NC GOP corporate socialism and charter schools

In 1996 NC passed HB 955, also known as the Charter School Act. In January 2011 the National Alliance for Public Charter Schools ranked NC 32nd out of 41 states with charter school laws with poor marks in accountability, equity of funding, and the low cap of 100 schools for the state.

The NAPCS is billed as a non-profit headed by former Bush administration official Nina Rees, the reality is that it is a powerful, well connected lobbying group with deep pockets and wealthy benefactors, which isn't unusual. What is unusual is the amount of success it's had influencing the decisions of NC GOP legislators and the banquet of taxpayer dollars they've established for hedge fund managers, Wall St. banks, big banks, and wealthy investors to gorge upon.

The NC GOP began planning this feast shortly after the NAPCS report, in February 2011 Republicans in NC began a movement to lift the cap on charter schools and the number of applications has expanded exponentially.

In the summer of 2011 at the annual ALEC conference in New Orleans Thom Tillis was crowned best corporate ass kisser. Among the main topics at ALEC's summer indoctrination camp for parasitical politicians was the privatization of public schools.

Embolden by his new title, Tillis and the NC delegation which included ALEC Education Task force member Republican Rep. Linda Johnson,and 28 other Republicans returned to NC with a plan.

That plan was to subvert our public school system and divert taxpayer funds into private hands, to enrich the few with the wealth of the many. By passing bills to expand the number of charter schools, create a separate charter school board, give out interest free loans to applicants, and take power away from local school boards, they opened the door and the vault of the state's treasury and turned their backs on the very people they were elected to serve.

Why would they do such a thing? Money, and lots of it. The reason hedge fund managers, Wall St., big banks, and wealthy donor/investors are interested in charter schools is the construction of them and the access to millions upon millions of tax dollars.

At the end of the Clinton administration, when the Republican controlled congress was undermining Glass-Steagall and setting up a feeding frenzy for Wall St., they passed anew kind of tax credit called the New Markets Tax Credit that gives enormous tax credits to banks and equity funds that invest in community projects in under served communities. This tax credit has been used extensively in recent years to build charter schools and hand the already wealthy a "free lunch" on the taxpayer's dime.

There is a lot of money in charter schools, and not just the ones run by for profit management companies, just google the salaries of the people that run them, non-profit and for profit alike, but it pales in comparison to the money to made by the New Markets Tax Credit.

Investors who put up the money for construction can double their money in seven years through a 39% tax credit from the federal government. This is a tax credit on the money they're lending, so they're collecting interest on the loans as well as the 39% tax credit.

Then they piggy back the tax credit on other federal tax credits such as historic preservation, job creation, or Brownsfields tax credits and pocket even more public money. If they invest 10 million, in seven years they can double their money.

And here's the icing on the cake, the charter schools, or the state ends up with the debt service on these loans and the corporations and banks whose lobbyists write the NC laws that allow them to do this walk away with tens of millions in tax payer dollars. On top of that, if the investor is a hedge fund, they don't even have to put up their own money.

The whole charter school scam is nothing but corporate socialism sponsored by the NC GOP that provides a path for them to redistribute the wealth of the state into the hands of their wealthy donors.

http://www.nydailynews.com/new-york/education/albany-charter-cash-big-ba...

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Charter schools, follow the money

Thank you for bringing this information to light. When charters were first approved for NC, I participated in a two-year long, League of Women Voters study of charter schools. (As an aside, you’ll have to check into the tweet posted by a Buncombe county Repub, referring to this group as the League of Women Vipers....makes me proud!) Over the course of two years, we followed the arrival of charters in NC and visited at least a dozen of them. Today, there are League members in several areas again studying charter schools.

At the end of the two years, I (personally) could see several things.

One, there is a place for charter schools. They serve as a pressure relief valve for parents whose experience of getting their child’s needs met require something beyond traditional public schools. Of course, if more funding were available to traditional public schools, they would be better able to meet these needs.

Second, as long as the school age population of North Carolina continues to rise so quickly that Wake County has to build a school a year, there was no way any charter school could draw off an amount of students so significant that traditional public schools would be forced to look at charter school programs and adapt them for use in their own schools.

And most importantly, the legislation creating charters never allowed for any real oversight of charter schools. At that time, there was a 100 charter school limit for the state. That has been lifted. The meetings held by charters, like school board meetings, are considered to be open, so any member of the public can attend. This is where real oversight occurs. No media outlet has enough reporters to cover the meetings of every charter school and no local cable channel can broadcast them all. No community group or non-profit can follow charters that closely. The Department of Public Instruction was not allotted funds to allow them to hire people to do this, either. It is physically demanding to visit 100 or more schools scattered around the state just to attend their meetings.

Charters can be shut down, but this happens primarily for financial mismanagement. Academically it is hard to follow the schools. So besides parental complaints to the state, the only way to monitor academic success is though end of year testing. If the chosen method of education does not work for a student, they often return to traditional public schools, but need additional tutoring and other aid to get back up to their grade level. There is no special funding to cover this additional task for the traditional schools.

Meanwhile, as they say, follow the money. Another pressure to create charters schools was publicized last fall, in this article from Reuters.

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Under a federal program known as EB-5, wealthy foreigners can in effect buy U.S. immigration visas for themselves and their families by investing at least $500,000 in certain development projects. In the past two decades, much of the investment has gone into commercial real-estate projects, like luxury hotels, ski resorts and even gas stations.

Lately, however, enterprising brokers have seen a golden opportunity to match cash-starved charter schools with cash-flush foreigners in investment deals that benefit both.

Two years ago... a venture (was set up) called the Education Fund of America specifically to connect international investors with charter schools. (They are) currently arranging EB-5 funding for 11 schools across North Carolina, Utah and Arizona and says he has four more deals in the works.

And that's just the start, Wing says: "It's going to be explosive."

Foreign investment has created an additional push to create for-profit public schools. The article continues:

Meanwhile, the IRS has signaled it plans closer scrutiny of charter schools' tax-exempt status if they rely on for-profit management companies to provide their classroom space and run their academic programs, Hall said. He sent his clients a long memo this summer warning that the stepped-up IRS oversight could put some at "significant risk."

In the first nine months of this year, (2012) the government approved 3,000 petitions from foreigners seeking to participate in the program - nearly twice as many as were approved all last year, according to the Department of Homeland Security.

Charter schools have become particularly trendy because they are pitched as recession-proof.
An investor forum in China last spring, for instance, touted U.S. charter schools as a nearly fool-proof investment because they can count on a steady stream of government funding to stay afloat, according to a transcript posted on a Chinese website.

Participants can get a temporary visa by investing $500,000 to $1 million in a federally approved business. If the business creates or preserves at least 10 jobs in two years, the investor and his immediate family are eligible for permanent residency in the United States.

*
http://www.reuters.com/article/2012/10/12/us-usa-education-charter-visas...

As always, follow the money. Just imagine if we could take all the money that has been invested into charter schools and put it into our traditional public schools. And now they want lottery money to be used for putting up charter school buildings with no indication regarding who will actually OWN these buildings. Will they be left to the for-profit organization to sell at a huge profit, at a later date? Or, will Wake County Commissioners be given control of the buildings themselves?
Keep following the money.