Latest News and Comment from Education

Tuesday, October 4, 2016

CURMUDGUCATION: Duncan Scolds Education Schools

CURMUDGUCATION: Duncan Scolds Education Schools:

Duncan Scolds Education Schools



When former Secretary of Education Arne Duncan isn't busy joining another board of some education-flavored enterprise (his latest is Revolution Foods, an over-hyped cafeteria supply company), he still finds time to offer uninformed opinions about education itself.

Pay me to have an opinion about school lunch? Retirement is awesome.


Take for instance his open letter today at Brookings, in which Duncan castigates the nation's collegiate teacher preparation programs.

He opens with his trademark blame-disguised-as-praise:

Schools of education are providing one of the most important services in America today, training our future teachers who will prepare our children to succeed in work and in life. No other responsibility is more directly linked to our future.

Really? Economic policy, business growth, policies addressing poverty, maintenance of infrastructure, global diplomacy-- nothing at all more directly influences the future of our nation than how well colleges prepare future teachers?  Okay then. Let's address the Most Critical Issue Facing Our Nation with a look at the hard facts.

Nah. On second thought, says Arne, let's just pull out a report from the National Council on Teacher Quality, a group devoted to proving that college ed programs stink, and proving it by using the laziest research methods ever. In fact, Duncan goes back to a NCTQ report from November of 2014, the delightful "Easy A" report. I've already discussed this as the most rigor-free half-baked research to ever be taken seriously. Research so lazy that it "evaluated" non-existent programs. Research so lazy that it literally consisted of reading commencement programs and course catalogs.

Duncan also cites the Deans for Impact, a group that includes Mayme Hostetter, a "dean" of theRelay Graduate [sic] School [sic] of Education [sic], the group created by charter operators as a way 
CURMUDGUCATION: Duncan Scolds Education Schools:



Jeb! Still Doesn't Understand
Jeb Bush sat down with Matt Barnum for an interview that ran at Campbell Brown's pro-reform website, the 74, And in the course of the interview. Bush showed that he doesn't understand education any better than he ever did. (He also discussed the Presidential election, though he didn't explain how his oppo guys did such a lousy job fending off Donald "Dumpster Fire" Trump.) So what are the things
No Digital Leadership for the Future (and No Research Base, Either)
"Future-Ready Schools" is emerging as the umbrella buzzword for the cluster of edu-biz opportunities emerging around the world of personalized learning, competency-based education, and the computer-driven school. There's a lot to learn about this area, and none of it is encouraging for fans of public education or the general idea of having children taught by human beings. You can read a lot about

OCT 02

ICYMI: October Already
Just some of the choice reading from the week. Don't forget to pass it on. And don't forget to look at some of the writing linked in the right-hand column of this blog. Denied I wrote about this piece this week, but the Texas systematic denial of special ed services deserves a look. New Empirical Evidence That Students in Persistent Economic Disadvantage More Likely To Bias Value-Added Estimates O

OCT 01

How Much Democracy Is Too Much?
The march of market-based education reform has come in lockstep with an assault on democracy. From Philly to Detroit to Chicago, the repeated policy message has been that Some Folks really shouldn't have democracy, that Some Folks need to have things decided for them. Of course, Some Folks invariably turn out to be non-wealthy, non-white folks. If you are poor and black, democracy is apparently a
When a Charter Closes (and Choice Is Not Choice)
The free market acolytes, lovers of the modern charter school, have a pretty neat and clean vision of the future. Well-informed parents choose from within a wide array of charter schools, and at appropriate moments, the market sloughs off those schools that either do a lousy job or are just not providing something that a large slice of the market wants.The whole process should be as tidy and blood


New Grants Announced: Education Department Continues to Pour Millions Into Charter School Black Hole

New Grants Announced: Education Department Continues to Pour Millions Into Charter School Black Hole:

New Grants Announced: Education Department Continues to Pour Millions Into Charter School Black Hole

Image result for Charter School Black Hole



Last week, the US Department of Education announced that it had approved $245 million in grants to eight states under the federal Charter School Program. The states, California, Florida, Georgia, Louisiana, Massachusetts, Tennessee, Texas and Washington, will receive $177 million in grant money. In addition, 15 charter management organizations, including IDEA Public Schools in Texas and KIPP's public charter school network in California, will receive $68 million in taxpayer dollars.
This means the federal government has spent nearly $4 billion on charters in the past nearly 25 years, according to Center for Media and Democracy (CMD) analysis.
These awards continue to fund a program that has been plagued by significant fraud and waste; at least $200 million and counting as the Center for Popular Democracy has detailed in two reports.
As CMD documented in its report "Charter School Black Hole," federal tax dollars have even gone to "ghost schools," charters that never opened, in addition to charters that opened and failed -- with almost no accounting for the money spent or assets, let alone accountability to the school children affected by charter fraud, waste, and incompetence. Indeed, as CMD documented late last year, in state after state charters overall performed no better than traditional public schools -- and virtual charters like the K12 operation performed markedly worse -- and charters were subject to little transparency or real accountability.
Meanwhile, at the American Legislative Exchange Council, corporate lobbyists, special interest groups, and legislators turned their attention to vouchers -- another way to divert cash from public schools to the private or quasi-private sector but with even less accountability. This comes in the wake of the numerous failures caused by ALEC's deeply flawed charter school bills, which were passed into law in numerous states.
Twenty states applied for the new round of grants, and here are the new charter school state grantees along with a snapshot of their complex history and/or documented problems:
California: More than $4.7 million in federal taxpayer money was handed out to create charter schools that subsequently closed within a few years. CMD's investigation found that California's record on charters is marked by continued failures, including squandering of taxpayer money, along with deference to unaccountable authorizers and resistance to federal efforts to mandate better state oversight.
Florida: Florida landed a grant worth up to $104 million in 2011, and has one of the worst records in the nation when it comes to fraud and lack of charter school oversight. More than 120 charter schools have closed in the little more than a decade that Florida began authorizing charters for reasons that include poor academic performance, unsafe conditions, lack of running water, financial mismanagement, and fraud.
Georgia: Here's one of many examples of problems with charter schools in the state. Atlanta's Latin Academy Charter School, Latin Grammar Charter School, and Latin College Prep Charter School discovered that the founder of the schools, Christopher Clemons, had allegedly misappropriated approximately $600,000 from school accounts through ATM withdrawals. The FBI arrested Clemons. "The Atlanta Journal-Constitution reports Clemons allegedly used that money on travel, meals and clubs. A records check by the Atlanta Journal-Constitution revealed cash withdrawn from an ATM at the same address as a strip club...Clemons also allegedly borrowed hundreds of thousands of dollars in the schools' names but without their authorization. The financial hit put the viability of Latin Academy at risk despite fundraising efforts by parents and an anonymous pledge of $1 million. The boards cut salaries and expenses in an attempt to remain in operation."
Massachusetts: The Gloucester Community Arts Charter School was closed in early 2013 due to low enrollment, high rates of attrition, and financial instability. An investigation by the state's Charter School Office found myriad problems with the school, including the lack of a coherent curriculum, violations of the State's bidding laws in the contract for its facility, among other concerns. The schools trustees surrendered their charter and the school closed down in the middle of a school year, putting about 100 students on the street in search of new schools.
Tennessee: In 2013, Tennessee's governor told the Tennessee Virtual Academy, an online charter school operated by for-profit K-12, Inc., that it had one last chance to improve its students' academic performance after a history of low test scores. The school responded by, in Diane Ravitch's words, by becoming the "worst school in the state" and posting the very lowest test scores of all of its 1,300 elementary and middle schools. But state's effort to close the school failed after a fierce public relations campaign from K-12, and it remains open today.
Washington: In 2012, after three failed efforts, billionaire school privatization philanthropist Bill Gates spent an estimated $30 million to win a referendum to New Grants Announced: Education Department Continues to Pour Millions Into Charter School Black Hole:

National teachers’ union: Trump’s behavior greenlights bullying and bigotry in our schools

National teachers’ union: Trump’s behavior greenlights bullying and bigotry in our schools:

National teachers’ union: Trump’s behavior greenlights bullying and bigotry in our schools


 The National Education Association is planning a six-figure advertising campaign that will accuse Donald Trump of bullying behavior that wouldn’t be tolerated in the classroom — let alone the White House.

According to the NEA, the largest labor union in the U.S. at 3 million members, Trump’s incendiary rhetoric gives cover to school bullies who harass religious and ethnic minorities.
Lily Eskelsen Garcia, the president of the NEA, said schoolyard taunts have been inspired by Trump’s support for barring Muslims from entering the country and building a massive wall to stop Mexicans from crossing into the U.S.
“Here we are, five weeks away from the election, and we’re seeing bullying behavior from one of the two people who aspire to be the next president of the United States. We take that very seriously,” she said during a media conference call Monday.
Democratic presidential candidate Hillary Clinton’s campaign forwarded the NEA’s conference call announcement to reporters earlier in the day Monday. One year ago, the NEA endorsed Clinton in the Democratic primary.
In recent days, her campaign has homed in on child-focused messaging. Cleveland Cavaliers star LeBron James endorsed Clinton on Sunday as a “champion for children and their futures.” A scathing new Clinton TV ad plays audio of Trump criticizing women’s looks as young girls look at themselves in mirrors. And Clinton herself has cited the supposed “Trump effect” of increased bullying in schools.

Democratic presidential candidate Hillary Clinton clasps hands with NEA President Lily Eskelsen Garcia at the NEA's 95th Representative Assembly in Washington on July 5. (Photo: Kevin Lamarque/Reuters)
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Democratic presidential candidate Hillary Clinton clasps hands with NEA President Lily Eskelsen Garcia at the NEA’s 95th Representative Assembly in Washington on July 5. (Photo: Kevin Lamarque/Reuters)

Garcia, who taught elementary school for more than 20 years in Utah, said she used to turn every presidential election into a civics lesson by asking students to watch the debates and interview their parents about politics. But she doubts this would be productive in the current political climate.
“I’m not so sure I really want my kids to watch this debate. It’s really kind of disturbing what they’re hearing out there,” she said.
During the media call, Carrie Pugh, the campaigns and elections director for the NEA, said, “We’re spending up to six figures on paid, mail and digital to amplify this message. And, of course, there’s a massive amount of mobilization happening on the ground.”
An April Southern Poverty Law Center report on the Trump effect posits that his campaign has inflamed racial tensions in American classrooms. More than two-thirds of teachers polled said some students — mostly the children of immigrants or Muslims— expressed fear about what might happen to their families if Trump were elected president.
In August, however, PolitiFact noted that it was “not a scientific survey.” The “respondents don’t represent a random sample of teachers, and it’s likely that those who chose to respond to the survey are those who are most concerned about the campaign’s impact on students.”
PolitFact continued: “This means it would be inaccurate to extrapolate from the survey that bullying and harassment are generally on the rise across the country. Rather, it is more a collection of teachers’ anecdotal experiences.”

Rep. Keith Ellison holds a news conference about what he calls
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Rep. Keith Ellison holds a news conference about what he calls “the rhetoric attacking Muslims and the Islamophobia” in the 2016 presidential election. (Photo: Chip Somodevilla/Getty Images)

Rep. Keith Ellison, D-Minn., a Clinton supporter and the first Muslim elected to Congress, said during the Monday conference call that Trump “did not start bullying, but he has slammed his foot on the national accelerator to a disturbing and palpable degree.”
Ellison cited a controversy at the University of Minnesota to demonstrate the effect one of Trump’s core campaign promises has had on the student body there. The school’s College Republicans group painted a controversial “Build the wall” mural, and protesters subsequently spray-painted “Stop white supremacy” over it.
“Now we have a group of students kind of at each other because of an idea that he has introduced,” he said.
Joy Bock, an eighth-grade social studies teacher for Groveport Madison Schools, located outside Columbus, Ohio, said on the NEA conference call that she was a lifelong Republican voter but has decided to support Clinton.
“One of my students said something that broke my heart. Before the entire class, she made a startling statement: ‘If Donald Trump wins, I’ll be sent back to Peru,’” she told reporters. “I want to be very clear. This 14-year-old girl is an amazing American citizen, born in the United States. She has never been to Peru, the country her parents emigrated from.”
Julie Rine, a teacher from northeast Ohio, said she hadn’t personally seen Trump-related bullying but claimed that Trump’s electoral success has normalized joking about topics that might hurt minority students.
“They’ll make jokes about building a wall or being on the wrong side of the wall. I think that’s hurtful even if they are joking and it’s not directed at those kids,” she told Yahoo News. In her 21 year of teaching, Rine said, she has not seen kids talking so much about political candidates.
“Again I don’t think they are trying to be hurtful,” she said. “I think they are unintentionally being hurtful.”National teachers’ union: Trump’s behavior greenlights bullying and bigotry in our schools:

Eschools say they will appeal audits determining inflated attendance | The Columbus Dispatch

Eschools say they will appeal audits determining inflated attendance | The Columbus Dispatch:

Eschools say they will appeal audits determining inflated attendance



On top of the more than $60 million they may seek to recover from ECOT, the Ohio Department of Education also could demand about $23 million more from eight other online schools for inflated attendance.
On the same day ECOT was dealt a defeat in court, state education officials informed eight other online charter schools that they, too, were unable to properly justify their reported enrollments.
Officials at several of those schools said today they feel they were duped by state regulators and plan to appeal the findings to the State Board of Education.
“We really feel like we were misled,” said Jeff Nelson, superintendent of the Virtual Community School in Reynoldsburg.
The Department of Education, he said, first told him the school would not have to provide data showing how long students were logged in to the school’s computer system for its 2015-2016 attendance review, but would need such information for its 2016-2017 review.
“Then they came back in June and told us we’d have to produce it for 2015-2016,” Nelson said. “ We feel it’s unreasonable for them to go back and ask for information they know we didn’t have."
The department says it could verify the equivalent of 280 full-time students, well below the 835 students Virtual Community School reported, a finding that could cost the school more than $3 million in state aid.
In all, the eight schools reported 4,998 students, but the state verified 1,654 students, one third of the total. That includes Quaker Digital Academy and the Buckeye Online School for Success, which got credit for zero students.
The Department of Education this year beefed up attendance audits of online charter schools, asking for hard data to justify the numbers of students the state was funding. A top department official has said the final decision on asking online schools for log-in duration records this year was made by Gov. John Kasich’s longtime adviser and then-chief of staff, Wayne Struble.
Franklin County Common Pleas Judge Jenifer French on Friday rejected ECOT’s request for a preliminary injunction that would have blocked the state from using log-in durations as a way to verify student counts. French wrote that there is a "public interest in ensuring our children are receiving the education that our taxpayers are funding." State law requires charter students to participate in a minimum 920 hours of “learning opportunities” each year.
LaShawn Terrell, superintendent of Akron Digital Academy, said changing requirements mid-year made it impossible for her school to adjust.
“We respectfully disagree with ODE's improper, unilateral and retroactive implementation of guidelines that we were told would not be effective until the current school year repeatedly,” Terrell said. The academy primarily serves economically disadvantaged students at risk of drop out.
Terrell said like most online schools, Akron Digital Academy did not previously document login duration data for students but recently implemented a new system to capture such data for the current school year.
Sen. Peggy Lehner, R-Kettering, chairwoman of the Senate Education Committee, said Judge French took a hard look at the case and decided the state wasn’t on the witch hunt that ECOT tried to portray.
“Merely providing a computer that a student can use to access coursework isn’t adequate, particularly with children who are really struggling in school,” she said.
State lawmakers are expected to address the attendance issue at some point, either in the post-election lame duck session or next year. ECOT founder Bill Lager has been one of the largest individual contributors to legislative Republicans in recent years.
House Speaker Cliff Rosenberger, R-Clarksville, declined to comment on the ruling or on additional legislation. Senate President Keith Faber, R-Celina, through a spokesman, stressed that the attendance issue isn’t just about ECOT, but also traditional public schools.
“He has consistently said that we should be paying for outcomes and performance in our schools, not simply doling out tax dollars based on who fills a seat or logs into a computer,” said Faber spokesman John Fortney.
Addressing online attendance is going to take thought and should not be passed until next year, Lehner said. She wants a way to make both schools and parents accountable.
“The legislature does need to take a look to make sure we are being fair both to ECOT and the students who are trying to get an education through this methodology,” she said.
 Eschools say they will appeal audits determining inflated attendance | The Columbus Dispatch:



Big Education Ape: ECOT attendance inflated by 9,000 students, audit finds; $60 million in state funding in jeopardy | cleveland.com - http://bigeducationape.blogspot.com/2016/09/ecot-attendance-inflated-by-9000.html



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How Success Academy Charter Network Uses Children | Huffington Post

How Success Academy Charter Network Uses Children | Huffington Post:

How Success Academy Charter Network Uses Children



Success Academy Charter Schools were closed on Wednesday September 28. It wasn’t a national or religious holiday, it hasn’t snowed yet, and public schools were open, teachers were teaching, and children were learning. Success Academy Charter Schools were closed last Wednesday so its CEO Eva Moskowitz could rally political opponents of New York City Mayor Bill de Blasio and highlight potentialchallengers for the 2017 mayoral election. Moskowitz needed kids to fill up the audience so she pulled them out of school and dragged them and their parents to Brooklyn’s Prospect Park.
To keep the children and their parents happy, Moskowitz brought entertainment, the rapper turned actor Common. Speakers included potential mayoral rivals Bronx Borough Present Ruban Diaz Jr. and Brooklyn Congressional Representative Hakeem Jeffries. Jeffries dismissed individuals and groups that oppose the charter networks as “haters.” Moskowitz is demanding that New York City double its number of charter school seats to 200,000 by 2020.
Officially, the rally was sponsored by a group called Families for Excellent Schools. Except the group is not really about families. Four of its five founding board members are Wall Street brokers. Its big money pro-charter financial backers include the Walton Family Foundation and the Broad Foundation. The Families for Excellent Schools website claims that its executive director, Jeremiah Kittredge, was a public school teacher and labor organizer before he joined them. But according to his Linkedin page, Kittredge only graduated from Brown University in 2008 and has been a professional charter school advocate ever since.
I have questions for Eva and her friends, and maybe also for the Brooklyn district attorney’s office. Children and parents who attended the rally got nice blue t-shirts. I want to know who paid for the 20,000 t-shirts (estimated bulk rate $5 each or about $100,000) and the busses that transported participants (estimated at $600 a bus, $60,000 for 100 busses)? Did organizers pay to use Prospect Park and for extra police assigned to the rally (it costs $4,000 just to rent the boathouse for a wedding)? Did Success Academy cover expenses with public money and why wasn’t the money for the rally used for education? A pro-charter event organized by Moskowitz and Families for Excellent Schools at the state capital in Albany in 2015 cost an estimated $700,000. Children were pulled out of school that day also. Who keeps paying, besides the children?
On October 6 the Alliance to Reclaim our Schools is planning demonstrations in dozens of cities to support public schools. Parents, students and educators will gather outside of their schools before the bell to hold a rally and march. They are not charter schools, so after the rallies children and teachers will walk into their buildings to start the school day and learn.




The Unintended Consequences of Taking a Hard Line on School Discipline - The New York Times

The Unintended Consequences of Taking a Hard Line on School Discipline - The New York Times:

The Unintended Consequences of Taking a Hard Line on School Discipline




It did not take long for school safety agents in New York to find their first gun of the new school year. Day 1 had barely begun at a Brooklyn high school last month when the officers stopped a 15-year-old student who had stowed a loaded .22-caliber pistol in his backpack and thought he could pass it through a metal scanner.
In short order, the boy was led away by the police. Also in short order, the city’s Department of Education issued a statement invoking a two-word phrase that has virtually been holy writ in classrooms around the country for the past quarter of a century: “There is zero tolerance for weapons of any kind in schools.”
It is hard to imagine many law-abiding citizens disagreeing that the acceptance level for students carrying guns, knives, drugs or other harmful items should be nonexistent. But the concept of zero tolerance has come to encompass such a broad range of disruptive actions that roughly three million schoolchildren are suspended each year, and several hundred thousand are arrested or given criminal citations. Many students are hauled off to police station houses for antisocial behavior that, a generation or two ago, would have sent them no farther than the principal’s office.
Have get-tough policies gone too far? Predictably, opinions are divided. Nonetheless, as the accompanying video shows, the pendulum in some jurisdictions is swinging away from hard-nosed book-’em certitudes toward softer let’s-try-to-reason-with-’em approaches.
It is a shift that was encouraged by Eric H. Holder Jr. toward the end of his tenure as attorney general. He figures prominently in a new offering fromRetro Report, a series of video documentaries examining major news stories of the past and their lasting consequences. This report was prepared in collaboration with the Center for Public Integrity, an investigative news organization based in Washington that has written a series of articles on harsh school discipline.
A central figure in the video is Joe Clark, who built a national reputation in the 1980s as the no-nonsense principal of violence-plagued Eastside High School in Paterson, N.J. (Some people may know him better for having been played by Morgan Freeman in the 1989 film “Lean on Me.”) Patrolling the hallways with bullhorn and baseball bat in hand, Mr. Clark cast himself as the scourge of troublemakers, a Rambo making classrooms safe for pursuits like the works of Rimbaud.
In 1982, his first year, he expelled a reported 300 failing students, some of them well beyond normal school age, and went on to ban dozens more whom he described as “leeches, miscreants and hoodlums.”
On his watch, test scores did improve. The gains were hardly breathtaking, though. Mr. Clark also ran afoul of the school board, which accused him of usurping its authority over expulsions. But many defended Mr. Clark for getting rid of disruptive students, among them a veteran teacher at Eastside who says in the video that “you can’t educate unless you have order in your school.”
As the 1980s yielded to the high-crime early ’90s, “zero tolerance” became a mantra in school districts across the United States. “There was a real concern,” Mr. Holder acknowledged to Retro Report, “that we were just losing control as a society.”
It was an era of near-panic over violence by young people. Fears gave rise to the notion of a generation of “superpredators,” a word that has resurfaced in the current political season, including last week’s presidential debate. It was invoked in the ’90s by, among others, Hillary Clinton, who now renounces its use.
And so, back then, suspensions and arrests began to soar. Local authorities were emboldened by the Gun-Free Schools Act of 1994, a federal law that required states receiving federal education money to expel for at least a year any student found bringing a weapon to class.
But the zero-tolerance net came to be thrown ever wider, ensnaring far more than gun toters, knife wielders and drug dealers. Infractions once deemed the province of school disciplinarians — tardiness, say, or mouthing off to a teacher — often made their way to police blotters. There were eyebrow-arching moments like the arrest of a 12-year-old girl for doodling on her desk with a green marker, of an autistic child who had kicked a trash can, of teenagers who got into fistfights (as teenagers have done probably since Neanderthal days).
To some degree, school administrators were like generals who go to battle relying on tactics from the last war. Zero tolerance kicked into high gear, and stayed there, after youth violence had already entered what would become a steep decline. Homicides involving juvenile offenders, for instance, peaked in 1994, Justice Department figures show. By 2014, their numbers had fallen by two-thirds. Even occasional mass murders in schools, horrifying as they are, have not materially altered the overall pattern of reduced mayhem.
It is not lost on researchers that students expelled, suspended or arrested on charges like disorderly conduct are disproportionately black and Latino, or disabled mentally or physically. In kindergarten to 12th grade, blacks were 3.8 times as likely as whites to receive out-of-school suspensions, according to the United States Department of Education. Youngsters in those grades with disabilities were more than twice as likely as others to be suspended.
Researchers talk about a “school-to-prison pipeline” that runs like this: Young people are suspended from classes for long stretches, or are handed over to the police. As a result, they become prime candidates for quitting school entirely. Dropping out, in turn, makes them less likely to find jobs and more likely to become part of the criminal class.
Perhaps not surprisingly, a sense that school systems and police departments went overboard has begun to take root. An outspoken critic is Steven C. Teske, the chief judge of juvenile court in Clayton County, Ga., just south of Atlanta. Teenagers, Judge Teske has cautioned, will be teenagers.
“Zero tolerance as a philosophy and approach is contrary to the nature of adolescent cognition,” he told a Senate subcommittee in 2012. For all the arrests, suspensions and expulsions that he had observed, “school safety did not improve,” he said. If anything, “the juvenile crime rate in the community significantly increased.”
“These kids lost one of the greatest protective buffers against delinquency — school connectedness,” the judge said.
To foster that connectedness, some schools are shunning harsh punishment in favor of talking things through with rule breakers. They are places like Furr High School in Houston. Its principal, Bertie Simmons, prefers consequences that are “academic,” as with two students who forged a permission slip. Rather than being suspended or put on detention, they were required to write a paper about their offense.
“If you just treat people with kindness, it’s far better than being so punitive,” Ms. Simmons told Retro Report.
No public school system in the country is bigger than New York City’s, with 1.1 million students. It, too, has moved away from harsh discipline as an automatic response. Suspensions in the second half of 2015 were down by one-third from the same period the year before.
At the same time, safety improved. Major crimes — like rape, felony assault, burglary and robbery — were reported at their lowest level since the police started tracking them in 1998.
For many months, the administration of Mayor Bill de Blasio has even raised the possibility of removing metal detectors from some of the scores of school buildings where they are fixtures. Many students regard them as “intrusive and denigrating,” a mayoral panel concluded last year.
But transforming talk into action has been slow. An episode like that of the boy caught trying to slip a gun into school last month is unlikely to dissuade school safety agents and others who insist that the scanners save lives.
Notwithstanding the need for continued vigilance against that sort of lawbreaking, Mr. Holder contends that broad changes are essential. “We have a connection between our school system and the criminal justice system that did not exist before and that I don’t think should exist now,” he said.
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Chicago's Troubled Schools Made Wall Street $110 Million - NASDAQ.com

Chicago's Troubled Schools Made Wall Street $110 Million - NASDAQ.com:

Chicago's Troubled Schools Made Wall Street $110 Million


The Chicago Board of Education was desperate for cash. Two Wall Street players were willing to lend it -- at a price.
J.P. Morgan Chase & Co. and Chicago-based Nuveen Asset Management have made realized and paper profits exceeding $ 110 million on purchases this year of $763 million in Chicago Public Schools bonds. The school system needed the money to replenish its dwindling coffers before the new school year and to build and repair facilities.
The school system's bonds are a favorite for John Miller, Nuveen's co-head of fixed income, who said the firm bought when the market feared a default, a concern he called overblown. "At the end of day, this school system is critically important to Chicago -- to the whole country really," he said.
"We took a period of market risk on behalf of our client when they needed it most and the market has recognized their improved financial position," a J.P. Morgan spokeswoman said.
Political and labor struggles plague Chicago Public Schools. The 397,000-student school district struggled to sell municipal bonds in February until Nuveen bought about a third and decided in July to borrow directly from J.P. Morgan for fear that investors might balk again, a school board spokeswoman said.
"CPS did not have the luxury of waiting longer to demonstrate to the market that the progress we were making was real," said Ronald DeNard, the school district's senior vice president of finance, in an emailed statement about the bonds purchased in July by J.P. Morgan.
The tough terms of the bond sales highlight the choices the school district faces after years of skimping on pension contributions and relying heavily on borrowing. Its bonds are rated B3 by Moody's Investors Service and traded as low as 73 cents on the dollar in March before rebounding to about 90 cents in September. The bond sales facilitated much-needed fixes like lead abatement and classroom construction but increased the school system's already heavy debt load and its annual interest payments.
"J.P. Morgan and Nuveen are taking advantage of a distressed school district at the expense of our most vulnerable students," said Jackson Potter, staff coordinator at Chicago Teachers Union.
Chicago's school district stays open on a bare-bones budget of $5.5 billion with a below-investment-grade, or junk, credit rating on nearly $7 billion of bonds. Its teachers union is threatening to strike, in part, over proposed changes to its pension plan, which suffers from a nearly $10 billion funding gap. The school system's rainy-day fund is nearly empty and relies on short-term borrowing to get through the school year.
Nuveen held few Chicago Public School bonds in recent years but has been watching its prices closely since May 2015, when Moody's cut its credit ratings of the school board and the city of Chicago to junk.
The investment company, which now owns about $806 million of the school district's bonds, dedicated an analyst to cover the district full time to better understand its capacity to increase revenue and the likelihood of a bankruptcy filing.
Prices of outstanding Chicago school bonds were hit in 2013 and 2015 after defaults by Detroit and Puerto Rico. Illinois Gov. Bruce Rauner called for a state takeover of the school system and for a potential bankruptcy filing over the past year and prices fell below 75 cents on the dollar.
Nuveen determined that the default risk was far lower than that implied by the bond prices. When J.P. Morgan was struggling to find buyers of $725 million in bonds in February, the fund manager agreed to buy about 36% of the issue at about 84 cents on the dollar.
Mr. Miller continued buying after and now owns 60% of the bonds, making it the single largest investment in the $15 billionNuveen High Yield Municipal Bond Fund. Nuveen has made unrealized gains of about $103.3 million on all the CPS bonds it owns, a company spokeswoman said.
Demand for Chicago Board of Education debt grew over the summer as investors gained confidence that the school board could plug much of its 2017 budget gap with budget cuts, state aid and new tax revenues. Market conditions also improved significantly, sending prices of municipal bonds with junk credit ratings up and pushing their yields down to about 4.6% in early July, a 17-year low, according to the S&P Municipal Bond High Yield Index.
Still, when the school district turned to J.P. Morgan for more money in July, it decided to sell the bonds directly to the bank to avoid the risk that investors would reject it. Instead, demand for the bonds rose throughout the summer, and J.P. Morgan sold all of the debt for a $12 million profit in September, Wall Street Journal analysis of data from the Municipal Securities Rulemaking Board shows.
"You've gone from having maybe two to three people being interested in these deals to all of a sudden having 20 investors interested," said Mr. Miller of Nuveen.
J.P. Morgan committed to hold the $150 million in bonds it purchased for about six weeks until the board of education prepared documentation allowing them to be sold to institutional investors.
The certainty J.P. Morgan provided came with a high price: The bank paid 91 cents on the dollar for the debt at a yield of 7.25%, much higher than the approximately 6% yield on the school board's outstanding bonds at the time. It sold the debt at prices as high as 102 cents on the dollar in early September and its trading profits, plus a $1.2 million purchaser's fee, amount to the 9.5% return in six weeks.
J.P. Morgan has a longstanding relationship with Chicago Public Schools and is the top underwriter of its bonds over the past 10 years, according to data from Thomson Reuters. The bank views the school board as a high-priority client that it understands well and is willing to support its short- and long-term capital needs, the bank spokeswoman said.
--Aaron Kuriloff contributed to this article.


Read more: http://www.nasdaq.com/article/chicagos-troubled-schools-made-wall-street-110-million-20161002-00026#ixzz4M8i6ArJ3




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