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Stop Charter School Fraud

This section includes articles explaining why charter schools are not about helping students but rather are simply scams designed to rob millions of tax payer dollars away from real public schools. 
In this report, we will describe the dark underbelly of how charter school promoters such as Bill Gates have used their vast wealth to bribe and corrupt elected officials from small rural school boards to state legislators and even the State Superintendent of Public Instruction in order to continue the charter school scam in Washington State - even after the Washington State Supreme Court ruled that charter schools are unconstitutional. We hope you will share this important article with other parents, friends and teachers who care about the future of our democracy and our public schools.

It is ironic that two of the most corrupt scams facing our state education system were discussed at the Washington State Senate Ways and Means Committee hearing on Monday January 18 2016. The first was a JLARC Report on Tax Preferences. The second was the scam charter school "fix" bill Senate Bill 6194. "Tax Preferences" is a fancy term used for billions of dollars each year that are robbed from our public schools and handed to wealthy corporations like Microsoft and Boeing. For example, Bill Gates evades paying about one billion dollars per year in Washington State taxes by pretending that his corporation, Microsoft is located in Reno Nevada rather than in Redmond Washington. "Charter Schools" is a fancy term used to describe unregulated contracts given to private for profit corporations that also rob our schools of millions of dollars. See the connection? Both bills benefit billionaires while harming one million school children in Washington state who now are forced to spend their school days in extremely over-crowded classrooms just so a few billionaires can buy bigger boats. Sadly, I predict that both scams will pass the State legislature.

Timeline of Recent Scams
In August 2015, the Washington State Supreme Court not only found that the State legislature was in contempt of court for failing to comply with their "paramount duty" to fully fund our public schools - but began fining the legislature for every week this violation continues. Then on September 4 2015, the same Washington State Supreme Court ruled that the charter school initiative was unconstitutional. Normally, when the Supreme Court states that something is against the law, most responsible grown ups would simply comply with the law. However, leaders of our state legislature have apparently decided to ignore both court orders.

In terms of funding our public schools, there has been only one bill submitted in the legislature this past year that even comes close to the $3 billion per year needed to lower class sizes in Washington state back down to the national average. That bill, Senate Bill 6093 sponsored by Senators Chase and McAuliffe, would end a tax loophole the wealthy use to avoid paying their fair share of state taxes. It has not even gotten a hearing. Instead, while the needs and rights of one million school children to an education are shoveled under the rug, the entire focus in Olympia has been on how to ignore or "fix" the Supreme Court Charter School ruling. Here we will describe four of these charter school "fix" scams - all funded by the man behind the curtain, Bill Gates.

In December 2015, three fake Education Reform front groups (each of which receives millions of dollars in funding from Bill Gates) announced that they had formed a PAC to give legislators a half million dollars in bribes (also known as campaign contributions) in trade for "fixing" the problem created when the Washington State Supreme Court ruled that that the Charter School Initiative 1240, also funded with millions of dollars by Bill Gates, did not comply with the Washington State Constitution. Naturally, with this much money up for grabs, on January 4 2016, Senate Bill 6163, also known as the "Charter School Fix" bill was filed in the Washington State state legislature. According to Public Disclosure Commission filings, the prime sponsor of the Charter School Fix bill was one of two dozen legislators who received a down payment from the Bill Gates funded WA Charter School PAC. Their bill would allow up to ten percent of all Washington schools to be "converted" into unregulated and unaccountable fraud factories that could rob taxpayers and public schools of more than one billion dollars per year.

It is important to note that this bill has nothing to do with school choice or school innovation or even helping the kids who were enrolled in illegal charter schools. School districts are already allowed to create any type of alternative school that complies with our state laws and state constitution. Former charter school kids can attend public schools like any other kids. Parents are allowed to petition school boards to allow their student to attend any school in the school district or move to a different school district or run for the school board and create their own innovative schools. Instead, this Charter School Fix bill is purely about robbing up to one billion dollars per year from public schools and turning these tax payer dollars over to private for profit corporations. One only has to look at how charter schools have turned into fraud factories from California to Florida to New York and Ohio and many other charter school states to understand what the real purpose of charter schools is - it's robbery of tax payer funds pure and simple.

Here is the math. Washington State has about one million public school students. Each student receives about $10,000 in school funding (about $8,000 from the state plus about $2,000 from local levies and federal funding). This is about $3,000 per pupil less than national average of $13,000 per student - which is why Washington state has among the lowest school funding and highest class sizes in the nation. This extremely low level of funding is also why the Washington State Supreme Court has held the state legislature in "Contempt of Court" for failing to comply with their Constitutional "Paramount Duty" to fully fund our public schools.

The total funding for all one million Washington state students is about $10 billion per year. This is $3 billion per year less than the national average - with the difference being diverted into billions of dollars in tax breaks for wealthy corporations like Microsoft and Boeing. If the charter school fix bill were to pass, yet another billion dollars could be siphoned off from public school funding and diverted into charter school fraud factories. Here is the language from the bill: ""A school district board may not approve more than.. ten percent of the total number of public schools in the district as district charter schools." (SB 6163, Page 18) Ten percent of $10 billion is one billion dollars.

The actual amount of the robbery could be much higher because the above figure does not include school construction funds which would also be siphoned off by charter schools. Here is the language from the bill that gives away up to ten percent of school construction funds: "School districts providing facilities that serve district charter school students are eligible for state matching funds for common school construction. District charter school facilities not owned by the school district may request state construction funds through the office of the superintendent of public instruction." (Senate Bill 6163 Page 27)

But a billion dollar loss to students and tax payers is only one of many drawbacks of this 37 page bill. In this report, we will describe the following 12 major drawbacks of the Charter School Fix bill:

Even though the Washington State Supreme Court ruled that charter schools are unconstitutional and ordered the State legislature to fully fund our real public schools, some of the leaders of the State legislature, in a blatant act of defiance, have decided to hold hearings on two "charter school fix" bills both of which would rob even more millions of dollars from our public schools. The hearing on the two charter school fix bills will be in Olympia on Tuesday January 12 2016 at 1:30 pm in the Senate Cherberg Building. Parents and teachers who want the legislature to focus on funding our real public schools instead of funding charter schools should attend this hearing and let the Senators know that you oppose diverting any more money away from real public schools.

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This is the second of two reports I have written about the Charter School Fix bills to help parents and teachers better understand how the charter school fix bills would rob millions of dollars away from our real public schools. First, a quick review of how we got to this crazy place. In 2012, the Washington State Supreme Court found that the State legislature had failed to comply with their Constitutional Paramount Duty to fully fund our public schools and ordered the legislature to come up with a plan to fully fund our public schools. When the legislature failed to come up with a plan, in September 2014, our Supreme Court held the legislature in "Contempt of Court" for dragging their feet. In 2015, the legislature claimed that they added a billion dollars in school funding. But in fact, they merely restored funds that they had cut in previous legislative sessions. Therefore, in August 2015, the Supreme Court began fining the state legislature. Thus far, the legislature has simply ignored these fines.

Then on September 4, 2015, our Supreme Court ruled that the Charter School Initiative 1240, funded with millions of dollars by Bill Gates, was unconstitutional in part because charter schools would divert billions of dollars away from public schools and in part because public school funds would be handed over to private corporations rather than being controlled by publicly elected school boards.

In response to this Supreme Court ruling, in December 2015, a couple of fake groups, SFC and LEV, announced that they had formed a new PAC to provide a half million dollars in campaign contributions to legislators willing to "fix" the problem created when the Washington Supreme Court ruled that the Charter School Initiative 1240 was unconstitutional. On January 4, 2016, Senate Bill 6163 was submitted to the Washington State legislature which would "fix the charter school problem by putting charter schools under the control of local school boards. After researching this 37 page bill, on January 7, 2016, I published a report calling Senate Bill 6163 a "framework for fraud" and summarizing 12 specific problems with Senate Bill 6163. Here is a link to my first report: https://coalitiontoprotectourpublicschools.org/charter-school-fix-is-a-framework-for-fraud

Later on January 7 2016, a second 44 page Charter School Fix bill was submitted in the Washington State legislature. This bill would fix the charter school problem by diverting millions of dollars in Washington State lottery funds in order to pay for charter schools. This bill claims that these funds are not restricted for use by public schools and can therefore be used to fund charter schools. This bill does not yet have a number but is available at the following link: leg.wa.gov/Senate/Committees/EDU/Documents/2016 Draft bills-PSSBs-Amds/ELKE 1.12.16 S-3706 1.pdf

In this second report, we will review the problems of this second Charter School Fix bill. We will begin by addressing some of the questions raised by my first report because these same concerns also apply to the second charter school fix.

Who paid for the Charter School Initiate 1240?
In my prior report, I pointed out that Bill Gates spent millions of dollars promoting the Charter School Initiative 1240. One person, our of of the thousands who read my first report, felt that this was an unfair attack on Bill Gates, who is the richest man in the world with a total wealth in excess of one hundred billion dollars. In fact, according to the Washington State Public Disclosure Commission, Bill Gates contributed $3.6 million in direct funding to the "Yes on 1240" campaign. As I explain in the following article, the actual amount Bill Gates spent promoting the Charter School Initiative was more than $35 million. It is therefore accurate to claim that Bill Gates paid for the Charter School Initiative. https://weaponsofmassdeception.org/7-billionaire-controlled-corrupt-government/7-1-how-billionaires-buy-elections


Are SFC and LEV real groups or fake groups?
In my prior report, I pointed out that the groups who who formed the half million dollar PAC to pay legislators for promoting a charter school fix were fake groups funded with millions of dollars from Bill Gates. By fake groups, I mean that these groups are funded predominately by Bill Gates and other billionaires and not by contributions from stakeholders such as parents and teachers and/or the general public.


Specifically, SFC (aka Stand For Children) has received about $16 million from the Gates Foundation and LEV (aka the League of Education Voters) has received about $14 million from the Gates Foundation. Therefore the half million dollar PAC they created is in reality a Bill Gates funded PAC. These two fake groups are only two of more than 100 fake groups funded by Bill Gates to promote his takeover of our public schools.

Are the the Half Million Dollars that the WA Charter Schools PAC is giving to Legislators Bribes or Just Campaign Contributions?
In my previous report, I described the half million dollars being given to Washington state legislators as "bribes." One person objected to my calling these campaign contributions "bribes."

The WA Charter School PAC website described their new program this way:
"The WA Charters PAC delivered checks of $1,000 dollars to 13 members of the house and 11 Senators, on both sides of the aisle last week, including Representatives Pettigrew (D-37), Sawyer (D-29), Senn (D-41), Magendanz (R-5) and Senators Mullet (D-5), Fain (R-47), Litzow (R-41), and Rolfes (D-23). The PAC is continuing to raise funds despite the December 10th cut-off date... WA Charters expects to raise more than $500,000 by the end of session... We know we will have more champions to thank after the session” added Thomas Franta, CEO of WA Charters."

So the money is simply WA Charters way of saying thank you to legislators for passing a charter school fix bill. But is offering both current money now and the promise of a lot more money later in trade for passing a charter school fix bill a bribe? Here is the Webster's Dictionary definition of a bribe:

Bribe: Something given or promised to a person in order to influence dishonestly a decision or action; something valuable (such as money) that is given in order to get someone to do something; money or favor given or promised in order to influence the judgment or conduct of a person in a position of trust; to try to get someone to do something by giving or promising something valuable (such as money).

Here is what the Washington State Constitution says about the legality of paying off legislators to get them to pass a bill:
Article II, Section 30 BRIBERY OR CORRUPT SOLICITATION. The offense of corrupt solicitation of members of the legislature, or of public officers of the state... to influence their official action, shall be defined by law, and shall be punished by fine and imprisonment... A member who has a private interest in any bill or measure proposed or pending before the legislature, shall disclose the fact to the house of which he is a member, and shall not vote thereon.

It is a fact that the prime sponsors of both charter school fix bills have been given campaign contributions from WA Charters PAC. Numerous legislators have also received direct campaign contributions from SFC, LEV and various members of the Washington Roundtable. This sort of influence peddling is one of the worst forms of corruptions. Bills should be passed solely on the merits of whether they benefit the people and children of the state of Washington - not based upon who is offering the most money to legislators and their re-election campaigns.

Are the Charter School Fix Bills Really a Framework for Fraud?
One person, out of the hundreds who read my last report, objected to my use of the word "fraud" in the title of my last report despite the fact that I provided links to numerous reports of charter school fraud in other states and provided specific quotes from Senate Bill 6163 of "loopholes" that would allow the exact same sort of fraud in Washington state as has already occurred in several other states.


I declined her request to change the title of the report because Fraud is one of the major problems of charter schools in every state that has allowed charter schools. In fact, fraud in the form of robbing from the tax payers is one of the major purposes of charter schools. Without fraud, there would be no financial incentive to push for charter schools or money to bribe legislators into creating charter schools or money to create fake groups to promote charter schools. To be more clear, here is the Webster's Dictionary for the word Fraud:

Fraud: The crime of using dishonest methods to take something valuable from another person, intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right; a copy of something that is meant to look like the real thing in order to trick people.

This is exactly what charter schools are. They are a copy of our public schools in order to trick people into giving private for profit corporations money that should have gone to real public schools. The dishonest methods used include marketing campaigns that falsely claim that charter schools are better than public schools (the perversion of truth) as well as bribing legislators into allowing charter schools. The legal right that is given up is the right of our children to receive a real education from a real, experienced and highly qualified teacher. As we noted in our previous article and will show again in this article, the primary method charter schools use to increase corporate profits is to use inexperienced, untrained teachers who are paid substantially less than real teachers.

The reason each of the charter school fix bills are a framework for fraud is that both bills contain numerous loopholes that are specifically intended to allow charter schools to hire unqualified teachers and then pay them much less than real public school teachers. There is no benefit to children in gutting the pay of teachers. There is only a benefit to for profit corporations in that the less they pay teachers, the more they can make in corporate profits. But before we review the loopholes in the second charter school fix bill, let's quickly review the fraud studies from other states:

Three 2015 Studies of Charter School Fraud in other States
A March 2015national report documented charter school fraud and waste totaling more than $200 million - but says the total is  impossible to know because there is not sufficient oversight over charter schools.The report, titled “The Tip of the Iceberg: Charter School Vulnerabilities To Waste, Fraud, And Abuse,” was released by the Center for Popular Democracy.
https://populardemocracy.org/sites/default/files/Charter-Schools-National-Report_rev2.pdf

The report notes that these figures only represent fraud and waste in the charter sector uncovered so far, and that the total that federal, state and local governments “stand to lose” in 2015 is probably more than $1.4 billion.

The report states: "Charter operators have used school funds illegally to buy personal luxuries for themselves, support their other businesses, and more...The vast majority of the fraud perpetrated by charter officials will go undetected because the federal government, the states, and local charter authorizers lack the oversight necessary to detect the fraud.”

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The fraud included corruption, asset misappropriation, financial statement fraud, conflicts of interest such as purchasing schemes, bribery, bid rigging, kickbacks and extortion, theft, skimming, billing schemes, payroll schemes, expense reimbursement schemes, shell companies, ghost employees, ghost students, ghost buildings, accomplice vendors, overstated expenses, fake expenses, forged checks, fake refunds, and manipulations of assets and inventories. California alone stands to lose more than $100 million to charter school fraud in 2015. The vast majority of this fraud perpetrated by charter officials will go undetected because California lacks the oversight necessary to identify the fraud.