Jeff Bryant has written a stunning documentation of the damage done by the charter industry to public schools in North Carolina. It is worth your time to read it all. It is a preview of what lies ahead for public education in the Trump era, unless parents and educators and public-spirited citizens join to save their public schools. It is not a pretty picture.
The Tea Party Republicans in the legislature and Governor Pat McCrory in the state house set a course to undermine, underfund, and starve public schools while opening the state to charter schools, whether nonprofit or for-profit. Jeff Bryant shows how funding for the public schools is below 2008 levels, even though enrollment has grown by nearly 80,000. Public schools have had to make budget cuts, at the same time that charter schools and online charter schools take away students and funding. In North Carolina, as in many states, if a student leaves a charter school after October to return to the public school, the charter school gets to keep the full year of tuition and is not obliged to replace the student who left.
The board that oversees charter schools and decides which new charters to approve is filled with charter school advocates. As Donald Trump used to say, “It’s a rigged system, folks, it’s a rigged system.”
Bryant explains in detail how the for-profit charter management companies make money. He uses the example of National Heritage Academies, which is based in Grand Rapids, Michigan, the hometown of Donald Trump’s designated Secretary of Education. Half their teachers may be uncertified, which means they have lower salary costs. But the real money is in the real estate.
How do these schools make a profit? The best answer the reporter for the Charlotte Observer could find was in management fees for the EMOs [educational management organizations], which In North Carolina equal to 7 – 19 percent of total school operational costs.
But based on my inquiries, that figure represents a very small part of the profit these schools make.
Out Of Michigan And Florida
“North Carolina is one those states that is new to the charter game,” Ellen Lipton tells me in a phone call to her office in Michigan – home of National Heritage Academies. NHA is based in Grand Rapids, where Betsy DeVos also lives.
“The low per-student funding that tends to characterize Southern states generally kept charter school operators from moving into those states,” she contends. “But now states like Michigan are getting saturated” so the charter chains have decided to move south.
Lipton is a Michigan State Representative who has spoken out against the spread of charter schools through the state’s Education Achievement Authority, an appointed agency, similar to the Achievement School District North Carolina created last year, that takes over low-performing schools and turns them over to charter operators.
According to Lipton, NHA has “fine-tuned” the business of chartering to ensure they make a profit. She points me to a recent investigative report by the Detroit Free Press that finds, “It is difficult to know how charter management companies are spending money … Unlike traditional school districts, the management companies usually don’t disclose their vendors, contracts, and competitive bid documents.”
“NHA is a business model based on, not necessarily educating kids, but on being a facilities management company,” Casandra Ulbrich, another Michigan source, tells me.
Ulbrich is currently serving her second eight-year term on the Michigan State Board of Education and also works in education administration at a state community college.
She tells me how the NHA business model works: First, NHA forms a charter school board to “invite” NHA to manage a new school. The governing board is not independent of the management company, and members of the board can serve on multiple NHA charter boards across the state, thus creating a network of charter school boosters the work on promoting these schools.
After securing a contract to manage the new school, NHA purchases a building – it could be a storefront in a strip mall or an abandoned warehouse – and requests approval from an authorizer to open a school there. After the authorization, the charter board signs a lease agreement with Charter Development Company, LLC to take over ownership of the building. Charter Development Company, which has branches in all the states where NHA has schools, has its home office in Grand Rapids, Michigan, at the same address as the home office of NHA.
Now NHA and its related enterprises own the building and its contents, even if desks, computers, and equipment have been purchased with taxpayer money. It receives rent payments from the district. It owns the curriculum the school teaches. And if NHA is ever fired, the charter board – and by extension the district – is in the awkward position of having to buy back its own school.