The Los Angeles Times ran a first-page story about the latest charter school scandal, only a day before the school board election that will decide whether charter advocates will take control of the Los Angeles school board.
There will likely be a low voter turnout for this special election, and the question is turnout: Will enough parents vote to save their public schools, or will the profligate spending of the charter industry on propaganda and false attacks ads enable them to privatize the schools of half the students in the district? If the charter billionaires win, look for more privately run charters that produce incompetence, plunder, profit, and power for the elite.
The big story today is about Celerity Education Group, a charter chain that is thriving with public money. Its CEO is Vielka McFarlane.
In 2013, she earned $471,842, about 35% more than Michelle King, the superintendent of the Los Angeles Unified School District, makes today.
McFarlane was prospering, and it showed. She wore Armani suits, ate at expensive restaurants and used a black car service.
Financial records obtained by The Times show that, as Celerity’s CEO, she paid for many of these expenses with a credit card belonging to her charter schools, which receive the bulk of their funding from the state.
It could not be determined whether McFarlane, 54, ever reimbursed the charter schools for her credit card purchases. Neither she nor a lawyer hired by Celerity responded to requests for comment about the transactions.
At a time when charter school advocates are determined to increase the number of such schools in L.A., the story of McFarlane and the Celerity schools offers a case study of the growing difficulty of regulating them. The task of spotting and stamping out risky financial practices in charters largely falls to the school district’s charter schools division, which employs about a dozen people dedicated to monitoring the schools’ fiscal health.
But as the number of L.A. charter schools has grown to more than 220, enrolling about 111,000 students, oversight has become a challenge for district officials, who are at once competitors and regulators.
In 2012, L.A. Unified’s charter schools division made a routine request for financial records from the Celerity Educational Group.
When the school network’s credit card statements arrived that fall, many of the transactions had been blacked out. One page was nearly all black.
Concerned school district staff grew even more alarmed when they received the full records, which showed that McFarlane had paid for lavish meals and out-of-state travel on the nonprofit’s credit card.
In one month in 2013, she had spent $914 at the Arroyo Chop House in Pasadena, $425 at The Lobster, a seafood restaurant in Santa Monica, and $355 at Paiche, a now-closed Peruvian restaurant in Marina del Rey.
From the arrival of the credit card statements until 2015, when it refused to allow Celerity to open two new schools, L.A. Unified took a gentle approach to the charter group’s unorthodox practices. It sent notices urging the organization to institute tighter financial controls, but continued to renew the schools’ charters when they came before the school board.
L.A. Unified officials referred Celerity’s credit card transactions to the district’s inspector general, who eventually opened an investigation into the group’s finances. Then, in late January, federal agents from the Department of Homeland Security, the FBI and other agencies raided Celerity’s offices, as well as the headquarters of a related nonprofit, Celerity Global Development, and McFarlane’s home. The focus of the federal investigation is unclear, and the district’s inquiry is ongoing…
While the district investigated, Celerity went national, expanding into Ohio, Florida and Louisiana, where it operates four schools in addition to the seven it runs in Southern California. McFarlane launched Celerity Global Development, the parent company of the schools in her growing empire, and began offering herself as a consultant to other charter school leaders.
In 2015, McFarlane became the CEO of Celerity Global, an organization that took in millions of dollars in management fees from Celerity’s schools. But Global wasn’t just supporting the schools; it had the power to control Celerity Educational and could appoint and remove the school network’s board members.
The Celerity schools were often short on supplies, but McFarlane spent lavishly on herself and arrived at school in a chauffeur-driven limousine.
She told staff that education was a business. And she knew how to make money–for herself and her lavish tastes.
As the CEO of Celerity Educational Group — and now of Celerity Global — McFarlane steered hundreds of thousands of public dollars to several companies providing services to her schools. Those companies are registered to her, state records show, and list their addresses as either Celerity Educational’s or Global’s offices.
Celerity Educational Group’s check register for the 2015-16 school year shows payments totaling nearly $1 million to an information technology company called Attenture, a general contracting company called Celerity Contracting Services, and Celerity Development, a limited-liability corporation that buys properties and rents them to McFarlane’s charter schools.
The organization has also paid thousands of dollars to Orion International Academy, a private high school in Chino Hills that McFarlane founded in 2013, and where she is still the CEO.
The flow of money from the charter schools to Celerity Development is documented going back to 2011, when Celerity Educational Group signed a 10-year lease with the company, which at the time had only one owner — McFarlane. That made her, in effect, both landlord and tenant of the two sites in South L.A. on which she expanded Celerity Dyad Charter School.
McFarlane’s brother and son are on the company’s payroll. The financial entanglements among the many companies raise ethical and legal questions. Some quoted in the article suggest that there may be felonious behavior.
By late 2015, L.A. Unified officials decided they had seen enough.
Having concluded that Celerity’s financial issues had become too serious to tolerate, they recommended that the school board refuse the group’s request to open two new schools, and the board agreed. Celerity’s leaders appealed to the Los Angeles County Office of Education, which could have intervened, but chose not to.
“This is effective ongoing oversight,” Jose Cole-Gutierrez, the director of L.A. Unified’s charter schools division, said in a recent interview.
Not that it stopped Celerity’s Southern California expansion.
State law allows charter schools that have been denied at the local level to appeal to the state. Last November, over the objections of L.A. Unified and the county, the State Board of Education voted to let Celerity keep growing.
More public money will flow Celerity’s way this fall when it opens two new L.A. charter schools.
Question: In light of the FBI investigations, in light of the LAUSD investigations, in light of the concerns about conflicts of interest and self-dealing, why did the California State Board of Education overrule the LAUSD recommendation and the L.A. County Office of Education? Why did the State Board of Education decide that this charter chain should open two more charters before the investigations are completed? Why aren’t the legal authorities intervening to protect citizens and the law?
If you live in Los Angeles, vote tomorrow.
Vote for either Carl Petersen or Lisa Alva.
Vote for Steve Zimmer.
Do not vote for anyone endorsed by the California Charter School Association, which defends corporations like Celerity. Taxpayers should not pay for Armani suits, chauffeur-driven limousines, or expensive meals. Citizens should support those who want to strengthen and improve the democratically controlled public schools of Los Angeles.
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