California lawmakers have been told over the past two decades that it needs to improve how it oversees charter schools, but the state has not yet made significant changes to its laws and policies about how to hold a charter school accountable while it’s operating. Those shortfalls have cost the st ate, which has seen recent cases of fraud and other improper spending by certain charter school networks. San Diego prosecutors said a lack of charter oversight was prominent in the A3 charter school fraud scandal of 2019, in which A3 operators used their charter network to steal $400 million of state school funding via illegitimate practices. A new 83-page report published last week highlights what it describes as long-standing weaknesses in California’s charter oversight and argues for lawmakers to make improvements, including setting clearer and higher standards for the authorizers that oversee charter schools and changing how much funding authorizers receive for oversight. The report was produced by California Charter Authorizing Professionals, a nonprofit group that provides support and professional development for charter authorizers in the state, as well as the National Network for District Authorizing. Charter schools are publicly funded and privately run schools that are independent of school districts. The premise of charters is that they get more operating freedom than traditional public school districts do in exchange for higher accountability. To open, they have to get approved by an authorizer — most often a school district, sometimes a county education office or the state Board of Education. The authorizer is in charge of vetting the charter school’s petition to open, handling oversight of the charter to ensure it performs and follows its charter, and deciding every several years whether the charter meets legal criteria to get its charter renewed and continue operating. California’s weak charter school oversight isn’t a new issue, as multiple reports in the past couple decades have identified needs for improvement. The state auditor told California 23 years ago that charter oversight “at all levels could be stronger to ensure charter schools’ accountability.” “We have a system that allows for very uneven oversight,” said Tom Hutton, executive director of California Charter Authorizing Professionals. “The downsides of how we do it have become very apparent.” Charter reform legislation has been proposed in the years since the A3 fraud case broke, but such legislation has repeatedly failed amid fervent opposition from charter schools and their families. Groups representing charter schools and traditional public schools were close to reaching a compromise on several reforms under Senate Bill 414 earlier this year, but negotiations fell through at the last minute and Gov. Gavin Newsom vetoed the bill, saying some of its provisions were “unworkable.” SB 414 focused largely on issues directly concerning charter schools, such as financial audits and vendor hiring, but proposed less on reforming charter oversight practices as a whole. At the heart of the charter oversight problem, according to the newest report, is that California sets a low bar for authorizing. California law allows people who want to start a charter school to submit a charter petition to any of the state’s approximately 1,000 school districts for authorizing, regardless of the district’s interest, capacity or qualifications to oversee a charter school. In California, there are currently about 330 charter school authorizers, including county education offices and the State Board of Education. Meanwhile, other states require agencies to apply to become a charter authorizer, vet and evaluate authorizers for their oversight capacity and performance, and permit fewer agencies to become authorizers. California law prescribes few oversight tasks for authorizers to follow while a charter school is operating. Per state law, authorizers have to visit the school once a year, name a staff member as a contact for the school, make sure the school files reports required by law, “monitor the fiscal condition” of the school and notify the state if the school closes or its charter is renewed or revoked. But there are many more duties that charter authorizers do, and should do, to hold schools accountable, the report said. “We have very minimal things spelled out that authorizers have to do… that is not what lawyers call the standard of care in the business,” Hutton said. “If you do the bare minimum, you’re probably not doing the job.” State law also doesn’t explicitly outline what an authorizer can do to intervene if they have concerns about a charter school during its operation, short of denying or revoking the school’s entire charter petition, the report said. These minimal requirements have left authorizers unsure of what exactly their duties are and varying degrees and quality of oversight, the report said. “When you have such minimal guidance and no system for even checking whether those little things are done, you end up with a very uneven landscape in terms of oversight,” Hutton said. In California, charter schools write their own performance expectations in their charter petition, which then becomes the charter school’s foundational document and basis for oversight after being approved by an authorizer. But relying on the petition can be problematic, Hutton said, because the oversight agency should be directing the terms of oversight, not the charter school. Adopting the charter petition as its final foundational document also puts pressure on a charter school to have all details about its operations finalized before working with the authorizer, he added. The report recommends California follow the example of other states by having authorizers negotiate and finalize a performance contract with a charter school, which would become the basis for their oversight. Performance contracts outline expectations for both the charter and the authorizer throughout the contract period, performance metrics the charter must meet and solutions to address shortcomings by the charter, which could be improvement plans or restrictions on the charter school. Authorizers are charged with holding charter schools accountable, but unlike other states, California has no established way of holding authorizers accountable. The state doesn’t have a way of intervening or even detecting when an authorizer is failing to conduct proper oversight. The report notes that other states outline specific standards they expect of authorizers and use those to conduct performance reviews. Authorizers that don’t meet standards may be barred from authorizing new charters or may be removed as an authorizer. California could also change how it allocates money to fund charter authorizers’ oversight, the report argues. Authorizers are typically allowed to charge up to 1% of a charter school’s enrollment revenue to cover the costs of oversight. But basing authorizer funding on a charter school’s enrollment doesn’t accurately measure how much time and resources the authorizer has to commit for oversight, authorizers have said. Under this model, there are simultaneously charter authorizers in California that are being paid too little and others that are being paid too much, Hutton said. Some authorizers authorize few or small charter schools and don’t receive enough from them to pay for additional staff or staff time to conduct oversight. In some small district authorizers, charter oversight is handled by the superintendent or chief business officer, who have their hands full running their own district. There are also some duties, like reviewing a new charter petition, that authorizers have to complete before ever receiving oversight funding from the charter school to do the job, the report said. At the same time, some districts are collecting too much in oversight funding. Several districts have profited off oversight fees by authorizing many online or home-based charter schools with large enrollments, and they have often not used all the fees to actually pay for oversight. Central to both issues is a problem that a state audit identified back in 2002: authorizers are often unable to justify the oversight fees they are charging charters because they are not tracking their actual oversight costs. There is no comprehensive data yet to show how California charter authorizers are spending their oversight funding or even how they conduct oversight. The recent report urges California to come up with a way to not necessarily raise oversight funding rates charged to charter schools, but to reallocate existing funding. That could mean setting a floor and a ceiling for oversight money, capping oversight money for districts that authorize many large charter networks and reallocating that excess money to districts that are struggling to pay for oversight, Hutton suggested. Neither the California Charter Schools Association nor a representative of the Assembly Education Committee, which has helped develop charter reform bills in recent years, could be reached for comment this week. ...read more read less