Yet another millionaire is made, thanks to the latest in charter school scheming.
This time, it’s state Rep. Eddie Farnsworth, who has figured out a way to sell his charter school business – the one built with taxpayer funds – and make millions on the deal and then likely get himself hired to continue running the operation.
Which now converts to a non-profit and thus will no longer have to pay property or income taxes.
Sweet plan. Sickeningly so, when you consider that Farnsworth is making his millions off of tax money intended to be used to educate Arizona children.
Other charter schools are getting rich
Farnsworth is just the latest operator to use charter schools as his own personal ATM – one that shoots out public funds.
The Republic’s Craig Harris has spent all year reporting on operators who are getting rich – or at least, making a tidy pile of cash – off publicly funded charter schools, aided by laughable state laws that require hardly any oversight or accountability.
Damian Creamer, the school’s founder and CEO, last year scored an $8.8 million “shareholder distribution” from the for-profit company that now runs Primavera, according an audit filed with the Arizona State Board for Charter Schools.
Taxpayers pay twice for same schools
Now comes Farnsworth with his Benjamin Franklin Charter School scheme, approved Monday by the Arizona State Board for Charter Schools.
Under the arrangement, Farnsworth is selling his for-profit four-school operation to a non-profit run by a trio of handpicked pals who will now select someone to run the schools. Farnsworth has applied for the job.
According to state records, Farnsworth will score at least $11.8 million in profit from the deal. He’ll also keep nearly $3.8 million in “shareholder equity” accumulated over the years since starting the suburban charter school chain in 1995. But Farnsworth declined to disclose the total profit he will make on the deal.
“I make no apologies for being successful,” he told the Arizona State Board for Charter Schools.
And you wonder why Farnsworth has fought efforts to require better oversight and reform of Arizona’s charter schools?
The Republic’s Harris reports that when the sale closes, taxpayers will have paid twice for the same schools – once to essentially pay the mortgage on the Farnsworth-owned buildings and now to assume more debt in order to buy the buildings.
And – by the way – it’s all legal
The most outrageous part of this outrageous story is that what Farnsworth is doing is apparently legal.
Charter schools aren’t required to bid contracts to get the best price. There are no conflict-of-interest laws that prevent school owners from milking their schools by hiring themselves or their relatives to perform work that likely could be obtained more cheaply if put out to bid.
Also outrageous: Gov. Doug Ducey and the Republican-run Legislature don’t see a problem.
As a result, some of these charter school operators are becoming millionaires – building up impressive bottom lines using tax money given them to educate students.
Ben Franklin schools aren’t bad. The schools, which serve mostly white students in the east Valley, scored a B on their last state report card, and on state standardized tests, they score well.
Not nearly as well, however, as the guy who has made millions off them.
Reach Roberts at email@example.com.