News


Feds Deny California's Charter Grant Application

Published September 29, 2015 13:56

U.S. Department of Education (USDOE) officials stunned their counterparts at the California Department of Education (CDE) yesterday by rejecting California’s application for funding from the federal Charter School Grant Program.  The news was all the more shocking given that Ohio, widely-recognized as the state with the nation’s most troubled charter school sector, will receive the lion’s share of grant funds.

The federal Charter School Grant Program provides several types of grants, with the bulk of funding allocated through the so-called State Education Agency (SEA) grant.  Under this grant, the USDOE provides large, multi-million dollar grants to SEAs who, in turn, provide subgrants to developers of new charter schools. 

These subgrants comprise a primary source of start-up funding for most new charter schools in California.  They are an especially vital source for the many charter schools that are not affiliated with a prominent charter management organization (CMO).  In recent years, major education philanthropists have concentrated their charter grantmaking nearly exclusively on CMOs, leaving new and independently-managed charter schools largely dependent on the federal CSP funds to pay start-up costs. 

Until now, California has been a major beneficiary of federal CSP funds.  In 2010, California received a five-year, $250 million award of funds.  These funds supported the launch of dozens of new charter schools and are a major driver of the remarkable growth of California’s charter school sector. 

With the expiration of this grant this year, California applied for a new grant earlier this summer.  CDE and State Board of Education staff worked feverishly and collaboratively with CSDC, CCSA and other advocates to draft an application.

The USDOE, however, reformulated the SEA grant scoring criteria earlier this year, adding several features that made it difficult for California to compete.  The controversial criteria awarded additional points for states that have not previously received SEA grant funds and states whose charter laws emphasize a strong role for state bureaucrats in overseeing vaguely-specified “quality authorizing” principles espoused by the National Association of Charter School Authorizers. 

These efforts to boost quality and oversight appear to have backfired.  The USDOE awarded over $70 million to the Ohio Department of Education—the largest of the eight grants it made.  The Ohio charter school sector is widely-regarded as the nation’s most troubled, with widespread allegations of financial abuses and worse.   In an apparent effort to address this embarrassing situation, USDOE issued a finger-wagging “dear colleague” letter yesterday, admonishing state education officials to ensure charter schools spend federal grant funds appropriately and urging them to prevent financial abuses. The Washington Post quoted USDOE Undersecretary Nadya Dabby as describing Ohio’s charter oversight practices as “pretty good.”

The ongoing torrent of bad charter news in Ohio, however, paints a strikingly different picture.  Legislative efforts to clean-up Ohio’s charter mess fell flat earlier this year.  A recent Ohio Supreme Court opinion offered a blistering attack on financial practices of charter schools that contracted to give their publicly-funded assets to for-profit management companies.  Worse yet, the Ohio Department of Education’s Director of School Choice resigned under a cloud earlier this month amid allegations that he manipulated data to falsely inflate scores of Ohio’s charter school authorizers.  Authorizer oversight was a major item in the USDOE’s new grant scoring rubric and the Ohio Department of Education is the recipient and administrator of the huge new grant.

Grant readers dinged California’s application on multiple fronts, stating that it offered a weak “vision for authorizing” (the USDOE’s new criterion for state-driven chartering), a vague management plan and inadequate plans to target disadvantaged student populations.  Of the 15 applications that scored above 90 points (i.e., among the 15 higher-scoring state applications), California ranked 14th, according to USDOE staff. 

No word yet on whether California officials may appeal the denial of the grant application.

We will keep CSDC Members apprised of updates as they become available and provide further analysis at this fall's California charter school conference.


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