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September 22, 2021


               
HOT OFF THE PRESS:
REPORT RELEASED THIS MORNING PROVES CHARTER SCHOOL ENROLLMENT SKYROCKETED DURING PANDEMIC

National Alliance for Public Charter Schools' Painstaking Research Brings Excellent News
The National Alliance for Public Charter Schools (NAPCS) two hours ago released a report that definitively shows public charter school enrollment increased by 240,000 students from the 2019-20 school year to the 2020-21 year. That is roughly double the increase of the previous year. The NAPCS analyzed data collected from education agencies in 42 states (currently, 46 states have charter school laws; Kansas and Tennessee did not participate in the study). That data showed that charter school enrollment increased in 39 of those states and fell by modest numbers only in Illinois, Iowa and Wyoming, for a nationwide increase of seven percent. At the same time, 1.4 million students dis-enrolled from traditional schools to attend charter schools, engage in home schooling or other alternatives. The NAPCS report notes that this increase, the largest since 2014, came during a year when fewer new schools were opening because of the pandemic. The study also showed that virtual charter schools were responsible only for some of the growth. For example, while virtual charter school enrollment grew in Oklahoma, Utah and Pennsylvania, in Texas, which is the state with the second highest enrollment increase, growth is not attributable to virtual charters. The NAPCS also interviewed parents who made the switch from traditional to public charter schools, finding that many made the change because they felt compelled to find a better option, and once in the charter school, found it worked well for their child and had no plans to switch back.
 
The NAPC will present its findings at 10:00 a.m. EDT today in a Zoom webinar, which will also be recorded for later viewing. Register here. Find the full report, including state by state breakout data, here.

         
WOLF ON THE ATTACK

Takes Another Swipe at Pennsylvania's Public Charters
Pursuant to the NAPCS report, Pennsylvania saw a 15.5 percent increase in public charter school enrollment last year, but it seems Governor Wolf didn’t get the memo about the schools’ increasing popularity. On Friday, he initiated a regulatory process for six new rules that the legislature has refused to pass. All are designed to make things tougher for charter schools. The proposed regulations would subject charter school trustee board members to the Public Officials and Employees Ethics Act, which sets boundaries for conflicts of interest and penalties for violations. They would also establish application guidelines for new charters, clarify the process for reconciling payment disputes between districts and charters, tighten financial and auditing standards, and require the online posting of nondiscriminatory enrollment policies. The Governor’s proposed regulations are included in House Bill 272, which must be passed by the General Assembly before going to the Independent Regulatory Review Commission and the Legislative Reference Bureau. A 30-day comment period opened Sept. 18. If they survive the lengthy approval process, the earliest the regulations would take effect is 2023. Christen Smith, Wolf Initiates Regulatory ‘Fix’ for Pennsylvania Charter Schools, The Progress, September 17, 2021

                                        
MOST GEORGIANS THINK CHARTER SCHOOLS ARE PEACHY

New Poll Tracks With NAPCS Report
Not surprisingly, after a year that saw a 9.2 percent increase in public charter school enrollment statewide, a new poll finds that more than half of Georgia voters support an expansion of charter schools in the state. The poll, commissioned by the Georgia Charter Schools Association, showed 56 percent of registered voters in Georgia favor increasing the number of public charter schools, and six out of 10 surveyed view them favorably. Support cut across political lines: 61 percent of Republicans, 56 percent of independents and 55 percent of Democrats expressed support for public charter schools. Even 52 percent of Democrats went beyond merely supporting existing charter schools to respond that their number should be increased. Female parents especially support increasing the number of Georgia charter schools, with 62 percent voting in favor. Politicians, take note. Poll Shows Support For Charter School Expansion In Georgia, The Center Square, September 18, 2021

                                    
MOVING RIGHT ALONG IN IOWA

State Board of Education Wasting No Time on Charter Approval Process 
A timeline for starting new charter schools in Iowa under the state’s new legal pathway emerged Thursday from the State Board of Education. The board wants its rules for charter schools in place in time for charter applications to be approved for the 2022-2023 school year.  Previously, charter schools could only be established after receiving permission through a local school board, which explains why Iowa so far has only two charter schools. In an effort to spur charter school growth, state lawmakers passed and Governor Kim Reynolds signed into law a bill that now allows a founding group — such as a group of private citizens or a university — to instead go directly to the state board for approval of a charter school application. The board hopes to finalize its rules by January and begin reviewing charter school applications in February, with a March 1, 2022 deadline to apply. Phillip Sitter, Under the State Board of Education’s Timeline, New Charter Schools Could be Coming to Iowa as Soon as August 2022, Des Moines Register, September 16, 2021

FLORIDA SUPREME COURT'S SILENCE = $45 MILLION 
Another $45 Million Could be on the Horizon in Palm Beach
Florida’s Legislature passed a law in 2019 that requires school districts to share referendum dollars with charter schools from that point forward. But Palm Beach School District (PBSD) in 2019 and 2020 refused to share with its charter schools their share of proceeds from a 2018 referendum for teacher raises, safety, security and mental health. The charters were entitled to $45 million for those years. Two of the charter schools and two parents filed suit against the district, which wound its way through the appeals process. The most recent ruling was in favor of the charter schools. Now, the Florida Supreme Court has declined to take the case. The Court’s silence lets the ruling in favor of the public charter schools stand. Another judge is expected to rule soon on whether the district owes its charter schools another $45 million for 2021 and 2022. Scott Travis, Charter Schools to Collect At Least $45 Million in Tax Dollars After Court Win, South Florida Sentinel, September 9, 2021
                                 
WHO SAYS CHARTER SCHOOLS ARE NEVER HELD ACCOUNTABLE? 

Sorry Chapter Ends With Prison and Huge Fines for Bad Apples
The co-owner of California’s A3 online charter schools who was accused of stealing tens of millions of dollars of state education funds was sentenced Friday to four years in state prison. The San Diego County District Attorney also ordered Jason Schrock and his business partner, Sean McManus, to pay $37.5 million in fines. McManus is still awaiting sentencing on his guilty plea. The pair were also accused of transferring more than $100 million in public school funds to private companies they owned under the guise of providing educational services, while pocketing the money and providing no services. In all, more than $220 million in stolen funds are being recovered, of which $14 million will be paid in restitution to A3 students who suffered from the fraud. Additional monies will be earmarked for programs to aid kindergarten-through-12th-grade students in San Diego and the rest will go back to the state. Staff, California Man Gets Prison for Massive Charter School Scam, KCRA News, September 12, 2021
 
CHARTER SCHOOL LEADER GAMBLED BIG ON A HEDGE FUND
Case in Point: Continuing Disclosure is Critical
Hmong College Prep Academy’s (HCPA’s) authorizer, Bethel University, has placed the school on probation and recommended the board fire its superintendent after she lost $4.3 million of the school’s money she invested in a high-risk hedge fund. Christianna Hang, superintendent and chief financial officer, founded HCPA in 2004. It’s now Minnesota's largest single-site charter school, with around 2,400 students in St. Paul. HCPA is building a new $43 million middle school with some financing facilitated by the city. Hang was looking for opportunities to help pay for that project when she wired $5 million to a hedge fund in 2019, in violation of the school’s policy and state law. The school is now suing the hedge fund. The school’s lawsuit claims the U.K.-based Woodstock hedge fund either stole its money or badly mismanaged it, both of which the hedge fund denies.

Court filings show the HCPA’s attorney, Jim Martin, expressed “reservations” about the investment plan and warned Hang multiple times that it was “contrary to the objectives of HCPA’s Investment Policy.” HCPA’s board has admitted that its “governance and compliance needs greater focus.” Eric Rasmussen and Rebbeca Omastiak, Hmong College Prep Academy Superintendent Faces Removal Over Risky Investment, KSTP.com, September 21, 2021
School Improvement Partnership serves as continuing disclosure agent or has provided monthly monitoring for dozens of charter schools and CMOs. To learn more about our work and services, click here. 
              
NO CHILD LEFT BEHIND, LITERALLY!

Top D.C. Charter Schools Give Preference to Homeless Students
Eleven of the most sought after public charter schools in Washington D.C. plan to offer admissions preference to students who are homeless, in foster care, receive assistance, or who are older than their grade level. The D.C. Public Charter School Board created the “At-Risk Preference Approval and Monitoring Policy” to help level the playing field for at-risk students and their families so that more can access the schools they want to attend. With the current lottery system, only four percent of at-risk students get a seat in their school of choice.

Another goal of the new policy is to increase socioeconomic diversity at schools that have a low percentage of at-risk students. The D.C. Policy Center said socioeconomic diversity is “extremely low at 35 schools that have less than 20 percent of students who are at risk,” while 47 percent of students in the District are identified as at-risk, according to the 2020 DC School Report Card. Abigail Constantino, 11 Charter Schools in DC Will Give Admissions Preference to At-Risk Students, WTOP News, September 18, 2021
School Improvement Partnership improves transparency and accountability in the charter school bond market. The School Improvement Partnership Database (or SIP Database) contains financial, academic and operating data on charter schools and charter school borrowers around the country. It is being built out to include all charter schools and charter school borrowers in the coming months. From each financial audit for a CMO or charter school, the SIP Database contains 50 financial data points, always refreshing automatically to include the three most recent years. The SIP Database has a dashboard for subscribers that displays requested data points in an easy-to read-fashion, and such data can be exported in Excel from the SIP Database to the subscriber. Please view our website or call us at 215.854.6322.
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