Every nonprofit’s board of directors carries the weight of their organization’s future on their shoulders. In these threatening and uncertain times, that load can get heavy. With so much about future funding unclear, every chance to bring in new resources is extremely attractive, but these opportunities can also bring difficult ethical and reputational questions. That’s the dilemma that many charter schools have brought down on themselves as they took advantage of their questionable eligibility for Paycheck Protection Program (PPP) loans.
Small businesses and their employees found themselves made vulnerable to the pandemic’s economic fallout. Congress heard their pain and funded two rounds of the Paycheck Protection Program, totaling $600 million in loans “to provide a direct incentive for small businesses to keep their workers on the payroll” and “forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.” The nonprofit sector lobbied so organizations across the sector could draw on this support, though government organizations were excluded.
Many charter school leaders saw the PPP as an opportunity to shore up their finances as independent nonprofits. In doing so, and asking for PPP loans, they denied or downplayed their status as “public” schools, whose public funding continued even as school buildings were being shut.
Public schools, traditional and charter, face a stark future—and one with uncertain funding, as they and their states acclimate to a shrunken tax base. But in taking PPP funding, charter schools have chosen to separate themselves from the public school systems that serve the greatest number of the nation’s students. Speaking to the Washington Post, Marguerite Roza, director of the Edunomics Lab at Georgetown University, which studies education finances, explains:
Charter schools applying for federal aid underscore the uncertainties that schools face in the upcoming budget cycles. In addition to not knowing how much money they will receive next year, school leaders said they are unsure how many extra expenses they will incur for cleaning and protective equipment.
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“Charters applied because they are qualified and they are perpetually scared about getting their next dollar,” Roza adds.
Now, these schools are being called out as hypocrites taking unfair advantage of a program and a benefit not designed for them and denied to the part of the public education system that serves the majority of America’s children.
- Marc Greenfield, an attorney who chairs the board for The Learning Community, a Rhode Island charter school that returned a PPP loan, saw the error of their ways in comments to the Boston Globe. “We have come to believe that the PPP loans are intended for a more distinct or traditional nonprofit,” Greenfield concedes, “and while we are technically a nonprofit, our primary identity, mission, and value is as a public school.”
- Boston’s Achievement First, a mayoral academy that primarily serves students in Providence, has held onto its $2.5 million loan. According to Elizabeth Winangun, the organization’s director of external relations, it’s out of concern for next year’s funding, both public and private.
- In comments to the Washington Post, Shawn Hardnett, founder and executive director of DC’s Statesmen College Preparatory Academy for Boys, rationalized keeping a $300,000 loan that a neighboring traditional public school would have to do without: “These kids are bearing the brunt of everything that goes bad in the city. Everything we can do to protect the most vulnerable children in the city, we are doing. Every dollar we find we should get into this building,”
- Another DC charter, Digital Pioneers Academy, is also going to keep its PPP loan. Mashea Ashton, who founded the school, cited challenges—high overhead costs and money spent training teachers on technology and distance-learning training—that are not unique to charter schools, even if their ability to benefit from PPP funding is. “If we don’t have these resources,” Ashton says, “then I would have to let go my [physical education] and art teachers, and those who are not full-time with us. And those positions are essential to delivering our mission.”
Carol Burris, executive director of the Network for Public Education, a nonprofit advocacy organization that has been a critic of charter schools, sees this as another sign of how they harm the nation’s public education system. “I think it’s really an abuse of funds. They are not losing their funding stream.”
NPQ has questioned the wisdom of the charter school movement and the belief that a competitive marketplace is the right way to improve public education. If we believe that every student is equal and entitled to the best education we can provide, then this kind of game playing needs to be seen for what it is. Charter schools want to be seen as public schools when it is to their advantage and as private businesses when that suits them better. In a matter so critical, as school funding, this does not bode well.
The CARES ACT included $13.2 billion for the Elementary and Secondary School Education Relief Fund to help to public schools, including charter schools, meet the challenges of these times. Jonathan E. Collins, an assistant professor of education and political science at Brown University, told the Globe he’s not sure if future federal funding will go to school districts, since some have already received help through the PPP. “Accepting the money undermines the argument that charters play by the same rules as traditional public schools,” Collins says. “The scariest part of this is…I don’t know the answer,” Collins said.”
As independent organizations, charter schools do not have responsibility for all children. Public schools do. By seizing an opportunity to do what public schools cannot, they illustrate why the marketplace isn’t right for public education. It will be difficult enough for public schools to emerge and begin again; there is no benefit to further tilting the funding balance against traditional schools.—Martin Levine