A New Front in Walker’s War on Public Education: Privatizing Charter School Authorizers

A topic that has not yet garnered much attention in the slowly unfolding catalog of horrors that is Governor Walker’s budget bill is its set of proposals for charter schools. Of a piece with the budget bill’s meat-axe approach to the UW System, the charter school proposals are certainly bold, if by bold we mean untested, excessive, and irresponsible. The policies are also poised to inflict damage on public education to a degree that could prove devastating. All this, plus privatizing an exclusively governmental function – the charter school proposals have hit a bad public policy trifecta.

The budget bill’s charter school provisions amount to a dog’s breakfast mixed together from Wisconsin’s current system for non-school-district-authorized charter schools in Milwaukee and Racine (so called “2r” charter schools) and ALEC’s model legislation, which it calls the Charter School Growth with Quality Act.  Amazingly, the result is worse than even ALEC proposes.

The 2r System

Some background, first, on the 2r system. (“2r,” by the way, is a shorthand reference to the provision of Wisconsin law (section 118.40(2r)) that sets all this out.) The current 2r authorizers are the Milwaukee Common Council, UW-Milwaukee, and UW-Parkside. They are empowered to establish charter schools in their area, either by operating the schools themselves or contracting for the operation with others. Together, they are responsible for the 23 “2r” charter schools that are currently operating in Milwaukee (22) and Racine (1).

Funding for these schools comes from the state. The schools receive $8,075 per student in general state aid. The total amount of these payments is deducted from the statewide pot of money that gets paid out in general state aid to all the school districts in Wisconsin. This year, every school district’s general state aid allocation was reduced by 1.5% to cover the cost of the $68.6 million that went to the 2r charters.

ALEC’s Model Legislation

ALEC’s legislation is fairly straightforward. It calls for the establishment of a statewide public charter school commission as an independent state agency with nine appointed members. The commission is to evaluate and either approve or deny charter school applications. The commission enters into contracts with the schools whose applications it approves, monitors their performance, and renews or revokes their charters. The commission is also to submit an annual report to the state legislature summarizing its activities and the performance of the charter schools it authorizes. About 15 states across the country have adopted a version of this legislation.

Like the ALEC model legislation, the Governor’s budget bill bulldozes through the notion of local control of schools. It establishes a new state agency, the Charter School Oversight Board, which is attached to DPI. The Board is to have eleven members. A majority are to be appointed by Governor Walker (2), Senate Majority Leader Scott Fitzgerald (2) and Assembly Speaker Robin Vos (2). The others include Tony Evers and two members appointed by him (each of whom must previously have been associated with a 2r charter school), and one member each appointed by Senate Minority Leader Jennifer Schilling and Assembly Minority Leader Peter Barca.

The budget bill most closely mirrors the ALEC bill in its description of the requisite backgrounds and skills of the Board members.

According to the budget bill:

The appointing authorities . . . shall ensure to the extent feasible that members appointed to the board are geographically diverse and have experience and expertise in governing public and nonprofit organizations; in management and finance; in public school leadership, assessment, and curriculum and instruction; and in education law; and understand and are committed to the use of charter schools to strengthen public education.

This language comes from the ALEC bill, which states:

Members appointed to the Commission shall collectively possess strong experience and expertise in public and nonprofit governance, management and finance, public school leadership, assessment, and curriculum and instruction, and public education law. All members of the Commission shall have demonstrated understanding of and commitment to charter schooling as a strategy for strengthening public education.

ALEC’s proposal? Come On, We Can Do Worse Than That!

The budget bill gives the Charter School Oversight Board significantly less authority than ALEC’s Statewide Public Charter School Commission. Rather than itself evaluating and approving charter school proposals and monitoring charter school performance, the Board will only consider and approve applications by entities to be new 2r authorizers, like UW-Milwaukee and UW-Parkside. Any “nonprofit, nonsectarian organization or consortium of such organizations” can apply to become a 2r authorizer. Once approved, that organization is empowered to enter into contracts with charter school governing boards to establish new charter schools anywhere in the state. There is no limit on the number of charter schools that could be established this way.

Quick! Apply for a Job with the Scott Jensen Institute!

In other words, the members of the Board appointed by Governor Walker, Scott Fitzgerald and Robin Vos could join together to approve the application to be a charter school authorizer of any private entity, from K12, Inc. to the Republican Party of Wisconsin. Let’s call a hypothetical entity the Board selects the Scott Jensen Institute. The Jensen Institute would then be free to roam all over the state, contracting with new charter schools wherever it goes.

Once its application has been approved by the Board, the Jensen Institute’s only continuing responsibility would be to submit an annual report to DPI, the legislature and the Board which identifies each charter school it has established and describes each school’s academic and financial performance, as well as lists its own operating costs and the services it has provided to its contracted charter schools. Beyond that, the scope of the Institute’s operations would be limited only by the scale of its ambition.

Let’s pause for a moment to consider this, since we’d be breaking new ground here. There is nothing like what is being proposed anywhere else in the country.

Whatever one thinks of charter schools, their authorization has heretofore been considered a governmental function. The budget bill opts instead for privatization. It would establish an arrangement by which a private entity like our hypothetical Jensen Institute could function with the powers of an independent state agency but none of the responsibilities. The Jensen Institute would be empowered to grant the state’s authority to charter school operators to set up potentially lucrative operations anywhere in the state. Conveniently, it could also charge a licensing fee to each of the charter schools it authorizes.

Since it would be a private entity, the Institute would have no disclosure obligations, would not be subject to the open records law, and would not be bound by conflict of interest restrictions. While the Institute would have to be non-profit, there would be no cap on how much it could pay its officers. (The president of the nonprofit College Board was paid a salary of $1.3 million in 2012.) The head of the Institute would have more power to shape K-12 education in Wisconsin than Tony Evers, with none of the pesky responsibilities of a public official. Mr. Jensen, your table is ready.

More of Everything for the New Charter Schools    

Now, let’s look at the charter schools that would be established under this scheme. Each charter school the authorizing entity approves would be able to collect $8,075 in state funds for each student it enrolls. The state funds that get diverted into paying all these new charter schools will come right off the top of the state’s appropriation for general state aid to the state’s school districts. The more charter schools are established, the less each school district in the state will receive in general state aid. The budget bill places no limit on the amount of funding that can be drained from local school districts in order to pump state funds into these new charter schools.

The new charter schools qualify for state categorical aid payments as well.  They are designated as “local education agencies” under federal law, and so they will also be able to receive federal Title I funding and federal support for students with disabilities. In addition, these charters schools will be the first to qualify for state transportation aid to ferry their students to and from school.

Blocking a Charter School’s Doors?    

The budget bill states that most school districts will be able to “prohibit a pupil who resides in the school district from attending” a charter school established under this scheme. The exceptions are school districts that serve more than 4,000 students and that operate at least two schools that received a “meets few expectations” or “fails to meet expectations” grade on their state school report card. The districts that fall into this category include the seven largest districts in the state (Milwaukee, Madison, Kenosha, Green Bay, Racine, Appleton and Waukesha), plus Oshkosh and Beloit. Together, these nine districts serve about one-quarter of Wisconsin’s public school students.

The new authorizing entities can thus operate with a free hand in the state’s largest urban areas. There is nothing the local school districts can do to affect their operations, and there is no obligation on the part of the charter schools to consult with local school districts and attempt to coordinate their efforts.

It seems that all the other school districts might not be able to do much to stop the new charter schools either. The budget bill says that they can “prohibit” their students from attending newly-established charter schools. How is that supposed to happen? A student could simply not show up for the start of fifth grade at her neighborhood elementary school and instead start attending the new Friedrich Hayek Academy charter school that’s just opened down the street. School district officials are not going to stand with their arms folded blocking the doors to the new charter school.

Summing Up: Yikes!

So, let’s sum up. The budget bill appropriates not an additional penny for general aid to school districts during the next two years (and for 2015-16 slashes a separate $150 per pupil categorical aid payment that every school district in the state was counting on). Every district’s state aid will be reduced in order to fund the budget bill’s guaranteed payment of $8,075 for each student enrolled in a charter school. The budget bill proposes a “bold” and unprecedented scheme to establish new charter schools all over the state. The number and identity of the new charter schools is to be determined by a private entity.   That entity will wield the charter-school-authorizing power of the state and will be selected by the board of political appointees of a new state agency. The private entity will have to file annual reports but will otherwise be essentially unaccountable. What could possibly go wrong?