Nearly 2,500 Bridges to Nowhere: Congress Considers Expanding Charter Program Despite Millions Wasted on Closed Schools

UPDATE July 15th -- Earlier this week, Senate Majority Leader Mitch McConnell (R-KY) invoked cloture on the ESEA bill, which contains provisions to expand the Charter Schools Program. The final vote will be held today. McConnell's move to bring matters to a close came as a surprise to the authors of the bill who had expected a more robust debate, and, as EdWeek reports, "especially squeezes Democrats who are still working on proposals to beef up accountability."

As both the House and the Senate consider separate bills that would reauthorize and expand the quarter-billion-dollar-a-year Charter Schools Program (CSP), the Center for Media and Democracy (CMD) has examined more than a decade of data from the National Center for Education Statistics (NCES) as well as documentation from open records requests. The results are troubling.

Between 2001 and 2013, 2,486 charter schools have been forced to shutter, affecting 288,000 American children enrolled in primary and secondary schools.

Furthermore, untold millions out of the $3.3 billion expended by the federal government under CSP have been awarded as planning and implementation grants to schools that never opened to students.

Charters Much More Likely to Close

The failure rate for charter schools is much higher than for traditional public schools. In the 2011-2012 school year, for example, charter school students ran two and half times the risk of having their education disrupted by a school closing and suffering academic setbacks as a result. Dislocated students are less likely to graduate and suffer other harms.

In a 2014 study, Matthew F. Larsen with the Department of Economics at Tulane University looked at high school closures in Milwaukee, almost all of which were charter schools. He concluded that closures decreased "high school graduation rates by nearly 10%" The effects persist "even if the students attends a better quality school after closure."

Hidden behind the statistics are the social consequences. According to a 2013 paper by Robert Scott and Miguel Saucedo at the University of Illinois. They found that school closures "have exacerbated inter-neighborhood tensions among Chicago youth in recent years" and have been a contributing factor to the high rate of youth incarceration.

A Map of Failure

Using federal data, CMD has compiled an interactive map of every charter school that has been forced to shutter between 2001 and 2013:

Source: NCES

Because the U.S. Department of Education does not provide the public with any accounting for the amount of taxpayer money—whether state or federal—that has been spent on these failed charter schools, there is no way to estimate the total amount of money missing in action. However, the Center for Popular Democracy (CPD) recently estimated that "according to standard forensic auditing methodologies, the deficiencies in charter oversight throughout the country suggest that federal, state and local government stand to lose more than $1.4 billion in 2015."

Major Probes into Closed Charters Underway

According to a PowerPoint presentation CMD has uncovered, the watchdogs at the U.S. Department of Education's Office of the Inspector General are currently conducting major nationwide probes into the lack of accountability and oversight within the Charter School Program. One of these audits focuses on where federal grants end up when charter schools are forced to close. A spokesperson for OIG confirmed to CMD that these investigations are ongoing.

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The new probes come in the wake of a scathing 2012 audit, which exposed an utter lack of financial controls in the case of money awarded to charters that later closed. "The school files had no follow-up documentation for any of the 12 closed schools reviewed," the OIG noted in the case of California. The U.S. Department of Education had conducted no oversight and failed to ensure that states receiving tens or hundreds of millions in grants had "procedures to properly account for SEA grant funds spent by closed charter schools."

Meanwhile, U.S. Department of Education officials have assured stakeholders that the problems with millions disappearing down black holes are now a thing of the past. But the fact that the OIG has found reason to launch major investigations this year tells a different story.

Federal Millions Missing in Action as Charter Close or Never Open

It is impossible to anticipate the findings of the ongoing OIG probes, but even a cursory review of federal charter school grants in Wisconsin and Indiana, conducted by CMD, uncovered dozens of schools that were created out of seed money under the program but later forced to shutter because of financial mismanagement, failure to educate students or lack of enrollment.

Wisconsin received $69.6 million between 2010 and 2015, but out of the charters awarded sub-grants during the first two years of the cycle, one-fifth (16 out of 85) have closed since.

Indiana was awarded $31.3 million under the Charter Schools Program between 2010 and 2015. One of the reasons the state landed the grant, the reviewers contracted by the U.S. Department of Education to score the application make clear, was that charter schools in the state are exempt from democratic oversight by elected school boards. "[C]harter schools are accountable solely to authorizers under Indiana law," one reader enthuses, awarding the application 30/30 on the rubric "flexibility offered by state law." This "flexibility," which the federal program is designed to promote, has been a recipe for disaster:

  • The Indiana Cyber Charter School opened in 2012 with $420,000 in seed money from the federal program. Dogged by financial scandals and plummeting student results the charter was revoked in 2015 and the school last month leaving 1,100 students in the lurch.

  • Padua Academy lost its charter in 2014 and converted to a private religious school, but not before receiving $702,000 in federal seed money.

  • Via Charter School was awarded $193,000 in a "planning grant" but never opened.
  • Early Career Academy landed a $193,000 planning grant and was due to open last year. This has been postponed because of "governance issues," according to the school. The charter is sponsored by a for-profit college—ITT Tech—that is currently being sued by federal government for coercing students into taking out student loans for college credits that do not transfer.

In April 2015, Education Secretary Arne Duncan testified in front of the Appropriations Subcommittee on Labor, Health & Human Services and Education on abuse of federal funding by for-profit colleges, such as ITT Tech, that were "taking advantage of a massive influx of taxpayer resources."

"The findings that we are putting forward are pretty stunning…pretty egregious. The waste of taxpayer money—none of us can feel good about," said Duncan.

And yet, he is calling for a 48 percent expansion of the charter schools program—a program that will likely be up for the vote in the House and Senate this week, before the results of any of the OIG audits are made public to lawmakers and stakeholders.

CMD will soon be releasing the full dataset, as well as information on the methodology used to arrive at the list of closed schools, to help reporters and public school advocates tell the story.

Comments

Thank you, Jonas. I am very familiar with the corruption, scandals, and crony capitalism of the school privatization movement, having written the book Hoosier School Heist which details the school privatization movement not only in Indiana but also across America, a book highly praised by Diane Ravitch and others. The only way this is going to stop is through a grassroots movement of rebellion. With the exception of the Chicago Teachers Union and a few others, the unions (nationally and locally) are either too cozy with billionaires, too spineless too act, too out of touch with what is really going on, or just don't know or care enough to get the job done. Educators need to be educated, so thank you for getting the word out.

While its easy to find faults in the charter school movement (and yes, there are plenty), one could certainly find plenty of problems in public school education as well. Ive been a teacher for over a decade with experience in public, private, charter and colleges. Ive also taught in Europe and in the US so I have seen a lot of what is wrong and right. The charter school movement has, for many students, been shown to be a success. At the school that I have worked at, students who were failing at public schools have turned their academic careers around and gone onto college. This year we had a 100% college acceptance rate. We also have a very large number of special education students who have found public schools lack the support that they need. The 'outrage' that this article expresses seems to suggest that the charter school movement is a wholly bad thing. If there are financial issues, then new laws and requirements need to be put into place. The same attitude is prevalent with people who criticize the common core curriculum. I will be the first person to say that its not perfect, but its ideal (that all students learn the same material) is a very logical one. With that, like with charter schools, the solution is not to scrap them but to fix what is wrong. I will be the first person to say that requirements need to be rigorous before money is handed out. Charters should not be dealt to anyone, and in my opinion, should not be in the domain of for profit corporations. All the benefits of charter schools should be the students of the charter schools. People also complain about charter schools eroding collective bargaining, but as I work in North Carolina (where teacher pay is abysmal) and it is a right to work state, there is no collective bargaining anyway. In a number of states, collective bargaining has been (unfortunately) broken down. Its a sad state of affairs but if you take away Charter Schools, you take away choices for students who don't fit in public schools and can't afford to go to private schools.

Although I'm no fan of charters, I'm skeptical of the map's accuracy. I checked the map for my area (Pueblo, CO) and the they have a charter listed as closed that is still open.(Dolores Huerta Prep HS)

I don't understand the statement. There are bad public schools, but that is the problem to be addressed, and the answer is not to replace them with charter schools. My opinion: elect government officials who are more accountable for the proper education of all children and not beholden to those who wish to capitalize on charter schools being financed in part, at least, by taxes coming out of all taxpayers pockets.

The reason our public schools are so bad is threefold: 1) the way they are funded is illogical and ensures failure of those in poor areas. We cannot continue to fund schools with the money from local property taxes going to the schools in that area. All sources of funding should be meted out equally to all schools in all areas, and when a wealthy person or corporation donates to education, that money should be spread out equally over the educational system. That is the only way we are going to ensure that all students have equal opportunity for a good education. 2) The diversion of tax money from public education into for-profit schools over the last few decades has further eroded our public schools. 3) Until we stop the ongoing robbery of the middle and working classes by the wealthiest, we are not going to be able to solve the problem of poverty, which is the biggest enemy of education. Children who are from destitute or financially floundering families are facing insurmountable obstacles to becoming adequately educated to be successful as productive members of society.

Ok, you obviously are invested with the charter school movement, the gateway drug to privatization. If they were so great, why won't they show their books? Plus, in Indiana, you don't even have to be accredited to be handed that money. Look at Bush in Texas--just started handing out money. All you had to do was fill out an application, get the check, cash it and make like a drum and beat it. And here's something else--public schools aren't so hot--because they are UNDERFUNDED. Can I repeat that for you? What is wrong with public education has ALWAYS been wrong with public education (which you would know if you were, as you say, a teacher)--the funding structure. The only place to get it right, surprise, surprise, is New Jersey. There, poorer districts get MORE money, which is exactly how it should work. And what's that you say? Throwing money at the problem won't solve it? Apparently it does--look at the gazillions the Koch brothers are paying out to buy public education. If they weren't getting their money's worth they wouldn't be doing it.

Couch, your summation paragraph really hits the subject on the nose. Charter schools not only effect the children but the general community. Less pay for teachers, or "abysmal" pay and I would be led to belief work conditions, as you say is a sad state of affairs tied directly to Charter's. That is the crust of my thoughts on the subject. Why must current living standards be reduced for those entrusted with the children's education? Charters are more viable and excepted in community's that historically pay lower wages to their education staff, at least at the school level.

As long as the public schools continue to stress that ALL students must be academia bound, as well as to continue to take away consortium-bound opportunities, we will have parents looking elsewhere. In my district, we have only four electives. All of the shop classes, home ec, auto, beauty, etc, have all been axed. Charters in San Diego are flourishing because they have hooked up with Corporations who have the students become apprentice(s) in the working field that they have chosen. Why have four years of classes that are worthless to the job that they are or will be qualified to to do once they get out of high school? One final example: Matt, a 16 year-old at a Michigan High school, was told he had to drop out due to failing grades. He was told he wasn't "fit" for college, like other kids. He went on and won 1st place in DECA for welding in the nation from his charter school...and now owns his own welding company and has expanded into 3 other states..so much for public education......