Charter schools were conceived as laboratories of educational innovation, but increasingly they are becoming laboratories for financial inventions. Among the creations are for-profit school chains with complex ownership arrangements that make it hard for the public to see where its tax dollars go and how much is going into profits rather than education.
North Carolina’s charter school program has grown increasingly ripe for financial exploitation since Republican lawmakers lifted the state’s 100-school charter cap. North Carolina now has 184 charter schools with 15 more approved to open this fall. According to the Public School Forum, a group that supports traditional public schools, 20 percent of North Carolina’s charter schools are operated by for-profit companies, most of them based outside of the state.
This week, the N.C. Charter Schools Advisory Board recommended taking that trend even further. It asked for state approval of Wake Preparatory Academy, a K-12 charter school that wants to open in Wake Forest in 2020. The school would be the first in North Carolina for Glenn Way, founder of the American Leadership Academy charter school chain in Arizona. Through ALA and its related companies, Way made about $37 million by building and operating Arizona charter schools, according to The Arizona Republic.
Charter schools are public schools, but operated by boards independent of the local school system. They are not required to provide as many services as traditional public schools, such as transportation and food. They are supported by an allotment of state and local public school funds attached to every student who enrolls.
Wake Preparatory Academy, with a full enrollment of 2,105, would be one of the largest charter schools in North Carolina. The school would be built by Schoolhouse Development, a company in which Way is an owner, and then leased back to the school. It would be managed by another of Way’s companies, Charter One, which could be paid up to 15 percent of the school’s revenues every year.
Such arrangements constructed around linked companies and no-bid contracts have served Way well. But they will not serve North Carolina well. The vital work of ensuring that every North Carolina child has an opportunity to receive a sound, basic education should not be farmed out to companies whose first priority is making a profit. Indeed, Way’s charter operations in Arizona have drawn complaints about their lack of transparency and their use of state funding.
Despite such concerns, the N.C. Charter Schools Advisory Board looks favorably on the financial resources Way’s companies would bring to Wake Preparatory Academy. CSAB member Alan Hawkes, said, “We need an (education management organization) with integrity, with an academic performance track record, an EMO with deep pockets. This fits Charter One.”
It now seems the test for that board’s approval is not whether a charter school will add to public education, but whether it will survive as an enterprise. That’s the wrong measure and it will inevitably lead to profiteering problems with North Carolina’s charter schools.
NC should consider adopting tighter conflict of interest rules, as Arizona did in the wake of issues involving charter school owners. It shouldn’t look at whether proposed charter schools are viable for their operators, but whether they are valuable for their true owners, the North Carolina taxpayers.
— The Charlotte Observer