by Drew Harwell
Tampa Bay Times
June 17, 2012
It was one of the most egregious cases of mismanagement in Florida charter school history: a public elementary school that enriched its administrators, impoverished its teachers, failed its students and collapsed in disgrace.
Life Force Arts and Technology’s closure this month, after two years of classes and spending more than $1.6 million in public education funds, signaled the end of a charter school that was roundly despised.
It also proved a dramatic point about the state’s $1 billion charter-school industry: that the freedom granted to charters can open the door to for-profit companies with little interest in following the rules or achieving student success.
Florida’s charter system, one of the largest in the nation, lets schools experiment in exchange for results. Many schools have flourished, offering creative curricula and top-level academics, and charters now teach 180,000 students statewide — enough to fill Hillsborough County’s public classrooms.
But when a school does go bad, local school districts insist they have little power to push for change or punish administrators. They point to stricter laws in other states — including spending oversight, board requirements and a ban on for-profit management — that could have helped prevent the abuses that led to Life Force’s demise.
Lawmakers have ignored suggestions that the state implement stronger financial controls, and the state’s charter laws grant companies wide berth in deciding who leads the school and how they can spend public funding.
Dunedin’s Life Force hemorrhaged money, declared bankruptcy and hired an unproven management company that wrested control away from what is supposed to be a charter school’s chief watchdog, its governing board.
Hanan Islam and her company, Art of Management, then fired teachers, starved classrooms of supplies and distributed books and pamphlets written by Scientology founder L. Ron Hubbard.
For months, Islam evaded warnings and visits from Pinellas County school officials, all the while steering more than $100,000 from the school to her private business accounts.
School choice advocates say Florida’s charter laws have enough power to prevent disaster, and point to the termination of Life Force’s charter — after months of disorder and reports in the Tampa Bay Times — as proof the system works.
“You can’t make this broad-brush judgment because of one bad actor. Bad things happen in traditional public schools, too,” said former Florida Education Commissioner and state Sen. Jim Horne, who now lobbies for several charter management companies.
“It’s terrible and awful” that the school was mismanaged, he said. But its closure “means the system is working, and that all charters are getting better.”
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Charter schools are privately run, publicly funded and, as the state Department of Education says, “free to innovate.”
Since the first five Florida charter schools opened in 1996, more than 500 have opened across the state, with 125 more applications approved last year. Florida’s charter enrollment, the second highest in the nation behind California, has doubled since 2005.
Last year the state paid charters more than $1 billion, $90 million of which came to schools in the Tampa Bay area. Charter chains and entrepreneurs have followed the money.
In Florida, 150 schools statewide are run by for-profit companies, the second highest in the country, according to the National Education Policy Center.
Many charters advertise a private school education at a public school price, and last year the state’s FCAT-based grades for most charter schools were A’s.
In Hillsborough, Terrace Community Middle School has been an A-rated school for a decade and is recognized as one of the best in the state.
But charters are not immune from academic ills. Mavericks in Education, a for-profit charter chain with eight schools in Florida including St. Petersburg and Largo, has been taken to court by whistle-blowers who claim the school inflated enrollment and faked grades to earn more state funding.
In the past five years, compared with traditional public schools, charters have consistently shown lower rates of A’s and higher rates of F’s, state records show. Last year charters accounted for 10 percent of Florida’s public schools but 50 percent of its F’s.
Adam Miller, the state Department of Education’s director of charter school programs, points to dropping charter approval rates as proof state standards remain high. Last year, the state received 350 new charter school applications, an increase from the previous year of 40 percent. A third were approved, down from half five years ago.
Once a charter is approved, the responsibility for policing its management falls to the school’s own governing board. At Life Force, Islam found in her board an unquestioning audience, possibly because she hand-picked its members and sought to add them to the payroll.
State law doesn’t define the extent of a management company’s control. While in some states, these boards need formal approval or must have members who are teachers, parents or school district representatives, Florida allows anyone with a clean criminal background to serve on a charter board.
At Life Force, teachers criticized board chairman Louis Muhammad as Islam’s loyal ally. Hired by Islam as a consultant last summer, Muhammad was fired in October after pushing a student on the school bus. Three months later, Islam appointed him to the Life Force board.
Turnover among the other Life Force board members was high, and few had classroom or finance experience. When members learned they could face personal risk for the school’s dire financial condition, several quickly resigned.
A University of Washington study last year found most charter boards nationwide received scant training and offered little support to the school. Florida’s “governance training” for new charter board members lasts four hours, can be completed online and needs renewal only once every three years.
Cheri Shannon, president of the Florida Charter School Alliance, said more rigorous board training could teach charter board members “where to go for help, who to ask, who to trust.”
But she said the buck for charter school accountability should stop at local school districts.
“The way you keep the bad ones from proliferating,” Shannon said, “is you don’t let the bad ones open in the first place.”
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One in four Florida charter schools has closed, whether by choice or district command. Two dozen of those terminated schools once taught students across Tampa Bay.
School choice advocates say Florida’s charter law on financial reporting is airtight: Schools must file monthly financial statements and annual audits, and a bad school budget can necessitate a corrective action plan.
But the law allows for vague reports that don’t detail exact expenses. And schools that do reach financial crisis are given two years before the charter termination process can begin.
At Life Force, when the district warned the school that its debts of hundreds of thousands of dollars could lead to closure, administrators found a different way of extending its time: They filed for bankruptcy, granting them court protection to reorganize and quieting the district’s threats.
Life Force stopped submitting financial reports for four months, saying the district should seek them in court. Meanwhile, state funding to the school continued at a rate of about $800,000 a year.
And earlier this year, Imagine Schools, a national nonprofit that runs charters in St. Petersburg and Land O’Lakes, came under fire for paying up to $750,000 a year in rent to its own subsidiary.
In the most recent FCAT scores, Life Force and Imagine also had the lowest scores in the Pinellas district. Still, the district is giving Imagine one more year to improve.
Dot Clark, Pinellas County’s coordinator for partnership schools, said the district should have been more forceful in demanding answers from Life Force.
Amid cuts to district budgets and rapid growth of new charters, districts say they find themselves underfunded and overwhelmed. The state paid districts $24 million last year to service charter schools, state records show — $15 million less than the districts actually spent. And changes to the law last year slashed district allotments even more.
A 2008 legislative report recommended the state adopt a financial monitoring system that could expose financially troubled charter schools before they became critical, but no system has been put in place.
School choice advocates criticize district calls for more financial oversight as a lingering effect of their “shotgun marriage” to charters, which compete with them for students and funding. That inherent tension can grind on charters’ independence.
“What they’re really saying is they want to control the charter more and reduce innovation, reduce risk,” said Charter Schools USA CEO Jonathan Hage, a member of Gov. Rick Scott’s education transition team and a Jeb Bush adviser who helped draft the state’s first charter school law.
“It’s like Burger King looking next door and saying, ‘Do I really want this McDonald’s set up next to me?’ ”
• • •
The Center for Education Reform, a charter advocacy group, calls Florida one of the friendliest charter states in the nation. The Department of Education last year unveiled a $30 million fund to help subsidize new charter creation.
State lawmakers last year also okayed virtual charter schools. And certain “high-performing” schools were granted expanded rights to enroll more students, triple the length of their contracts and replicate across the state with less district supervision.
In October, an early attempt at rapid charter replication came to Pasco County from Charter Schools USA, one of Florida’s largest for-profit management companies.
The firm’s application to open a charter for up to 1,400 students was riddled with holes: It failed to mention a location for the school, and the board tasked with independent oversight had the same address as the school’s management company.
Because the sparse application met state criteria, Pasco County School Board members said they had no choice but to approve it. Contract negotiations have since fallen apart.
“They’re trying to expand the number of charter schools, period,” said Andy Ford, the president of the Florida Education Association, the state teachers’ union. “They don’t care if they’re good or bad.”
Many charter advocates preach self-regulation and suggest guidelines instead of more monitoring or a tougher set of laws. But that can give schools like Life Force leeway to make their own rules.
“That’s the concern with charter schools: We’ve got to make sure we’ve got trustworthy people,” Life Force principal Lenor Johnson said.