“Real” Accountability for Charter Prep Should Extend to the Whole System

With the recent failure of the Portland-based REAL Prep Charter Academy to open its doors, even after spending $500,000 of federal grant development money, parents and taxpayers are demanding more “accountability” for Oregon’s charter schools. But who should hold these schools accountable?

Consider the case of the Willamette Education Service District (WESD), a public entity which provides services like special education to school districts. Despite “oversight” by the state and a board of governors, clear and compelling reports of misconduct delivered by a reputable ESD leader were ignored for years.

As far back as 2004, a neighboring ESD leader, Bob Nelson, alerted the Oregon Department of Education, the Secretary of State’s Office, state lawmakers, and local education officials to no avail. It took media intervention to make a real difference. A 16-month Statesman Journal investigation revealed mismanagement including awarding “no-bid contracts, questionable property deals and supposedly self-supporting ventures that failed, lost money or drew formal complaints and lawsuits.” These mistakes cost taxpayers millions.

Regarding the WESD scandal, the Statesman Journal concluded, “The problems have been compounded during the past 10 years by lax board and state oversight and quid pro quo arrangements with state officials who were operating within a similar culture of mismanagement — a culture that continues today. And in spite of recent improvements, some problems continue unabated.”

Problems with oversight are not limited to just the Willamette ESD episode. A cursory glance reveals a history of management or ethics problems in many school districts across the state. Even in the absence of shady practices, the fact that we are spending on average more than $11,000 per pupil and getting mediocre to poor results (Education Week ranks Oregon 43rd), should clearly indicate lack of accountability and poor management in the system. Within Portland Public Schools alone, mismanagement problems are not limited to the REAL Prep charter scenario, but extend to chronically failing schools (like Jefferson High, which reportedly moved a principal last year due to mismanaging funds), failed property management (consider Whitaker Junior High for an utter waste of resources), and a dismal on-time graduation rate of 53%.

It is tempting to imagine some dream team of “smart people” who can oversee operations of schools and ensure they operate efficiently to provide the best education possible with the public funding they have. But such dreams are just that: imaginary. In the real world, government oversight rarely ensures efficiency, thrift, or effectiveness.

In contrast, in the business world, financial mismanagement can persist only for a limited time before the operation goes out of business. That is exactly what is happening with REAL Prep. REAL Prep founders are facing the consequences of poor planning: Their dream of ensuring future income working in an industry they loved is gone, with little to show for it other than humiliation.

Wasting 500,000 tax dollars is terrible. But because charter schools face more realistic financial demands (demands from which regular public schools are frequently sheltered), poorly managed schools can’t operate indefinitely. An ineffective, inefficient, or unwanted public charter school either must shape up or close its doors. That is not a tragedy, in the grand scheme. It is an important form of accountability, one from which regular public schools have been sheltered for decades.

Such protection for public schools has not been a boon. Rather, it has enabled the sort of culture which allowed the WESD to waste millions, unimpeded for years. The same shelter keeps chronically underperforming schools from improving, and allows districts to continue sick practices like “passing the trash” (transferring the worst teachers and administrators to other positions or schools rather than firing them).

The key solution for the education system is the same as that for the WESD. Legislators passed a law this year that allows some districts to opt out of ESD services and to keep most of the dollars that otherwise would be given to an ESD. That means districts can hold WESD accountable because now it has to earn their patronage.

Likewise, districts and schools should be held accountable by forcing them to earn student attendance. This can be best accomplished by increasing students’ other educational options through open enrollment in public schools, more charter schools, and K-12 education tax credits and opportunity scholarships that allow more students to attend private schools.

As for REAL Prep, more accountability is the answer to prevent future failures from wasting tax dollars. But the accountability should be parents, not politics.

Oregon Innovates During “The Year of School Choice”

The Wall Street Journal recently called 2011 “The Year of School Choice.” According to the July editorial:

“No fewer than 13 states have enacted school choice legislation in 2011, and 28 states have legislation pending….Louisiana enhanced its state income tax break for private school tuition; Ohio tripled the number of students eligible for school vouchers; and North Carolina passed a law letting parents of students with special needs claim a tax credit for expenses related to private school tuition and other educational services.”

It should be added that here in Oregon, our legislature passed a bill to allow open enrollment among public school districts. Starting in 2012, parents may enroll their children in another district as long as the receiving district is accepting transfers. This arrangement can promote increased enrollment in schools with empty seats while offering additional opportunities to out-of-district children.

A second bill eased enrollment restrictions for online schools. A third allows public universities and colleges to sponsor charter schools. All three bills have been signed into law by Governor John Kitzhaber.

It’s becoming increasingly evident that allowing families more freedom in educating their kids is the way of the future. In a pioneer state, Oregonians should be proud of the ways we are innovating to give students more diverse choices in education.

“Ready for College and Life”

In just a couple weeks, students everywhere return to school. Have you ever thought of how important it is where a child goes to school? After their family, the greatest influence on growing children is usually their school.

Private scholarship programs like the Children’s Scholarship Fund-Portland help elementary children from lower-income families choose the school that is right for them.

This summer I attended a luncheon at Central Catholic High School to honor graduating seniors with athletic scholarships to college. I was invited by a young man who began to be sponsored by the Children’s Scholarship Fund-Portland when he was in grade school. One of Central Catholic’s star basketball players, he will attend Portland State and play for the Vikings. He was able to attend private schools because of scholarship assistance from caring Oregonians.

“I have learned that nothing’s going to be handed to you and that you’ll succeed through hard work,” he told me. “[Private school] was challenging, but it has gotten me ready for college and life.”

The Children’s Scholarship Fund-Portland helps lower-income Oregon children get a hand up early in life through a quality elementary education. That simple step puts kids with limited choices on a path to success that can change the rest of their lives. To see how you can help a child reach his or her potential through this program, visit www.cascadepolicy.org/links/children.

Which Oregon School District Teaches No Students?

Oregon’s major teachers union, The Oregon Education Association (OEA), is seen by many observers as the big loser coming out of the recent legislative session in Salem. Why? Because it failed to convince enough legislators to stop some modest school choice bills from passing. It also couldn’t stop Governor John Kitzhaber, whom it endorsed and financially supported, from agreeing to sign these bills as part of a larger education reform package.

The highest profile bill in question was House Bill 2301, known as the virtual public charter school bill. The union has been trying to shut down online public charter schools ever since they started making inroads several years ago. This year it had hoped to cripple these schools, which it sees as competition to the brick-and-mortar schools in which its members teach. Instead, the legislature agreed to let these online schools expand from teaching about one percent of the state’s K-12 students now up to at least three percent of students in any and all school districts around the state.

In 2005 the union backed a bill to create a state-run competitor to these innovative online schools. Known as the Oregon Virtual School District, it has since been funded to the tune of more than seven million dollars. Legislators appropriated the funds with the intention that the district would “provide online courses.” But as Nigel Jaquiss reported in his recent Willamette Week exposé, “…after six years and the appropriation of $7.1 million, including another $1.5 million lawmakers just approved for the current biennium, the Oregon Virtual School District has yet to provide a single ‘course.’”*

This revelation calls into question which online schools are real and which may appear to be real, but are not. Schools like Oregon Connections Academy and Oregon Virtual Academy are real schools with hundreds of real teachers educating thousands of real students across the state.

The state-run Oregon Virtual School District, on the other hand, is truly a virtual district in the not real sense of the term. It has no teachers and no students. The only real part is that it has spent millions of real taxpayer dollars. And for what? It has a nice website and offers some helpful content and tools for teachers. But that’s about it. Somewhere along the line, its mission morphed from providing real online courses to hosting some “academic materials vetted by the Education Department and training for teachers.”

The Oregon Department of Education manager who oversees the Virtual District says that it is not an alternative to online charter school offerings. “We are not set up to compete with them from a financial point of view,” he says.* Real online charter schools, paying real teachers to teach real students, receive on average less than 5,700 public dollars a year for each enrolled student.** A simple calculation tells us that the $7 million allocated to the Virtual District so far could have been used to teach at least 1,200 students for one school year, or 200 students over the six years it has received state funding. But, again, so far the district has taught zero real students.

The teachers union keeps calling for more accountability from Oregon’s real online public charter schools, the ones with real teachers educating real students. It seems far past time for state legislators and taxpayers to call for accountability on the part of the Oregon Virtual School District. What have we gotten for $7 million in this “district”? If the answer is “not much,” then we should close it down and refocus our energy and resources on real schools with real students.

Oregon’s online public charter schools are not virtual; they are real schools where real learning occurs. Just because their teachers may not wear the union label shouldn’t give OEA the right to stop them from competing with the brick-and-mortar schools its members occupy.

Parents and students hold real online public charter schools accountable every day as they freely enroll and disenroll. More school choice will give more parents and students that power over brick-and-mortar schools as well. If OEA wants to keep students in classes taught by its members, it should figure out how to do that without holding the kids hostage. All students and their families deserve the right to choose where they get their education. Anything less is a disservice to them and to the taxpayers.

* “Virtual Combat: Oregon’s teachers union hates online charter schools. But its alternative has little to show for millions of taxpayer dollars,” Nigel Jaquiss, Willamette Week, July 20, 2011, www.wweek.com/portland/article-17755-virtual_combat.html.

**  “Unintended Consequences: an analysis of charter school funding in Oregon”, Vanessa Wilkins, Northwest Center for Educational Options, April 21, 2010 http://www.nwceo.org/pdf/NWCEO_Charter_School_Funding_Study_May_2010.pdf.
The average Oregon public charter school received slightly over $5,700 per student in 2008/2009 according to the Oregon Department of Education Financial Database, depending on the district that charters them. Current online charter schools are chartered in districts that pay less than this amount; but if the Oregon Virtual School District were to accept students statewide, it likely would receive closer to the average charter payment per student. Note that the $5,700 average per student charter school funding is approximately half the total public funding of brick-and-mortar public schools in Oregon.

Thousands of Oregon Kids Waiting – Literally – for Education Package

This week, legislators and lobbyists are working frantically behind the scenes on an education package that could help transform educational opportunities for students across Oregon. The package features reforms that will shape the state’s oversight of education as well as parents’ ability to choose a public school based on a school’s merits rather than its address.

One of the bills at the center of the tension, HB 3645, would allow Oregon’s public colleges to sponsor a charter school. Oregon’s charter schools are public schools that are operated by non-profit organizations. These schools do not charge tuition, cannot be religiously based, and cannot discriminate against students for their background, academic aptitude, or any other reason. Currently, only school districts or the State Board of Education may sponsor charter schools. This bill would allow charter applicants to ask Oregon’s public colleges to sponsor charters. Many states, including New York, Michigan, and Minnesota already have similar laws.

I discovered the urgent need for such a reform last year when I set out to learn how many of Oregon’s children were on waiting lists to get into a public charter school. Out of Oregon’s 108 charter schools, 92 schools finally responded. More than 4,700 kids were on waiting lists for a charter school last summer. Fewer than 20,000 kids (less than 3%) currently attend charter schools, but clearly far more would, if given the opportunity. In fact, a 2008 poll showed that 24% of Oregon parents would choose a charter school if they could.

Parents want options for their kids beyond the local district school. But why haven’t charter schools expanded enough to meet the demand? District politics frequently make it nearly impossible for even excellent applicants to get permission to start or expand a charter school.

Portland Public Schools’ (PPS) history with charter schools is telling. The application process is lengthy and expensive, taking 12 – 18 months and costing thousands of dollars since applicants typically hire experts to help. They not only must submit a detailed operating budget and curriculum, but they must pay to send out surveys and conduct focus groups to determine student demand. The PPS application itself is 50 pages long, and complete applications are hundreds of pages long. The hurdles continue through the process and the record reflects that clearly. PPS only approved three out of 17 charter applications (18 percent) between 2004 and fall of 2010.

Are such sky-high hurdles altruistic attempts to protect students from bad charter schools? Theories about the cause or justification of such district suspicion abound, but ultimately school boards are driven by local politics. Political incentives involve a number of competing interests, many of them selfish and in opposition to students’ interests.

Such competing incentives are sometimes apparent in the denials themselves, which often claim that charter schools will have an “adverse impact” on regular district schools by drawing too many students (and accompanying funding) from regular district schools. These claims neglect the reality that charter schools get about 55 cents for every dollar that a regular public school spends per student, and when a student transfers to a charter school, regular district schools no longer bear the cost of educating that child, allowing more money to be spent per student who remains in district-run schools.

HB 3645 will help charter schools steer past some of the political obstacles and to be judged more on their merits. But first, the bill must endure the political game at the state level. The Oregon Education Association (OEA), a union, has stated that it opposes allowing public colleges to sponsor charter schools because, “[a]t a time that we are closing neighborhood schools it doesn’t make sense to promote the growth of charter schools.”

Likewise, the OEA opposes HB 3681, which would essentially carry charter schools’ open-enrollment policy over to regular public schools, increasing kids’ educational options. It also opposes HB 2301, which would loosen enrollment restrictions that currently restrict many families from being able to choose a virtual charter school.

The OEA apparently believes that regular district schools are entitled to local student enrollment. The OEA fears that giving parents a choice would create financial instability for schools that might lose too many kids to transfers. But if parents are leaving a particular school in droves, doesn’t that suggest that something is wrong with that school? And if something is wrong, why should parents be forced to send their children there? Opponents of school choice argue that those children who are left behind in bad schools would suffer most. Yet, evidence across the nation suggests that these kids, too, benefit as schools are forced to improve their performance to retain students and accompanying funds.

This is not a battle between private education and public education. All of these educational options are public schools! School choice – empowering parents to choose a school that is the right fit for their kids – is making a significant difference for thousands of Oregon families already. Many more could benefit, finding the schools that work best for them, with bills like HB 3645, 3681, and 2301.

Stand for Children, Governor John Kitzhaber (a Democrat), and many House Republicans have fought the OEA and popular myths to support this education package. As Oregon’s voters and legislators consider these school choice bills, they should consider the thousands of Oregon families who are waiting for a better educational opportunity for their kids.

The Not So “Cool School” Initiative

By Michael Bastasch

The Oregon “Cool Schools” Initiative (House Bill 2960) directs the Oregon Department of Energy to provide zero to low-interest loans and grants to school districts for energy efficiency building improvements. Governor John Kitzhaber, the bill’s main proponent, argues that HB 2960 will create healthier, more energy efficient schools and create jobs. However, given the propensity of government to overestimate the benefits of its programs while completely understating the costs, the economic impacts of HB 2960 most likely will yield the opposite results of what Gov. Kitzhaber claims.

Luckily, Oregon has a case study in Washington State. Washington initiated a similar program in 2005, and the results were underwhelming. A recent report from the Washington Policy Center shows the costs of the program greatly outweighed the benefits. First, many of the new “green” schools actually used up to 52% more energy than predicted, and some were even less efficient than buildings that were decades old. 

Second, most of the money that went to each school was spent on meeting the program’s guidelines and not to energy savings. For example, the Spokane School District spent $455,826 bringing Lincoln Heights Elementary up to the “green” requirements. Only $81,000 (18%) was spent on energy efficiency measures, while the rest (82%) was spent on meeting other requirements that didn’t yield any energy savings. In addition, estimates reveal that the payback time on these “green” improvements is about 43 years. Since virtually no school goes that long without making any changes, it is very likely that energy efficiency investments will never pay for themselves.

Third, student scores at these “green” schools were not significantly improved. In fact, student performance was 25% below what was promised by the Office of the Superintendent of Public Instruction in 2005. Moreover, academic performance was lower on average at “green” schools than at comparable schools in the same district, according to the State Board of Education’s Accountability Index. Students in these schools are actually performing worse and at a higher cost to Washington taxpayers.

Washington’s experiment should provide us with a lesson on why “green” projects such as these almost never pan out. Instead, Gov. Kitzhaber and other proponents of HB 2960 tout the popular phrase “job creation.” The question we should be asking is, job creation for whom and for how long? HB 2960 requires that schools receiving initiative funds only hire Oregon-based contractors and that district employees not perform work constituting over 5% of the project’s total cost.

Gov. Kitzhaber and his staff also claim that for every $1 million spent, 10 to 15 jobs will be created. How would spending approximately $67,000 to $100,000 per job add jobs to the economy, especially when these jobs are temporary? What the Governor does not mention is how many jobs will be lost for every “Cool Schools” job that is created. Basically, HB 2960 carves out a nice little temporary benefit for a small group of people at the expense of all Oregon taxpayers. What is ignored are the unseen costs to the overall economy, such as jobs not created had the funds been efficiently spent by individuals, and also the goods that those workers could have produced had resources been employed in different areas.

Washington’s “green” schools debacle should show Oregonian lawmakers that these types of endeavors are often fruitless and result in wasted tax dollars, lost jobs and misallocated resources. Why should Oregonians be forced to “invest” in an initiative where they will never see any returns or any noticeable long-run benefits? They shouldn’t, and legislators should consider the wider economic impacts of HB 2960 before blindly passing it.


Michael Bastasch is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

Oregon Education Spending Increases―But for What Outcome?

How much do we spend to educate students in Oregon? It depends on what kind of spending you include. On May 31, The Oregonian cited a U.S. Census Bureau report stating that Oregon spent $9,805 on average in 2008-09 school year, 7% below the national average for per pupil education spending. That figure excluded certain spending and is well below the Oregon Department of Education (ODE) and national teachers union (NEA) figures for that same year: $10,029 and $10,129 respectively. Add the year’s debt service expenditures reported by the ODE (which presumably go toward improving kids’ education), and spending per enrolled pupil jumps to around $11,200 per student. This total figure climbs even higher to around $12,600 if you measure per pupil expenditures by actual average attendance rather than the October 1 student enrollment.

The National Education Association (NEA), the nation’s biggest union, ranks Oregon around the national average for spending (less than 2% under the average spending per enrolled pupil, but above average for spending for average daily attendance), despite our lower than average cost of living. Typical for the U.S., Oregon has significantly increased per pupil spending, from around $7,000 in 1981-1982 (after adjusting for inflation to 2010 dollars), to more than$11,000 in the 2009-2010 school year.

Yet, focusing on how much Oregon spends per student begs the question as to how much spending is enough. Nationwide, spending has more than doubled since 1970, but improved outcomes have not followed. While fourth and eighth graders are doing slightly better on the nation’s most stable educational measurement―the National Assessment of Educational Progress (NAEP)―it appears that any early gains are lost by the time they reach the finish line: 17-year-old students have not improved since the U.S. Department of Education first started measuring their math and reading performance with the NAEP in the 1970s.

Likewise, international evidence confirms that spending is a poor predictor of educational outcomes. While the U.S. is among the top for per pupil spending, we place in the middle of the pack of developed nations. Decade after decade, our leaders promise better outcomes with “better oversight” and “increased accountability.” But the accountability they speak of does little to empower teachers or administrators to harness their own unique talents and passions, nor does it empower parents and students to find the educational program that would best help them thrive. Bottom-up, market-oriented reforms already have proven successful in places like Florida, New York City and Milwaukee.

Rather than hyping the same empty promises that require better “oversight” by bureaucrats, many states are now catching on and creating more educational opportunities with public charter schools (choice schools), open enrollment policies, opportunity scholarships and education savings accounts. Groups like Oregon’s Stand For Children now recognize that increased funding is not a silver bullet; rather, smarter spending is necessary. Movies like Waiting for “Superman” and The Cartel highlight true success stories around the nation. Perhaps Oregon, too, will join the new wave of effective education reform.

$11,540 per student in 2009-2010: Are we getting our money’s worth?

According to the National Education Association, the national teachers union, Oregon spent an average of $10,476 per enrolled student in the 2009-2010 school year. Add in reported debt service spending, and that figure leaps even higher to $11,540 per student.

Are we getting our money’s worth? Nationwide, spending has more than doubled since 1970, but improved outcomes have not followed. While fourth and eighth graders are doing slightly better on the nation’s most stable educational measurement―the National Assessment of Educational Progress (NAEP)―any early gains are lost by the time they reach the finish line: 17-year-old students have not improved since the U.S. Department of Education first started measuring their math and reading performance in the 1970s.

Likewise, international evidence confirms that spending is a poor predictor of educational outcomes. While the U.S. is among the top spenders for education, we place in the middle of the pack of developed nations for performance.

Decade after decade, our leaders promise better outcomes if we just spend more and incorporate “better oversight” and “increased accountability.” It hasn’t worked. It’s time we turn the system on its head and empower teachers and administrators at the ground level to use their talents―and parents and students to find the educational program that will best help them thrive.

 

 

 

Arizona’s Empowering Education Savings Accounts: An Example for Oregon

Leading by example, Arizona’s government recently passed a bill creating Arizona Empowerment Accounts. Under the new program, if a child with special needs leaves his or her traditional public school, a portion of the state funding that would have gone toward educating that student will go into an education savings account for that student. The money then can pay for other educational options: private school tuition, online courses, tutoring or homeschool curriculum. The money left when the child finishes high school can be used for college within four years of high school graduation.

This program harnesses the benefits of both vouchers and savings accounts. Vouchers have been shown by gold standard social science studies to improve educational outcomes for students who receive vouchers and even for those who remain behind in regular public schools. Nine out of the ten random assignment empirical studies found that vouchers improve student outcomes; one found no impact. 19 out of 18 studies found that vouchers positively impacted regular public schools; only one found no impact.

Vouchers help give kids the intellectual background to better succeed in life, while the savings function of the program will also likely increase students’ financial ability to attend college. Research has shown that having economic assets substantially increases kids’ educational outcomes and likelihood to attend college. Of children who expect to one day graduate from a four-year college, those with savings accounts are six times more likely to attend college by the time they are 23.

Educational savings accounts will empower families to choose the type of education that will best serve their kids, leading to better outcomes for students. Oregon’s legislators should take note and bring such great opportunities to our state.

Why This Mom Is Speaking out Against the PPS $548 Million Bond Measure

We’ve heard the Portland Public School District propaganda machine and the bureaucratic sound bytes about how the so-called school modernization bond will begin the important process of updating Portland schools, bring jobs to the community, increase student achievement, attract young families to the District, and on and on….

But what we don’t hear is a logical, compassionate response to the fact that this bond will tax people out of their homes. I’ve raised this issue many times and given the District plenty of opportunity to respond, but all I get is…crickets….

Could it be because they don’t want to recognize the striking disconnect between their establishment and the financial realities of most in their community?

I’ll let you decide the answer to that, but one thing is clear: It’s time they heard the voice of the taxpayers footing this bill.

I have received criticism from Portland bureaucrats that I couldn’t possibly understand what this means for the school district since, after all, I live in Wilsonville, I have a construction bond in my district, and our schools are being taken care of.

Here’s my response: It doesn’t take a genius to figure out how a monumental tax increase will affect a community, especially in a recession. And, I don’t have to live in the District in order to pick up the phone, listen to heart-wrenching stories from folks on fixed incomes or barely scraping by, understand that this bond measure will put them on the streets, and become enraged at the audacity of the Portland Public School district for putting a “utopian” measure on the ballot with no regard for our economic condition.

I am an advocate for taxpayers statewide, and I will continue to speak out as long as the District remains deaf to the financial reality of its residents.

Since PPS likes to point out that I enjoy a school construction bond already in my district, I’d like to point out the consequences of that. Wilsonville is one of the highest property-taxed areas in Oregon, and when I receive my tax bill every year, it’s like swallowing a jagged horse pill. In fact, my mortgage payment was increased by $300/month at the start of this year to cover my bloated property taxes, which was devastating to my household budget.

Sound like something Portlanders want to take on? I think not.

Not when Portland is still suffering from the grips of economic recession, not when unemployment remains above 10 percent, not when homeowners are barely able to cover basic expenses, not when renters are in no position to deal with rent increases, not when foreclosures are still on the rise and this bond may add 1,000 homes to that list, not when this bond will cost the community 5,000 jobs due to the drastic decrease in disposable income, not when bricks and mortar will do absolutely nothing to increase the atrocious graduation rates within the district (average 53%), and not when the major supporters of the bond measure are the ones who stand to have their pockets lined at our expense.

This is a teachable moment for taxpayers. A time to push back against excess and to demand a more reasonable, financially viable option. The District needs to go back to the drawing board and come up with a proposal that only focuses on the basic, critical structural needs of our schools.

PPS needs to heed the warning that this is no time for “wish list items.” Save those for after the economic recovery.


Lindsay Berschauer is a former Washington state construction company owner. Now an Oregon resident, she is speaking out against the School Modernization Bond Measure as a private citizen. Lindsay recently worked with Cascade Policy Institute as a research associate and now works for Third Century Solutions on the Oregon Transformation Project, which brings to Oregon citizens information and opportunities to bring about lasting budget and regulatory reforms that will ensure a robust and growing private sector. Berschauer’s son will be entering the public school system next year.

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