handled the transaction for Excelencia is called Charter Asset Management, and this is only one of the incredibly shady sounding services that they offer to charter schools. They’re also not alone in this business. Another such company, which also buys receivables, is Charter School Capital. This one is even shadier than the other, founded as it was by an actual charter school operator who then used it to buy the receivables from his own school, thus pocketing the transaction fees himself.

Kohlhaas used the state’s public records act to obtain a huge trove of emails sent by charter operators, and he has mined them for posts like this one.

This is a big difference between a public school and a charter school. Would it be legal for a public school principal to sell the “receivables” for his or her school? Of course not. She would be charged with a crime and sent to jail.

 

Arthur Goldstein, veteran NYC teacher, traveled to Pittsburgh for the Public Education Forum, which will be live-streamed by MSNBC.

Outside he sees a group of protestors from the charter industry, complaining that public schools get any notice at all. Six percent of America’s children are in charters. Almost 90% attend public schools.

Goldstein remembers the many events where the charter industry monopolized Oprah, NBC’s Education Nation, “Waiting for Superman,” etc. and no public supporters were invited as the speakers sneered about them.

Now the charter industry has Betsy DeVos, the nation’s top education official, singing their praises. So why protest a gathering where they have two spokesmen (Booker and Bennett) but are not the sole focus of attention?