- Public Advocates, a non-profit law and advocacy organization, is pushing for greater oversight, clearer accounting measures and more parental involvement in charter school financial affairs in a recently released report indicating most California charter schools are either failing to fully disclose how special assistance funds are spent or are not reporting the spending altogether.
- EdSource points out that California charters are responsible for the education of about 10% of the state’s 6 million students and receive about $3.4 billion under the Local Control Funding Formula, including about $900 million for students who qualify for supplemental funds.
- Charter schools are required to prepare the same Local Control and Accountability Plan (LCAP) templates as school districts, but, unlike school districts, they are not required to create parent LCAP advisory groups or present accountability plans at public meetings. Next year, however, both school districts and charter schools will be required to include a parent-friendly budget overview as an attachment to their LCAP.
When public funds are used for any purpose, the public has a right to know how those funds are spent. However, many charter schools do not have sufficient oversight of financial matters. In many cases, this issue is because of the way current policies are written. The burden of oversight is another factor in some states as well.
A lack of transparency and inadequate oversight can set up the potential for waste, fraud, and abuse. A 2015 report from the Alliance to Reclaim Our Schools and the Center for Popular Democracy, entitled “The Tip of the Iceberg,” reported over $200 million lost to fraud, corruption and mismanagement in charter schools. And in a paper published in the Indiana Law Journal, Preston Green, a professor of educational leadership and law at the University of Connecticut, asserts that some charter schools have “engaged in Enron-like related-party transactions to divert charter school funding away from students.”
Money wasted or diverted in any form means that fewer dollars are available for the true business of education. School district leaders should be concerned about how this issue impacts their own stream of funding. Charter school leaders should also be concerned about how waste and abuse in this arena not only affects the availability of funds for the classroom, but also affects the reputation of charter schools. Some states, like Colorado, have already crafted stronger charter school accountability laws. The Public Leadership Institute has also created a model “transparency in charter school spending act” that can be used a template.