Education Law Prof Blog: New Report Paints California's Charter Schools As Economic Boondoggle That Has Little to Do with Student Need, Cost Efficiency, or Quality

A new report on California's charter schools may be one of the most scathing to date--in part because it does more than examine student achievement.  Achievement studies inevitably raise methodological and interpretation debates.  More simply, it is often unclear whether the studies are comparing apples to apples.  This new study, however, filters charter schools through other more straightforward data and factors: locality need, cost efficiency, and legal compliance.  On these measures, the report suggests that California's charter school expansion is a financial boondoggle.  To use a baseball analogy, the disappointing quality of many of these schools is really just the fourth strike against a policy that should have already been called out. The report's introduction states:

From less than 200 schools in 1998, the California charter school industry has grown by more than 600%, to over 1,200 schools serving nearly 600,000 children, or nearly 10% of the state’s students. One of the sources fueling this growth is an extensive network of government programs that provide public funding or tax subsidies for charter school buildings. Over the past 15 years, California charter schools have received over $2.5 billion in tax dollars or taxpayer subsidized funds to lease, build, or buy school buildings. This report finds that this funding is almost completely disconnected from educational policy objectives, and the results are, in turn, scattershot and haphazard. Hundreds of millions of dollars are being spent each year without any meaningful strategy. Far too much of this public funding is spent on schools built in neighborhoods that have no need for additional classroom space, and which offer no improvement over the quality of education already available in nearby public schools. In the worst cases, public facilities funding has gone to schools that were found to have discriminatory enrollment policies and others that have engaged in unethical or corrupt practices.  

The report's key findings include:

  • Over the past 15 years, California charter schools have received over $2.5 billion in tax dollars or taxpayer subsidized funds to lease, build, or buy school buildings.
  • Nearly 450 charter schools have opened in places that already had enough classroom space for all students—and this overproduction of schools was made possible by generous public support, including $111 million in rent, lease, or mortgage payments picked up by taxpayers, $135 million in general obligation bonds, and $425 million in private investments subsidized with tax credits or tax exemptions.
  • For three-quarters of California charter schools, the quality of education on offer is worse than that of a nearby traditional public school that serves a demographically similar population. Taxpayers have provided these schools with an estimated three-quarters of a billion dollars in direct funding and an additional $1.1 billion in taxpayer-subsidized financing.
  • Even the worst charter schools receive generous facility funding. The California Charter Schools Association identified 161 charter schools that ranked in the bottom 10% of schools serving comparable populations last year, but even these schools received over $200 million in tax dollars and tax-subsidized funding.
  • At least 30% of charter schools were both opened in places that had no need for additional seats and also failed to provide an education superior to that available in nearby public schools. This number is almost certainly underestimated, but even at this rate, Californians provided these schools combined facilities funding of over $750 million, at a net cost to taxpayers of nearly $400 million.
  • Public facilities funding has been disproportionately concentrated among the less than one-third of schools that are owned by Charter Management Organizations (CMOs) that operate chains of between three and 30 schools. An even more disproportionate share of funding has been taken by just four large CMO chains— Aspire, KIPP, Alliance, and Animo/Green Dot.
  • Since 2009, the 253 schools found by the American Civil Liberties Union of Southern California to maintain discriminatory enrollment policies have been awarded a collective $75 million under the SB740 program, $120 million in general obligation bonds, and $150 million in conduit bond financing.
  • CMOs have used public tax dollars to buy private property. The Alliance CollegeReady Public Schools network of charter schools, for instance, has benefited from over $110 million in federal and state taxpayer support for its facilities, which are not owned by the public, but are part of a growing empire of privately owned Los Angeles-area real estate now worth in excess of $200 million.

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Derek Black

Derek W. Black is a Professor of Law at the University of South Carolina School of Law. His areas of expertise include education law and policy, constitutional law, civil rights, evidence, and torts. The focus of his current scholarship is the intersection of constitutional law and public education, particularly as...