Gov. Hogan’s Charter School Fraud Bill
Straight from the playbook of Betsy DeVos
It’s hard to remember now, but when Larry Hogan was running for governor in 2014, he made a campaign promise to cut $1.5 billion in “fraud, waste, and abuse” from the state budget.
“Our recent analysis of state and federal audits shows specific examples of waste, fraud, and abuse in state government that the current administration has refused to act on…The Hogan-Rutherford administration will implement the recommendations of past audits, conduct additional audits of every state agency, and immediately get to work eliminating duplication, fraud, and waste to make sure that every cent of taxpayer money is spent efficiently.”
— Larry Hogan’s campaign website
But since being elected, the governor has instead developed a legacy of cutting taxpayer funding from vital public services: public schools, Baltimore’s Red Line, Montgomery County’s Corridor Cities Transitway, the Prince George’s County Hospital, and more. With slowed investment in communities, the Maryland economy has stalled.
Since November 2015, the number of jobs in the state has increased by 1.1 percent, a gain of 30,200 jobs. That’s lagging behind the nation, where jobs grew 1.6 percent year over year, according to the estimates, which are adjusted to account for seasonal variation.
— The Baltimore Sun
As The Baltimore Sun editorial board wrote in 2015, after Gov. Hogan cut $68 million in public education funding: “Recall that on the campaign trail, he asserted that he had found $1.5 billion in waste, fraud and abuse in state government. We haven’t heard much about that since he took office.”
But while we haven’t heard the governor talk much about fraud of taxpayer dollars during his time in office, he’s now practically inviting it with his Charter School Fraud Bill.
The Charter School Fraud Bill Would Create a Separate, Unaccountable School System
Last month, Gov. Hogan announced he would be introducing a new bill to expand the number of charters schools in Maryland. The central piece of his legislation (HB878/SB704) is the creation of an alternative authorizing board — which he names the Maryland Public Charter School Authority.
Right now, each district’s school board has the authority to grant or revoke charters to the private operators who run charter schools. That’s for good reason; the entire point of charter schools is to develop innovative instruction strategies that, if effective, can be scaled up to help the rest of the students in the school district. This is what makes them public charter schools.
“Chartering has become an industry, and in many cases, rapid expansion has replaced innovation and excellence as goals.”
— Brown University’s Annenberg Institute for School Reform
But the concept of a separate authorizing board means that the state effectively creates a second taxpayer-funded school system of all private operators. That means there’s no more collaboration of ideas between charter schools and traditional public schools. National charter management organizations — many of whom collect 10% or more of public funding in operational fees — could set up shop in Maryland without having the same accountability standards as traditional public schools.
It’s likely that under such a system, even for-profit charter groups would open schools and keep much of their taxpayer funding instead of spending it on their students.
We know this is likely to occur in Maryland because it has happened in other states with separate charter authority boards. Like in Michigan, where Betsy DeVos unfortunately had the opportunity to experiment with her failed ideas.
Time and time again, we’ve seen this system lead to occurrences of fraud. In 2014, the Center for Popular Democracy found that more than $100 million of public taxpayer money had been lost to charter school fraud, waste, and abuse in the 15 states they examined. As a solution, they recommended that any board that authorizes charter schools be made up of elected members — like a school board. But under Gov. Hogan’s bill, he gets to appoint the separate authorizing board members and gets to select the board’s chair.
Last year, the U.S. Office of Inspector General released a report in which they audited 33 charter schools in six states. According to U.S. News and World Report, they found “instances of financial risk, including waste, fraud and abuse, lack of accountability over federal funds and lack of assurances that the schools were implementing federal programs in accordance with federal requirements at 22 of the 33 schools they looked at, all of which were run by management organizations.”
The list goes on and on. Ohio, Minnesota, Pennsylvania, California…really all you have to do is type in a state’s name next to “charter school fraud” in Google Search and you’ll likely find a list of reports and news stories. But not in Maryland. As Rachel Cohen reported for the Baltimore City Paperduring the debate over Hogan’s attempt to weaken Maryland’s charter school law in 2015:
“I don’t care what the National Alliance for Public Charter Schools, a lobbying group out of Washington, D.C., has to say about the charter school law in Maryland or where they rank Maryland relative to their own biased standards. Neither should you,” testified Megan Miskowski, a speech language pathologist at Patterson Park Public Charter School. It’s Maryland’s strong law, she argued, that explains why Maryland charters have never wrought the level of fraud and abuse so prevalent in places such as Minnesota and Louisiana — states that receive high marks from NAPCS.
Leaders in both chambers of the Maryland General Assembly are already criticizing the approach:
“The idea that somehow you’re going to have a special school board for charter schools makes absolutely no sense.”
— House Speaker Mike Busch
“If [Hogan] did his research and history, he would understand that it was a recipe for fraud and failure. It didn’t work in Michigan, it didn’t work in Ohio, and we’re definitely not going to have it in the state of Maryland.”
— Joan Carter Conway, chair of the Senate’s education committee
Maybe when he was sworn into office, Gov. Hogan was surprised to find that there wasn’t actually $1.5 billion in fraud, waste, and abuse in Maryland state government. But creating a completely unaccountable school system that has demonstrated a reliable record of fraud in other places seems like a very odd way of delivering on a campaign promise.