How Bad Are Waste and Fraud at Charter Schools? This Bad.

Lax oversight and limited accountability has led to a shocking misuse of taxpayer funds by charter schools nationwide, according to a new report from the Center for Popular Democracy and Integrity in Education.

“We expected to find a fair amount of charter school fraud when we began this project, but we did not expect to find over $100 million in taxpayer dollars lost,” said Kyle Serrette, the Director of Education Justice at the Center for Popular Democracy. “That’s just in 15 states. And that figure fails to capture the real harm to children. Clearly, we should hit the pause button on charter expansion until there is a better oversight system in place to protect our children and our communities.”

The report, “Charter School Vulnerabilities to Waste, Fraud, and Abuse,” examined representative charter school data from 15 states and found instances of charter operators using charter funds for personal use; school revenues being used to illegally support charter operator businesses; mismanagement that put children in potential danger; charter executives illegally inflating enrollment to boost revenues; and charter operators mismanaging their schools.

While many of the instances of charter school fraud and abuse noted in the report resulted from school administrators pilfering funds and misrepresenting their successes—a comparatively small number when compared to the national total of charter schools—it should be pointed out that limited oversight has helped foster an atmosphere where these kinds of problems are more commonplace. And much of this hands-off practice stems from the way charter schools have evolved over the ensuing years since their initial conception.

“To understand why there are so many problems in the charter industry, one must understand the original purpose of charter schools,” the report says. “Lawmakers created charter schools to allow educators to explore new methods and models of teaching. To allow this to happen, they exempted the schools from the vast majority of regulations governing the traditional public school system.”

So even as the number of charter schools increases, along with the funding that they receive, accountability measures have been slow to keep pace.

“Despite rapid growth in the charter school industry, no agency, federal or state, has been given the resources to properly oversee it,” the report noted in its introduction. “Given this inadequate oversight, we worry that the fraud and mismanagement that has been uncovered thus far might be just the tip of the iceberg.”

So what are some of the common-sense laws and oversight methods that the report suggests? For starters, establishing an office dedicated to managing and overseeing charters on the state level will help maintain performance standards and temper instances of fraud and abuse. Greater transparency on the part of charters, including independent audits available to the public and easy access to the charter agreements and other pertinent documents, will create a sustainably open atmosphere. And expanding many of the requirements for public schools to charter schools, including non-discrimination and transparency requirements, will narrow the divide in terms of oversight.

“Our school system exists to serve students and enrich communities,” says Sabrina Stevens, Executive Director of Integrity in Education. “We need to have rules in place that can systematically weed out incompetent or unscrupulous charter operators before they pose a risk to students and taxpayers.”

If so-called reformers are so determined to tout charter schools as a panacea for traditional public schools, then at the very least they can be held to the same standards of accountability, oversight, and scrutiny that public schools must take for granted.

“School funding is too scarce as it is; we can hardly afford to waste the resources we do have on people who would prioritize exotic vacations over school supplies or food for children,” Stevens adds. “We also can’t continue to rely on the media or isolated whistleblowers to identify these problems.”