Tuesday, February 28, 2012

Charter school with 25% turnover rate flips revenues into irresistible capital projects

Despite their funding by the charter-happy Bill Gates Foundation, the PBS News Hour did what actually seemed to me to be a balanced report on a cyber charter school in Pennsylvania last week.

Chunks of the revenue the charter company is generating (in part by means of education tax dollars) are not going back into actual classrooms with teachers for their students but into electrifyingly sexy capital projects at big payouts for developers and politicians:

JOHN TULENKO (reporter): Last year, Nick Trombetta earned $163,000. However, since its founding in 2000, P.A. Cyber has collected a total of $45 million in profit.

And the question is, what is P.A. Cyber doing with leftover money?

NICK TROMBETTA (charter school CEO): Well, we're investing it back into research and development. We're investing it back into our program. We're investing it to multiple centers across the state to serve more children. We're investing that back into P.A. Cyber.

TULENKO: Most of the money has been spent within a 12-block area of tiny Midland, Pa., a former steel mill town where P.A. Cyber is based.

Midland now boasts its own performing arts center, also designed to house the company's offices, for which P.A. Cyber paid $10 million. A few blocks away, $12 million more built the virtual teachers center in what had been a steelworkers union hall. And close by, the money is also funding construction of new corporate headquarters, in addition to $5 million in other properties recently purchased in Midland.

To critics, hiring more teachers and creating more live courses would have made better use of taxpayers' education dollars, but Trombetta defends his choice.

TROMBETTA: We do need buildings for our employees. I mean, it costs money to lease them. It costs money to build them. And the dollars that we do receive, we were able to squirrel away some dollars over the course of the years and invest in that.

TULENKO: P.A. Cyber also spun off its own not-for-profit business, developing online curriculum to sell across the country.

Together, the nonprofit and the school have grown to employ 694 people in what was a dying steel town.

TROMBETTA: We decided to create a new industry. And it was an industry that replaced the old. And you're right, and it was to create opportunities for children across this commonwealth and across the United States. This has been huge for this area.

TULENKO: The town's comeback even earned it a nickname, the Midland miracle, though not everyone believes.

RON SOFO (public school superintendent): Wait a minute. I didn't know that public schools and the funding of public schools should be an economic development strategy for one small section of one county. I don't think that's the purpose of public education in this commonwealth or in America.

Economic development has become the be-all and end-all. Quality and culture and education are no longer intrinsically good. Instead, their value is only determined by the wealth maximized and the power generated. And charter schools are the latest vehicle of economic development, which is why they ultimately fail in frameworks and lifeworlds where education is inherently good.


  1. Thank-you- thank-you- and thank-you for this post.

    The Obama administration,ignoring evidence,bribed states to lift the legal barriers on charters to get Race to the Top money. The research is clear that charters are no better, and many are worse than public schools. A 2009 study of 2,330 middle school students at charter schools in 15 states found that they performed no better in math and science.

    “Nearly half of the charter schools nationwide have results that are no different from the local public school options and over a third, 37 percent, deliver learning results that are significantly worse than their student[s] would have realized had they remained in traditional public schools.” - Washington Post (WP)

    A more extensive CREDO Study in 2010 at Standford found that 83% are no better and worse than traditional public schools:

    Charter schools license to launder public money to private interests was reported by Juan Gonzalez in 2007 in the Daily New and Democracy Now
    Charters in Ohio cost taxpayers 2.5 times more money than traditional public schools:

    Ignoring facts, DoEd says RttT reforms "opens up doors" for children. They fail to mention why tax money pays $300,000 to $400,000 salaries to charter school leaders to oversee a tiny number of students. They fail to mention the unsavory real estate deals or high teacher turnover, or the systematic expulsion of children with disabilities in charters.

    Those of us in the education milieu live in the reality based world that equality is a core concept of public schools. Obama and Duncan, just like Bush, are creating a reality serving the 1% re: education reform. Hence, the rush to impose their reality on an unsuspecting population with RttT and NCLB waivers (recycled RttT).

    In summary, the current privatization efforts via accountability and charter schools cannot be separated from the US history of successful re-segregation and more recently 12 years of re-gentrification of the inner cities. Charters and vouchers re-segregate children based on family income, class, race, and disability under the guise of giving families “choice”, when in fact, every charter chooses its students (and families) and expels the undesirables.
    Look at New Orleans public schools for the results of 6 years of charterized schools. They are more racially, economically, and disability segregated than before the 1980's. 15 years of Duncan-led reforms in Chicago Public Schools Rahm spins his lies as "saving poor kids":

    It's difficult to believe the mogul class when they claim edu-reforms care about equality for poor kids. Reality shows separate means equal when it comes to schools for "those" kids.

  2. One more link for public consumption:

    "The Big Enchilada"


    "Trying to make a killing in the charter school business"?! Yeah, that's right, the charter school business is so profitable that I'm telling all my friends in the hedge fund business that they're in the wrong business. My message: "If you really want to make a lot of money, start a charter school!" LOL! -- Whitney Tilson"

    "In 2007, hedgefunder and charter school maven, Whitney Tilson chided me for implying that there was a profit to be made in the charter school market and that he and his group DFER were pursuing exactly that course, under the banner of school reform. It was Tilson himself, a couple of years later however, who let the cat out of the bag in a New York Times article by Joe Nocera."

    Read it and weep for TN public schools.