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Report says Michigan charter schools received startup grants, but never opened

Oct 21, 2015

Credit Ryan Stanton / Flickr Creative Commons / http://michrad.io/1LXrdJM

UPDATED: 8:35 am on 10/22/2015 The federal government paid at least $1.7 million to 25 Michigan charter schools  that never opened, according to a report released this week by the Center for Media and Democracy (CMD).

The Wisconsin-based media group "conducts in-depth investigations into corruption and the undue influence of corporations on media and democracy," according to their website.

They say state and federal records obtained through the Freedom of Information Act show that in the 2011 - 2012 school year, the schools were approved for more than $3.7 million in Charter School Program startup grants.

The schools received the funds, but never progressed beyond the planning phase, says the CMD.

"Most of them didn't get any press coverage because basically they never opened and so their non-opening really wasn't news. But some of them received upwards of $109,000," said CMD Executive Director Lisa Graves.

According to their website, the Michigan Department of Education makes early-stage planning grants available to charter school developers for up to 18 months of program planning and design in two stages:

Stage One: Refinement of an ambitious, innovative academic vision, and design of a data-based program evaluation methodology that will demonstrate to the governance body whether the vision is succeeding. Up to $35,000 will be released upon award for use in completing these deliverables.

Stage Two: Development of a sound, comprehensive business plan to support the academic vision and finalization of a full charter application strong enough to secure a charter contract from a Michigan authorizer. Up to $75,000 of additional funds will be released upon satisfactory completion of Stage One for use in completing these deliverables.

A lack of regulation and accountability in charter schools is part of the problem, says Graves.

"That money hasn't been paid back, there's no real accounting for how it was spent, or why such sums were spent and came to naught. I think that's a problem. If that kind of money was going into the public schools, we'd have some accountability," she said.

Michigan currently has over 300 charter schools.

Michigan Department of Education spokesperson Bill DiSessa issued the following statement concerning this issue:

"A grant recipient is not required to repay a grant if it fails to open a new charter, unless the grant was used to buy equipment and materials. In such cases, the materials are disposed of in such a way as to ensure the materials – or the funds received from liquidating them – remain available for public use in Michigan.

There are no specific state or federal sanctions for opening or not opening charters which have received grant funds.

All recipients of grant funding are audited to ensure their activities are allowable, and carried out in accordance with approved budgets and management plans. 

The MDE was the grant awardee, and followed all federal guidelines on the administration and use of these funds."

– Paulette Parker, Michigan Radio Newsroom

THIS STORY WAS UPDATED TO INCLUDE A STATEMENT FROM THE MDE.