I've long struggled to grasp how charter schools turn a profit and for whom. Yesterday I spoke to somebody at @Network4pubEd who helped me wrap my mind around one aspect of it. I'll publish that interview later but first let me spell this out:
Okay so most charter schools have to be nonprofits. These nonprofits get public money, and what they do with that money is theoretically subject to all kinds of regulations. They're meant to use it to run a school, which involves paying for goods/services that should be itemized
But one of the items on their itemized list is often "management services," often provided by a for-profit company. Thus the nonprofits sweep public money, sometimes most or even ALL of it, into a for-profit management company which is far less regulated and transparent
In cases like these, the non-profit is a facade for the for-profit management company that essentially runs the school (and is the reason for the school's existence). The company runs it with the goal of having as much public money left over as possible to keep as profit
There are two basic ways to ensure bigger profits. One, secure more public funds by e.g. raiding districts for students and cooking the attendance books. Two, cut operating costs by e.g. hiring unqualified teachers and "counseling out" high needs kids
The management companies also do stuff like buy property and then lease it to their own charter school at a price of their choosing, paid for of course by public money. Or they create separate service companies and contract with themselves, paying themselves handsomely
Owners of for-profit charter management companies can make a hell of a lot of money this way. All of that money is public money earmarked for education, but it's not being spent to ensure the best education for students. Education is just a pretext for profiteering
There are other ways that charters make money, including the role of non-profit management companies, but this scheme is a big part of the story and is really important if we want to understand who is actually financially benefitting from ed reform and how
Oh and by the way there is a bill in the House that aims to stop this in its tracks. The charter school lobby is pissed about potentially not getting funds to fork over to for-profit management companies, and their reaction says an awful lot thehill.com/homenews/house…
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Here's a website that collects news items about charter school scandals at the end of each month. There's like one a day. Theft, fraud, "financial irregularities," sudden closures. Charter schools are truly the Wild West, little oversight or transparency networkforpubliceducation.org/another-day-an…
One of my guiding beliefs that a society should provide its children with a non-janky education system
Personally I think we should stop letting incestuous networks of LLCs registered to empty units in anonymous suburban office parks educate entire subsequent generations of people