Tar Heel Heist: How the Charter School Industry is Hijacking Public Ed

Jeff Bryant

The following was originally published in AlterNet

If the American Dream is still alive – the one that includes a good job and a house with a yard, kids, and a two-car garage – you can see it taking shape in Wake County in the heart of the state of North Carolina.

Signs of surging prosperity are everywhere this morning as I make my way to West Lake Middle School in Apex, NC, on the outskirts of Raleigh. What were once sleepy two-lane country roads are now teaming with impatient commuters, school busses, and mini-vans. New housing developments, shopping centers, and office buildings are transforming the rolling Piedmont landscape. Wake County is home to five of the fastest growing cities in the Tar Heel State, which is the state with the nation’s fastest growth in economic output in 2015 at 13.4 percent.

At West Lake Middle this morning, cars and busses in the drop-off lane back up out to the main road, where commuter traffic pushes impatiently to get by. I angle my car to a visitor spot because I’m not here to drop off a child. I’m here for a protest rally.

The protest is happening because the rising tide of North Carolina’s economic resurgence has yet to raise all boats. Outside the school’s entrance, a gathering of students, parents, and teachers, many carrying signs declaring they are “All In for Public Schools,” listen to a speaker from the state teachers’ association call for better funding for local schools.

Another speaker, National Education Association President Lily Eskelsen Garcia, exhorts the crowd to “stand up for the needs of our students, our educators, communities, and public schools.”

In a conversation with me after the event, she explains, “When you come to a school and see how hard the teachers and staff work to address the challenges they face – the increasing class sizes, the students struggling with poverty, the lack of textbooks and basic supplies – you have to wonder why our political leaders are not working as hard to make sure schools and teachers have what they need.”

North Carolina is one of the many states providing public schools less funding per student than in 2008, according to the most recent analysis conducted by the Center on Policy and Budget Priorities. Schools remain below 2008 funding levels despite having to educate nearly 76,000 more students, according to a recent analysis by left-leaning advocacy group NC Policy Watch. The author of that analysis, Lindsay Wagner, finds that many schools have responded to budget hits by cutting textbooks, school supplies, and instruction in non-core subjects such as art and music.

A nationwide study on “school funding fairness” conducted by the Education Law Center finds North Carolina is one of the least fair states in the nation, earning a grade of “F” for its education spending in relation to the state’s economic productivity.

While the schools struggle with under-funding, they also face increased competition for funds. As Wagner reports, Republicans, who took control of the state legislature in 2010 and the governorship in 2012, are intent on expanding education options in the state by providing some parents with school vouchers to transfer their children to private schools and by increasing the number of charter schools in the state.

Charter schools – publically funded but privately operated schools generally free of most state regulations – are a favorite cause of Republican state lawmakers, and some Democrats. Former State Assembly House Majority Leader Paul Stam, who represented Apex until 2016, has said his “‘dream’ is that every public school will someday be a charter school,” according to Bob Geary of The Indy, an independent news outlet that covers the central region of the state.

What’s unclear is how a state hell-bent on financial austerity can afford to create what is essentially a new parallel school system of taxpayer supported charter schools.

Charter schools take a sizeable cut from the funding pie for education in the Tar Heel state. According to the NC Law Project, local spending on charters exceeds traditional public schools by $215 per student. The study calculates, “If local funds were truly shared equally, charter schools would have sent $3 million to local school districts in FY 14-15.”

In my travels around North Carolina – to the state’s three largest school districts – I ask school board members, legal and education experts, and charter advocates to explain how a state that doesn’t seem to adequately fund its existing public school system can afford to add a competitive new one.

Complicating the matter is the presence of a rising new sector of for-profit charter schools, many coming to North Carolina from out of state. Few North Carolinians I talk to can explain how these schools make a profit. And if the schools do, it begs the question of whether it is ethical or legal for private interests to profit from education while many schools in the existing system can’t afford adequate learning materials and instructional staff.

These questions are not only important to North Carolinians; they are critical to the rest of the nation. President-elect Donald Trump has pledged to accelerate the growth of charters nationwide with a proposal to create a $20 billion federal block grant for states to offer families more “school choice.”

A key advisor to the president-elect, former New York City Mayor Rudy Giuliani, recently stated, “Trump is going to be the best thing that ever happened for school choice and the charter school movement,” according to a New York press outlet.

Trump’s nomination for Education Secretary is Betsy DeVos, who has spent millions to advance charter schools and other forms of “school choice” around the country. In Michigan, Devos’ home state, 4 out of 5 charter schools operate for a profit. Her husband Dick founded a charter school in their state. And, according to Education Week, “Expanding school choice has been a philanthropic-focus shared by many members of the wealthy DeVos family, which made its fortune from Amway Corp., the direct sales behemoth.”

So far, charter schools make up only about seven percent of the nation’s schools, but with the possibility that charters, under Trump and DeVos, might now explode nationwide, what can the rest of the country learn from North Carolina?

A Scramble For Cash

My next stop in Wake County is at a Whole Foods grocery store to meet with Wake school board member Christine Kushner. Kushner, a Princeton graduate in public policy who has lived in Wake County for over 20 years, was elected to the board in 2010.

Kushner ran unopposed in 2016, which may explain why at our interview, just days before the election, she’s treating herself to “an embarrassingly large bowl of ice cream,” as she puts it.

In between spoon-fulls, she talks to me about the challenges Wake County schools face. Responding to growth is at the top of the list. “Wake County adds nearly a kindergarten class every day,” she estimates.

Tightened state budgets make Wake’s growth even harder to manage. “When my son started kindergarten in Wake County in 2000,” Kushner recalls, “he had a full time teacher assistant in the class in addition to his teacher.” That’s hardly ever the case since the last state budget cut funding for teacher assistants. “There used to be more adults in the school, which meant teachers had more time to teach,” she recalls.

Balancing the effects of growth with inadequate funding is made even more complicated by the growing presence of charters. Charters have whittled away at public school enrollments in Wake County to the point that only 81 percent of eligible students in Wake attend district schools.

Charters from outside the district that enroll Wake County students confound budget planning further, as students who transfer to charters take district and state money with them. Frequently, the out-of-district charters are located in counties that spend less per student than Wake spends, which gives the charters an incentive to poach students from Wake rather than their surrounding communities.

Should any of those charter students decide they want to return to Wake district schools after the official count day in October – something Kushner contends happens a lot, although she did not provide a specific figure – the charters get to keep the money. Yet, when charters lose students during the school year, they are not required to fill those empty seats, even if they have a waiting list.

The financial situation is similar in neighboring Durham County, where I talk with school board member Natalie Beyer.

Beyer, a Durham native, has raised three children in the county’s public schools and is a founding member of Parents Across America, an organization that has opposed charter school expansions and called for more accountability of these schools.

Durham County’s population has grown more than 11 percent since 2010, when Beyer was elected, according to US Census data. Yet funding is not keeping pace, she maintains.

The pressure to find new places to cut clashes with the needs to serve more students with widely varying needs. “Our two most expensive programs serve students who are in prolonged hospital stays and students in juvenile detention,” she tells me. “Are we supposed to abandon those kids?”

While funding for the district tightens, the number of charters has nearly doubled from 8, when she took office, to 15, including two new online charters that operate statewide.

She tells me about the migration of some 6,500 students from Durham Public Schools to charters every year. Durham County, which has a higher per-pupil expenditure than Wake, loses over 500 students every year to out-of-district charters.

In the meantime, Durham County charters poach students from schools in neighboring Orange County, which has the highest per-pupil expenditure in the state. And so the scramble for cash goes as charters are incentivized to pick off students from the most well-off districts so they can maximize their per-pupil revenues.

“Hasn’t Been Done Well”

In 2011, North Carolina state lawmakers lifted the cap on the number of charters allowed to operate in the state, which had been limited to 100 – a move not only backed by Republicans but also encouraged by the Obama administration’s requirement for Race to the Top grant money, which the state won.

In the first three years, 53 new charters opened their doors in the state, raising the charter school student population in the state by 65 percent.

Much of the fervor for charters in North Carolina came from conservative lawmakers who promised these schools would be more financially efficient.

But the supposed financial efficiency of charters is muddled by the fact these schools don’t have to provide many of the services traditional public schools provide, such as transportation, a hot lunch, and personnel to attend to the needs of students who struggle with English or who have the most challenging physical and emotional issues. Also, in North Carolina only half the teachers in a charter have to be certified, so teachers are often paid a lot less.

Research studies on the financial efficiency of charters has found mixed results, yet it does appear they generally spend a higher proportion of funds on administration than public schools spend and lower proportions on instruction. Charters also have development and facility costs and marketing expenses public schools don’t have.

Many of the new NC charters quickly found out the financial difficulties of creating and operating a school were insurmountable. Ten of the new schools closed within four years, four during their first year of operation. The closures displaced more than 1,100 students and often left large amounts of taxpayer dollars unaccounted for.

“All of our charter school failures have been fiscal failures,” Any Hawn Nelson tells me during a phone conversation. “I am not anti-charter,” she says. “I used to work for a charter and agree with market inspired education reform, if it promotes equity. But [North Carolina’s implementation of charters] hasn’t been done well,” she argues.

Nelson, who currently works on research and policy for two agencies connected to the University of North Carolina at Charlotte, is an expert on the history of Charlotte-Mecklenburg schools and is currently working on a book about the district.

Nelson contends charter board members and management staff are often overwhelmed by the challenges of financing charter schools, especially during the start up phase.

The complications of inter-district migration of students I found elsewhere in the state are present in around Charlotte-Mecklenburg, Nelson confirms. “We have 26 charters in the county, but many are fed by communities across the boarder,” she explains. Numerous charters that ring the district complicate financial planning even further. “There’s no way to predict enrollment,” she states. “And many charter parents like to shop for charters and apply to multiple schools.”

Case in point, a local news outlet recently reported that a community school district in neighboring Cabarrus County was blind-sided by a bill for $326,800 in payment for 231 students who transferred to a new charter that opened nearby.

“Since these are additional students that we didn’t project and the state didn’t project, you’re left with a bill from the charter school wanting their money,” a local official complains.

The charter school that wants its money also happens to be part of a chain of charters operated by Charter Schools USA, a Florida-based for-profit education management organization (EMO).

Here Come The For-Profits

Charter Schools USA operates over70 schools, mostly in Florida but also in Louisiana, Georgia, Illinois, Indiana, and Michigan. CSUSA operates eight schools in North Carolina, five of which opened or expanded in 2016. Another CSUSA school is scheduled to open in 2017.

According to Nelson, many North Carolina charter schools are turning to for-profit management companies like CSUSA to help overcome financial problems of starting a school.

According to research from the charter industry, the national closure rate for charters in 2011 was 15 percent. Most closed for financial reasons. Only 3 percent of charter schools have ever been closed for academic underperformance. Among those schools that were closed for financial reasons, an overwhelming majority, 90 percent, are “independent, grassroots start-ups.” These start-ups “lack connections to the money and power” that often comes from partnering with private organizations like for-profit EMOs, the analysis says.

In North Carolina, the state’s charter governing boards also seem to favor opening new schools that are linked with management groups that are often for-profit and from out of state. As the Charlotte Observer reports, in the first four years after the state’s cap on charters was lifted, “the number of North Carolina charter schools run by a for-profit management company … more than doubled, from eight to 17.”

Of the 11 charters approved for 2016, six are operated by for-profit EMOs originating outside the state, including CSUSA, Accelerated Learning Solutions (another Florida-based company), and two new charters operated by National Heritage Academies, a Michigan-based for-profit EMO that already operates 11 charters in the state.

Of the eight new charters approved for 2017, four are operated by the same three out-of-state for-profit EMOs.

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, 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, LLCto 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.

For-profit EMOs justify this arrangement, according to Ulbrich, by arguing that because they take on the risk of starting the school, they deserve the compensation. “That would explain the lease arrangement for the first few years,” Ulbrich counters. “But once the builder gets its money back, why shouldn’t the property revert to ownership by the taxpayers?”

Florida-based Charter Schools USA operates much in the same way, according to Sue Legg, a source I’ve used for previous investigative reports on charters in that state.

Legg – a public school teacher, college professor, and an administrator of state school assessment contracts at the University of Florida for over 30 years – points me to a recent report she authored with Pat Hall for the Florida League of Women Voters.

The report explains how CSUSA profits through its host of affiliated businesses including Red Apple Development, Ryan Construction Company, the Florida Charter Education Foundation, and the curriculum software firm Connex. These companies, which are often owned by or employ the same individuals, collaborate to pad their wallets at taxpayer expense.

After a charter board signs a lease agreement, the report finds, CSUSA flips the property from Ryan Construction to Red Apple Development, and lease payments are charged out 40 years, with rent and interest adding to the lease payments. “Another 13 to 15 percent is charged by CSUSA for management fees, hence 40 percent of public money is not spent on instructing children,” the authors contend.

In a particularly egregious example of corporate self-interest taking precedent over public good, after CSUSA’s construction partner, Ryan Construction, completed work on two new CSUSA schools, Ryan “sold by special warranty deed” the schools to Red Apple Development, CSUSA’s real estate partner. One sold for $1 and the other for $10. After taking over the lease, Red Apple was then able to jack up lrase payments to whatever it wanted. The payment from one school, the one that sold for $1, amounted to $1,325,666 per year, courtesy of the taxpayers. The charter also has to pay capital lease payment increments to Red Apple ranging from $9,540 to $135,300 per month through June 2042. Both schools, of course, are tax-exempt.

As CSUSA, and other charter chains, build their networks of schools, their financial dealings become more opaque. “Once there’s a critical mass of schools in a chain like CSUSA,” Legg explains to me in our phone call, “the schools pool their resources to start new schools or loan each other money to stave off financial distress due to low demand. This would never show up in an audit.”

Both Ryan Construction and Red Apple Development have several North Carolina charter school properties connected to CSUSA listed in in their portfolios.

An Illegal Enterprise?

Now that charter chains such as NHA and CSUSA have honed their business model in their homes states, they’re being imported into North Carolina.

That’s caught the attention of University of North Carolina – Chapel Hill law professor Tom Kelley who recently wrote a legal review of the schools’ business practices.

When I meet with Kelley in his office at UNC, he is just wrapping up work with students involved in the college’s Community Development Law Clinic that involves third-year law students in providing legal counsel to community based nonprofit organizations. More recently, he’s been engaged in projects in Africa examining applications of Western-based law to communities on that continent. Books about African countries are strewn about the floor.

What on earth got him interested in examining North Carolina charter schools?

“I’m not an opponent of charter schools,” he tells me, having “bought into the bipartisan support” for the schools. Nevertheless, when the state lifted all restraints from the expansion of these schools, he felt the need for someone “without a particular point of view” to look at the potential problems that unbridled charter growth could cause. And because North Carolina charters are legally required to practice as nonprofits, he feels his expertise in nonprofit law seemed suited to examining the potential legal issues with these schools.

“There are unexamined but crucially important legal issues,” he tells me.

An early flashpoint that caught his attention was the investigative report by Marian Wang for the ProPublica news outlet on a chain of charters in the state owned by businessman Baker Mitchell who, at the time, also served on the states’ Charter School Advisory Board.

In her report, Wang finds the four charter schools Mitchell was instrumental in creating all hired the same for-profit management company, Roger Bacon Academies, which is also owned by Mitchell. Virtually every aspect of the RBA schools’ financials is tied to Mitchell’s business relationships.

Kelley’s legal review examines the four RBA schools along with 17 other schools, including those managed by CSUSA and NHA, to determine compliance with nonprofit law at the state and federal level.

In addition to examining government forms available for the schools, Kelley filed public records requests with each of the schools, asking them to provide copies of all board and committee meeting minutes, copies of all vendor and service contracts, and budget documents.

Kelley’s review finds EMOs such as NHA and CSUSA exhibit “troubling indications of noncompliance” with nonprofit law at both state and federal levels.

In the case of the Roger Bacon Academy, “Evidence points to nonprofit law violations,” Kelley concludes.

Regarding NHA- and CSUSA-managed schools, the review concludes, “Charity regulators should also closely scrutinize: their non-compliance.

Kelley alleges NHA is “masking how the charitable dollars are being spent and how much money NHA is taking as profit.” NHA operates its charters as what are known as a “sweeps” contracts, in which almost all of the public funds given to the school are then paid to the for-profit organization. This makes it is almost impossible to audit the real expenses. Typical budget reports from NHA, according to Kelley, “contained so many vague line items that an outside observer would have little idea what the money was actually being spent on.”

He notes NHA’s lease arrangements ensure “there is virtually no way for [NHA] to lose money. It takes the nonprofit organization’s money, pays itself whatever it wants in rent (thereby eliminating any debt it incurred in constructing the facility), and reimburses itself for any and all real-estate-related expenses.”

In another deft move, NHA’s management contracts explicitly permits the company “to attribute the expenses of shared back-office services to any of its schools, so long as the attribution is ‘reasonable,'” which guarantees costs get obscured in budget reports.

Regarding CSUSA, he alleges the organization collaborates with Red Apple Development “to make its charter schools the subjects of lucrative ‘real estate plays.’” He finds “at least some evidence” to indicate CSUSA concealed from state and federal authorities that the management firm would be the school’s landlord.

Kelley concludes the EMOs he examined “charge charter-holding nonprofits rent (possibly above-market rent) long after their acquisition-related debts are paid off. Because the management organizations own the schools’ real estate (and, in the case of RBA and NHA, practically everything else the schools need to function), the schools’ boards of directors are virtually powerless to fire them or otherwise alter the relationships.”

What The Charter Industry Wants

What do charter school proponents in North Carolina think about the business practices of these for-profit charters?

To find out, I contact Alex Quigley who serves on the state’s Charter School Advisory Board that recommends to the State Board of Education individual charters for approval and policies for operating all aspects of the schools.

Like many of his colleagues on the CSAB, Quigley is in thick with the charter industry, having led a charter school in Durham and now currently serves as managing director for Pave Schools, a charter school chain in New York City and Raleigh, NC.

Other CSAB members with ties to the charter industry in North Carolina include Alan Hawkes, who serves on the board of two NHA charters in Guilford County, Eric Sanchez, who founded a charter in Hendersonville, Joe Maimone who leads a Rutherford County charter associated with state-based charter chain Team-CFA, and Tammi Sutton who works for the KIPP charter school chain.

I ask Quigley if having so many members of a regulatory board for charter schools with strong ties to the charter industry – and one with ties to a for-profit – might not create conflicts of interest. “Only board members can decide if there’s a conflict of interest,” he replies. “We are all very aware of the lines that can potentially be crossed.”

Does he have any concerns about the business practices of for-profit charters in the state? “What I’m interested in is good schools,” he replies. “I’m agnostic about who operates them.”

Like many other North Carolinians I spoke to, with the exception of the attorney Kelley, Quigley seems to have only a vague notion of how for-profit charters make money. He suspects it has something to do with “the front end of starting the school and the back end of operating the building.”

When I ask him about NHA specifically, he replies, “I don’t know the inner workings” about the schools’ financials.

Quigley also seems nonchalant about the fact so many charters are coming to North Carolina from outside the state. “You’d have to ask them” why they’re coming here, is his position. “I don’t know their marketing plan.”

Like many others I spoke with, Quigley seems to believe that EMOs, or those charters connected to “wealthy philanthropists,” have an advantage in the current way of doing charters in the state because of their ability to overcome the challenges of the start up phase. “We do want to see charter schools that grow out of the community,” he adds, “but it’s tough to start them.”

That kind of answer is likely to get pushback from charter school operators who believe in the original vision of charters as community-based institutions. One such believer of that original vision is Chris Terrill, the director of Pine Lake Preparatory charter school in Iredell County, just north of Charlotte.

A ‘Truer Representation”

When a new charter in the CSUSA chain announced it would open at site only a mile-and-a-half from Terrill’s independent charter, he had choice words for the local reporter covering the story.

“They are in this to make a profit,” Terrill says about the CSUSA school.

According to the reporter, Terrill believes his charter to be “a truer representation of the charter school model.”

How much truer? On my final leg in this journey through the Tar Heel charter school story, I decide to find out and visit his school.

Terrill is eager to talk about his school, greeting me in the parking lot as soon as I get out of the car. He invites me into his office where we talk about how he started his career in education as a schoolteacher and then an administrator in Kansas.

He cut his teeth in the charter industry in Florida with a charter school chain that eventually went belly up. “It was quite frankly a train wreck,” he recalls. “When I got to my first school, there wasn’t even a building.” He recalls getting attacked by raccoons by the dumpster one night when he was staying late to clean the school because janitorial services hadn’t showed up.

Pine Lake is anything but a train wreck.

Terrill takes me on a tour to view the cluster of buildings that make up the K-12 school. The newest facilities include new STEAM (science, technology, engineering, arts, and math) labs, where I talk to a teacher about his work with students on a unit on robotics. There’s a well-appointed gym and a near-by athletic facility for the football team and other sports.

Pine Lake is a grade “A” school according to the state’s rating system. There are over 3,000 students on the waiting list to get into the school.

Such was not always the case. When Terrill arrived at the school, it was struggling financially, and many of the sparkling new facilities that attract students to the school today did not exist then. What helped transform the school, he points to, is a line item on the budget that shows $505,000 in revenue from annual donations.

He tells me about having frank discussions with parents about how the “free education” they were getting at the charter needed extra financial support to get to the level of what they really wanted for their children.

He also says the school has a “high level” of parent volunteer support.

Terrill is quick to draw sharp distinctions between his school and the for-profit CSUSA-affiliated school that opened nearby, Langtree Charter Academy. He shows me spreadsheets to illustrate the pains he goes through to be transparent about the ways his school takes in and spends money. He explains to me how the board of directors for his school is accountable to and reflective of the families who support Pine Lake. He describes how his school has built a collaborative relationship with Iredell County schools to share best practices.

When I ask him how schools like Langtree make a profit, he says he has no idea but thinks it might have something to do with real estate, paying teachers less, and operating a substandard facility.

When Langtree opened, Terrill’s independent charter lost 111 students to the school – a big blow but one he says his school has more than recovered from. In contrast to his school’s A rating, Langtree received a “C” grade from the state in its first year. And many of those departing students, Terrill claims, are back on his school’s waiting list.

Who Owns Schools Matters

Regardless of which model is closest to the original vision of charter schools – either community-based, independent charters like Pine Lake Preparatory or the for-profit schools operated by NHA, CSUSA, and other EMOs – the reality is that under current financial constraints like what exist in states such as North Carolina, neither model can be funded without drawing from significant money from non-traditional sources.

In the case of Pine Lake, the money comes from wealthier households or private foundations, which begs questions about whether the model can work in every community and whether it can ever be independent from the exclusive desires of the rich.

In the case of the for-profit charters, the money comes from the ability of EMOs to reallocate costs for teaching and learning to other cost centers that can be spun into private income from real estate, finance, and contracting.

In both cases, the mission of public education is distorted, and taxpayers grow ever more distant from having control over their schools.

Who owns our public schools matters, despite any argument that justifies a school model based solely on “results.”

As Kelley notes in his legal review, charter operators often argue that all that matters is whether charter school students do well on standardized tests and that parents are generally satisfied with the schools’ performance compared to public schools. But this argument ignores the tax-paying public, which is a “silent third party” that deserves to know “whether those outcomes are being achieved without wasting charitable public dollars.”

Kelley’s recommendations to ensure charter school accountability include, among others, requirements for charters to report much more information about their financials and a prohibition on obvious conflicts of interest in charter school governance and operations.

Those recommendations are well and good, but let me close this story in the same situation in which I started it: stuck in traffic.

As I leave Pine Lake Prep, the elementary grades let out, and I’m caught in the slow moving line of parents picking up the their children. Of the more then 1,800 students attending Pine Lake, only about 350 ride the three buses the school operates. So the line of cars is long.

Also, like all charter schools in North Carolina, students come from all around the region, so having ready access to a car – and a schedule flexible enough to wait patiently in traffic during the middle of a work day – provides an advantage. Well over half the students at Pine Lake commute from neighboring Mecklenburg County to the south, and nearly a third from Cabarrus County to the east.

Like the parents at West Lake Middle School, where I started this story, these parents believe in a version of the American Dream that includes a guaranteed access to a school that will accept their children for who they are and provide a benchmark of education quality that is expected in a country that professes to “lead the world” in all aspects of human enterprise.

But unlike the parents at West Lake, you likely won’t seen Pine Lake parents attending protests demanding better schools for all children and a better system of education that serves everyone’s needs. They got theirs.

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