Waste, Fraud and Abuse or Something Better?

choicesThe 2014 report on Charter School Vulnerabilities to Fraud, Waste, and Abuse by the Annenberg Foundation was triggered by the U.S. Inspector General’s warning about mismanagement in charter schools.

I compared the report’s  recommendations to Florida’s laws.  We have laws.  We are short on enforcement.  What can we do to clean up the mess?  It is a mess.  Florida has over 600 charter schools, and its closure rate is nearing 50 percent.  I made some recommendations.

These are the types of problems the report cited.  Florida has them all.

  • Charter school operators use public funds for personal gain.
  • School revenue is used illegally to support other charter operator businesses.
  • Mismanagement puts children in actual or potential danger.
  • Charters request public money for services not provided.
  • Charters inflate enrollment to boost revenues.
  • Charters mismanage public funds and schools.

Their recommendations listed below relate to improvements in oversight, transparency and governance.  Florida has many, but not all of these regulations.  Can you pick out where we fall short?

Oversight

  • Establish an office of charter schools with authority to prevent and catch bad actors and refer them to appropriate law enforcement agencies.  The office should have the authority to amend contracts and to withhold funds.

Transparency

  • Require charters to be independently audited.
  • Require transparency: disclose board members financial affiliations, conflict of interest, open meetings and minutes, use of public and private funds by the charter and management company
  • Require disclosure of all vendor contracts over $25,000 and prohibit any contracts in which a board member or charter operator has a personal interest.

Governance

  • Require elected board members who live in the area and who represent parents, teachers and students
  • Hold governing board members legally liable for fraud or malfeasance at the schools they oversee.

THE FLORIDA CASE

Oversight. Florida has a central office for charter oversight in the Department of Education. The legislature has also proposed an additional institute at Florida State University or evaluate charter proposals and procedures.  Neither agency has legislative authority to enforce laws.  Districts sign the contracts with charters, but they have limited authority to require changes in procedures unless the charter cannot pay its bills or endangers children.  There is a mediation process for disputes, but by and large charters are allowed to fail due to poor academic performance or financial insolvency.

Transparency. Charter schools must post this information on their websites:   governing board members, meeting minutes, audits and budgets, academic performance, letter grade, and management company affiliation.  Many of these regulations are generally ignored.  Management companies must disclose what they charge for services but not how they spend the money. Florida requires audits, but auditors are allowed professional discretion about what to report unless the problems are very serious.

Governance. Governing boards must approve a parent representative, but governing board members are not required to live in the district.  Board members often are appointed by management companies and are associated directly or indirectly with them. It takes a serious violation of law before districts intervene. Lapses in oversight mount for both independently run charters and for those run by management companies.  It is often difficult to know whose interest the governing boards are protecting.

Authorization.  Criteria for eligibility of

HOW SHOULD THE LEGISLATURE RESPOND?

Florida comes up short on the enforcement of charter school laws and regulations.  Audit violations cited by the Auditor General continue from one year to the next.  The rate of charter closures (293) is close to one-half.  Nearly one third of charters are so small they are not part of the state’s school grade accountability system.  They fail more often.  The focus of the charter movement has been on quantity of schools rather than quality.  Quality is defined by school  grades which can be manipulated by enrollment and dismissal policies.

Florida can do better if the Florida Department of Education required that:

  • Board members were independent from the school staff and the management companies and approved by districts.
  • Laws regulating transparency, conflict of interest, nepotism, admissions and dismissal policies were enforced.
  • Guidelines for controlling excessive salaries and payments for facilities were enacted.
  • Accountability and transparency of charter management companies’ use of public funds were increased.
  • Charter authorization criteria required justification of need and innovation.

Better screening, stricter oversight, stronger enforcement, and more transparency are the keys to a better success rate.  Florida talks the talk but does not walk the walk.

Posted in Charter School Management, Florida.

One Comment

  1. I believe you have created the short list for educational legislative priorities. Please keep in mind as they will be called for in August.

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