(Update and clarification: This provides new information on the fate of one charter school, Glidden Class Act.)

I recently wrote about a report by the advocacy group, the Network for Public Education, about waste in the federal Charter Schools Program (CSP). It was the second such report published in 2019 by the group, which was co-founded by historian and activist Diane Ravitch. Both of them, not surprisingly, received pushback from charter school supporters.

The first report, published last March and titled “Asleep at the Wheel,” said that the U.S. government had wasted up to $1 billion on charter schools that never opened, or opened and then closed because of mismanagement and other reasons. It also said the Education Department does not adequately monitor how its grant money is spent.

The second report, published last month, was titled “Still Asleep at the Wheel” and provided new details about waste in the Charter School Program. It noted that the state with the most charter schools that never opened was Michigan, home to Education Secretary Betsy DeVos.

Report: Federal government wasted millions of dollars on charter schools that never opened

Ever since the second report was published, critics have been attacking it, saying that it was exaggerated and even that the authors were basing their claims on data they obtained from teachers’ unions. The lead author of the report, Carol Burris, said the critics have it wrong, and in the following post, she explains where the information came from and how the results were reached.

Critics may be surprised to learn that some of the key data came from none other than DeVos herself (although not intentionally). DeVos has often said she is no fan of federally funded education programs, though she still defended the CSP in a letter to a U.S. legislator cited below.

The Network for Public Education is an alliance of organizations that advocates for the improvement of public education. It is headed by Ravitch, a former official in the administration of President George H.W. Bush who broke with corporate-based school reform and became the titular leader of the movement opposing it.

The network opposes charter schools — which are publicly funded by privately managed — seeing them as part of a movement to privatize public education. However, its two 2019 reports are focused not on the place charters hold in American education but about how the federal government spent its money on a program aimed at expanding the charter sector.

Burris is executive director of the Network for Public Education and a former award-winning principal in New York. She has been chronicling the charter school movement and the standardized-test-based accountability movement on this blog for years.

Here’s the piece by Burris.

By Carol Burris

The Network for Public Education recently published a report, “Still Asleep at the Wheel,” that documents the failures of the U.S. Department of Education’s Charter Schools Program (CSP), a program that has wasted hundreds of millions of dollars on charter schools that never opened or opened and closed. That report, for which I was the primary author, reviewed thousands of federally funded charters included in a partial database of charter schools funded from grants that were active from school years 2006-2007 to 2013-2014. During that time, CSP subsidized about 1,700 schools that never opened or have failed, sometimes under the shadow of fraud.

For 25 years, the CSP enjoyed the uncritical support of Congress. Spending was allowed to grow unchecked even as rules were loosened and modified. The charter industry, not surprisingly, was angered by our carefully documented report and has tried to discredit it by nitpicking and misinterpreting its contents while avoiding the big story the report reveals: that the CSP has grown from a small program intended to aid small, start-up charter schools, to a wasteful program that now gives money to schools that never open, schools that close (including many that never should have opened at all), corporate charter chains with millions in resources (enough to lease private jets) and even charter advocacy organizations.

These critics argue that “Still Asleep at the Wheel” exaggerates the waste and flaws in the program. Our response is, “If you don’t believe our numbers when it comes to the failures of the program, use the numbers given to Congress by Secretary of Education Betsy DeVos instead.”

After the publication of our first report in March 2019, DeVos was asked to respond to Congress on its findings. That response was never made public, but you can now read it on our website here or below.

After you wade through the secretary’s disparagement of Diane Ravitch and the Network for Public Education, you will find data in her letter that not only supports the conclusions of that second report, but shows them to be an underestimate.

Please read the following paragraph, from that letter, noting the figures I have put in bold.

Since 2001, of the 5,265 charter schools that have received funding through a State entity or directly from the Department, 634 did not open and are unlikely to open in the future. As the developers of these schools received only CSP “planning” funds, which serve the specific purpose of enabling a charter school developer to explore the feasibility of opening a new charter school, the average award size for these schools was significantly lower than the average award size for CSP “implementation” grants and subgrants. In total, the funds awarded comprise less than 3.5 percent of the more than $2 billion in total awards made to public charter schools during the same period.

Now let’s put these numbers in context.

The secretary states that 5,265 charter schools have received grants since 2001. Her language is imprecise. The only record of the charter schools that received funding from 2001-2005 are those that were receiving a multiyear grant that was still active during the 2006-2007 school year. Beginning in the 2006-2007 school year, the states were first required to provide a list of schools that received the federal grants. Neither she nor her predecessors know which schools received funding outside of the above, a claim we both explain and document in the report.

The number she provides is most likely the number of charter schools that received funding from active grants from the time from which school information was required (2006) until the 2016-2017 school year. These are the years for which WestEd, a research company that has taken a pro-charter stance and that officially monitors the CSP, did an analysis for the department shortly after our first report. That analysis was based on a 2019 data set that includes a handful of schools that were receiving grants as early as 2001.

I verified the number (5,265) using the recently published 2019 data set provided by the Department. I determined that 4,860 schools had a unique National Center for Education Statistics (NCES) revised ID number and 618 schools had no NCES revised ID. From those without IDs, I pulled out duplicate names. From that total (5,478) I subtracted those schools (192) that received grants after the 2016-2017 school year. DeVos says that number is 5,265 in her letter. I found 5,286 schools. I will defer to the Secretary’s number in the discussion below.

What Secretary DeVos neglected to tell Congress in her letter is how many of those 5,265 grantee schools were still in existence. But the recently published 2019 Overview of the Charter Schools Program prepared for the Department by WestEd does. According to the overview[1] (see slide 8), 3,138 charter schools that were funded by CSP from active grants from 2006-2007 to 2016-2017 were open in 2016-2017. That means that 2,127 schools either never opened or closed — which represents 40.4 percent of all charters that were funded from active grants during those years.

Let’s compare those numbers to those in our latest report, keeping in mind that the time period we cover ends by 2015, not 2017. Of the 4,829 grants we reviewed, we said that 1,779 went to schools that never opened of closed — 37 percent. That proportion of failed schools is considerably less than the secretary’s percentage (40.4 percent) of defunct charter school grantees.

Now let’s move on to the schools that never opened. According the secretary, of those 5,265 schools that received money, 634 never opened and are likely to not ever open up. That number represents 12 percent of all grantees. Our report identified 537 schools that never opened (again during a shorter period of time). According to our report, ghost schools represent 11 percent of all grantees — less than the secretary’s percentage.

Finally, the secretary tells us that “less than 3.5% of the more than 2 billion dollars” granted since 2001 has been granted to charter schools that never opened their doors. The $2 billion figure is not explained; between 2001-2017, the Department of Education spent $3.4 billion to fund and expand charter schools. But let’s assume the Secretary is again being imprecise and is referring to schools funded by active multiyear grants from school years 2006-2007 through 2016-2017, which includes some schools as far back as 2001. That funding figure would be approximately $2 billion, and 3.5 percent of $2 billion is $70 million. If she indeed means all schools since 2001, $119 million has been spent on schools that never opened.

The total for grants in the 2015 data set we used for our report is $1,794,548,157. Of that amount, 3.5 percent is $62,809,185. Our report said $45.5 million was wasted on ghost schools. Again, it appears as if we did not catch all of the waste. Notwithstanding the nitpicking and complaining, the “Still Asleep at the Wheel” report made conservative, careful choices throughout and its bottom-line figures are likely the floor — the most easily identified waste in the CSP program. Waste was also certainly present in the early years when the department did not even require that school names be reported by the states.

Although our critics can quibble about whether an individual school on a state list is open or closed, the Department of Education itself provides the numbers that verify that large proportions of schools (in excess of 40 percent) collected the grants and then either did not open, or have opened and shut down, as well as the millions spent on ghost schools.

What follows next is a more detailed response to two critiques of our report.

The first critique is a blog post on the Thomas B. Fordham Institute’s website, written by William Flanders of the Wisconsin Institute for Law and Liberty (WILL), a right wing think tank that promotes vouchers and charter schools, co-authored with Jim Bender of School Choice Wisconsin. Flanders and Bender list 11 schools of the 289 Wisconsin charter schools that received CSP grants, claiming that those 11 schools that we listed as closed were open. These, the authors state, are “glaring errors” and therefore our entire report should be discounted.

One of the schools listed by Flanders and Bender, Class Act, was never on our closed schools list — however, Glidden Class Act was.

Glidden Class Act began receiving a CSP grant in 2006. It did not enroll any students until the 2008-09 school year when it enrolled 5 students. From 2006 – 2008, the school received a total of $425,000 from a CSP grant, according to the CSP database of 2019 which you can find here.

Glidden Class Act was located in Glidden, Wisconsin when it closed in 2009 as the districts of Glidden and Chequamegon merged. Immediately following the merger, Class Act opened with a different NCES number and a different location in New Falls, Wisconsin, 15 miles away in a wing of the district's public high school. Class Act received a dissemination grant for $250,000 beginning in 2011 when its enrollment was 8. It then dropped to 1 (2012), 5 (2013), 6 (2014) and then 0 in 2015.

Class Act hobbles along. Its 2017 enrollment was 11. While one could argue that the merger of the district means that Glidden never truly closed but rather changed its name, NCES number and the city in which it was located, there is a forest that should not be ignored as we look at this tree.

Grants of $425,000 and $250,000 were doled out to Glidden Class Act and Class Act during years in which the schools had either no students or very low student enrollments. Does this represent the mission of the CSP program, which is “to provide money to create new high-quality public charter schools, as well as to disseminate information about ones with a proven track record?” Or, is this one more example of state and federal education departments being asleep at the wheel?

We are submitting a FOIA request to find out just how this large sum of money was spent.

Meanwhile, we are investigating the status of the other schools on the Flanders and Bender list. Despite being on the state list of closed charters, there is evidence that some with the same or similar name may be open based on information provided by William Flanders. We will update our Wisconsin list of closed schools as corrections are warranted.

The second is a critique by the National Alliance for Public Charter Schools (NAPCS), which itself has received a grant of nearly $2.4 million from the Charter Schools Program. NAPCS, whose self-interest is obvious, slanders the report in emails sent to education reporters as “half-truths, falsehoods, and unsubstantiated assertions.”

As I read their critique published on their website here and here, I wondered if they read our report as well as the secretary’s letter to Congress from which they quote.

The first allegation is that the Network for Public Education “incorrectly assumes that when a multiyear CSP grant award is made, funding is provided in its entirety up front… Schools that never open receive only a fraction of the award amount — typically only utilizing ‘planning’ funds.”

We make no such assumption, and the data we report in state lists reflect reduced amounts given to schools that received only planning funds. Those numbers are taken directly from the CSP 2015 database. As we describe in our report, the CSP 2015 database is a snapshot that provides amounts given, and in some cases, if the grant was not closed at the time the data set was published, amounts promised.

Planning funds are apparent. That is why most of the ghost schools of California are listed as receiving $45,000 as compared to the average state grant of over $427,000; the ghost schools of Tennessee typically received only $10,000; the ghost schools of Michigan received the reduced grant amount of $110,000 and nearly all of the ghost schools of Hawaii received $90,000. There are a few exceptions with larger amounts — it may be that was the promised amount when the “snapshot” was taken. Nevertheless, a clear pattern of reduced funding for unopened schools is there and is reflected in our report.

As we mentioned above, given that DeVos reported that the amount spent on schools that “did not open and are not likely to open” was $70 million, and we state it was $45.5 million, the NAPCS allegation that we overestimated the total amount wasted is not substantiated by the data provided by the Secretary herself.

To better understand why funding schools that never open is a terrible idea, our report does a deep dive into several such charter schools for which we were able to obtain detailed records. One of those is the Harris Academy. You can find a copy of the spreadsheet used by the Michigan Department of Education to track its grant spending here.

The organization that received the grant to open Harris Academy is called the Potter’s House Prevention Center. The spreadsheet shows that the proposed charter operators drew down $109,995 of the $110,000 planning grant. About $6,000 of those funds were not approved and in theory the department should have clawed that back.

Look closely and you will notice that a large share of the money went to the for-profit, Lewis Property Holdings, LLC. The deeper you dig, the more troubling the story becomes.

Patricia Lewis, then sole director of Lewis Property Holdings, LLC, was on the Harris Academy planning board.

Just before her involvement in the new charter, Lewis was the chief executive officer of a previous charter school, Lewis Academy of Excellence in Clayton County, Georgia. In 2010, Georgia’s Department of Education recommended denial of the school’s charter due to serious concerns including probable cheating on the state test of 2009 and financial irregularities that included a suspicious payment. Lewis withdrew the application and closed the school.

Patricia Lewis started that failed school using CSP funds. In 2001, Patricia Lewis/The Lewis Academy of Excellence received a $5,000 grant from CSP. It then received another round of implementation grants in 2004 and 2005 totaling $400,000.

Let’s sum this up. An individual who was the chief executive officer of a failed Georgia charter school that had received $405,000 from CSP becomes part of a team that received $110,000 to open a Michigan charter school, cashes in on all but five dollars of that grant, and that school never opens.

Others schools do not receive the full amount awarded if they do not spend it properly. Such was the case with the Francis Marion Charter School, whose principal was arrested for stealing $45,855 from the school’s CSP grant. The school was supposed to receive $350,000 in grants. After the theft, $175,000 was held back. In the 2015 data set, only $175,000 was reported as distributed, the amount we report. Hopefully, the school reimbursed the CSP for the $45,855 their employee took. This article, which describes the theft, shows the principal standing before classroom posters that say, “I can trust God no matter what” and another that says, “I need to make the wise choice.”

What happens to the money that is not spent? In her letter, Secretary DeVos says it is returned to the Treasury. That may be the case with grants that the department gives directly, but when it comes to state grants (as is the case with the vast majority of CSP funding), it appears that the money is recycled to other charter schools — some of which also never open or close — until the grant cycle is complete.

The second criticism leveled by the NAPCS is that some of the schools we list as closed may be open. They estimate that number to be 120 of the 1,779 schools that we list, from the greater list of nearly 5,000 that we reviewed. Given the problems with the overall management, transparency and accountability in the program, we clearly acknowledged in the report that this could lead to schools being incorrectly labeled (either adding or subtracting from our bottom line). Schools occasionally change names and NCES numbers, and errors are undoubtedly included in the state lists and databases themselves.

We have invited corrections and have received emails that have informed us of schools that the sender believes are open, as well as schools we do not list that the sender believes are closed. We are regularly updating our list based on that information. Keep in mind that the charter that received the grant may be closed and the school reopened by someone else — with a different staff and a different mission. We have pursued several leads where this was the case and kept the school on the closed list. We are determined to maintain an accurate list and therefore appreciate corrections.

Now let’s step back. Even if NAPCS is correct and 120 schools are listed in error (they provide no evidence), this would mean that our rate of defunct charters drops from 37 percent to 34.3 percent — which is less than the secretary’s 40.4 percent rate. But NAPCS did not provide an estimate of how many schools were incorrectly not listed. The errors in the list should cut both ways. We may have included schools that are open and missed schools that never opened or closed.

An unfathomable critique put forth by NAPCS, however, is its defense of for-profit charter schools. NACPS accuses us of “conflating” for-profit charters with for-profit management companies. Part IV of our report carefully explains that only Arizona allows for-profit schools and we explain the regulations regarding for-profit charters, for-profit charter management organizations (CMOs), and CSP grants.

We urge readers to read Part IV which discusses for-profits and CSP grants and take a look at the referenced documents in Part III that show where Michigan ghost-charter funding went. Readers will see examples of CSP funding that went from nonprofits to for-profit consulting companies and CMOs that were on the proposed schools’ planning board. The outcome was a school that never opened. Our report also documents two closed Miami charter schools that paid 97 percent of their income to the for-profit White Hat Management Company, and a charter school in Camden, N.J., that fell under the weight of for-profit management fees and lease agreements.

Finally, the NACPS takes issue with our classification of charters that close. We consider such grant funding to represent waste and we consider this failure. But they characterize such closings as a success for accountability. They quote the DeVos letter that states only “1.7 percent of CSP-funded charter schools close before their second year of operation.” That is no surprise. Schools propped up by federal money should be able to make it through the first few years.

We wanted to get a better picture regarding how long the closed charters actually survived, so we crossed-matched our list of California closed grantees with the California Department of Education’s list of closed charters, which provides the opening and closing dates. We took out any illogical dates on the state list (for example, the school’s closed date occurring before the school’s open date).

Here is what we found: 73 percent of those closed CSP grantees closed in five or fewer years. That is insufficient time for a kindergartner in the first cohort to graduate from fifth grade. Only 8 percent of the closed California grantees survived to the 10-year mark or beyond and then closed.

We were shocked when we recently discovered that the U.S. Department of Education considered a charter school to be a success as long as the charter school was able to make it to year three.[2]

The department’s and charter lobby’s indifference to the hardships that result from charter churn is deeply concerning.

We urge readers to consider this account of how it feels to children when “accountability” shuts their school down, or mismanagement puts locks on the doors of a chain of charter schools. Read what happens when a school closes with little warning, including within a month into the school year. Or the effect on the local public schools when hundreds of students flee their charter schools after the charter schools’ CEO mismanages funds, resulting in the eventual demise of a small chain.

When the Clemente Charter School in California closed, its leaders put up a message thanking parents and saying that they had “a great ride,” as if it were the end of summer camp rather than the end of school on which parents and children had depended.

What do all of the above stories have in common? Every one of these schools got their start-up funds from CSP. We find stories like these along with other charter scandals to be even more tragic than the wasted funds.

The NAPCS concludes it critique by implying that NPE is somehow controlled by teacher unions because of the limited contributions that NPE, which issued the report, and its related 501(c)(4) organization, NPE Action have received.

NPE was incorporated in 2014 as a project of another nonprofit called Voices for Education. During those early years, NPE received grants from the Chicago Teachers Union Foundation, which were used primarily to fund early conferences. We were and still are deeply grateful for that early financial support. NPE became its own nonprofit entity on Dec. 31, 2015. We received one additional grant for $25,000 from CTUF for a film project in early 2017. Money granted to our related organization, NPE Action, from the AFT was used to provide scholarships to teachers and parents to attend our conference.

Organizations like NAPCS have made great hay in demonizing unions such as the Chicago Teachers Union. Reporters credulously write stories that use the slightest excuse to characterize a conflict as “teachers unions versus,” conveniently ignoring the civil rights organizations, university researchers, foundations, parents, and community organizers — as well as teachers and administrators themselves — who often lead (and even fund) those efforts. NAPCS tossed in the “teachers union” charge because they know it would find fertile ground among reporters and policymakers who routinely use the trope themselves.

From where, then, does NPE receive our financial support? We are funded each year through the generosity of nearly 1,000 individual donors and small family foundations that have in common — a deep and abiding love for public education. They support the work of our 1.9 (one full-time and two-part-time) employees. Our diverse volunteer board is composed of teachers, college professors, and advocates who lead organizations that support early-childhood education, smaller class sizes and stronger public schools. Finally, our founder and president, Diane Ravitch, provides invaluable support and guides all our work.

The Network for Public Education is not the first to alert the public about the waste and mismanagement associated with the Charter Schools Program. The Center for Media and Democracy drew attention to many of the issues we discuss in this report as early as 2015.

But the responsibility to investigate the program does not lie with the Network for Public Education, the Center for Media and Democracy or even the National Alliance of Public Charter Schools.

Congress must now step up to the plate and demand a thorough, independent analysis of the Charter Schools Program including all available program data. That analysis should be supervised by the House subcommittee on Labor, Health and Human Services, Education, and Related Agencies, the committee that oversees the Department of Education’s budget.

Monitoring of the program by WestEd, which states its desire to expand access to charter schools on its website, is neither objective nor sufficient supervision. In addition, the Office of the Inspector General of the U.S. Department of Education should be funded to investigate all grants that went to schools that never opened, as well as all grants of $1 million or more.

[1] The CSP overview posted on our website also appears on the website of the CSP. We downloaded it, including the WestEd “talking points.” on the Power Point version.

[2] See the critical OIG audit of IDEA charter schools that have received over $200 million in CSP grants. Definition of a successful charter can be found on Page 8, Footnote 6.

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Here is the June 28, 2018, letter that Secretary Betsy DeVos sent to Raúl M. Grijalva, a member of the U.S. House of Representatives:

Devo s Response by The Washington Post on Scribd

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Here is the updated version of “Still Asleep at the Wheel.” Changes to the original are minimal, Burris said, and have no effect on the overall argument about waste in the Charter School Program.

Asleep by The Washington Post on Scribd