New Study Uncovers Millions of Tax Dollars Wasted on Low Performing Charter Schools and Schools That Never Opened
Released: May 26, 10am
Federal money intended to help good charter schools expand instead went to some of Ohio’s notoriously bad charters, including some of the money that went to schools that never opened.
The explosive findings are contained in Belly Up: A Review of Federal Charter School Grants, which examines money spent in Ohio during the program’s 21-year-year history.
“As Ohio takes steps to make charter school sponsors more accountable under the reform law passed last year, it’s important that policy makers understand the past,” said OEA President Becky Higgins. “Together with our colleagues at Innovation Ohio and ProgressOhio, we examined how these Charter School Program (CSP) grants have been awarded, and tried to identify the shortfalls along the way. Ohio cannot afford to waste money on failing charter schools. It needs to invest in the good ones.’’
The Ohio Charter School Accountability Project did the analysis to determine how a state with so many of America’s worst-performing charter schools could be in line for so much federal money intended to help the best ones. What it found was decades of waste, warning signs that were ignored and a political climate that tolerates even low-performing schools.
The report found:
- Of the 292 Ohio charter schools that have received federal CSP funding since 2006, 108 (37 percent) have closed or never opened, totaling nearly $30 million. Meanwhile, barely 2 percent of all companies nationwide that have received any federal grants or incentives since 2000 have failed.
- The Ohio tally includes 26 charter schools that received nearly $4 million in CSP funding but never opened. There are no records to indicate whether any of these public funds was returned.
- Ohio charters that received past CSP funding and State Report Card grades in the 2014-2015 school year had a median Performance Index score that was lower than all but 15 of Ohio’s 613 school districts.
- Since the federal grant program began 21 years ago, its lone assessment – conducted by WestEd – found material weaknesses that have been ignored by federal grant makers. In one instance, a potential grant reviewer even told the Ohio Department of Education that she was unqualified for the job and asked to be excluded from its reviewers’ list. Instead, the department thanked her for “agreeing to participate as a community school grant reader.”
- Paolo DeMaria, recently appointed Ohio Superintendent of Public Instruction, was Associate Superintendent of Finance and School Options at the time WestEd raised concerns about Ohio’s processes for distributing the federal money to charter schools.
- Of the 44 Ohio charter schools where State Auditor David Yost conducted surprise attendance audits recently, 17 had received federal CSP funding. One of them – the London Academy – only had 10 of the 270 students ODE thought it had in attendance the day Yost’s investigators showed up. All told, these audited schools received about $6.6 million in federal funding.
OEA Vice President Scott DiMauro called the wasted money “mind-boggling.’’
“It’s also completely unacceptable,’’ he said.
DiMauro urged U.S. Education Secretary John King to take corrective action that includes more transparency in the decision-making process surrounding the grant awards and he called on the agency to implement some of the reforms that Ohio Senator Sherrod Brown has been advocating. Brown has called for greater accountability and disclosure requirements on the federal level.
Last September, federal officials stunned education experts by announcing that Ohio would receive $71 million in CSP grants – more than any other state. Ohio’s large award came in spite of its reputation as one the worst charter states in the country, according to national charter advocates. The swift and severe criticism that followed prompted USDOE to put Ohio’s award on hold.
Those mistakes include giving millions to the state’s most notorious charter school scofflaws, including:
- Horizon Science Academies and Noble Academies: Total CSP Grants: 7.6 million
Linked to a Muslim cleric exiled in Pennsylvania, the chain is the subject of an ongoing FBI investigation, and WikiLeaks revealed cables showing the U.S. State Department notified the CIA about suspicious visas for teachers and administrators. In June 2014, 19 of its schools were raided by the FBI, including four in Ohio. The Ohio schools also have been dogged by allegations of test-tampering, teachers using racial slurs in the classroom, unqualified teachers, sexual misconduct in the classroom. ODE investigated allegations raised by teachers who witnessed the problems but found no wrongdoing.
- Imagine Schools: Total CSP Grants: $5.9 million
The chain has been under fire nationally for saddling schools with exorbitant leases paid to its subsidiary, SchoolHouse Finance. Imagine recently lost lawsuits in Indiana and Missouri over the same type of abusive leases seen in Ohio. A federal judge in Missouri ordered Imagine to pay $1 million and called the lease arrangement “self-dealing.’’ One of the chain’s worst-performing Ohio schools, Romig Road in Akron, is among the charters that closed – but received federal grant money. All of Imagine’s Ohio schools received a D or F on the most recent state report cards.
- White Hat Management: Total CSP Grants: $1.4 million
Owner David Brennan has been the most powerful and influential of Ohio’s charter school operators since state money started flowing to them. Brennan’s schools also are routinely among the lowest performing. While Ohio’s historically lax regulations make it difficult to close even the worst schools, several of Brennan’s schools have been shut down for academic reasons or contractual non-compliance. Staffers for GOP state Auditor David Yost made surprise visits to charters to see if they are padding attendance records and concluded that White Hat’s dropout recovery schools were among the worst.
It’s been well documented that ODE’s grant application for the $71 million was inaccurate and misleading, prompting state officials to revise the number of poor-performing charter schools in Ohio from six on its initial application to 57 – a tenfold increase. The author of the application, David Hansen, was forced to resign as head of ODE’s office of school choice and community schools after getting caught illegally cooking the state’s accountability system to benefit Ohio’s politically connected eSchool operators.
It is unclear when or if federal regulators will release the $71 million.
Read the entire report here.