MDE, State Board of Education Call for Charter School Transparency

Senate Education Committee Takes Testimony, Acts

LANSING – Legislators need to act to increase public charter school transparency, the State Board of Education and Michigan Department of Education (MDE) testified during a Senate Education Committee meeting today.

The committee held a hearing on a set of bills to require charter schools, also known as public school academies, to be more open to the public about their finances and other matters. The committee reported the bills to the full Senate for consideration.

“The State Board of Education, in collaboration with the Michigan Department of Education, has long called for increased transparency regarding the finances of public school academies and charter school education management organizations, which in Michigan are often private, for-profit, entities that manage charter schools,” said Board President Dr. Pamela Pugh, who testified. “Charter schools are public schools. Parents and other members of the public should be able to find out information about their finances and operations just as easily as they are able to do so for traditional public schools. Unfortunately, that is not the case.”

Another difference is that authorizers appoint charter school boards, a structure that contrasts with board members from traditional public school districts being elected by local voters.

In April, the State Board of Education approved a charter school transparency resolution and asked the legislature to act.

Also testifying during today’s meeting was Dr. Sue Carnell, MDE chief deputy superintendent.

“Goal 8 of Michigan’s Top 10 Strategic Education Plan is to provide adequate and equitable school funding,” Dr. Carnell said. “We believe that taxpayers are responsible for funding our schools and that they have the right to know how their taxes are being used to educate the children that public school academies serve.”

Dr. Pugh and Dr. Carnell provided testimony on:

• Senate Bill 943, sponsored by Sen. Dayna Polehanki, addresses school aid and disclosure requirements for public schools.
• Senate Bill 944, sponsored by Sen. Rosemary Bayer, requires a management agreement with educational management organizations.
• Senate Bill 946, sponsored by Sen. Darrin Camilleri, calls for additional requirements for oversight of public school academies by authorizing bodies.
• Senate Bill 947, sponsored by Sen. Polehanki, restricts public school academy real estate transactions with certain entities.

State Superintendent Dr. Michael F. Rice said he appreciated the committee’s action and urged the full state Senate and House to take similar action.

“All we ask is that taxpayers have the same visibility and the same transparent understanding of where taxpayer funds to charter schools go and what they support as they do for traditional public school districts,” Dr. Rice said.

In January 2022, the State Board of Education sent a Freedom of Information Act request to 278 districts, both traditional public school districts and public school academies, to seek financial records to show how they spent their taxpayer funding, including contracts with third-party vendors and by extension education management organizations. 

Responses to the request showed the difference in financial reporting required of traditional public districts as opposed to public charter schools. The contracts provided by charter schools included some but not all details that would ordinarily be provided as part of a district’s financial reports. Responses to the request highlighted the lack of comparative data because there is no requirement that the information about a charter school be reported by an education management organization, let alone any requirement associated with the form in which the information is to be shared.

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