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9486 in the collection
Charter schools' problems surfacing
Ohanian Comment: I
post this just for the historical record. At
last the media is expressing a shred of doubt
about charters.
I'm all for charters if they truly do something
different from the inadequate 'get 'em ready
for Harvard' curriculum. But most don't. They
just provide a pathway for corporate greed and
nepotism and eliminate union protection for
teachers. Most important, they don't introduce
significant change that will help students.
By Martha Woodall
When an unusual coalition of Republicans and
Philadelphia Democrats led by State Rep. Dwight
Evans joined forces to pass a law bringing
charter schools to Pennsylvania, they spoke in
glowing terms about this "innovative"
alternative to troubled public schools.
At that time - 11 years ago - few could have
predicted the explosive growth - and
controversy - that now surround the charter
movement.
About 67,000 students are enrolled at 127
charter schools statewide, including several in
Philadelphia that are now under criminal
investigation.
The "innovation" most in evidence at the
Philadelphia Academy Charter School in
Northeast Philadelphia, as The Inquirer has
reported, has led to allegations of nepotism,
conflicts of interest and financial
mismanagement, all now under investigation by
federal authorities.
Philadelphia Academy Charter is hardly alone.
While many charter schools are hailed in their
communities as educational beacons, the state
auditor general has found financial and ethical
problems at charters across the state.
In Philadelphia, the federal criminal probe has
spread to at least three other city charters,
including Germantown Settlement, where charter
money allegedly was used to prop up related
agencies.
State Education Secretary Gerald L. Zahorchak,
meanwhile, is demanding a full accounting of
administrative and instructional costs at
Chester Community Charter School. That school,
however, is not under criminal investigation.
Zahorchak also has complained that "cyber"
charters, which offer online instruction to
students at home, have amassed $28 million in
cash reserves.
A growing chorus of legislators and others say
the law that launched the educational
experiment needs an overhaul.
An Inquirer examination reveals:
The law allows little scrutiny of charters.
Districts approve charters but have limited
power to shut them down. The state exercises
scant oversight on charter spending, which
totals more than $633 million this year.
The law dictates a crazy-quilt pattern of
funding for charters. Each district pays a
different amount even when the students attend
the same charter. For example, Philadelphia
pays $8,088 per student; Jenkintown, $15,174.
Cybers get the same payments as other charters
even though students receive online instruction
at home.
Charters are paid extra for special-education
students, regardless of their disability. There
is no requirement they spend all the money on
special-education services. Chester Community
Charter spends only 20.7 percent of its
special-education funds on special education.
The law bars school board members from serving
on charter boards, but it does not prohibit
politicians or a founder's friends and
relatives. State Rep. Dennis O'Brien (R.,
Phila.), for example, is a board member of
Maritime Academy Charter School in Bridesburg.
Weak oversight and legal loopholes have enabled
some charter operators, such as Philadelphia
Academy founder Brien N. Gardiner, to build
empires by creating related companies that do
business with charters.
The state's fiscal watchdog, Auditor General
Jack Wagner, says it's time to revamp the law.
He plans to issue a charter report early next
year based on his department's audits. "You
can't have the same law in an ever-changing
environment," said Wagner, a newly re-elected
Democrat.
Wagner will find support in the Rendell
administration, where Education Secretary
Zahorchak supports changes, especially in
funding and special education.
In the legislature, the situation is more
complicated.
State Sen. Jeffrey E. Piccola (R., Dauphin),
new chair of the Senate Education Committee,
said he's open to holding a hearing to see if
the law needs to be altered.
"We would hear from both sides," said Piccola,
who cosponsored the 1997 law. "The people who
operate charters have some ideas about how we
should change the law to make it easier for
them to operate."
State Rep. James R. Roebuck Jr. (D., Phila.),
chairman of the House Education Committee, also
supports hearings.
"There are things that have happened that no
one anticipated," he said.
With 65 percent of the state's charters based
in Southeastern Pennsylvania, it may be
difficult to marshal political support for
change, especially when Evans, one of the most
powerful politicians in Harrisburg, doesn't see
the need.
After becoming frustrated by persistent
problems in city schools and the lack of
educational options for working parents, Evans
became one of the staunchest charter advocates
in Harrisburg. "I still think it's a good law,"
Evans said. "I would give it a B-plus."
Pa. is 'charter-friendly'
Nationwide, Pennsylvania is considered a
"charter-friendly" state. The Center for
Education Reform in Washington, a charter
advocacy organization, rates Pennsylvania's law
as the 12th strongest of the nation's 41
charter laws.
Back in 1997, charter advocates said the
taxpayer-supported, independent schools would
jumpstart educational reform. They reasoned
that charters could experiment with creative
educational approaches because they are free
from many rules and regulations restricting
public schools.
Charters provide educational choice by giving
parents of low-income and working families an
alternative to failing public schools,
especially in the inner city. And competition
from charters, supporters said, would force
public school districts to do a better job and
boost test scores.
The first charter opened in Minnesota in 1992.
By the time the Pennsylvania legislature
adopted its law, 26 states had charter laws on
the books, including New Jersey, which had
passed its law in 1996. The laws varied widely.
Paula Hess, an education policy expert who
worked with state House Republicans in
developing the law, said it was "crafted to be
Pennsylvania-specific."
With 501 districts, the state favored local
control. School boards were given the
responsibility for approving and overseeing
charter schools instead of the state Department
of Education, as is done in New Jersey.
But because charter advocates feared school
boards would reject applications out-of-hand,
Pennsylvania's law limited districts' ability
to deny applications, and it established a
state appeals board with power to overrule
local boards. As a result, charters flourished
in Pennsylvania. They grew more slowly in New
Jersey, where there are just 62 charters
statewide, including seven in Camden County.
Concentrated in Phila.
In Pennsylvania, Philadelphia has the greatest
concentration of charter schools: almost
exactly half, 63, of the state's 127. What
began as a modest expense has ballooned to $320
million per year, 14 percent of the city school
district's $2.3 billion budget.
Philadelphia officials know all too well the
limitations of the state law. While the
district is responsible for ensuring that
charters operate properly, the law allows the
district to exert close scrutiny only every
five years, when a charter is up for renewal.
In the interim, it's up to the charters to
report major changes. Districts cannot withhold
money from charters even if they are
mismanaged, under-performing or fail to file
required reports.
"Responsibility, transparency, accountability
and performance," said Michael J. Masch, a
former member of both the Philadelphia Board of
Education and School Reform Commission, who is
now the district's chief business officer.
"When public money is being given to a private
organization, those are the four things you
have a right to demand. And the charter law, as
written, does not give the public sufficient
ability to meet those goals in reviewing the
performance of charters."
Lawrence Jones, president of the Pennsylvania
Coalition of Charter Schools, said charters
already are required to submit piles of
documents.
"They have a tremendous amount of paperwork and
accountability," said Jones, CEO of Richard
Allen Preparatory Charter School in Southwest
Philadelphia. "For the most part, people
running charter schools want to do a pretty
good job. They don't mind accountability
because they know that was the arrangement."
The law allows charters to behave very
differently from regular public schools, and it
is silent on many issues. The law does not set
academic qualifications for charter CEOs or bar
charter officials from hiring relatives. It
does not limit officials' salaries or prevent
founders from creating entities that do
business with their charters.
Hess said lawmakers set no requirements for
CEOs because they wanted to give charter boards
the flexibility to hire nontraditional leaders.
She said salaries were not limited, and
nepotism was not barred, because districts did
not face those restrictions.
CEOs and board members are supposed to report
their financial interests and any conflicts of
interest annually to the state. But the auditor
general has found that not everyone complies.
Hess was taken aback when she learned in the
spring that Philadelphia Academy Charter School
had hired Kevin M. O'Shea, a former police
officer with a high school diploma, to be CEO.
As The Inquirer reported, a web of charter and
business entities enabled O'Shea and school
founder Gardiner to earn more than most
superintendents in the region. Both men and
relatives on the payroll were later fired.
In July, the legislature responded by changing
the school code to bar charter administrators
from collecting salaries from more than one
school or from entities doing business with
charters.
Senate Majority Leader Dominic Pileggi (R.,
Delaware), a charter supporter, favors
examining the law in light of what happened at
Philadelphia Academy. "If an analysis shows
that stronger oversight and greater
transparency would decrease the possibility of
wrongdoing, I would support such changes," he
wrote in an e-mail.
Other charters' business practices have come
under scrutiny.
As The Inquirer reported yesterday, state
officials have raised questions about Chester
Community Charter School's spending on
administration and instruction and its
classification of special-education students.
The school, which spends the highest portion of
any charter in the state on administration,
pays millions of dollars in annual rents,
management fees and salaries to a for-profit
company run by Vahan H. Gureghian, a wealthy
lawyer.
Ted Kirsch, president of the American
Federation of Teachers Pennsylvania, said that
in 1988 the late Albert Shanker, then AFT
president, first proposed charter schools to
empower educators and promote innovation.
"I think if he could see how some of these
'entrepreneurs' are making money out of this,
he would be appalled," said Kirsch, whose union
represents teachers at a few charters. The
union has no plans to join any debate on the
law.
After Philadelphia Academy was rocked by
allegations of conflicts of interest, nepotism
and financial wrongdoing in the spring, the
federal criminal probe was launched. It has
expanded to encompass at least three more city
charters, according to sources with knowledge
of the inquiry.
One of those schools is Germantown Settlement
Charter School, which is being investigated by
several law enforcement agencies for allegedly
diverting some of the $31 million in taxpayer
funds it received over nine years to prop up
other nonprofits operated by its parent group.
And two former administrators at the former
Raising Horizons Quest in Philadelphia are
awaiting sentencing after pleading guilty to
federal charges they tried to cover up the
theft of more than $14,000 in charter funds.
The former chief executive of a now-defunct
Philadelphia charter was sentenced in 2006 to
33 months in federal prison for defrauding the
school district of $206,554.
Evans said there is no need to amend the law
based on problems at a few schools.
"The vast majority are good and solid," he
said. "Laws against fraud and stealing are
already on the books. You don't need a special
charter-school law to deal with that."
Performance mixed
Although charters were intended to boost
academics, local, state and national studies
say the results have been mixed. Some charters
consistently have produced top test scores.
Statewide, 73 percent of traditional public
schools met the academic benchmarks of the
federal No Child Left Behind Act in 2007-08,
while only 56 percent of charters did, an
Inquirer analysis found.
But in Philadelphia, charters out-performed
traditional schools, 55 percent to 43 percent.
Besides academic achievement, charters and
districts have long sparred over how much
charters receive per student.
The law's funding formula deliberately gives
charters less per student than the public
district spends because the rate excludes such
district costs as busing and debt service. The
state reimburses districts 30 to 40 percent of
their charter costs.
And just as there is disparity in how much is
spent per student in regular public schools,
the same holds for charters.
Philadelphia, which has nearly 35,000 students
in charter schools, pays $8,088 for each
student receiving regular instruction and
$17,658 for a special-education student this
academic year. Upper Darby's rates are $8,097
and $17,249; Jenkintown's, $15,174 and $31,586.
The special-education rate is based on a
district's average special-education costs.
But the Rendell administration claims that some
charters do not spend all the special-education
money they receive on special-education
services. Last summer, the administration
proposed that charters return excess funds to
districts, but the legislature never acted.
An Inquirer analysis shows that most special-
education students in charter schools have
relatively mild learning problems that require
the least expensive services. In Philadelphia,
where 69 percent of the special-education
students in charters are in that category, the
School Reform Commission favors amending the
law to create a tiered payment system based on
services students need.
Education Secretary Zahorchak also supports
that approach.
Nepotism problems
Especially in Philadelphia, charters have been
a magnet for politicians, their staffers and
their families.
Several politicians helped found schools,
including Evans and former State Sen. Vincent
J. Fumo, now on trial on federal corruption
charges. Sheryl S. Perzel, wife of State Rep.
John M. Perzel, the former Republican House
speaker, was the driving force behind New
Foundations Charter School in Tacony and headed
its board for several years.
At least five elected state officials serve on
charter boards, which are responsible for
setting policy, hiring staff and approving
budgets. Many more have aides on charter
boards.
Evans sees no problem with politicians serving
on charter boards "as long as they are open and
transparent and not abusing their powers."
Critics argue that having a legislator on a
charter board presents a conflict of interest
because a district may ignore problems at that
charter rather than risk offending the
lawmaker.
"That's an issue that identifies why this law
needs to be looked at again," said Wagner, the
state auditor general.
— Martha Woodall
Philadelphia Inquirer
2008-12-29
INDEX OF OUTRAGES
Pages: 380
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