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What Texas Should Know About Charters, from a Floridian

By dianeravitch
March 11, 2016 //
5

A civic leader in Texas asked on the blog whether there was any impartial information about charters and their effects. I forwarded her request to Sue Legg of the League of Women Voters in Florida.

 

Sue wrote the following response:

 

 

We have been studying charter and other choice systems for several years. See: http://lwveducation.com​
In Florida, we have non-profit and for profit management companies. The biggest concern with for-profits are their associated real estate firms that build/purchase facilities and then charge the school excessive amounts for leases. Since the charter schools are privately owned and managed, the facilities are paid for by public tax dollars but revert to private owners if closed. We have relatively few charters located in publically owned buildings.

 

There are issues with charter boards. Most are not independent from the management company. Thus, the business model often depends on high staff turnover and low salaries. There are many regulation problems including conflict of interest and nepotism. Big charter firms create umbrella non profits that receive the charter. Their boards often have overlapping board members. Academica, for example, the largest Florida charter chain created Mater charters, Somerset charters, Doral, and Ben Gamla charters among others.

 

Many small independent charters have inexperienced or profit seeking people who start and then close charters, thus keeping substantial start up money awarded by the state. Some legislation has tried to curb this.

 

Charters in Florida tend to duplicate public school programs. Some do focus on children who need a different approach and many of these are successful. The school grade policies complicate their existence, however. For example, schools that focus on children with dyslexia are chronically called ‘F’ schools because those children struggle to learn even though they do make significant progress. ​

 

Florida has 650+ charters. The evidence of resegregation is clear. The high closure rate has received legislative attention. The practice of selective admission/retention is evident even though the admission process is supposed to be random. Achievement based on test scores does not differentiate charter and traditional public schools if well matched samples are used.

 

We have annual audits of each charter. There are also data on racial and economic demographic characteristics as well as school grades.

 

This legislative session has centered on charter authorization systems that would take even more control away from local school boards. Thus far, these proposals look like they will fail.

 

A Citizens for Strong Schools lawsuit over the failure of the state to support public education begins on March 14th.

 

Let me know if I can help.

 

Sue M. Legg Ph.D.
President, Alachua County LWV
Chair, School Choice Project Florida LWV

Categories Accountability, Charter Schools, Florida, For-Profit, Texas

Video: Ride the Profitship Charter Chain to Success!

By dianeravitch
March 3, 2016 //
5

Here is a very funny video that says in 2 minutes what the public needs to hear as more and more community public schools are run by corporate charter chains. I could explain the same thing with footnotes in a chapter, but skip the chapter and watch the video. It was produced by the Progressive Magazine.

 

This video was made by the same team that created this video. It’s all about the money.

 

 

Categories Budget Cuts, Charter Schools, Corporate Reformers, Education Industry, For-Profit, Privatization

Sue Legg: Florida Republican Proposes to Fix Charter Mess

By dianeravitch
February 20, 2016 //
13

Well, this is a hopeful sign. A Republican the state senate in Florida has proposed to change the charter law so that it focuses on the neediest children, the ones for whom charters were first created. With the house leadership firmly controlled by Rep. Eric Fresen, whose brother-in-law owns one  of the largest and most profitable charter chains in the state, the two houses of the legislature may be on a collision course. Rep. Fresen always takes care of the charter industry.

 

Sue Legg, who has studied Florida charter schools on behalf of the state League of Women Voters, wrote with the following information:

 

 

A recent Senate President, Don Gaetz, proposed a bill this week to curb ‘private enrichment’ facilities schemes by charter school management firms and their real estate arms. He acknowledged that the legislature has gotten away from the original intent for charters schools. His bill would prioritize charters serving impoverished students and/or those with disabilities.

 

Florida has over 650 charter schools, over a third are run by for-profit firms. The legislature, the Governor, the Department of Education and the State Board of Education are all strong charter supporters.

 

This is the first time that a staunch Republican legislator has publically acknowledged the rampant charter exploitation and abuse and taken meaningful steps to curb it. It even addresses public ownership of facilities. The bill is not perfect; it may not pass. However, Senator Gaetz calls for “Charters with a Conscience”. Sometimes you just have to share the good news. 

 

Senator Gaetz is thinking about what is right. He and Rep. Fresen (HB 873) are squaring off over charter school funding for facilities. Both bills would reduce the amount of capital outlay dollars public schools can assess through local property taxes. According to the Miami Herald, Senator Gaetz’s bill would also crack down on ‘private enrichment’ schemes that charter management firms use to build and lease facilities for which they charge exorbitant rates.
Charter board members would have to swear that capital outlay funds would only be used for facilities. Funds would be awarded only to public entities, a 501(c)(3) specifying in its articles of incorporation that all property will return to specified public entities upon dissolution, or is owned by or leased to a person or entity who is not an affiliated party to the charter school.

 

The Senate proposal has some other very good features. It would reconfigure the funding formula to prioritize those charters that offer quality alternative schools for impoverished students or those with disabilities. Certain charters would receive a base capital outlay allocation from state funds, but those that serve at least 75% of children qualifying for free or reduced lunch or 25% of children with ESE, would receive an additional twenty five percent or fifty percent if both criteria are met. The Miami Herald quotes Senator Gaetz who suggested that ‘…we want to weight it for those charters that have a social conscience’.

 

The bill does not take capital outlay money away from traditional public schools for charter schools. It does, however, change the formula for how the money is allocated.

 

There are some ‘gotchas’ in the Senate bill. The legislature still needs to work with districts to create viable policy. Nevertheless, Senator Gaetz appears to recognize that unregulated school choice benefits some companies more than children.

Categories Charter Schools, Education Industry, Education Reform, Florida, For-Profit

Wall Street Journal: Obama Staffers Flee to Broken For-Profit College Sector

By dianeravitch
February 17, 2016 //
10

A few days ago, I posted about the odd circumstance that friends of President Obama had bought one of the nation’s largest for-profit corporations that provide higher education, even though it is generally known that these “colleges” have abysmal graduation rates and are known for predatory practices.

 

Now, the Wall Street Journal is pointing out the irony that the Obama administration harassed these institutions, drove down their value, and former Obama staff and current friends are taking them over at a fire sale price. We know, based on the actions of the Department of Education under Arne Duncan, that the administration has no objection to for-profit charter operators. We know, from Arne Duncan’s selection of Joanne Weiss, CEO of NewSchools Venture Fund as his chief of staff, that he has a fondness for the corporate sector. We know, from Arne Duncan’s selection of Ted Mitchell, also a CEO of NewSchools Venture Fund, as Under Secretary of Education, that the Department favors entrepreneurs. NewSchools Venture Fund underwrites charter chains and education businesses. It is at the epicenter of the corporate ed reform biz.

 

So, I am not so sure I agree with the WSJ’s characterization of the Obama administration as hostile to for-profit ventures. I think the collapse of for-profit higher education value is due to its poor performance and its lack of value or values. The dropout rates are higher than those in nonprofit institutions, and some employers will not recognize degrees from these diploma mills.

 

In an editorial titled “Regulating Education for Profit,” the WSJ writes:

 

Check out last week’s proposed sale of Apollo Education, parent company of the University of Phoenix. When Mr. Obama was preparing to take office in January 2009, Apollo stock hit a multiyear high above $78 per share. Seven years later, after Washington’s regulatory onslaught that favored nonprofits over for-profits in doling out federal subsidies, the shares had recently fallen below $7.

 

The University of Phoenix was once educating close to half a million students but last month reported an enrollment below 180,000. And with Apollo recently trading below book value, it might be a real bargain—especially for an investor betting that the next Administration might go easier on for-profit colleges. Now comes news that Apollo will be sold to several private equity firms. And coincidence of all coincidences, after the sale closes the company will be run by a former top official in the Obama education department, the same outfit that led the attack on Apollo.

 

The Vistria Group is a Chicago private-equity firm. The company was founded around the time that Mr. Obama was beginning his second term and its founders include Marty Nesbitt, who began playing pick-up basketball with Mr. Obama years before he became President, and Tony Miller, who was the second highest-ranking official in the Department of Education from 2009 until 2013.

 

Once the sale closes, Mr. Miller will become chairman of Apollo’s board….

 

By the way, the Obama education department will have to approve Vistria’s purchase of Apollo, and we’re told the guidelines for approval are notably vague. What better way to win a regulatory blessing than have a former senior education official like Mr. Miller commune with his old regulatory comrades. Hey, Tony, great to see you; any job for me after, say, Jan. 20, 2017?….

 

To summarize, an Obama pal is the day-to-day boss of a department that succeeds in destroying 90% of the value of a politically targeted company. Then he leaves government, buys the company at a fire-sale price and announces that the problems that attracted so much negative government attention are ending—just in time for a new Administration that might not hate for-profit education as much as this one. Government mediation sure can be a lucrative business model.

 

 

 

Categories Accountability, Education Reform, For-Profit, Higher Education

BREAKING NEWS: Lawsuit Filed Against Magnolia Charter Chain in California

By dianeravitch
February 16, 2016 //
11

A lawsuit has been filed against the Gulen-affiliated Magnolia charter chain in California. 
The plaintiffs accuse the chain of significant financial improprieties. 
“The complaint calls for a comprehensive investigation by the State Department of Education. It cites findings made last year by the state in an audit of Magnolia including that 69% of Magnolia’s financial transactions were unaccounted for; that Magnolia routinely awards large contracts to vendors that have overlapping connections with their own employees and board of directors; and that Magnolia has illegally used hundreds of thousands of taxpayer dollars to pay for visas for Turkish nationals.
“The complaint states that all three of these activities are hallmarks of Gülen charters. Magnolia has denied ties to Gülen, an organization under investigation by the Turkish and United States governments.  
“Magnolia is headed by Caprice Young, former president of the board of the Los Angeles Unified School District (LAUSD), and founder of the powerful lobby, the California Charter Schools Association. Under Young’s leadership, Magnolia runs 11 schools, including eight in LAUSD, and recently submitted petitions for eight more schools in Anaheim, LAUSD, Garden Grove, Fremont, and Oceanside. The complaint states that if all eight charter schools were to be approved, the cost to the state of California would be in the billions of dollars.”

Categories California, Charter Schools, Education Reform, For-Profit, Funding, Gulen Charter Schools, Hoax

What Does Illinois Governor Rauner Have in Common with Martin Shkreli?

By dianeravitch
February 16, 2016 //
9

Did you know that Governor Bruce Rauner has something in common with that guy who bought the rights to rare drugs and raised the prices sky-high?

 

I learned about it from blogger Glenn Brown.

 

 

“…Rauner is never going to brag about his spoils derived from Ovation because in 2008 the Federal Trade Commission took the company to federal court, accusing it of price gouging and violating antitrust laws. According to the FTC, Ovation acquired control of the only two drugs used to treat heart defects in premature babies. The company then raised the cost of treatment nearly 1,300 percent. (The Star Tribune reported in 2008 that Ovation also bought three other children’s drugs and raised their prices by 864 to 3,437 percent.)

 

 

“Ovation acquired the rights to a drug developed by Merck & Co. called Indocin I.V. Ovation then acquired the drug NeoProfen from Abbott Laboratories about a year later in 2006. The FTC asserted the NeoProfen acquisition was unlawful because Ovation knew it was getting the only competitor to its Indocin I.V. drug.

 

 

“The FTC detailed how Ovation quickly raised the price of Indocin from $36 to nearly $500 a vial. The price of NeoProfen was similarly inflated by Ovation. The FTC brought its complaint in U.S. District Court for the District of Minnesota in 2008. The Minnesota Attorney General joined the FTC as a plaintiff in the lawsuit. Acting FTC Bureau of Competition Director David P. Wales issued this statement upon announcement of the legal action:

 

 

“‘While Ovation is profiting from its illegal acquisition, hospitals and ultimately consumers and American taxpayers are forced to pay millions of dollars a year more for these life-saving medications. The action taken today is intended to restore the lost competition and require Ovation to give up its unlawful profits.’

 

 

“The FTC went on to say: ‘Indocin and NeoProfen are the only two pharmaceutical treatments sold in the U.S. for a condition known as patent ductus arteriosus, a disorder that primarily affects very low birth- weight premature infants. In babies with this condition, the blood vessel connecting two major arteries of the heart fails to close on its own soon after birth. Patent ductus arteriosus can be fatal if not treated. The only treatment other than drug therapy is surgery, which carries the risk of serious complications and costs far more than treatment with either Indocin or NeoProfen.’

 

 

“The FTC’s Commissioners approved filing of the federal complaint by a vote of 4-0. Most devastating of all is this statement from Commissioner Jon Leibowitz (appointed by George W. Bush) who wrote separately: ‘Ovation’s profiteering on the backs of critically ill premature babies is not only immoral, it is illegal. Ovation’s behavior is a stark reminder of why America desperately needs health care reform and why vigorous antitrust enforcement is as relevant today as it was when the agency was created almost one hundred years ago in 1914.’ And U.S. Senator Amy Klobuchar (D-Minn) said: ‘A company like Ovation knows that when it comes to saving a baby’s life, price is no object. They banked on that, literally…’” (Rauner company raised cost of life-saving drug for babies 1,300% by Doug Ibendahl,Oct. 21, 2014).

 

 

“…As we’ve said repeatedly here at Republican News Watch, it doesn’t matter how much money Bruce Rauner has made. But it does matter what he was willing to do for it, and it does matter who he expected to subsidize his lifestyle. Rauner and his partners made the decision that it was okay to squeeze parents desperate to save the life of their newborn child. What else is it going to take for those still supporting Bruce Rauner?” (Rauner’s former company settled federal lawsuit over infant heart drug by Doug Ibendahl, Oct. 23,2014).
Doug Ibendahl is a Chicago Attorney and a former General Counsel of the Illinois Republican Party.

 

 

 

Categories For-Profit, Illinois

Peter Greene: Governor LePage of Maine Appoints Himself as State Commissioner of Education

By dianeravitch
February 16, 2016 //
10

Governor Paul LePage is a Tea Party guy who has twice been elected governor of Maine. He prevailed each time in a three-way split.

As Peter Greene notes, Governor LePage is known for his bizarre statements. Among other things, he refused to attend an event honoring Martin Luther King, Jr. Day:

One of his first acts as governor was to refuse to attend a Martin Luther King Day breakfast and, when called on it, to tell the NAACP to kiss his butt. He also undid decades of environmental reguations, and took down a mural of labor history in the capitol, comparing it to North Korean brainswashing. He sabotaged a $120 million wind power plan.

He has gone through six education commissioners in three years. The last nominee might have had some trouble getting approved by the State Senate because he is a creationist.

Governor LePage is a strong supporter of charter schools, choice, digital learning, and competency based education (nonstop assessment by computers). He views public schools with contempt.

Early on in his first term, he embraced Jeb Bush’s digital learning plan and set about implementing it. One of the best exposes of our time was written by Colin Woodard about “The Profit Motive behind Virtual Schools in Maine.” That’s when many people recognized that the tech companies were giving money to Jeb Bush’s Foundation for Educational Excellence, and FEE was promoting the tech companies’ products. And it was all about profit.

Greene thinks that Governor LePage may crown himself King of Maine. One hopes that he will have only one opponent in the next election. He is an embarrassment to the state of Maine.

Categories Bush, Jeb, Charter Schools, Education Industry, For-Profit, Maine, Privatization, Technology

How Privatizers Learn to Hoax the Public 

By dianeravitch
February 14, 2016 //
17

The Foundation for Education Excellence, the organization founded by Jeb Bush to turn education into an industry, is holding a boot camp to teach newcomers how to shape their message of privatization and call it “reform.”
The teachers are not educators–who cares what they think?–but PR specialists who know the tricks of their trade: how to sell ice to Eskimos, how to sell a defective used car to unwary buyers, how to persuade people that the moon is made of cheddar cheese. 

Categories Bush, Jeb, Corporate Reform, Education Industry, For-Profit

Obama Friends Take Over For-Profit Higher Education Group

By dianeravitch
February 10, 2016 //
15

A group of investors with close ties to the Obama administration have taken control of the University of Phoenix and other for-profit “universities.”

“The troubled for-profit education company that owns the giant University of Phoenix agreed on Monday to be bought for $1.1 billion by a group of investors that includes a private equity firm with close ties to the Obama administration.

“The university and its owner, the Apollo Education Group, have been subject to a series of state and federal investigations into allegations of shady recruiting, deceptive advertising and questionable financial aid practices.

“In recent years, many for-profit educational institutions that have received billions of dollars in federal aid, including the University of Phoenix, have been pummeled by criticisms that they preyed upon veterans and low-income students, saddling them with outsize student loan debt and subpar instruction.

“Moreover, at many of these schools, enrollment has been falling and profits shrinking, casting doubt on the future health of the industry.

“The investors in the Apollo Education Group include the Chicago-based investment firm Vistria Group, the Phoenix-based Najafi Companies, and funds affiliated with Apollo Global Management, which is not connected to the Apollo Education Group….

“Vistria’s founder is Marty Nesbitt, one of President Obama’s closest friends and the chairman of the Obama Foundation. Mr. Nesbitt is also a longtime business partner of Penny Pritzker, the commerce secretary.

“A Vistria partner and its chief operating officer, Tony Miller, was deputy secretary of the United States Department of Education between 2009 and 2013. He has been tapped to become the new chairman of Apollo Education Group in August, when the deal is scheduled to be completed.”

If you watched the video of the congressional panel quizzing John King about the ethical “lapses” of Chief Information Officer Danny Harris, you may recall that King said that deputy secretary Miller had cleared Harris.

Now we understand why the for-profit higher education industry has gotten a free pass.

Categories For-Profit, Higher Education

Gene Glass: Would Horace Mann Tweet? (Make This Go Viral!)

By dianeravitch
February 8, 2016 //
8

Gene Glass has written one of the most brilliant, most perceptive commentaries on the billionaires’ reform movement that I have ever read.

He gives a witty, well-sourced analysis of the familiar corporate reform narrative and punches giant holes in it.

Here is the opening sentence:

“A democratically run public education system in America is under siege. It is being attacked by greedy, union-hating corporations and billionaire boys whose success in business has proven to them that their circle of competence knows no bounds.”

Glass is one of our nation’s most celebrated and honored researchers. He called VAM “stupid” back in 1998. Unlike many ivory-tower academics, he is taking sides: he is on the side of public education, democracy, and truth.

If you don’t read this, shame on you.

Please tweet it, post it on Facebook, share it with your friends and your elected officials.

Categories Billionaires, Charter Schools, Corporate Reform, ESSA, For-Profit, Hoax, Research, Testing
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