School FACT Act Brings Accountability to Michigan Schools

Legislative package holds charters, districts to same accountability standards
Thursday, November 30, 2017

LANSING — Legislation offered by a group of House and Senate Democrats would provide parents with the information they need to make informed decisions about their children’s education by shedding light on the authorizing organizations that oversee charter schools  and the education management organizations (EMOs) that run them. The School Freedom, Accountability, Choice and Transparency Act, or School FACT Act — House Bills 5286-5294 and companion Senate Bills 674-682 — would empower parents to make fully informed choices about education options and make the best decisions about where to send their kids to school.

“When we send our kids off to school in the morning, we want to know that they’re getting the best education possible — no matter which school they go to,” House Democratic Floor Leader Rep. Christine Greig (D-Farmington Hills) said. “While we have rules in place to hold traditional and charter schools accountable, we have no systems in place to demand accountability from the for-profit educational management organizations that run charter schools, or the authorizing organizations that oversee them. All kids deserve schools that are held to account, and that is what our legislation will do.”

Bills in the School FACT Act would address that problem and others by:

Requiring Disclosure

The School FACT Act would require EMOs to produce annual audited financial statements; authorizers to account for fees collected to oversee charter schools; and charter schools to publish their contracts with an EMO and that EMO’s financial statements on its website, and to account for its student recruiting costs.

Providing Accountability

Bills in the package would clarify the requirement that the state superintendent must suspend authorizers that fail to provide adequate oversight, and provides appeals and rehabilitation processes; and creates an authorizer’s duty to report a financially failing EMO to other charter schools under its oversight contracted with the same EMO.

Instituting Critical Reforms

The School FACT Act would prevent charter schools performing in the bottom 5 percent of schools from shopping for new authorizers or expanding to new grades or locations; require authorizers to attend all school board meetings of the charter schools it oversees and report on its oversight efforts; prevent EMOs from making “sweetheart” real estate deals using taxpayer dollars; and prevents conflicts of interest between EMOs and groups or individuals who establish charter schools.

Accountability measures in the School FACT Act would give parents the peace of mind that all the schools their children attend are providing a quality education rather than simply profits for the companies behind them, said state Rep. Kristy Pagan (D-Canton).

“No matter what school parents choose to send their child to, we must ensure that all of our students are receiving a world-class education,” Rep. Pagan said. “My bill, House Bill 5289, would give the state superintendent the ability to stop charter school authorizers from continuing to permit failing schools from opening, all while collecting their authorizing fee for doing so. The authorizer would then have to account for all fees and reimbursements and provide an annual compliance report to the state superintendent. This sort of accountability and transparency is incredibility important and we must ensure all of our public schools are held to the same standards.”

The School FACT Act would also institute reforms that would give taxpayers additional peace of mind at a time that the state is contemplating giving for-profit charter schools a greater share of tax dollars. The state Senate recently passed Senate Bill 574, which would allow charter and cyber schools to raise money through special enhancement millages and allow those funds to flow through to EMOs and their bottom lines.

 “We should never allow schools that are doing a poor job of educating students to expand until they show they can provide a quality education,” state Rep. Darrin Camilleri (D-Brownstown Township) said. “This legislation would put the brakes on a failing charter school’s ability to expand into new grades or new locations until it shows it can deliver the kind of excellent education that Michigan students deserve and that parents expect. That’s the kind of accountability Michigan families deserve.”

Senate Democrats praised the School FACT Act, saying the bills would give parents the tools they need to make sound education decisions for their children.

“Parents today have a larger number of educational options than ever, and comparing options can be overwhelming,” state Sen. Hoon-Yung Hopgood (D-Taylor) said. “Parents need good information to make informed decisions. Traditional and charter schools are already held to disclosure standards, but the educational management organizations that run charter schools are not. With these reforms in place, parents will be empowered to make informed decisions for their families, which is what every mom and dad wants to do.”