Michigan, allegedly, does not permit for-profit charter schools.
And yet one of the largest for-profit charter management corporations, National Heritage Academies (NHA), is headquartered in Grand Rapids, Michigan. And they take the “for profit” part seriously:
NHA funds itself partly by charging its schools high rates. For example, the New York Daily News reported that NHA owned property in Brooklyn and charged one of its charter schools there $2.3 million to rent the property, which is $1 million over market rate. This means that the extra $1 million dollars goes to NHA instead of the individual charter schools.
So, how does a school claim to be a “non-profit” operation when they are diverting public tax dollars to a “for-profit” enterprise like NHA?
While only one state, Arizona, currently allows for-profit charter schools to operate in their state (California just passed a law against for-profit charters on July 1, 2019), in the upside-down world of corporate education reform the differences between for-profit and not-for-profit charter schools are so negligible as to be nonexistent.
How could this be?
Because not-for-profit charter schools in many states, including Michigan, are free to contract with for-profit charter management companies for HR services, custodial services, and a number of other personnel and facilities needs.
Taking full advantage of this seeming “loophole” in funding arrangements, NHA operates 50 charter schools in Michigan, with many of these schools claiming “not-for-profit” status even as they contract with NHA for virtually all of their personnel and administrative needs.
If you’re thinking that the differences between for-profit and not-for-profit charter schools are differences without distinctions, you’d be right.
You might also be wondering where those public tax dollars go after being money-laundered through one of the–allegedly–non-profit charter schools to the for-profit charter management operation over at NHA.
Well, a lot of it goes to administrator salaries.
For example, NHA’s new CEO, Brian Britton, had no prior experience in education when he was hired to lead the corporation last year. His previous job was running airport restaurants and bars, and he worked for Disney before that. Not exactly a compelling profile for leading an educational organization that boasts “a network of 89 public charter schools serving more than 59,000 students in 9 states.”
As a privately-held, for-profit corporation NHA is not obligated to share what their executives receive in compensation, but Mr. Britton’s previous salary was nearly $500,000 per year, and it’s doubtful he would have taken the job with NHA for less than that.
That salary would make Britton the highest paid school “superintendent” in the state, and not by a little bit, either.
What about the state superintendent of schools? Isn’t that position responsible for all of the kids, teachers, and public schools in the state?
Well, yes. And that position is currently held by Michael Rice, the former supe in Kalamazoo, who had a compensation package worth $286,064 per year. His new salary as state superintendent is considerably less than that, at around $216,000 per year.
But unlike Mr. Britton, Dr. Rice does have experience in education: he “previously was superintendent of a New Jersey district. He began his career as a teacher in the Washington, D.C., district and has a bachelor’s degree in psychology from Yale University and a master’s and doctorate in public administration from New York University.”
The differences here provide a stark contrast between the goals and values of those who advocate for charter schools and the supporters of traditional public schools:
- You can either hire a former restaurant manager with no educational or work experience as a teacher or school administrator to lead your school system, and then massively overpay them in comparison to what you pay your teachers…
- Or, you can recruit a highly qualified, experienced, knowledgeable school leader and pay them a competitive salary to serve as the instructional leader for your community’s children, teachers, and schools.
Your choice says a lot about what you value in education. And whether you care more about profits or pupils.