Archives for category: For-Profit

After a scathing state audit of its finances, the EPIC virtual charter school cut its ties to the school’s for-profit co-founders.


The governing board of Epic Charter Schools underwent a major overhaul Wednesday night and then declared its independence from the for-profit school management company owned by Epic’s co-founders.

Epic’s seven-member board of education unanimously approved a mutual termination agreement, effective July 1, to end its contract with Epic Youth Services, which reportedly has made millionaires of founders David Chaney and Ben Harris.

“Big day for our school; big shift, obviously,” said the newly seated board Chair Paul Campbell, an aerospace and energy executive who founded the Academy of Seminole charter school.

“This school has outgrown its management company, which is why we did what we did today. There is no more CMO (charter management organization). … Not only will we save tens of millions of dollars, but you’re taking a significant leap forward in technology for this school…

In early October, a report on the state’s investigative audit of Epic revealed lax school board oversight and that one of every four taxpayer dollars Epic received went to the for-profit school management company, Epic Youth Services.

The state auditor found that 63% of those monies — nearly $80 million budgeted for students’ learning needs — has been shielded from all public or auditor scrutiny. The auditor is still battling in court to get access to those spending records.null

The state audit also revealed that Epic Youth Services was relying almost solely on Oklahoma public school employees to do the administrative work for both Epic’s Oklahoma and California schools while collecting tens of millions of dollars in management fees.

It also found that the company “improperly transferred” $203,000 in Oklahoma taxpayer dollars from the Oklahoma schools’ student Learning Fund account to help cover payroll shortages at Epic’s California charter school.

Angie Sullivan teaches first-grade students in a Title I school in Las Vegas. She writes regularly to every member of the legislature and to journalists to tell them what it is like from a teacher’s perspective.

She wrote this missive:

Shannon Bilbray-Axelrod should recuse herself from charter school legislation.  It is unethical for her to line her lobbying pocket and then work on charter legislation.  Scott Hammond and Carrie Buck should also recuse themselves from working on charter language having made millions in the business.  Unethical.  

While you are in AB420, you should amend the Charter Authority requirements.   

To sit on the 9 member board, you should have not earned money from a for-profit school.   

The number of recusals from Charter Authority board members while trying to do business is ridiculous. 

Oftentimes decisions are made with a questionable quorum because too many folks on the dais are making money from the business and have to recuse. 

If you are a charter lawyer, charter consultant, charter owner – not the time to sit on the decisions making board.  It is unethical.   

You should have to wait 3 years after profiting from charters before being allowed to sit on the board.  
The chair of the Charter Authority should not run a charter.   

This leads to awkward business.   

The Chair leaves the dais to go to the table to have the board give her permission and/or money.  I have seen Chair Melissa Mackedon who runs a charter in Fallon do this several times.   

It is like insider trading – benefitting their business and themselves.  Then popping back up into positions to hand out money and favors to other charters.  Charter Board Members should not be on both sides (giving and receiving) routinely in meetings.  Unethical.  

Former or current legislators should not sit on the Charter Authority Board.  It appears that they legislated to make millions.  Pat Hickey and Randy Kirner are examples of folks who recently left their positions and then became part of the Charter Authority Board.

Lawyers like Jason Guinasso who have chaired the board should not be able to come back a few years later to manipulate charter language or the board.   He addressed them as friends trying to take advantage of his connections.  Recently Guinasso approached the board from the table on behalf of a charter he most likely set-up for failure while he was chair.  The theft and lawsuits cost Nevadans.


https://www.nevadacurrent.com/2020/06/29/lv-charter-school-alleges-it-paid-1-6m-to-utah-management-company-for-nothing/

https://kutv.com/news/beyond-the-books/nevada-charter-school-ends-business-ties-with-american-preparatory-schools-in-utah

New EMOs/For-Profit Service Providers should not be allowed in the state.  No more new for-profit campuses under their umbrellas either.  They have made a huge mess.   Academica basically has a weird monopoly with different branches.   They are posed for rapid expansion.  Folks outside the state watching Academica in Nevada are very concerned.  

For-profit corporations like Academica take advantage of states like Nevada.  Language should be included to prevent rapid expansion and the ability to siphon money into side businesses.   This robs students and gives millions to side businesses.   Folks like Gulenist Soner Tarim should not be able to come into Nevada and apply for a charter – with language in the contract that gives them 12% off the top and ability to rapidly expand by being a EMO/Service Provider.  These should be two different things – EMO/Service Provider and Charter Applicant.  These administrators and side businesses are making a ridiculous amount of money and do not have to bid out their services.  The public should be able to see these contracts since the taxpayer is paying.  Folks should not be handing contracts out to their friends and family.

EMOS/Service Providers should not be allowed to break the charter diversity laws like Academica did intentionally when opening the Northern Pinecrest.  Academica should be closed for that.

PPP loans were given to both the charter campuses and the management corporations and all the side businesses.   How much money did a for-profit charter really get during the pandemic?   They got money for the EMO/Service Providers/Campus/Friends/Family etc?  Then held an informational meetings to warn everyone “not to say anything”.  

125 Florida charter schools already funded by taxpayers received $50 million in PPP loans https://www.abcactionnews.com/news/local-news/i-team-investigates/125-florida-charter-schools-already-funded-by-taxpayers-received-50-million-in-ppp-loans

I hope the FBI comes and arrests everyone involved in this mess and lining their pockets. 

https://www.nevadacurrent.com/2020/12/24/nevada-charter-schools-got-millions-in-ppp-loans/ 

$350+ Million in education money annually and not one person knows what it is spent on.

And seems like legislators are just fine with that?


The Teacher,

Angie Sullivan


https://www.leg.state.nv.us/App/NELIS/REL/81st2021/Bill/8052/Text

Bob Braun was an education reporter for 50 years. After he retired from the New Jersey Star-Ledger, he began blogging and paid close and critical attention to the state takeover of Newark. This column, posted in 2014, is as timely now as it was when it first appeared.

Let’s get this straight. Those of us opposed to the structural changes to public education embraced by crusaders ranging from the billionaire Koch brothers and the Walton Family Foundation to Bill Clinton and Barack Obama—along with Governor Chris Christie and Microsoft founder Bill Gates—are not opposed to the reform of public schools. We oppose their destruction.

We do not oppose making schools more accountable, equitable and effective—but we do oppose wrecking a 200-year-old institution—public education—that is still successful in New Jersey.

Public schools give students from all backgrounds a common heritage and a chance to compete against privileged kids from private schools. We don’t want schools replaced by the elitists’ dream of privately managed, publicly funded charter schools, which can be money makers for closely aligned for-profit entities.

We oppose eliminating tenure and find laughable the idea embodied in Teach for America (TFA), an organization that recruits new college graduates for short stays in urban schools, that effective classroom instructors can be trained in weeks if they’re eager and want breaks on student loans—breaks that come with TFA participation. We oppose breaking teacher unions, reducing education to the pursuit of better test scores and using test results to fire teachers. We want our teachers to be well trained, experienced, secure, supervised, supported and well paid. We want our kids to graduate from high school more than “college and career ready”—a favorite slogan of the reformers. We want them to graduate knowing garbage when they see it—to understand mortgages, for example, rather than just solving trigonometry problems.

Don’t call it reform, call it hijacking. A radical, top-down change in governance based on a business model championed by billionaires like Eli Broad, the entrepreneur whose foundation underwrites training programs for school leaders, including superintendents—among them, Christopher Cerf, New Jersey’s education commissioner from late 2010 until this past February. The Broad Foundation seeks to apply to public institutions, like schools, the notion of “creative destruction” popularized for businesses by economists Joseph Schumpeter and Clayton Christensen. In a memo forced into public view by New Jersey’s Education Law Center, leaders of the Broad Superintendents Academy wrote that they seek to train leaders willing to “challenge and disrupt the status quo.”

Sorry, but it’s neither clever nor wise to disrupt schools, especially urban schools. Irresponsible, distant billionaires cause unrest in communities like Newark, a place they’ll likely never get closer to than making a plane connection at its airport. These tycoons say they want to improve learning—to narrow the achievement gap between rich and poor, black and white. I don’t buy that. The gap is caused by poverty and racial isolation, not public schools. They want reform that doesn’t raise taxes and won’t end racial segregation. So they promote charter schools that segregate and pay for them with tax funds sucked from public schools. Bruce Baker, a professor at Rutgers Graduate School of Education, calls it “revenue neutral and nonintegrative” reform. What that means, Baker says, is “don’t raise our taxes and don’t let poor black and brown kids access better-resourced suburban schools.”

School reform once meant equity and integration. Now it’s called choice. Not the choice that would allow Newark kids to take a bus 15 minutes to Millburn. Not the choice that would allow the dispersion of disadvantage so the poorest attend the same schools as the most advantaged. It’s choice limited to a district. And choice limited to families who win a lottery for charter-school admission. “We’re letting poor parents fight it out among themselves for scrap—it’s Hunger Games,” says Baker.

Charters segregate. In Newark, where there are 13 charter schools, children with the greatest needs—special education kids, English-language learners, the poorest children—are stranded in asset-starved neighborhood schools. Disadvantage is concentrated, public schools close, and resources shift to charters. In Hoboken, three charter schools educate 31 percent of the city’s children, but enroll 51 percent of all white children and only 6 percent of youngsters eligible for free lunches.

Such skimming of the more able students lets proponents like Christie claim that charters outperform public schools. But charters serve a different population. In his devastating send-up of Newark’s North Star Schools, titled “Deconstructing the Cycle of Reformy Awesomeness,” Baker describes how charters achieve high test scores and graduation rates by shedding underperforming students. Half the kids—including 80 percent of African-American boys—dropped or were pushed out.

Charters are not the solution. “Overall, charters do not outperform comparable public schools and they serve a different population,” says Stan Karp, an editor at Rethinking Schools, an advocacy organization dedicated to sustaining and strengthening public education. He adds, “Nowhere have charters produced a template for district-wide equity and system-wide improvement.”

Many suburbs have resisted charters, but state-run urban districts like Newark cannot. In Newark, Christie joined with then Mayor Cory Booker, a devotee of privatization, to bring in Broad Academy graduates Chris Cerf to be state schools chief and Cami Anderson to be Newark superintendent. They were awarded a pledge of $100 million from Facebook cofounder Mark Zuckerberg to support school reform in Newark.

Suburbs cannot escape other reforms, including federal insistence on relentless, time-consuming annual testing to measure student achievement and teacher performance. While states can opt out of testing, the price in lost federal revenues can be high. Democrats for Education Reform (DFER), a national political action committee, applauds these changes as “bursting the dam” of resistance from unions to test-based evaluation and merit pay.

The coalition of foundations, non-governmental organizations and financial institutions promoting privatization is an opaque, multi-billion dollar, alternative governance structure. They include the Broad and Walton foundations; the Bill and Melinda Gates foundation; the Charter School Growth Fund and the NewSchools Venture Fund (a pair of nonprofit investment operations overseen largely by leaders of for-profit financial firms); the training and support organizations New Leaders for New Schools, the New Teacher Project and America Achieves; as well as the advocacy groups Stand for Children and Education Reform Now.

At its most recent summit of education reformers—including Newark’s Anderson—the NewSchools Venture offered workshops on “How Disruptive Can We Be?” and a seminar on charter schools that was advertised this way: “Charter schools are being brought into the center of reform strategies, not just to provide new options for some students, but to transform an entire public education system, based on a diverse portfolio of autonomous school operators.”

Why is school privatization such a draw for investors? Is it just philanthropy? No, there is also profit to be made from the $650 billion spent annually on public schools. Some charter school operations are profit making, including nearly two-thirds of charter school operators in Michigan and many in Florida—and Christie has been pressing to allow profit-making charters in New Jersey. Salaries for operators of charter school chains can run as high as $500,000 a year. The New Markets Tax Credit, pushed by charter supporter Bill Clinton when he was president, allows lenders to reap higher interest rates. Then there are rents paid by charter schools to charter-related profit-making companies like Newark’s Pink Hula Hoop (started by TEAM Academy board members); legal fees; and the sale of goods and services.

The costs of this movement: urban schools stratified. It’s an apartheid system, with the neediest warehoused in neglected public schools and a few lucky lottery winners in pampered charters. It is stratification on top of a system already stratified by all-white suburban districts and $35,000-plus private schools.

More costs: unconscionable amounts of time, energy and resources devoted to test preparation. The brightest young people, says Baker, will leave teaching to short-stay amateurs rather than endure the unpredictability of evaluations that rate a teacher “irreplaceable” one year and “ineffective” the next.

New Jersey ranks at the top nationwide in educational achievement, reports Education Week. We are second in “chance for success,” third in K-12 achievement and fifth in high school graduation. These statistics include urban schools; if properly funded, they succeed. Look at Elizabeth: good schools, no charters. Christie left it unmolested and provided millions in construction funds kept from other cities—perhaps because the school board endorsed him.

New Jersey is not the basket case Christie says it is. Urban schools are not failure factories. We don’t need a hostile takeover by Wall Street.

I recently had the pleasure of speaking to the North Texas School Boards Association by Zoom. Right now, Texas is ground zero for the charter industry. This is astonishing because the public schools in Texas far outperform the charter schools. The charter school lobby markets themselves as “saviors” of children, but they are far more likely to fail than public schools. This is a summary of what I told my friends in Texas:

I am a graduate of the Houston public schools. My father, who grew up in Savannah, never finished high school; my mother, who was born in Bessarabia, was very proud of her high school diploma from the Houston public schools.

I believe that all of us, whether or not we have children, whether or not we have children in public school, have a civic obligation to support public schools, just as we must support other public services, like police, firefighting, public roads, public parks, and public libraries. Taxes are the price we pay for a civilized society, and no investment is more precious than investing in the education of our children. They are our future. 

Texas, like every other state, guarantees a free public education to everyone. The clause in the state constitution says:

A general diffusion of knowledge being essential to the preservation of the liberties and rights of the people, it shall be the duty of the Legislature of the State to establish and make suitable provision for the support and maintenance of an efficient system of public free schools.

As constitutional scholar Derek Black shows in his book Schoolhouse Burning, the founding fathers of this nation wanted every state to provide free public education. They didn’t have it in their own time, but they saw it as essential to the future of the nation. In the Northwest Ordinance of 1785, the Founders said that any territory that wanted to become a state had to set aside one lot in each town for a tax-supported public school. Not a private academy supported by tax funds, but a tax-supported public school.

The leadership of Texas doesn’t care about the state constitution. Every time the legislature is in session, someone offers a bill to send public funds to religious schools, which are not public schools. Thus far, a coalition of urban Democrats and rural Republicans and the dedicated leadership of Pastors for Texas Children has defeated vouchers.

The Republicans who control the state have substituted charters for vouchers in their eagerness to provide alternatives to the right guaranteed by the state constitution. And they have not given up on vouchers.

Texas now has more than 800 charter schools. These are schools under private management, paid for with tax dollars. Contrary to their marketing strategy, they are not public schools. Some of those charters are part of big corporations, like KIPP or IDEA. Some are nonprofit schools that are managed by for-profit corporations. The GOP leadership wants more of them, even though the existing public schools are underfunded and have not recovered from a devastating budget cut of more than $5 billion in 2011.

When the idea of charter schools first emerged in the early 1990s, I was enthusiastic about their promise. I was in Washington, DC, working as Assistant Secretary of Education for Research in the first Bush administration. We heard from their sponsors that charter schools would be more innovative, would cost less than public schools because of their lack of bureaucracy, would be more successful, and would be more accountable than public schools because they were free of most regulations. 

Three decades later, this is what have we learned: 

   a). Charter schools are not more innovative than public schools. The only innovation associated with charters is harsh disciplinary practices called “No excuses,” where children are punished for minor infractions of strict rules. The largest charter chain in Chicago, the Noble Network, recently announced that it was getting rid of “no excuses” because it is a racist policy, meant to force black children to adopt white middle-class values.  

    b) Charter schools are not more accountable than public schools. In most states, the charter associations fight any effort to impose accountability or transparency. They don’t want to be audited by independent auditors. The only time they are accountable is when they close their doors because of low enrollment or abject academic failure. 

    c) Charter schools do not cost less than public schools. They typically demand the same public funding as public schools, even though the public schools pick up some of their costs, like transportation, and even though they have fewer high-need students than public schools. In some states, like Texas, charter schools get more public money than public schools.

    d) Charter schools are less effective than public schools. Those that have high test scores choose their students and families carefully and push out those they don’t want. On average they don’t outperform public schools, and they spend more money on administration than public schools. In some states, like Ohio, the majority of charter schools are rated D or F. 

Charters are unstable. They open and close like day lilies. Sometimes in mid-semester, leaving their students stranded.

The worst charter schools are the virtual schools. 

The state pays the cybercharters full tuition to provide nothing more than a computer, a remote teacher, and some textbooks. They charge double or triple their actual costs.

Virtual charter schools have high attrition rates, low graduation rates, and low test scores.

There have been huge scandals associated with virtual charter schools.

In Ohio, the Electronic Classroom of Tomorrow collected close to a billion dollars over 18 years. It was started by a businessman, who made generous contributions to political leaders. It had one of the lowest high school graduation rates in the nation. In 2017, ECOT was audited by the state and found to have collected tuition for phantom students. Rather than pay the state $80 million, ECOT declared bankruptcy in 2018. No one was fined, no one went to prison, no one was held accountable.

The biggest scandal in charter history was the A3 virtual charter chain. It had a massive scheme to enroll fake students. Eleven people were indicted. Eventualy, the leaders of A3 agreed to repay the state $215 million.

The largest of the virtual charters is K12 Inc; it is registered on NY Stock Exchange. Its results are familiar: high attrition, low test scores, low graduation rates. Their top executives are paid millions of dollars each. K12 is are operating in dozens of states.

Poor academic performance is not punished; financial fraud is not punished. There is no accountability. 

IDEA in Texas is in a class of its own when it comes to luxuries. They get hundreds of millions of tax-payer dollars, but they decided they needed to lease a private jet for their executives. When the story got into the newspapers, they dropped that idea. The media also reported that IDEA bought season tickets for special seating at San Antonio Spurs games. When the CEO decided to retire, he received a $1 million golden parachute. How many school superintendents do you know who got such a generous going-away present?

Charter schools claim that they “save poor kids from failing schools.” 

That’s not true. There are currently some 356,000 students in charter schools in Texas. Three-quarters of them are enrolled in charter schools in A or B school districts. The charter school students are being drawn away from successful schools in successful districts.

The charter lobby claims that there are long waiting lists. Don’t believe it. The so-called wait lists are manufactured. They are never audited. In Los Angeles, at least 80% of the existing charters have empty seats, yet still the lobbyists talk about wait lists. In New York City, charters buy advertising on city buses. When you have a waiting list, you don’t buy advertising.

The charter industry in Texas has a number of charter expansions already approved and expects to grow by 50,000 students every year. Unless the legislature plans to increase spending on education, charter growth will mean budget cuts for public schools. Charters in Texas currently divert $3 billion a year from public schools. Since they started, they have diverted more than $20 billion that should have gone to the state’s public schools. 

Charter schools in Texas are not more successful than public schools. Texas researcher William Gumbert reported that 86% of public school districts are rated either A or B by the state, compared to 58.6% of charter schools. Only 2.6% of public school districts were rated D or F, compared to 17.7% of charter schools.  

Texas Public Radio reported that graduation rates at charter schools were 30 points lower than the rates at public high schools. 

Two economists—Will Dobbie and Roland Fryer—studied the outcomes of charter schools in Texas. They concluded that charter schools have “no impact on test scores and a negative impact on earnings.”

William Gumbert, an independent analyst in Texas, has calculated that graduates of charter schools enter college less well prepared and are less likely to perform well in college, compared to students who went to public schools. He reported that the 2019 state ratings showed nearly 40% of charters approved by the state have been closed. 

The charters claim that they can close historic achievement gaps between children of different racial and ethnic backgrounds. This is not true. According to careful research by analyst Gumbert, public schools do a better job of narrowing the achievement gaps between black and white students and between Hispanic and white students than charters in the same districts. 

Again, using state records, Gumbert found that graduates of public schools were more successful in college than graduates of charter schools. Public school graduates were more likely to have a higher grade-point average in freshman year than charter school graduates. First-year grade-point average has been shown to predict college graduation. 

Now the charter industry is lobbying for a vast expansion in Texas. They don’t want to have to deal with elected school boards or other elected officials. Democracy is a nuisance, an obstacle. So they are promoting SB 28, which would remove any elected school boards or elected municipal officials from the charter approval process. The state board of education could veto a charter application only with a supermajority. Only one appointed state official—the State Commissioner, appointed by the Governor– would decide whether charters may invade your district, recruit the students they want and locate the charter school wherever they want. That is a major blow to local control of schools. 

Why are state officials in Texas, why is the Legislature, opposed to local control of schools?

After three decades of experience, we have learned about the policies and practices of charter corporations.

First, many charter schools are run by non-educators. They see a business opportunity and they compete for market share. 

Second, they market charter schools by making extravagant claims. They promise that their students will be successful in school and will go to college even before they open their doors. As we have seen, this is usually false.

Third, the few that get high test scores do so by cherry-picking their students or by setting the standards so high that only high-scoring students choose to enroll. BASIS is an example of that. Students have to pass a certain number of AP exams to graduate, so average students need not apply. In Arizona, where most of the state’s students are Hispanic or Native American, the BASIS schools enroll mostly white and Asian students.

Fourth, some charter schools raise test scores by pushing out students who get low scores. That means excluding students with disabilities and students who don’t speak or read English. It also means counseling out or finding creative ways to discourage the kids who are discipline problems or the kids who perform poorly on tests. The most successful charter chain in NYC accepts kids by lottery in kindergarten. Then they begin weeding out those they don’t want, and after third grade, no new students are accepted. By senior year, most of the students who started in K or first grade have disappeared

Fifth, charter schools typically hire young and inexperienced teachers who cost less than older experienced teachers. The turnover is high—sometimes as much as half the staff leaves every year and is replaced by newcomers to teaching. 

Sixth, the true secret of charter expansion is the money behind them. They are supported by a long list of billionaires who want to eliminate public schools. They mock our community schools as “government schools,” but they might as well mock our community police officers as “government security agents.” Our community public schools belong to “we, the people.” We pay for them with our taxes. They reflect our community history. They have the trophies that our parents, our cousins, our aunts and uncles won at football, basketball, baseball, volleyball, chess, and debate tournaments. They are audited and overseen by our neighbors. We elect the school board, and if we don’t agree with their decisions, we elect another one. 

Don’t give your public dollars to entrepreneurs and corporations to educate your children. 

Don’t replace your public schools with a free market where schools compete for customers. Markets produce winners and losers, not equality of educational opportunity. Use your tax dollars to make your public schools the best they can be for all the children.

Whatever your political views are, these schools belong to you, not to Wall Street or libertarian billionaires or opportunists. Tell your legislators to support your public schools. 

School choice means that the schools choose.

Public schools must take everyone. 

School choice is a hoax.

Don’t fund failure.

At a time when there are so many divisions in our society, we need our public schools to teach appreciation for our common heritage as Americans and as Texans.

I especially appeal to those with conservative values: Conservative conserve. Conservatives don’t blow up traditional institutions. People who want to blow up community institutions are anarchists, not conservatives.

Preserve and improve your community public schools for future generations. 

Billy Townsend was a school board member in Polk County, Florida. He saw up close and personal how charters were sucking the high-scoring students out of public schools and excluding the students with disabilities. He saw up close and personal how the state’s voucher program was serving as a refuge from high-stakes testing and enabling the restoration of racial segregation. Billy believes, as I do, that if the day ever comes when so-called reformers see the harm they are doing to kids and to our democratic institution of public education, they might repent. Will shame move them more than the pursuit of profit and power? Perhaps we are naive to think it might. But hope springs eternal that even the profiteers and entrepreneurs and shady fly-by-night grifters might someday see the light.

Billy has written a powerful series about the Jeb Crow school industry and how its sole purpose is to destroy public education without helping kids. All of the articles are referenced in this post, the last of the series. He has demonstrated how the voucher schools are highly segregated and low-quality. He refers to the choice schools as “failure factories” but now calls them “Jeb Crow” schools to credit former Governor Jeb Bush for creating the Big Lie that school choice saves children. It doesn’t.

Townsend throws out a challenge to reformers who are sincere, if there are any, about equity and helping kids:

Serious “reformers” — those who actually mean it when they use the moral, racialized language of equity in justifying punitive policies that destroy public education capacity — know today that their entire life’s work is bullshit that failed on its own terms. 

They know it. Every single one of them. Some of them will cry about America’s super awesome graduation rate; but they know that’s manipulated data bullshit, too. Mostly, they’ve just gone silent while think tanks beg to keep getting useless test data and grifters use the language and weaponry “reformers” provided them to demolish public education capacity for everyone. 

The question now: if, when, and how will “reformers” ever break their shamed silence about their failures and decide to help us fix them?

Jeb Crow means wealthier, whiter kids get high capital charters; more vulnerable, less white kids get no capital vouchers; and we kill/privatize public schools altogether.

The grifting and cheating by state education officials is breath-taking. They know that school choice is a cynical ploy to shift money from taxpayers to private corporations. They know that the corporation that handles the voucher funding now has assets of nearly $700 million. They know where power lies in Florida. They know how corrupt the Legislature is. But everyone goes along to get along.

If you read one thing today, read Billy Townsend’s reports on Florida’s massive crime against children and the state’s own future.

You may recall that the Oklahoma State Board of Education recently voted 4-3 to allow charter schools to share in local tax revenues, over the opposition of State Commissioner Joy Hofmeister, who said that the decision might violate state law. You may also recall that the virtual charter school in Oklahoma called EPIC has been embroiled in scandal after scandal (just google “Oklahoma EPIC scandal” and you will get lots of references to allegations of theft, embezzlement, ghost students, etc.). For example, in fall 2020, the state auditor reported that EPIC owes the state $8.9 million for inaccurate reporting, improper transfer of funds, and a multitude of other egregious (you might say “epic”) calculations. That $8.9 million was the tip of a very large iceberg. The state auditor said that about 1 of every 4 dollars that the state paid to EPIC (a total of $458 million) was deposited as profit by the school’s owners. The story is breathtaking.

The Oklahoma Parent Legislative Action Committee (PLAC) posted this on its Facebook page:


Oklahoma PLAC
  Facebook post:

TRANSPARENCY, ACCOUNTABILITY??? 🔎 Where art thou?

We’re wondering why State Board of Education member Jennifer Monies did not recuse herself during last week’s vote to settle a lawsuit that directly benefited another entity of which she serves as board member. She is both plaintiff and defendant in this case yet she still cast a vote. 

“On numerous occasions in the board’s public meetings, Monies has mentioned her service on the board of her son’s school, John Rex Charter Elementary in Oklahoma City, which would stand to benefit from the settlement and which is listed as a member of the Oklahoma Public Charter School Association on the organizations’ website.”

And another tragic Farce

EPIC Charter Schools named Charter School of the Year by Choice Matters

The Florida League of Women Voters has long been wary about the state’s rush to privatize public school funding through charters and vouchers. It has previously published reports on the conflicts of interests, the politics, and the money in the charter sector. In this report, it investigates the organization created to hand out money for vouchers, called “Step Up for Students.” I am posting only the introduction. To read the body of the report, please open the attached PDF file.

Step Up for Students

 Preliminary Investigative Report

League of Women Voters Education Task Force

Contact: Dr. Sarah (Sally) Butzin

President, League of Women Voters of Tallahassee

sally.butzin@gmail.com

850-728-1097

March 2021

Introduction

For the past 20 years, a private organization has been growing exponentially using direct and indirect public funds largely out of public view. This organization is the conduit for an unregulated school system without standards being created by the Florida Legislature.

The organization is called Step Up for Students (StepUpForStudents.org), an SFO (Scholarship Funding Organization) that awards and manages tax credit scholarships for the state of Florida, as well as in Alabama.  According to Forbes, Step Up is the 21st largest charity in the United States. To put that in perspective, the American Cancer Society is 18th. In 2019 Step Up and Subsidiaries had $697,363,075 in total assets. 

Step Up began with a mission to award vouchers to low-income students to attend private schools. It has grown to include vouchers, now known as scholarships, for students with special needs, students who have been bullied, students who are homeschooled, and students with reading difficulties. The income threshold has been raised through the years to at least 300% of the poverty level, with no income threshold for homeschool or special needs students.

Step Up receives donations from corporations who receive a dollar-for-dollar tax credit on corporate and certain sales taxes owed to the state of Florida. Billions of dollars have been diverted to Step Up instead of having been deposited into General Revenue to operate state government, including public schools. These tax diversions have been cleverly labeled as “donations”.

This report is the work of a team of volunteer members of the League of Women Voters of Florida. The League’s mission is to Empower Voters and Defend Democracy. Voters become empowered through information, while democracy requires transparency. An equitable and high-quality public education system is also essential for a vibrant democracy.

We hope to bring the shadowy operations of Step Up for Students into the sunshine through this report. The growing and unaccountable privately-controlled school system, while ostensibly under the Dept. of Education, should concern every Florida taxpayer. We hope that what we have learned will encourage an investigative reporter or organization to uncover more of what is unknown by the public. It’s a matter of fairness and justice. There’s more to the story.

A money management/marketing firm operating as a charity

Step Up for Students was created by venture capitalist John Kirtley in 2002, one year after then Governor Jeb Bush’s administration established the first (FTC) Florida Tax Credit voucher program, now called a “scholarship.” By 2020, Step Up had total net assets of over a half billion dollars. It is headquartered in Jacksonville at 4655 Salisbury Road. There is an affiliate office in Clearwater.

Step Up has approximately 265 employees with an $18 million payroll. The current President is Doug Tuthill, with a salary of $286,847. Eleven key employees have six-figure salaries with a total of $1.2 million in compensation. 

Founder John Kirtley remains the unpaid Chairman of Step Up. He, and his wife, have numerous board affiliations. Kirtley is co-chairman of the Florida Federation for Children, a PAC (Political Action Committee) that donated $1.4M during the 2020 election cycle.

The Board consists of 8 members, many with corporate ties. John Legg is a former state legislator and chairman of the Senate Ed Committee, and Al Lawson is a United States Congressman. Step Up also works for the state of Alabama through its subsidiary ASOF (Alabama Scholarship Opportunity Fund). Four of the Step Up board members are also on the ASOF board.

Step Up is one of two SFO’s authorized to administer five school choice scholarship programs in Florida. Step Up administers 99% of the contributions, while AAA Scholarship Foundation handles the remaining 1%. Step Up takes an administration fee of 2.5-3% of contributions. The cap on corporate contributions in 2020 was $874M, which means a 2.5% fee would be nearly $21M for Step Up.

This leaves plenty of funds for Step Up to promote the tax credit scholarship programs to corporations and car dealers, as well as to market the program to parents. Step Up offers webinars and support systems to recruit parents and assist them in applying for scholarships. Through the years, Step Up has organized large rallies in Tallahassee to bring thousands of students and parents to Tallahassee to lobby legislators to expand the program.

The fox guarding the henhouse

The Florida Department of Education’s Office of School Choice cannot supervise a program of this magnitude.  The task of supervising over 1,800 private schools and tracking individual vouchers given to parents is huge and varied.  Where students enroll must be verified.  Some schools report vouchers for students who are not enrolled. Some vouchers are awarded to students who do not meet the family income requirement for their voucher.  In addition, some vouchers allow parents to purchase supplies and services for students.  These individual purchases must be tracked.  

This is where Step Up has stepped in. The DOE (Department of Education) has outsourced oversight functions to the same private agency that also awards the scholarships. Since its inception, Step Up has awarded over one million scholarships.

What Step Up financials tell us about their size and growth

Income – Form 990 – 2018 & 2019:

$714,828,892 in “contributions and grants” – 2018

$614,153,616 in “contributions and grants” – 2019

Two Year Total: $1,332,982,508

Expenses – Form 990 – 2018 & 2019:

scholarships totaling $624,325,270 – 2018

scholarships totaling $667,545,702 – 2019

Two Year Total: $1,291,870,972

Payroll & Benefits & Outsourcing

2018 Payroll & Benefits: $19,899,245 

2019 Payroll & Benefits: $22,110,485 (Including $1,164,052 for “management & key employees) 

   $1,120,016 of the 2019 total listed as “fundraising expense”, so as of the last public report, they’re paying over $1 million just to fundraising professionals

Two Year Payroll Total: $42,009,730

What Step Up financials DON’T tell us

  • What is the source of the “contributions and grants”? Donor names are not listed. 
  • 2019 Audit Report listed $683,370 in functional expenses for “recruiting and advertising”. This included (according to the 990) a total of $592,698 paid to two employment agencies. Why? This is very unusual in a non-profit financial report. Who are they recruiting? What is their function?
  • More questions about payroll expenses are raised in Finding 2 of the 2019 audit (below).

What Step Up Audit Reports tell us about their program monitoring function

Findings from August 2019 Audit:

  • Finding 1: Step Up did not always properly evaluate the household income of FTC Program scholarship applicants to ensure that scholarships were only awarded to eligible students. A similar finding was noted in our report No. 2019-012. 
  • Finding 2: As similarly noted in our report No. 2019-012, Step Up procedures do not require and ensure that records of attendance and time worked by exempt employees, reviewed and approved by applicable supervisors, be maintained. 
  • Finding 3: Step Up did not notify employees and students of the purpose for collecting social security numbers. In addition, some unnecessary information technology (IT) user access privileges existed that increased the risk that unauthorized disclosure of the sensitive personal student information may occur. 
  • Finding 4: Application processing errors caused a delay in funding for certain students eligible for the Gardiner Scholarship Program. 
  • Finding 5: Step Up procedures did not always identify private schools receiving more than $250,000 in scholarship funds in a fiscal year to verify that those schools contract with an independent certified public accountant for an agreed-upon procedures engagement pursuant to State law. 
  • Finding 6: Step Up expended $280,000 in FTC Program earnings for non-FTC programs.

Other audits have revealed that Step Up has financial irregularities that require further investigation. For example, Step Up earned $1.4M in interest on tax-credit dollars from 2016-18, which could have been used on up to 237 scholarships. Step Up President Tuthill defended using the interest money for non-program expenses by pointing to “start-up costs.” 

What Step Up Audit Reports DON’T tell us

  • With respect to Finding 1: Failure to properly evaluate household income (multi-year finding) – What is the remedy if a student/family has been awarded a scholarship for which they do not qualify?
  • With respect to Finding 2: This finding says that Step UP has 29 exempt employees, including the Senior Director of Development, Development Officers, Director of Marketing, and Managers of Community Outreach, who worked from home in Florida, Georgia, or Pennsylvania. Who are these employees and what work are they doing on behalf of Florida’s students? Why are they living and working out of state? How much are they being paid? 

NOTE: Proposed legislation under SB48 is changing the SFO audit requirement from annually to every three years.

What School Financial Reports Tell Us about Step Up compliance monitoring 

  • In 2019, there were 1,209 schools that received more than $250,000 of scholarship funds. Of the 1,107 who actually submitted the required reports, 28% contained material exceptions that ranged from inadequate segregation of duties to not utilizing an operating budget.
  • There were 78 schools that did not submit reports and 48 that submitted incomplete reports.

What School Financial Reports DON’T tell us

  • Which schools are in compliance and which are not? Is this information available to parents?
  • Who is monitoring the quality and appropriateness of the educational materials and services that are eligible for purchase using scholarship funds?
  • Who is monitoring the quality and academic outcomes for students attending private and religious schools?
  • Who is monitoring compliance with DOE regulations that require to qualify for scholarship money, schools must “comply with the anti-discrimination provisions of 42 U.S.C. s. 2000?” That statute is part of the 1964 Civil Rights Bill, and says “No person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.

Charitable donations as a means to avoid taxes

Per the Florida Department of Revenue, “The (Florida Tax Credit) program allows taxpayers to make private, voluntary contributions to eligible nonprofit scholarship-funding organizations and receive a dollar-for-dollar credit against the following Florida taxes;”

  • Corporate income tax;
  • Excise tax on liquor, wine, and malt beverages;
  • Gas and oil production tax;
  • Insurance premiums tax; and
  • Sales and use tax due under a direct pay permit

What this means is that “donations” made to Step Up are not coming from the company’s assets, but by diverting taxes owed that would have gone into the state’s general revenue fund to pay for government services, including public schools. Since its inception, over $3 billion has been diverted, primarily to Step Up. In 2019 Step Up received $618 million from 250 donors. To date, 1,799 private schools participate in the tax credit scholarship program, 66% of which have a religious affiliation.

The “donations” appear to come primarily from the following since 2010:

  • Alcohol Distribution Industry ($1.3B)
  • Insurance Industry ($75M)
  • Healthcare Industry ($104.5M)
  • Financial Services Industry ($45.5M)
  • Banking Industry ($14.2M)

Notable donor/tax credit companies include:

  • Southern Glazer’s Wine & Spirits (largest single donor at $615M thru 2019), 
  • Geico Insurance, 
  • AutoNation Insurance, 
  • Humana Insurance, 
  • Iberiabank
  • Continental National Bank, 
  • United Healthcare, 
  • HCA Healthcare, 
  • HMS Host Restauranteur, 
  • Raymond James Financial, 
  • Waste Management, 
  • Skechers USA, and 
  • Circle K Stores. 

It is interesting to note that the Step Up website has not listed its corporate donors since 2018. Why have they gone dark? Perhaps due to negative publicity when it was revealed that many of the religious schools receiving scholarships had policies discriminating against LBGTQ students, employees, and families.  Some corporations withdrew their tax credit donations, including Wells Fargo, Fifth Third Bank, and Wyndham Destinations.

An expanded voucher program marches on

Using the tax credit donations, Step Up awards scholarships to qualified families, based upon ever-changing criteria. What started as a program to assist low-income families obtain funds to attend private schools (Florida Tax Credit Scholarship), has morphed into four additional programs for students with special needs (Gardner Scholarship), students who have been bullied (Hope Scholarship), students who attend a low-performing public school (Family Empowerment Scholarship), and students with low reading scores (Reading Scholarship).

The income eligibility threshold continues to rise, with pending legislation in 2021 rising to 300% of poverty level ($78,600 for a family of four), with annual increases going forward. There is no income threshold for students with disabilities or homeschooled students. And once a child qualifies for a scholarship, they keep it through 12th grade regardless of whether the family income grows.

New proposals through Senate Bill 48 will convert the five current scholarship programs into two ESA’s (Educational Savings Accounts) where recipients have full choice of spending on an array of approved goods and services and/or private school tuition. Leftover ESA funds can be banked for future college funds. The proposed ESA’s will be funded from a Trust Fund using general revenue funds as well as tax credit donations, which raises interesting constitutional questions.

During the Senate Education Committee debate during the 2021 Legislative Session, Senator Manny Diaz, Jr., the chief proponent of the new ESA program, assured the Committee that the program had ample guardrails to prevent fraud and abuse. However, what our Task Force has learned about Step Up makes us wonder if these guardrails are made of toothpicks.

Follow the money: Step Up and politics

This is an area that needs deeper delving, as it is difficult to trace the various PAC’s  (Political Action Committee) and entities that make campaign contributions under the radar. One place to start would be with Miami Senator Manny Diaz, Jr. (not to be confused with Manny Diaz who heads the Florida Democratic Party). 

Senator Diaz is the driving force with expanding charter and scholarship programs. He has inherent conflicts with his employment with Academica, a for-profit charter school management company. Senator Diaz also operates a PAC called Better Florida Education PC, which reported $1,152,070 in donations in 2021.Step Up President Doug Tuthil was quoted in 2011 on YouTube saying, “One of the primary reasons we’ve been so successful (is) we spend about $1 million every other cycle in local political races, which in Florida is a lot of money. In House races and Senate races, we’re probably the biggest spender in local races.” Is Step Up still making campaign contributions as a 501-c-3 non-profit organization?

We attempted to connect the dots to find connections between Step Up and campaign contributions to key legislators, as well as from corporations receiving tax exempt benefits. This again proved difficult given the practice of bundling individual contributions into groups with vague names such as Floridians for Good Government.

A driving force behind the ESA expansion is to create a cottage industry of start-ups and business ventures. In a presentation to the Florida Senate Education Committee, Tuthill was enthusiastically promoting opportunities for business to offer goods and services to growing numbers of parents who can choose what to purchase.

Step Up has conveniently created a portal on their website called “My Scholarshop” with direct links to vendors. It would be interesting to discover any links between the vendors and legislators, Step Up board members, or staff? 

Constitutional issues

The Tax Credit Scholarship program is an ingenious way to skirt constitutional issues such as the separation of church and state. By using Step Up, a non-profit entity, as a pass-through, the state is not directly funding the vouchers to religious schools.

In 2017 the Florida Supreme Court dismissed a law suit filed by the Florida Education Association for “lack of taxpayer standing” since the scholarships were funded from donations rather than tax revenue. The question remains whether the expanded ESA program will have the same protections.

Separate and unequal

In their book A Wolf at the Schoolhouse Door, authors Jennifer Berkshire and Jack Schneider ask, “Where does this end?” Some have suggested the ultimate goal is to create a completely parent-driven system where scholarships are available to all. Others have pointed out the cost-savings of privatizing the education system, eliminating the state’s responsibility to monitor the quality of educational programs, certify professional teachers, build safe school buildings, and provide annual assessments of learning progress.

When asked about quality control and learning outcomes, voucher proponents always revert to “parent choice.” It is up to the parents to make those determinations about “what is best for their child.” This assumes that all parents are up to the task.Are we on the road back 200 years ago when schooling was solely a parent’s responsibility? Parents back then cobbled together clusters of one-room schoolhouses and private tutoring. 

Parents with means had access to private schools with qualified teachers, while the Catholic Church created a system of parochial schools.

As the industrial age approached, it was clear that this parent-driven school system was inadequate for a modern society. In 1838, Horace Mann founded and edited The Common School Journal. Mann is considered the father of public education. His six main principles for creating public schools were:

  1. the public should no longer remain ignorant;
  2. that such education should be paid for, controlled, and sustained by an interested public;
  3. that this education will be best provided in schools that embrace children from a variety of backgrounds;
  4. that this education must be non-sectarian;
  5. that this education must be taught using the tenets of a free society; and
  6. that education should be provided by well-trained, professional teachers.

It is ironic that in the post-industrial information age, the Florida Legislature is promoting a system that was abandoned years ago. The Covid Pandemic has laid bare the importance of being highly educated to survive and thrive in a technological age. A high-quality education is more important than ever. This means highly trained teachers and a curriculum based on research and science. 

Reverting back to a cobbled-together system of home schools and religious schools in church basements will leave more children behind, and will lead to re-segregated schools based on race and income. Is this where Florida is headed?

Resources

This is a preliminary list of resources we found during our investigation. Others may find them helpful in uncovering more about the operations and conflicts with Step Up for Students.

John Kirtley: https://www.miamiherald.com/opinion/letters-to-the-editor/article235210632.html

John Kirtley: http://search.sunbiz.org/Inquiry/CorporationSearch/SearchResults?InquiryType=OfficerRegisteredAgentName&inquiryDirectionType=PreviousList&searchNameOrder=KIRTLEYJOHNF%20L040000768592&SearchTerm=Kirtley%20John&entityId=L04000076859&listNameOrder=KIRTLEYJOHNF%20L040000768592

Step Up For Students, Creation: https://en.wikipedia.org/wiki/Step_Up_For_Students

Step Up For Students, Promotion: https://www.politico.com/states/florida/story/2016/11/new-us-education-secretary-has-ties-to-florida-voucher-fight-107601

Step Up For Students & Donors: https://jaxkidsmatter.blogspot.com/search?q=Step+up+for+students+takes+down+their+annual+reports+to+hide+their+donors

Step Up For Students, Audit: https://www.news-journalonline.com/news/20190905/audit-finds-problems-at-floridas-step-up-for-students#:~:text=The%20audit%2C%20issued%20last%20week,students%20before%20it%20was%20fixed

Step Up For Students, Our Leadership Team: https://www.stepupforstudents.org/about-us/our-leadership-team/

Step Up For Student, Equal Opportunity: https://www.stepupforstudents.org/equal-opportunity-education/

Step Up For Students, Anti-gay policies: https://www.orlandosentinel.com/news/education/os-ne-vouchers-gay-students-updates-20200214-kprtbtsjfjbnhlsfat2asjfvle-story.html

Step Up For Students, Financial Reports: https://32n7ya2og9cc2147lx4e0my6-wpengine.netdna-ssl.com/wp-content/uploads/2019-2020-990-Form.pdf

Manny Diaz: https://www.miamiherald.com/opinion/letters-to-the-editor/article235210632.html

SB48, Bill Analysis: https://www.flsenate.gov/Session/Bill/2021/48/Analyses/2021s00048.aed.PDF

Alabama Opportunity Scholarship Fund, School Requirements: https://revenue.alabama.gov/wp-content/uploads/2017/05/Non-Public_School_Notice_of_Intent_to_Participate.pdf

Alabama Opportunity Scholarship Fund, Jeb Bush: https://yellowhammernews.com/bush-visits-alabama-raise-awareness-school-choice-low-income-scholarships/

POLITICAL CONTRIBUTIONS SUMMARY

Step up:  https://www.stepupforstudents.org/office-of-student-learning-2/teaching-learning/

Step up Advocacy: Voices for Choices.  https://www.stepupforstudents.org/step-up-voices-for-choices/

Step up Regional Councils:  https://www.stepupforstudents.org/office-of-student-learning-2/school-support/

Employee Giving:  https://www.stepupforstudents.org/donor-resources/employee-giving/

Kirtley vs AAA 

https://www.politico.com/states/florida/story/2019/04/18/school-choice-advocates-face-off-even-as-vouchers-win-support-972612

KEY LEGISLATOR PACs

https://www.news-journalonline.com/news/20191228/florida-legislatorsrsquo-pacs-amass-hundreds-of-millions-of-dollars/1

Sen. Wilton Simpson:  Pasco County, Trilby: Senate President

PACs:  Future Florida and Florida Green PAC, Jobs for Florida, Florida Republican Senatorial Campaign Committee $68,934,933.44

Senate Education Committee Republicans

Sen. Jennifer Bradley: District 5, Marion County; Education.  Husband is Rob Bradley, 

Chair of Senate Appropriations Committee

PAC:  Working for Florida’s Families https://www.opensecrets.org/campaign-expenditures/vendor?cycle=2020&vendor=Working+for+Florida%27s+Families

Sen. Doug Broxson: District 1, Okaloosa County; Pensacola Appropriations Subcommittee on Sen. Education, Appropriations

PAC:  none

Sen. Manny Diaz Jr:  District 36, Hialeah, Miami-Dade; Education, Appropriations, Appropriations Subcommittee on Education

PAC: Better Florida Education: http://www.betterfleducationpc.org/contributions.php

Manny Diaz Jr: https://www.transparencyusa.org/fl/candidate/manny-diaz-jr-can?cycle=2018-election-cycle

Sen. Joe Gruters: District 23, Sarasota; Education, Governmental Oversight and Accountability, Appropriations

PAC:  Republican Party of Florida $605,925,807.52

Sen. Travis Hutson District 7, Volusia County; Palm Coast Appropriations and Appropriations Subcommittee on Education

PAC:  First Coast Business Foundation $762,575

https://www.transparencyusa.org/fl/pac/first-coast-business-foundation-69922-pac/donors

Sen. Kathleen Passidomo: District 28, Lee County;   Appropriations, Appropriations Subcommittee on Education

PAC: Working Together for Florida

https://www.transparencyusa.org/fl/payee/working-together-for-florida-pac

Other School Choice Supporters 

Sen. Kelli Stargel: District 22 Lake; Appropriations Chair

PAC: None

Sen. Aaron Bean: District 4 Duval 

PAC: Florida Conservative Alliance $751,742.60 

https://www.transparencyusa.org/fl/pac/florida-conservative-alliance-60710-pac/donors?page=5

Lizbeth Benacquisto, District 27, Lee County: 

PAC:  Protect Florida Families $666,536.02

https://www.transparencyusa.org/fl/pac/protect-florida-families-fund-74099-pac

POLITICAL ACTION COMMITTEES 

American Federation for Children: Advocates for School Choice/Alliance for School Choice-Walton Foundation, Betsy DeVos https://www.politicalresearch.org/2012/08/01/rights-school-choice-scheme

Conservatives for Principled Leadership http://conservativesforprincipledleadership.com/

Conservative Solutions for Jacksonville http://conservativesolutionsforjax.com/

FAPSC-PAC https://www.fapsc.org/page/33

Federalist Society Members:  National group of conservative attorneys 

Fl Education Empowerment: Kirtley (closed)

Florida Federation for Children (Kirtley):  https://www.federationforchildren.org/about/

https://www.sun-sentinel.com/opinion/editorials/fl-op-edit-florida-voucher-schools-20210202-t7eunnz47vcezlzqys4ex6dfq4-story.html

*Victorious candidates supported by FFC:

https://www.federationforchildren.org/school-choice-supporters-victorious-florida-elections/

Floridian’s United for Our Children’s Future:  FP&L; U.S. Sugar, Florida Crystals Corp (aff. with Associated Industries of Florida). https://unitedforflchildren.com/

Contributions Reporting

Florida Elections Commission Campaign Finance Database https://dos.elections.myflorida.com/campaign-finance/contributions/

Center for Responsive Politics runs the Open Secrets https://www.opensecrets.org/

National Institute on Money in State Politics runs Followthemoney https://www.followthemoney.org/

Campaign Finance Database: https://dos.elections.myflorida.com/campaign-finance/contributions/#both

Florida Transparency USA https://www.transparencyusa.org/fl

NSPRA describes major funders of educational reform https://www.nspra.org/our_mission

Download the pdf here:

Peter Greene reviewed the Network for Public Education’s report on for-profit charter schools in Forbes, where he is a regular columnist.

He writes:

It has become cliche for politicians and policy makers to oppose “for profit” charter schools. It’s also a safe stance, because most people agree they’re a bad idea; for-profit charter schools are not legal in almost all states. 

But charter school profiteers have found many loopholes, so that while they may not be able to set up for-profit charters, they can absolutely run charter schools for a profit. That may seem like a distinction without a difference, but the difference is that one is illegal in almost all states, and the other, as outlined in a new report, can be found from coast to coast. The new report, “Chartered for Profit,” from the Network for Public Education examines the size and reach of “the hidden world of charter schools operated for financial gain.” (Full disclosure: I am a member of NPE.)

The most common workaround for operating a charter school for profit is a management corporation. In this arrangement, I set up East Egg Charter School as a non-profit; I then hire East Egg Charter Management Organization to run the school, and that is a for-profit operation (known as an EMO).

An EMO is an educational management operator.

In some cases, the school and EMO are enmeshed with each other, sometimes with family ties. In Arizona, Reginald Barr runs a non-profit EMO that manages four charter schools; he also, with his wife Sandra, runs for-profit Edventure, which collects $125 per student for managing the schools. The schools lease property from a company owned by the Barrs and hire another Barr company to handle payroll. The four charter schools are controlled by a single board; Sandra Barr and her mother hold two of the three seats.

Some of these management operations are large scale; the report finds that just seven corporations manage 555 charter schools across the country. But chartering for profit can work on a small scale as well; of the 138 for-profit management companies NPE studied, 73 ran only one or two schools. In other words, the EMO is created specifically to run one particular school, not as a stand-alone business venture...

No matter the scale, “sweeps” contracts are a common tool. The management company provides virtually all of the school’s services (building, maintenance, curriculum, payroll, etc) and may even contract not for a set fee, but, as one EMO contract states, it receives “as renumeration for its services an amount equal to the total revenue received” by the school “from all revenue sources.”

There are other ways to pull profits from these operations. Many charter schools are part of lucrative real estate deals. One audit in New York found that the Diocese of New York was renting a facility to NHA for $264,000 per year; National Heritage Academy (NHA) sublet that space to its charter school $2.76 million. Jon Hage, CEO of Charter Schools USA, also owns Red Apple Development, whose website displays 66 CSUSA schools that Red Apple developed and, in most cases, owns and leases.

Cyber-charters are particularly profitable, with one recent report suggesting that Californians are overpaying cyber charters by $600 million.

Please open the link and read about the vultures feeding on public school money.

Valerie Strauss of the Washington Post reviews the Network for Public Education report on for-profit charters, which explains how such money-grabbers function in states where they are supposedly illegal. Arizona is the only state where for-profit charters are legal, yet the report says they operate in 26 states and D.C. In Florida and Michigan, the majority of charters are run by for-profit companies.

Strauss points out that Joe Biden promised to cut off federal funding to for-profit charters. Here is a road map he can use to keep his promise.

She writes:

Now a new report, titled “Chartered For Profit: The Hidden World of Charter Schools Operated for Financial Gain,” details how many for-profit management companies (referred to as EMOs) evade state laws banning for-profit charters.


They set up nonprofit schools and then direct the schools’ business operations to related corporations. For example, it says, one of the largest EMOs, National Heritage Academies, “locks schools in with a ‘sweeps contract’ where virtually all revenue is passed to the for-profit management corporation, NHA, that runs the school.”


“In other cases, the EMO recommends their own related companies for services that include leasing, personnel services, and curriculum,” it says.


The report was produced by the Network for Public Education, an education advocacy group that opposes charter schools. It was written by Carol Burris, executive director of the Network for Public Education and a former award-winning New York principal, and Darcie Cimarusti, the network’s communications director.


The authors wrote that despite “strict regulations against the disbursement of funds from the federal Charter Schools Program (CSP) to charter schools operated by for-profit entities,” they identified more than 440 charter schools operated for profit that received grants totaling approximately $158 million between 2006 and 2017.


They also found that fewer disadvantaged students, proportionally, attend charters run for profit than at traditional public schools.


“Comparing the five cities with the most for-profit charter schools (by the proportion of students attending these schools) revealed that in all but one city — Detroit — for-profit run charters served far fewer students who are eligible for free or reduced-price lunch,” the report says. “In all cities, for-profit-run schools serve fewer students who receive services” under the federal Individuals With Disabilities Education Act.


Charters schools are publicly financed but privately operated. About 6 percent of U.S. schoolchildren attend charter schools, with 44 states plus the District of Columbia, Guam and Puerto Rico having laws permitting them.


Charter advocates say that these schools offer choices to families who want alternatives to troubled schools in traditional public school districts. Critics say that charter schools take money from public districts that educate most American children and are part of a movement to privatize public education.
This report is the third on federal funding of charter schools that the Network for Public Education has published since 2019. The earlier reports chronicle the waste of hundreds of millions of taxpayer dollars on charter schools that did not open or were shut down — and revealed that the U.S. Education Department failed to adequately monitor federal grants to these schools. You can learn about the first two reports here and here.


For years, charter schools enjoyed bipartisan support — and were backed by the administrations of presidents George W. Bush, Barack Obama and Donald Trump. But more recently, many Democrats have become skeptical of the charter movement, especially those schools that are operated or managed by for-profit entities — and Biden has vowed to stop federal funding for-profit charters.


But what is a for-profit charter?
“The term ‘for-profit charter school,’ while commonly used, does not accurately describe the vast majority of charters designed to create private profit,” the new report says.


While only one state — Arizona — legally allows for-profit entities to be licensed to operate charter schools, for-profit entities find ways to set up schools in states that only allow nonprofits to operate, it says.
The new report explains that typically, an EMO would find individuals interested in operating a charter school and then help “them create a nonprofit organization and apply for a charter license.”


Then, the board of the nonprofit group “enters into a contract with the for-profit EMO to run the school,” the report says. For-profit owners “maximize their revenue through self-dealing, excessive fees, real estate transactions, and under-serving students who need the most expensive services,” the Network for Public Education says.


Between September 2020 and February 2021, the authors said they identified more than 1,100 charter schools that have contracts with one of 138 for-profit organizations to control the schools’ key — or total — operations, including management, personnel and curriculum...

The report’s authors make recommendations to the U.S. Education Department and states regarding charters that are operated for profit, including:


• The Education Department “should conduct an extensive audit of present and former grantees to ascertain compliance with all regulations that define the for-profit relationship.”

• The federal government “should define a for-profit charter school as a school in which more than 30 percent of all revenue flows directly or indirectly to for-profit vendors.”

• All states should “follow the lead of Ohio by listing the management providers and posting their contracts with charter schools. To that information, the profit status of the EMO should be added.”

• Sweeps contracts should “be outlawed in every state.”• Related corporations of for-profit and nonprofit management companies should “be prohibited from doing business with their managed charter schools.”

• All charters should “be held by the school or campus itself, and not by a nonprofit subsidiary.”• A national database should “be developed that lists all charter EMOs and their corporate status (for-profit or nonprofit), along with their address and the name(s) of the private corporation’s owner(s).”

The mainstream media are filled with warnings about “learning loss” and how we must measure it and why students should go to summer school to make up for what they have “lost.” If we can’t quantify it, they say, how can we know which students are behind? This is silly. There was no “pre-test,” so there can’t be a “post-test.” A test that students take this spring can’t possibly demonstrate “learning loss,” since they can’t be compared to anything else. If you want to know where students are in their learning, ask their teacher.

Here are some good readings on “learning loss.”

Peter Greene gathered some and calls his post a “learning loss debunkery reader.” And don’t miss Peter’s personal tale of his own “learning loss.” It began right after high school graduation, when he realized he had forgotten algebra!

Russ on Reading turned “learning loss” into a Henny Penny fable, in which the wolves are trying to get into the henhouse.

“Wait a minute. Are we sure our children have lost their learning? I know a year away from the schoolhouse is concerning. And I know the online learning is not as good as beak to beak learning, but just what are we worried about here. Our children are learning lots of things. They have learned how to make the best of a bad situation. They have learned how we all need to pitch in to help each other. They have learned to wear masks in public. They have learned a lot about communicable diseases. They may have different learning this year, but is that the same as losing learning?  Before we let the foxes into the hen house, we better be sure there is a big problem.”

The Zoom meeting went silent. Goosey Loosey shut down Foxy Loxy’s Zoom feed. She said, “You know maybe we have bigger things to worry about than learning loss. I am going to go read my chicks a book.”