The Network for Public Education has released Asleep at the Wheel: How the Federal Charter Schools Program Recklessly Takes Taxpayers and Students for A Ride, a scathing condemnation of the federal Charter Schools Program (CSP), which is part of the Office for Innovation and Improvement at the U.S. Department of Education: “For over a decade, Congress has poured money into CSP at rates much higher than overall Education Department spending has increased.  We estimate that approximately $4 billion federal tax dollars have been spent or allocated to start, replicate and expand charter schools.”

The report recounts mounting abuses over the quarter century since the federal Charter Schools Program was established: “The CSP… was established in 1994 as a way to kick-start the creation of new charter schools…. Over its 25-year existence, the U.S. Department of Education estimates that the program has offered federal dollars to as many as 40 percent of charter schools.”  In this report, the Network for Public education evaluates three of the program’s seven funding streams: that award charter school start-up or expansion funds (1) to the 50 state departments of education, (2) to individual charter schools, or (3) to the Charter Management Organizations (CMOs) that operate chains of charter schools.

The Network for Public Education’s new report is explosive. The researchers conclude that if you want to start a charter school, you ought to hire a grant writer skilled at creating a compelling fictional narrative, because the department makes its grants without investigation—almost exclusively based on the story spun in the grant application: “While congressional appropriations to the CSP continue to climb, our investigation… found that not only does grant money awarded to charters by the CSP continue to go to schools that never open or quickly close, but hundreds of millions of dollars have been provided to schools that don’t resemble ‘high quality’ schools, including many that engage in exclusionary practices that keep some economically disadvantaged students, students of color, students with disabilities and English language learners (ELL) out.  Through our detailed examination of the CSP’s application process, we found a system in which the program awards grants based on which schools can write (or hire someone to write) the most compelling narrative in its application, knowing that the facts they present will never be checked. As we compared information on state databases and school websites with application data, we found startling discrepancies between what charter applicants promised and what they ultimately delivered. Time and again, huge sums of grant money have been awarded to charter schools that have inadequate business plans, discriminatory enrollment practices, or no evidence of strong demand for the school from the surrounding community.”

The Department of Education’s Office of Inspector General (OIG), in a series of reports beginning in 2012, has seriously criticized the lack of accountability in the federal Charter Schools Program, but the problems the Department’s own OIG highlighted have neither been investigated nor addressed. The Network for Public Education explains why the problem has worsened under Betsy DeVos’s leadership of the Department of Education: “The present Secretary of Education, Betsy DeVos believes that the promulgation of choice for its own sake is a public good, and that an education ‘marketplace’ should be the ultimate decision-maker of how education is delivered, regardless of the cost to American taxpayers. She is a determined supporter of the Charter Schools Program and is likely to continue to promote increasing investments in it.”

The researchers document seven primary findings:

1. “Hundreds of millions of federal taxpayer dollars have been awarded to charter schools that never opened or opened and then shut down.  In some cases, schools have received federal funding even before securing their charter…
2. “The CSP’s grant approval process appears to be based on the application alone, with no attempt to verify the information presented.  Schools have been approved for grants despite serious concerns noted by reviewers…
3. “Grants have been awarded to charter schools that establish barriers to enrollment, discouraging or denying access to certain students…
4. “Recommendations by the Office of Inspector General have been largely ignored or not sufficiently addressed…
5. “The department does not conduct sufficient oversight of grants to State Entities or State Education Agencies, despite repeated indications that the states are failing to monitor outcomes or offer full transparency on their subgrants…
6. “The CSP’s grants to charter management organizations are beset with problems including conflicts of interest and profiteering…
7. “Under the current administration, while Congressional funding for the CSP rises, the quality of the applications and awardees has further declined.”

The Network for Public Education recommends a moratorium on new grants from the federal Charter Schools Program while a serious investigation of the program is undertaken: “(I)t is time to investigate where millions of dollars have gone and secure back for the public all unaccounted-for spending. American taxpayers have a right to demand that their tax dollars aren’t wasted. Tax dollars that went to charter schools that never opened or quickly closed should not be considered the cost of doing business. And a program with a stated commitment to spread ‘high-quality’ schools should not be a major funding source for schools that leave families in the lurch and promote discriminatory enrollment practices.

Finally, the new report, Asleep at the Wheel: How the Federal Charter Schools Program Recklessly Takes Taxpayers and Students for A Ride, is particularly critical of the Department of Education’s willingness to trust the state departments of education (SEAs) with having established adequate oversight of the charter schools whose authorization they enable. The researchers declare that officials running the federal Charter Schools Program have not grasped, “the significance of the problems posed by providing the vast majority of funding to State Education Agencies, which have proven to be incapable or unwilling to tightly monitor the funds. Our findings show that some of the worst abuse of charter grant funds occurs when SEAs pass that funding along directly to individual charters or charter organizations as subgrants.  We found a continuing record of failure in the SEA grants program, with grants going to schools that never opened or closed quickly, to schools that blatantly discriminate in their discipline, curricular, and enrollment practices, and to schools that engage in fraud as well as in related-party transactions that result in private individuals and companies pocketing huge sums of money at taxpayer expense.”

Under the leadership of Betsy DeVos, this problem is exacerbated by her philosophy of hands-off deregulation: “The department claims it is unable to stem the flow of good money going to bad results because the states are responsible for oversight. The current Secretary of Education denies the existence of the problem altogether, arguing that stronger oversight of the program would be ‘inconsistent with the federal role in education.’ This impasse leaves American taxpayers with the expectation that public funds intended to proliferate the privately-managed charter school marketplace will continue to be subject to unavoidable waste, fraud, and abuse.”

Please do read the Network for Public Education’s new report in its entirety.   The report’s details of abuses in the federal Charter Schools Program are riveting.  NPE makes a compelling case for a moratorium on this program.