I knew something was seriously wrong as soon as I saw the budget of the charter school my kids attended. As a member of the school site council, I was on the budget committee. Now, as I looked at the numbers, I could see for myself how dire the situation was. The school was paying five times fair market value to lease a property from a shell company created by the former CEO of the charter management company. We were on a fast track to bankruptcy.
How did a charter school created by parents and teachers morph into a series of shell corporations and a money-making scheme so complex that the Securities and Exchange Commission would ultimately step in? The story begins nearly two decades ago with budget cuts. Like districts all over California, the Livermore schools had been forced to make deep cuts, including shuttering two beloved magnet schools. The Livermore Valley Charter School, which opened in 2005, emerged from a grassroots desire to provide art, music and science—all of the things our district schools were being forced to eliminate.
To me it sounded like the promise of Disneyland: a private school education at a public school price. While classes in the public schools had 25+ kids in a class, the charter would cap its class sizes at 20. I bought into it–hook, line and sinker.
Within a few years after opening, the K-8 school was in financial freefall. That’s when the CEO proposed an ambitious plan that would not just save the school but create a high school as well as acquire two additional schools in Stockton. By the time my son started at Livermore Valley Charter in 2012, I was already hearing whispers about the company that now ran the school: Tri Valley Learning Corporation. By 2015, when my kids were in kindergarten and third grade, signs that something was seriously awry were impossible to ignore.
With visions of becoming a major charter management organization, the CEO and the board of TVLC, had embarked on a property acquisition scheme involving numerous shell companies. One “company” bought the property, then leased it back to the school. In the event of bankruptcy, the shell company would walk away with the title. The whole enterprise was backed by millions of dollars of bonds secured by using the charter school students’ public funding as collateral. Yet another scheme created a private international school to be shared with the high school. Students from China were recruited to attend the school at $30,000 a head, then enrolled as public students to get state funds.
As a member of the school site committee, I could see for myself that something was seriously wrong. When I saw that same attorney was representing Tri Valley Learning Corporation and the various shell companies, I started asking questions—and got a very threatening letter in response. Committee members started receiving “notices of violation” from the District Authorizers regarding TVLC and the multiple schools that it now operated.
By the spring of 2016, the wheels were really coming off. After teachers were told that there wasn’t enough money to pay them, they threatened to stop coming to work. Parents also started organizing. A local investigative reporter began looking into the story, and would end up uncovering layer upon layer of fraud, mismanagement and deception.
Our beloved Principal quit. And TVLC hired a person who had a disturbing public blog, then proceeded to rescind the offer when parents found the blog. TVLC then went on to extend the position of Principal to the man who was under investigation for failure to report the abuse of a child at the High School Campus. This is when I pulled my kids out. When I could no longer trust that my children would be safe on that campus, especially in the event that something could go wrong. And so much had gone wrong already.
Meanwhile the school was falling part. By the fall of 2016, 400 students had left, including my 2 children. Those who stayed were told that they’d have to provide basic supplies, including toilet paper. For the students who experienced the collapse of their school and the disappearance of their teachers, the impact was devastating—like a slow death. By November the charter management organization had filed for bankruptcy. The former CEO would eventually be charged with misleading investors by the SEC.
Today my kids are back in the public school district and I’m much wiser about the dangerous mix of public funds and private corporations. In short, public schools should not be in the hands of private corporations. We need accountability for anything having to do with public funds and the education of our children. While my kids’ school was a public charter school, the board was privately elected, stocked with people who weren’t qualified. By the time parents figured that out, we couldn’t do anything about it. Our school was being run by a company, no longer beholden to us, the parents.
Do you live in California?
If so, stand with Katherine
Here is our suggested message:
The recall election is over. It is now time for serious charter school reform. Put in the safeguards needed to make sure the public and students are protected from fraud and theft. We do not need another A3 or Livermore scandal in the state. Charters should be governed by the elected, not by private boards.