Archives for category: For-Profit

Nora de la Cour is a high school teacher and writer. This article about the sham of for-profit remote instruction appeared in Jacobin. Study after study has demonstrated the poor results of virtual instruction, but the research does not deter the greedy entrepreneurs who see the profit in virtual charter schools. You may recall the recent press release from the National Alliance for Charter Schools about how charter schools increased enrollment by 250,000 during the pandemic; what the press release didn’t admit was that the “increase” was due entirely to growth in virtual charter enrollments, which may turn out to be a temporary response to the pandemic.

De la Cour sees the push for for-profit remote learning as another front in the privatization movement.

She begins:

In spring of 2020, we saw signs that billionaires and neoliberal politicians were looking to use the COVID-19 lockdown to finally eliminate one of the last remaining venues where Americans convene in the practice of democratic self-governance: the brick-and-mortar schoolhouse.

Plutocrat-funded techno-optimists giddily suggested we use the temporary requirement of virtual learning to test-drive modelsthat give families more “flexibility” and “freedom.” Then-governor Andrew Cuomo formed a partnership between New York state and the Bill & Melinda Gates Foundation to explore a post-pandemic future without “all these physical classrooms.” Betsy DeVos announced $180 million in grants for states to “rethink” K–12 learning, and her cohort of privatization pushers began licking their chops.

Advocates of public education were rightly horrified, recognizing that this would amount to a further hollowing out of one of our last remaining public goods. Fortunately, a combination of factors turned the discourse emphatically back in favor of preserving in-person K–12 learning as the American standard — for now.

The nearly universal problems with remote instruction last year made it politically impossible for the privatization crew to continue arguing that e-learning is the glittery new frontier of educational progress. In fact, survey data shows that a majority of parents disapprove of any kind of change to traditional schooling. This is despite a relentless onslaught of rhetorical attacks on public schools — from the bipartisan vilification of teachers’ unions to right-wing attempts to use mask mandates and critical race theory to breed ill will among parents. The term “school choice” has apparently become so distasteful that school choice conservatives are looking to rebrand their body blows to public education as a “school freedom” and “parents’ rights” movement. They’re winning legislative battles in diverse states, but they’re losing the war for public opinion.

It’s widely accepted that in-person schools meet critical developmental needs and are necessary for most students. Nevertheless, the pandemic has swiftly accelerated the expansion of digital instruction. Public education advocates are now at a crossroads. We can either proactively define the relationship between remote and in-person schooling, or we can watch from the sidelines as private companies claim a monopoly over distance learning and use it to undermine public education.

Open the link and read the whole article.

A regular reader called Bethree summarized the Rhode Island situation, in which friends of the Governor won a $5 (plus) million contract, although the corporation was formed only weeks before the contract was awarded and was the high bidder.

She wrote:

Read the wpri.com coverage 9/7,8,14 for the nitty-gritty (google wpri.com McKee ILO). As a one-time procurement supervisor for an engrg co, I found it highly entertaining.

Summary: ILO was incorporated 2 days after McKee’s March 2 election, and invited by his office to submit a bid for the work March 23. 5 bids received in April: 3 bidders knocked out during tech evaluation.

The two remaining bids– $8million vs just under $1million, made it obvious that the scope of work was, shall we say, imprecise. Results of rebid (? Or perhaps just an arm-wrestling session—unclear): ILO $6million, other guy $3million. ILO was apparently given the nod due to its long work history of absolutely bupkis, sadly other guy’s 20-yr history as a state ed consultant just… didn’t measure up. But, no worries– West Ed gets to share the spoils: $5million for ILO [scope K12], $1million for WestEd [scope colleges, U’s]. “’The Review Team believes that no additional time should be wasted on this procurement or a rebid,’ the four-member panel’s final report said.”

“We’ve supported people who get the work done…” McKee said at his weekly news conference Tuesday. “So it didn’t matter who referred or who may have had a relationship. I just want good people who can figure out how to help the state of Rhode Island and education, and that’s what we got.”  

“Magee [CFC boss & close McKee buddy/ donor via his brother’s 50CAN PAC] said Chiefs for Change isn’t working with ILO on the contract.” ROFL. Let’s just pretend we didn’t notice ILO was incorporated virtually yesterday, and its partners left Chiefs for Change to form ILO.

The state’s bid package put ILO in the catbird seat from the get-go. Although RI is paying for this work out of Covid-19 aid fed funding, the scope asked for expansion of “municipal education offices” outside the purview of traditional LEA’s. That’s a scheme realized in Cumberland by then-Mayor McKee and buddy Magee of CFS. McKee has 5 more such offices planned, to be run out of his office, for the [state-run] Providence school system. A full half of ILO’s proposed workhrs are devoted to that thinly veiled ed privatization; stated goal “to address lost learning and catch up and long-term learning programs.”

That leaves $2.5million for safe school reopening during covid. How is ILO doing 2 wks after students returned to bldgs? “…RI Assoc of School Committees exec dir Tim Duffy… surveyed all school supts and school chairs… ‘So far, there’s only one district that’s asked the ILO Group to review their school reopening plans, and that was Little Compton. The rest… haven’t been contacted and are not even aware of the services the consulting firm offers… reopening efforts this year have been guided by the U.S. CDC, the RI Dept of Health and RI Dept of Education.” He also noted the timing of the ILO news: ‘School reopening has already happened.’ Duffy’s comments contrasted with ILO’s Tuesday, when partner Cerena Parker cited helping schools reopen as one of the consulting firm’s biggest accomplishments so far.”

Christopher A. Lizotte of the University of Washington and Dan Cohen published an interesting research paper about how market-driven policies have been promoted and sold. The paper was published in 2014-2015, and the trends described here have become more powerful, promoted by some of the wealthiest people in the nation. The title of the paper is “Teaching the Market: Fostering Consent to Education Markets in the United States.”

Abstract. Marked-based reforms in education have garnered the support of politicians, philanthropists, and academics, reworking the nature of public education in the United States. In this paper we explore the methods used to produce consent for market-based reforms of primary and secondary (K-12) schooling in the United States, focusing on two case studies to interrogate how this consent is generated as well as how these reforms are resisted in place. In doing so we illustrate how market-making in public services is a contested terrain and the importance of understanding the nature of their roll-out at the local level.

Here is a brief excerpt:

We understand this shift toward marketization in education and its recent acceleration as being situated within the broad neoliberal shift towards privatization and deregulation of formerly public goods that has taken place over the past thirty years. As in other sectors that have been subject to this treatment, this process has occurred not simply through the retreat of the state but through the deliberate repurposing of the state to reshape its institutions in the image of a market (Peck and Tickell, 2002); indeed, many of the reforms that have taken place within education are the result of explicit state policies to create market pressures within education (Lubienski, 2005): These policies include (to name a few): the imposition of standardized testing as a method through which schools can be ‘judged’ by the market, the threat of school closures for ‘failing’ schools, and the use of selective grants to reward schools and districts conforming most closely to principles of deregulation and privatization. Crucially, however, these marketization processes require careful priming in order to generate public consent for market-based reforms. In particular, the marketization of education is powerfully promoted through the notion of school ‘choice’. Presented as an apolitical and socially neutral mechanism for allowing parents to maximize their children’s educational opportunities, choice is endowed with a moral authority that obscures the power inherent in who can exercise the power to choose and the available range of choices. This choice, it is argued, finds its natural expression in the expansion of markets as a supposedly level playing field where the best-performing options rise to the top and those that fail are eventually discarded. Indeed, as Rose (1999) claims, choice, defined as the individual maximization of opportunities, has become the litmus test by which good membership in the polity is defined. In this light, the term, like those used to describe other market-making projects in public services, hides assumptions about what kinds of choice can be legitimately exercised and under what circumstances. The power to ‘choose’ as it is understood under contemporary capitalism is a highly individualized capacity that seeks to maximize one’s return on investment. Other alternative possibilities tend to fade out of view in the language of most market-based school reformers.

Carol Burris, executive director of the Network for Public Education, wrote the following:

As you know, the House is trying to block federal funding to charters controlled by for-profits. But it will be an uphill battle. I recently did an investigation into the private sale of 69 charters by for-profit NHA. It is jaw-dropping. Please read about it and share. This is a critical time to get the word out. Thanks, Carol

https://www.washingtonpost.com/education/2021/09/14/charter-school-scams/

Jan Resseger, a prominent social justice advocate in Ohio, recently wrote about Jeb Bush’s cliche-ridden defense of for-profit charter schools. The House of Representatives passed a budget proposal to prohibit federal funding of them. Jeb Bush is a relentless proponent of privatization:

Her commentary was published by the National Education Policy Center. She begins:

It’s clear that the charter school lobby is upset about the House of Representatives’ effort in its proposed budget resolution to curtail abuses in the federal Charter Schools Program and to reduce the program’s appropriation by $40 million in the upcoming fiscal year.

Jeff Bryant explained last week: “The top lobbying group for the charter school industry is rushing to preserve millions in funds from the federal government that flow to charter operators that have turned their K-12 schools into profit-making enterprises, often in low-income communities of color. The group, the National Alliance for Public Charter Schools (NAPCS), objects to a provision in the House Appropriations Committee’s proposed 2022 education budget that closes loopholes that have long been exploited by charter school operators that profit from their schools through management contracts, real estate deals, and other business arrangements.”

The executive director of National Alliance for Public Charter Schools, Nina Rees went on C-Span to try to defend the program, and now it’s clear that the organization is calling on old allies to push Congress to cancel the House Appropriations Committee’s proposed elimination of all federal funding for charters operated for-profit by Charter Management Organizations. Bryant reminds us that Nina Rees was the deputy assistant for domestic policy for former Vice President Dick Cheney.

This week Jeb Bush, the ultimate old advocate for school privatization, came out of the woodwork with an op-ed circulated all over the country by the Tribune News Service. Bush’s piece appeared in our Sunday Cleveland Plain Dealer. Toward the end of his article, Bush gets to the point and protests the proposed House Budget Resolution: “Not only does it specifically cut $40 million in education funding (from the Charter Schools Program), but the House budget bill also includes alarming language that would prevent any federal funds from reaching any charter school ‘that contracts with a for-profit entity to operate, oversee or manage the activities of the school.’”

Bush thinks that the U.S. Department of Education ought to be allowed to make grants to charter schools whose operators are, in many cases, collecting huge profits at the expense of our tax dollars and at the expense of children whose education programming is reduced to ensure operators can make a profit. I guess he isn’t bothered by the charter management companies that have managed to negotiate sweeps contracts that gobble up more than 90 percent of the state and federal operating dollars and manage the school without transparency.

Open the link and read the rest.

Peter Greene writes in Forbes about the furor that erupted when House Democrats passed legislation to ban federal funding of charters managed by for-profit organizations. The charter industry and its lobbyists went bonkers, falsely claiming that the bill would prevent them from buying food from for-profit companies or hiring plumbers who work for profit.

He wrote:

The House Appropriations Committee has caused a stir with one tiny paragraph in its 198-page health, labor and education spending bill.

SEC. 314. None of the funds made available by this Act or any other Act may be awarded to a charter school that contracts with a for-profit entity to operate, oversee or manage the activities of the school.

The presence of for-profit operators in the charter school sector has long been a concern for critics, with almost all states outlawing a charter school strictly run for profit. But charter school operators have long worked a variety of loopholes, keeping the sector a highly profitable one, and most of those loopholes involve a non-profit charter school hiring a for-profit business. null

We are not talking about contracting services like school buses or cafeteria management; these kinds of side functions are frequently contracted out both in charter and public schools, but they are not the school’s primary activities.

The bill is clear and specific about targeting for-profit entities that “operate, oversee or manage the activities of the school.”

Sometimes the money comes from the real estate side of the charter business. There is such a thing as a business that specializes in charter schools and real estate. In some states, the government will help finance a real estate development if it’s a charter school, and in general developers have noted an abundance of cash. Though, as one charter real estate loan bond financier told the Wall Street Journal, “There’s a ton of capital coming into the industry. The question is: Does it know what it’s doing?” Many states have found a problem with charters that lease their buildings from their own owners as well. null

One example of a real estate operator making money from the real estate side was Carl Paladino of Buffalo. Paladino worked with charter operators via flipping properties and making “leaseback” deals, as detailed in a report from the Alliance for Quality Education. Paladino not only profited from the schools, but from investments in surrounding properties. He was not shy about any of it. On the question of making money from working with charters, the Buffalo City News quoted him: “If I didn’t, I’d be a friggin’ idiot.”

While many charters may contract out critical functions such as curriculum, the extreme cases are what are called “sweeps” contracts, in which the charter management organization (CMO) fully runs the school in exchange for as much as 95% of the revenue that comes in. A report that the Network for Public Education issued earlier this year details many of the creative ways that CMO’s turn a profit. CMO’s come in a variety of sizes, from chain operations running many schools all the way down to mom-and-pop CMOs that run a single school.

These arrangements can become convoluted. In Florida, one charter founder moved on and off the board of directors regularly to allow payments from his school to himself, and while the school was having trouble paying teachers, it was paying his company tens of thousands of dollars to license the school logo.

One could argue that outlawing for-profit charters actually made things worse, and that what would have been clear and open attempts to profit from a school are now hidden behind multiple operational layers.null

But all of this still leaves a simple question—what’s wrong with having charter schools managed, directly or indirectly, for profit?

In the rest of the article, he explains why for-profit charters are a terrrible idea.

Jeff Bryant is one of the best informed writers about charter schools in the nation. He is chief correspondent for Our Schools and director of the Education Opportunity Network. He explains here why the charter industry is using misinformation to stop a Democratic proposal to ban federal funding for for-profit charter schools.

He begins:

The top lobbying group for the charter school industry is rushing to preserve millions in funds from the federal government that flow to charter operators that have turned their K-12 schools into profit-making enterprises, often in low-income communities of color.

The group, the National Alliance for Public Charter Schools (NAPCS), objects to a provision in the House Appropriations Committee’s proposed 2022 education budget that closes loopholes that have long been exploited by charter school operators that profit from their schools through management contracts, real estate deals, and other business arrangements. NAPCS also objects to the legislation’s proposal to cut 9 percent from the federal government’s troubled Charter Schools Program (CSP).

The House budget proposal, which was passed out of the majority Democratic committee “in a party-line vote,” according to the Hill, has been praised by numerous education groups, including the National School Boards Association, the National Education Association, and the National Center for Learning Disabilities, for, among many things, more than doubling Title I funding for schools serving low-income children, providing over $3 billion more to educate students with disabilities, and increasing federal spending on K-12 education programs, Education Week reports.

The legislation mostly aligns with the President Biden administration’s proposed budget for K-12 spending, as reported by Chalkbeat in April 2021, and the provision ending federal funding of for-profit charter school operators reflects Biden’s pledge, made in his presidential campaign, to “not support any federal money for for-profit charter schools, period.”

The For-Profit Charter Problem

The specific provision regarding for-profit charters that NAPCS objects to states, “None of the funds made available by this Act or any other Act may be awarded to a charter school that contracts with a for-profit entity to operate, oversee or manage the activities of the school.”

Controversies over for-profit charter school operators are long-standing and largely unresolved

As University of South Carolina law professor Derek Black explains on his personal blog, “Most states require charter schools to be nonprofit. To make money, some of them have simply entered into contracts with separate for-profit companies that they also own. These companies do make money off students.”

A 2021 report by the Network for Public Education (NPE)—an organization co-founded by education historian Diane Ravitch that advocates for public schools—examined more than 1,000 charter schools that were contracted with for-profit management companies and found that the schools’ nonprofit boards were often mere fronts for profit-making enterprises that use the charter schools they operate to “maximize their profits through self-dealing, excessive fees, real estate transactions, and under-serving students who need the most expensive services.”

Among the practices that for-profit charter operators employ, according to the NPE report, is to establish “sweeps contracts” that “give for-profits the authority to run all school services in exchange for all or nearly all of the school’s revenue.”

The report also “identified over 440 charter schools operated for profit that received grants totaling approximately $158 million between 2006 and 2017,” from the CSP, despite “strict regulations” against awarding CSP funds to charter schools operated by for-profit entities…

NAPCS’s president and CEO Nina Rees told a CNN reporter that the legislation “could impact schools that contract out for cafeteria services, special education services, or back office staff…”

After the CNN article was published, it was updated with a quote from Connecticut Representative Rosa DeLauro, a Democrat who chairs the House committee that drafted the proposal, who called NAPCS’s petition campaign “a well-funded misinformation campaign,” and said, “The language [of the proposed legislation] is clearly focused on ending the practice of charters accepting federal funds only to have the school run by a low-quality, for-profit company rife with conflicts of interest.”

National Alliance for Public Charter Schools’ Nina Rees talked about congressional efforts to reduce federal funding of charter schools.
— Watch on www.c-span.org/video/

House Democrats want to ban for-profit charter management organizations, as Biden promised. Rees thinks this is terrible. CSPAN quotes the NPE report on for-profit EMOs (Chartered for Profit). Listen to call-ins at the end, which are opposed to charters. One call-in comes from Carol Burris, who wrote the NPE report. Rees makes for/profit charters sound benign. They are not. They are in it for the money.

Being an eduEntreneur does not always pay off. Chris Whittle founded the Edison Project, which was supposed to be for profit, but after much turmoil, its stock price plummeted, and he moved on. (Read Samuel Abrams’ fascinating history of the Edison Project in Education and the Commercial Mindset).

Most recently, Whittle founded Avenues, which was planned to be a global chain of boutique for-profit, private schools. Tuition at the state-of-the-art Avenues in NYC is $59,800. It’s opening was announced Ina full-page ad in the New York Times.

A few years ago, Whittle and Avenues parted company. In 2014, Whittle listed his 11-acre home in the jet-set Hamptons for $140 million, but it didn’t sell.

The Wall Street Journal recently reported that Whittle’s property in the Hamptons was purchased by the Avenues Global Holdings for $700,000 and will be sold to pay off the $6 million debt that Whtitle owes the school.

In an auction that took place Tuesday morning, Avenues was awarded right and title to the property, subject to other liens, for a credit bid of just $700,000, the spokeswoman said. The auction was a forced sale to satisfy more than $6 million in debts owed to Avenues by Mr. Whittle. Avenues expects to officially take title to the property next week and will make plans for the property soon after, the spokeswoman said.

“We hope that this facilitates the recovery of the more than $6 million that remains owed and unpaid to Avenues,” the spokeswoman said.

The property had been on the market most recently for $95 million, down from the $140 million Mr. Whittle first listed it for in 2014, The Wall Street Journal reported.

Reached by phone, Mr. Whittle said he has “had better days.” He said he had taken out a very large mortgage on the property in order to fund his latest venture, Whittle School & Studios, another for-profit school network, but the Covid-19 crisis derailed his plans.

Nancy Bailey writes here about the growing influence and persistence of the billionaire-funded groups that want to privatize our nation’s public schools.

Despite the substantial research that shows the ineffectiveness of free market school choice, the school choice in undeterred. As Bailey shows, “reformers” (disrupters) have become influential voices in the Biden administration and have created new groups to press their agenda of privatizing public schools. The new dean of the Harvard Graduate School of Education is a free market “reformer.”

Despite the persistent failure of the “reformers’” strategies, they press on, attacking public schools, supporting state takeovers, fighting to expand charters and vouchers. The billionaires continue to pour millions into their hobby, which is chicken feed to them.

This is an important article. Please read it.