An investigative group asserts that lax oversight over how charter schools are funded and how the schools are established and operated "has allowed an epidemic of fraud, waste, and mismanagement."
The investigative report by the Center for Media and Democracy, "Charter School Black Hole," says that the public lacks ready access to key information about how federal and state taxes are being spent on charter schools.
"Neither the federal government nor the states have created a place taxpayers can go to see how much in taxes are going to each charter and how the charters are spending the money (especially private or for-profit charters), including what happens to real estate purchased with the public’s money or the role of for-profit firms under contracts," the report states.
The center also has identified dozens of "ghost" schools, where federal charter grants were awarded to charter schools that never opened.
For example, in 2011 and 2012, $3.7 million in federal money was awarded to 25 Michigan charter schools that never even opened to students.
"If citizens relied on Michigan’s online database, they would not be alerted to tax money that’s been spent on charter schools that never opened," the center says. "These 'ghost' schools exist only on paper—on grant notification forms and in money spent that is basically unaccounted for. In sum, Michigan’s record of charter school oversight reveals continuing and substantial problems that have failed to identify even serious financial fraud by charter operators."
The report recommends several reforms:
- The U.S. Department of Education should publish a list of all charter schools that were awarded federal grants.
- Before approving federal charter grants, the Department should require that each state publish annual data on spending for each charter.
- The Department should mandate that it be notified if a charter school that receives federal grant fund closes or never opens, and that it be given a full accounting of how taxpayer funds were spent by the charter.
- The Department should include educators or administrators from traditional public schools and school boards in the pool of those evaluating proposals for charter grants.
- The Department should notify the public when a state education agency has applied for a federal charter grant and allow sufficient time for public comment.