Did charters really need up to $100M in PPP aid?

As Congress considers the next economic stimulus package, it’s worth mentioning that America’s charter schools snagged at least $925 million in emergency funding from the Paycheck Protection Program, according to an analysis by Network for Public Education.

In Arizona, 100 charter school operations bagged anywhere from $40 million to nearly $100 million in emergency funding, the analysis of U.S. Small Business Administration records shows.

That’s a lot of stimulation, economically speaking. Especially when you consider that the losses at publicly funded charter schools are largely a figment of the federal government’s imagination.

Unlike small businesses that saw their operations fall off a cliff when COVID-19 hit, Arizona taxpayers fund Arizona’s charter schools.

Not only have charter operators received their regular per-student allotments of state money, they are eligible for a share of the hundreds of millions of dollars in CARES Act funding that is being pumped into public schools to cover added costs due to COVID-19 and budget shortfalls.

So, what losses?

The Arizona Charter Schools Association sent me a statement saying charter schools were concerned this spring that the coronavirus would lead to state budget cuts, requiring them to lay off teachers.

“Charter schools have not only faced questions about the uncertainty of the state budget, but also seen steep declines in charitable fundraising and programs such as before- and aftercare — which are important revenue sources for our schools and students,” the statement said. “These federal funds have provided financial assistance to eligible recipients, as Congress intended.”

No word on how many of those schools returned the money when those state budget cuts didn’t happen.

It’s worth noting that more than 400 Arizona charter schools didn’t apply for emergency PPP funding. They wisely took a pass on trying to make a killing off a public health emergency.

Among the 100 charters that went for the windfall was – surprise! – American Virtual Academy. The management company, which runs Primavera Online School, snagged somewhere between $2 million and $5 million in PPP money.

This is the same company whose CEO, Damian Creamer, managed to pay himself a combined $10.1 million in 2017 and 2018 out of taxpayer money set aside to educate students. Never mind that fewer than a third of his students couldn’t read or do math at grade level or that nearly half were dropping out.

Creamer’s education technology company, StrongMind, also scored a $2 million to $5 million forgivable loan from the PPP program, according to The Arizona Republic’s Lily Altavena. Meanwhile, Verano Learning Partners, which was founded by Creamer and lists the same address as American Virtual and StrongMind, snagged a PPP payout of $150,000 to $350,000.

Other charters that hit the PPP jackpot include Legacy Traditional Schools, which snagged up to $1 million each for its campuses in Peoria, Mesa, Gilbert, Chandler and Laveen and up to $350,000 for its Goodyear school. And another $5 million for its Nevada schools.

In all, the Network for Public Education analysis shows Arizona charter schools snagged anywhere from $39.6 million to $99.4 million in PPP money.

All to protect the paychecks of charter school employees whose paychecks already were protected by taxpayers.

So what did these privately operated, publicly funded schools really use the money for? We’ll likely never know because Arizona doesn’t require much in the way of disclosure of how our money is spent.

I’m under no illusion that there will be a push to make these charter operations pay back the PPP money. The industry has powerful friends, both at the state and national level, and it lobbied hard to get a piece of the fund meant to provide relief to small businesses and nonprofits that opted not to lay off their workers.

Instead, these charter school operators figured out a way to use these relief funds to actually boost their bottom lines on the back of a pandemic. No bailout, just a bonanza.

One that should not happen again.