Launched in the mid-1990s, charter schools—publicly funded but privately operated—have been authorized to operate in 44 states with a mixed academic record and an appalling absence of public oversight by the state governments that made these public–private partnerships possible.

In July, the Network for Public Education (NPE) released Decline, the first installment of a new report, Charter School Reckoning: Decline, Disillusionment and Cost, which concluded: “Once heralded as a bold experiment in innovation and opportunity… (the charter school sector) is now characterized by stagnation, retrenchment, and rising school closures. Between 2022 and 2025, growth has nearly halted, and closures—often sudden and disruptive—are accelerating. Federal investment, rather than adapting to the sector’s shifting realities, has ballooned to half a billion dollars annually, funding schools that never open, quickly fail, or operate with minimal oversight and accountability.”

In Disillusionment, the second installment of the Charter School Reckoning report, released last week, NPE addresses the question of why support for charter schools has declined over the educational experiment’s 30 year lifespan. Back in the mid-1990s, charter school advocates imagined they would be: “nimble, innovative, community-driven alternatives to traditional public schools—laboratories of experimentation led by teachers and grounded in equity.”  Why didn’t the dream work out?

With examples from across the states, NPE tells a four part story of the collapse of the charter school dream—a combined policy failure that has created an education sector dominated by fraud, corruption, and the theft of public tax dollars. Each section names the dream and exposes its collapse:

First:   “Aspiration: Charter schools will be teacher-led schools, rooted in community needs, where parents have a real voice.  Reality: About half of all charter schools are run by charter management organizations—some are for-profit corporations; others are nonprofit. All are disconnected from families and communities.”  We learn that, “In 1995, two years after Michigan passed its charter law, multi-millionaire businessman J.C. Huizenga, son of the founder of the for-profit garbage collection corporation, Waste Management, opened his National Heritage Academies… Today, more than 60% of Michigan’s charter schools are run by for-profit companies.”  And, “In New York City, Eva Moskowitz, who heads the Success Academy chain, took home $1,018,977 in compensation in 2023—more than twice the salary of the Chancellor of the city”s nearly one-million-student public school system.”

Second:   “Aspiration: Less regulation of charter schools will unleash innovation.  Reality: Less regulation has resulted in mismanagement, profiteering, and scams.”  “Even if it can be argued that freedom from labor laws provides helpful flexibility, it is hard to see how exemptions from bidding laws, public oversight, and authorizer accountability—or the allowance of related-party transactions and for-profit management without financial transparency—are necessary ingredients for educational innovation.” “Ohio… has some of the most problematic charter laws in the nation. Roughly half of its charter schools… are operated by for-profit corporations, which flock to states with weak oversight and generous funding for charter schools. Across the country, for-profit entities manage charter schools in thirty-six states.”

Third:   “Aspiration: Renewable charter contracts with supervision provided by outside authorizers will create schools accountable to families and the public.  Reality:  Authorizer laws, which vary by state, have resulted in a steady stream of income for authorizers, weak oversight and, in some states, authorizer shopping that allows failed schools to continue… Only two states—Virginia and Kansas—grant local school districts exclusive authority to issue charters… Elsewhere, states have opened the authorizing business to a wide array of players—from small nonprofits to cash-strapped colleges—that can authorize charter schools, sometimes with little expertise in school oversight. When this broad access is paired with generous authorizing fees, a lucrative market emerges.”

Fourth:   “Aspiration: Charter schools will be run by teachers and parents, thus escaping bureaucracy.  Reality: Charter boards are nearly always composed of unelected individuals who may not even live in the state in which the charter is located. Often, they are connected to the school’s founders or management organization.” This section features a shocking story from Oklahoma: “Oklahoma’s largest virtual charter, EPIC Charter Schools, was technically governed by a nonprofit board—Community Strategies Inc.— but the real power rested with EPIC Youth Services… a private, for-profit management firm owned by the schools’ founders, David Chaney and Ben Harris. EYS took 10 percent of all taxpayer funding received by the charter school as a ‘management fee.’ According to Community Strategies Inc.’s 2020 Form 990, the taxpayer income to the school was $393,403,534, meaning the for-profit took in more than $39 million that year.”

I urge you to read the mass of stories reported from across the states in Disillusionment, published last week as the second installment of the Network for Public Education’s excellent comprehensive report. Reading the same story about state after state clarifies the danger of public policy based only on a lofty dream.

For me, as an Ohioan, it is fascinating to consider that nothing has changed since, 26 years ago, in a 1999 Akron Beacon Journal bombshell report, Whose Choice?,  Dennis Willard and Doug Oplinger exposed David Brennan’s White Hat Management Company: “White Hat runs 11 schools with 3,267 students and is projected to take in $16 million—or almost one of every three taxpayer-funded charter dollars… By next fall, Brennan and White Hat could have more than 30 charter schools in Ohio. By law, only nonprofit organizations, and not private for-profit companies, can start a charter school. But the nonprofits and Education Management Organizations work hand-in-hand, often so close it is difficult to determine which came first or if they truly are distinct entities.  For example, identical contracts for several White Hat Management-managed schools were submitted together to the state board, although the schools are supposed to be run by independent governing authorities—the private equivalent of school boards. These governing authority members, unlike public school board members, can have a financial interest in the schools, give contracts to friends and relatives without competitive bids, and are not required to undergo criminal background checks.”

The Network for Public Education’s new report concludes with recommendations for reform. As a cynical Ohioan, I wish I could imagine state legislators, susceptible to the power of lobbying and contributions to their political campaigns, who would be likely to adopt the reforms listed at the end of the report.  The recommended reforms are a guide, however, to what the public ought to demand when an appealing dream for public policy is proposed without the provision of necessary regulation and public oversight embedded as part of the plan.

In the case of charter schools, we ought to have known that when tax dollars are dangled in front of entrepreneurs, the kind of well-staffed, innovative, nurturing programs we dream about for children would likely evaporate into profits.