Even as the audacity and creativity of charter school fraud, malfeasance, and corruption continues to astonish even some of the most objective observers of this sector of these publicly financed, privately operated schools, the recent example of a charter in Oklahoma may set a new low for the industry. It also reveals how confounding the bad-doings of these schools can be to uncover and police.
An Oklahoma State Bureau of Investigation revealed that the co-founders of the state’s largest virtual charter school system, Epic Charter Schools, David Chaney and Ben Harris, split at least $10 million in profits from 2013 to 2018. They allegedly recruited “ghost students” (who were technically enrolled but received minimal instruction from teachers) from homeschools and sectarian private schools “for the purpose of unlawfully diverting State Appropriated Funds to their own personal use resulting in high NFAY [not full academic year] rates and low graduation rates for the students.”
Epic established an $800-to-$1000-per-student learning fund for students who did not enroll in a public school. These students were dubbed “members of the $800 club,” and assigned to “straw teachers,” who “would receive additional pay in the form of bonuses which included student retention goals,” while “those who dropped students would see a decrease in pay.”
Students were assigned to “straw teachers,” who “would receive additional pay in the form of bonuses which included student retention goals,” while “those who dropped students would see a decrease in pay.”
A search warrant cited parents who received money but admitted they had no intention of receiving instruction from Epic. One family withdrew its ten children from public schools, received $8000, and allowed the kids to ride horses instead of attending school. The warrant states, “Teachers did not take roll and determined attendance when students logged onto the computer.” This process explains why the 2018 Oklahoma report cards both showed that about 99 percent of students were “in good attendance.”
According to the state bureau of investigation, in 2013 Chaney told his board that 30 percent of Epic students were homeschooled. A year later, the agency found “dozens of ghost students.”
In a statement defending the enterprise, Epic spokesperson Shelly Hickman said “Since our inception in 2011, we have time after time proven ourselves innocent of all allegations. We will again.”
Oklahoma Watch reported that State Superintendent Joy Hofmeister said the state’s Education Department had fielded complaints for years but had never been able to verify allegations, in part because it lacked subpoena power. Many Oklahomans are asking why Hofmeister, who received over $23,000 in campaign donations from Chaney and Harris, did not report those concerns to the authorities. She indicated that law enforcement agencies did not want the Education Department to call for an investigative audit.
Hofmeister has said that she questions Epic’s expensive public relations campaigns, which includes a $2.48 million media blitz of print, online, TV and radio ads over the last twelve weeks.
It would have been nice if the state superintendent had also criticized Epic’s sponsored content in the Oklahoman, or its “branded” newspaper columns in the Tulsa World, one of which lauded a new Epic superintendent as a “natural-born leader,” who “begins his day at 5 a.m.” to read and do other things that enrich his personal development.
Harris, Chaney, and their spouses contributed $193,500 during the 2018 elections, alone. Co-founder Ben Harris said that the reason why Epic ramped up donations was “we kinda felt like it was us against the entire traditional education establishment.”
It must be remembered that Epic’s funding has grown to $112 million as Oklahoma state school funding was cut more than any other state, aside from Texas. Last year, Epic received $38.7 million more in state aid, as urban districts faced millions in cuts. Even Tulsa Superintendent Deborah Gist, a longtime school choice advocate, complained as her district lost 496 students to Epic in the fall semester.
And Epic has been using, or misusing, the state’s charter conversion law to take over rural school districts through what one superintendent calls “predatory marketing,” using misleading advertising “to attract students and teachers from surrounding school districts.”
According to the state bureau of investigation, in 2016, Epic enrolled 180 students from a rural county during the school year. This meant that the students were categorized as not full academic year, so their test scores did not count on the state report card.
This leads to what may be the most destructive legacy of Epic. Oklahoma Watch reporter Jennifer Palmer explains that Epic received mostly Cs on report cards but, “more than half of Epic’s 20,000 students in June 2018 were enrolled part-year.” This means that “four in ten student tests were not factored into the grades.”
This statistical gamesmanship hurts students. According to a 2017 Epic teacher, “Teachers were asked to submit monthly reports detailing which students were ‘red, yellow or green’ based on the MAP test’s predictions and which students were full-year and which were not.” She said, “It creates a culture of fear where you’re afraid to keep kids that are low performers on your roster.”
It must be remembered that Epic’s funding has grown to $112 million as Oklahoma state school funding was cut more than any other state, aside from Texas.
Worst of all, Epic encourages “churn” or the transience of students, especially low-performing students who fall further behind. The data isn’t easy to access, but the new report card shows that in 2018, Epic One on One Charter and Epic Blended Learning Center had 13,158 enrollees. That year, test scores were reported for only one third of them. And of that number, less than one quarter progressed to a higher level. Nearly 40 percent of test-takers dropped into lower performance levels.
Epic’s failure and fraud may or may not send a message to the Oklahoma Legislature’s Republican majority, but, as Palmer observes, Epic’s stature as “an icon of school choice” could pose some difficulty in altering its practices.
Lawmakers should ask what happened to the students who were enrolled in name only at Epic, and whether millions of dollars were wasted and thousands of struggling kids abandoned so we could pretend that so many aren’t being left behind.