Michigan city outsources all its schools

One of Michigan’s lowest performing — and highest spending — school districting is turning over its three schools with nearly 1,000 students to a for-profit charter company, reports the Wall Street Journal.

In Highland Park School District, adjacent to Detroit, “only 22 percent of third graders passed state reading exams last school year and just 10 percent passed math,”  reports the Journal. Only 10 percent of high school students were proficient in reading and none in math. Phoenix-based Leona Group will run all three schools.

Highland Park decided to privatize its schools after years of enrollment decline, poor fiscal stewardship and allegations that a board member stole more than $125,000 by submitting false invoices; the charges against the member are pending.

During the 2010-2011 school year, the district spent $16,508 per student. By comparison, Michigan districts on average spent $9,202 per pupil that year. In the process, Highland Park ran up an $11.3 million deficit over its $18.9 million school budget.

Joyce Parker, appointed emergency district manager by Gov. Rick Snyder, ruled out merging Highland Park with a nearby district. “The financial problems were immense and we had to look at nontraditional ways to get the district back on track,” said Parker.

Under Leona’s management, the schools will receive $7,110 per pupil in state funding and an undetermined amount of federal funds for low-income and special education students.

Under the state emergency law, all the district’s professional staff has been laid off.  Teachers can apply for jobs with Leona, but the company “has budgeted about $36,000 a year for Highland Park teachers on average . . . compared with almost $65,000 a year the teachers received in the 2010-11 school year, reports the Journal.

So Leona will have much less money per student, inexperienced teachers and students who are way, way behind academically. It doesn’t look promising.


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  1. Roger Sweeny says:

    I really hope that someone is following this closely and collecting useful data. I would LOVE to see how students are doing in two, three, or four years–and to see if any differences can be traced to different things that Leona Group does.

    The thing I dislike most in this business is how little science we do about ourselves. We argue all the time about what we should do but we have almost no decent data on what works and what doesn’t. So the arguing tends to come down to political and moral ideology.

    • Public education is a political entity. The only science that needs to be done is to determine who has more votes.

      That, ultimately, is why teaching skill garners so little notice in the public education system; it’s not a source of political power so it’s valueless.

  2. Yeah, this doesn’t look promising at all. On the other hand, it would indeed be a kick in the pants if these folks can make it work and show some positive progress. These kids deserve a lot better.

    I’ll bet this isn’t the last district we see doing this. What I don’t get is why not give them the $9K state average instead of $7K per student. It’s almost as if someone DOESN’T WANT to fairly study the problem and they’ve started them out swimming with a brick in each hand.

  3. Remember that the same district was just sued by the ACLU for failing to provide its students “the right to learn to read”.  I suspect that this would not have happened absent the move to go charter; Highland Park had been failing for a long time, but the unions were happy until now.

  4. Don’t forget they’ll be a corporation skimming money off the top, I mean, taking a profit.

    • Roger Sweeny says:

      That’s true if Leona Group has a “cost plus” contract, where they are paid for expenses plus a percentage as a profit.

      But this looks like they are getting a lump sum. Profit, in that case, does not come “off the top.” It’s what’s left “at the bottom”–after paying all expenses. If Leona Group has sufficiently underestimated how hard it will be to fulfill the terms of the contract (say, it is impossible to get enough teachers to work in that situation at 36K a year), they could even lose money.

    • Valid point, Mike. That’s the aspect of the market model we forget.

  5. 10+ years ago, the entire school district in Inkster, Mich., was turned over to for-profit Edison Schools. I think that quietly flopped (the way Edison itself quietly flopped after all the hype faded a way). Doesn’t that seem like part of this story? I tweeted to the reporter to ask her about it; no answer yet.

    • Maybe you could ask the reporter what the Inkster district was like before it was taken over?

      Naw, I’ll tell you.

      It sucked. It was awful both educationally and financially.

      But proving it’s an ill wind that blows no good, the debacle of the Inkster school district helped provide the reason for the emergency manager law making the takeover of rotten districts much easier.

      Even more excitingly charters are coming to be seen as the way out of the financial morass irresponsible districts inevitably get themselves, and the state, into. Exciting because it’s only a matter of time before the state legislators put two and two together to notice that a bunch of charters produces better educational results then a district and at lower cost.

      • Only when the kids and families “choose” to buy in, and self-select into those environments. When it’s simply imposed, it ignores the self-motivation of the students that created success in the first place.

  6. Your state’s supreme court is sending the emergency manager law to general popular ratification. Think it’ll pass? That would be an interesting litmus test for how the people want public services to be managed.

    • The old, not-quite-as-tough emergency financial manager law goes back into effect if the newer law loses.

      The fate of the initiative is a replay of the 2010 mid-terms and what happens depends on how strongly the feelings that drove those mid-terms are still in effect.

      There was a widespread belief that municipal unions were driving states towards bankruptcy and if there’s one group that took a serious beating that day it was the municipal unions. If those sentiments are still strong then the emergency manager law will stay on the books since it’s aimed squarely at the financial disasters the municipal unions caused as a result of their lush contracts.

      Wisconsin’s recall election suggests that the public’s still not ready to forgive the municipal unions but each state is different and you can expect the fact that this initiative will be part of the November general election to have an impact on its fate.

      Obama got a grudging pass from the unions for avoiding the Wisconsin recall but he won’t get one this time so when he comes to Michigan, as he must, he’ll have to talk up the repeal of the emergency manager law. He’s all in on the left edge of the political spectrum and that’s the home turf of the municipal unions. In the upcomig election, Obama will need them and they need him.

      • The emergency financial manager in Detroit describing his plans for 61 students per classroom just might come up.

        • Why? It’s not like anyone can claim the performance of the DPS will be impacted by larger class sizes. Once performance descends to “execrable” there’s nowhere to go but up.

  7. Whatever works. That’s the standard.

    A note of caution. KIPP charter schools had been operating effectively for years in the Denver Public School system. Thus, charter advocates tried to prove the model could simply be applied to neighborhood schools, which they attempted at the Cole Middle School site. In less than two years, KIPP backed out of the school, and its ability to simply impose its culture of success was challenged. When kids and families choose the model, it can work wonders. When not, it’s doomed to failure.

    • Roger Sweeny says:

      That’s why I would like to see this go forward, with outside parties following it and collecting lots of good data.

      A Nation at Risk came out in 1983 and we’ve done lots of things and had lots of arguments since then. But we still don’t know much of anything definitive about how to fix things. It would take at least 4 years to be able to draw any conclusions from Highland Park, but it’s worth the time if we actually learn anything useful.

      • A reasonable question then might be, why is there so little appetite for information-gathering in the public education system?

        • I would say there’s very, very little appetite for gathering information that gives a clear picture of how the “solutions” work. Why in the world would the WSJ reporter neglect to mention that this had been tried before in the same state and had failed? By any journalistic standard that’s part of the story.

          • Roger Sweeny says:

            This “had been tried before in the same state and had failed”? The Leona Group had already been given a poorly performing 3-school system near Detroit and failed to improve it? Okay, that was catty, but I do want to know what happened. Caroline, could you fill in what the WSJ reporter didn’t and tell us the story? Or anyone else who is familiar with what she is referring to.

  8. Sorry, I missed this question. @Roger, I don’t have that much information. I know that back in the heydey of Edison Schools, the Inkster, MI, school district was handed over to Edison in its entirety. I distinctly remember Ben Wildavsky, then with U.S. News, covering it (I remember this because I know him).

    The point is that the Wall Street Journal and/or Joanne, who are paid to get this information, should be providing it, rather than leaving us readers to speculate, or asking an unpaid volunteer (me) to get it. If it reflects poorly on the charter sector, they seem to “forget” to do that legwork, even if it leaves a giant hole in the story.