When Private Firms Run Schools, Financial Secrecy Is Allowed
By MORGAN SMITH
Published: December 14, 2013
On a recently approved Texas charter school application, blacked-out paragraphs appear on almost 100 of its 393 pages.Expanded coverage of Texas is produced by The Texas Tribune, a nonprofit news organization. To join the conversation about this article, go totexastribune.org.
Redactions on the publicly available online version of the application often extend for pages at a time. They include sections on the school’s plan to support students’ academic success, its extracurricular activities and the “extent to which any private entity, including any management company” will be involved in the school’s operation. The “shaded material,” according to footnotes, is confidential proprietary or financial information.
The school, part of an Arizona charter school network, opened a campus in San Antonio this year. It was technically formed under a nonprofit, but its management is handled by a private company, the Basis Educational Group, owned by the school’s founders. A spokeswoman for the Texas Education Agency said redactions appeared on the application because the information was copyrighted.
In Texas, commercial entities cannot run public schools. But when a school’s management — including accounting, marketing and hiring decisions — is contracted out to a private company, the distinction can become artificial. Such an arrangement raises questions about how to ensure financial accountability when the boundary between public and private is blurred, and the rules of public disclosure governing expenditures of taxpayer money do not apply.
Such agreements are not limited to charter schools. They can also be found in partnerships between traditional school districts and online course providers, particularly at schools where students receive all of their instruction online.
“The big issue is having some transparency,” said Bruce Baker, a Rutgers University