By Thomas Ultican 12/31/2025
Charter schooling has a 33-year history. In 1992, the first one opened in Minnesota and it was exactly the kind of school American Federation of Teachers President Al Shankar envisioned when he promoted the idea. It was small, teacher-run within a public district that tested innovative strategies to reach hard-to-teach kids. Almost immediately, that model was highjacked by profiteers. The Network for Public Education (NPE) has published two parts of their planned three-part series. “Charter School Reckoning: Decline” came in July. It details the harm charter schools are doing with their legacy of waste, fraud and abuse.
The late Al Shankar’s wife, Edith, claimed,
“Al became increasingly critical of charter schools as they moved further from their original intent. He warned that without well-crafted legislation and public oversight, business interests would hijack the charter school concept, ‘whose real aim is to smash public schools.’”
The reality is that nearly all attempts to create “well-crafted legislation and public oversight” has been thwarted by the industry. More than 50 national and state-based trade associations have lobbied aggressively against reform and oversight. The latest tax filings from 2023 show that the National Alliance for Public Charter Schools (NAPCS) reported over $26.5 million in income and they have $28 million in assets. The California Charter Schools Association (CCSA) reported nearly $13 million in new revenue and more the $17 million in net assets. These charter school advocates are powerful lobbyists working for unlimited charter growth, while fending off oversight and protecting existing charter schools. (Decline Page 2)
Founded in 2003 by Caprice Young and Steve Poizner, the older of the above-mentioned organizations is CCSA. Poizner is a wealthy technology guy from San Jose who as a Republican along with Arnold Schwartzenager was one of the last two Republicans to win statewide election in California. Caprice Young grew up in a foster home in Los Angeles but made her way to Yale. She worked 3 years for LA’s billionaire mayor, Richard Riordan and followed that with serving on the Los Angeles Unified School District board. Since leaving CCSA in 2008 she has been involved with several questionable charter school organization including the Gulan movement’s Magnolia schools.
The foundational years for both CCSA and NAPCS have a surprising number of billionaires and political leaders on their boards. At CCSA the early boards included John Walton (Walmart heir) and later his niece Carrie Penner plus Reed Hastings founder of Netflix. NAPCS, formed in 2004, had on its founding boards Caprice Young (Co-Founder CCSA), Fernando Zuleta (Charter school magnate), Joel Klien (Bloomberg’s education leader), Ted Michelle (New Schools Venture Fund), Whitney Tilson (Co-founder TFA and Democrats for Education Reform) and Margarete Spellings (George W. Bush’s Secretary of Education).
Decline
Released in July, the first NPE report subtitled “Decline” states, “A program originally intended to foster innovation became a vehicle for waste, mismanagement, and fraud.” As a highlight, the paper reports that of the 50 charter schools that have closed in first half of 2025, almost half of them received federal charter school funding as start-ups. That funding totals to $102 million. (Decline Pages 5 and 6)
The history of the federal charter schools’ program (CSP) is a history of failure. Beginning in 1995, CSP’s original funding was $5.4 million for creation of new charter schools. By 2011, CSP funding had rocketed to $226 million and the grift was on. (Decline Page 6)
Audits confirm that Between 2006 and 2016, 11% of CSP-funded schools never opened. In 2022, the Department of Education’s Office of the Inspector General found that 51% of schools promised by grantees between 2013 and 2016 never opened or expanded. (Decline Page 7)
As the federal government has increased its priming of the charter school pump, the charter growth rate has declined for both new school openings and enrollment. Between 2020 and 2023 charter school enrollment only increased by 0.1%, from 7.5% to 7.6% of total school enrollment. According to the National Center for Education Statistics (NCES) data, the number of charter schools increased by only 11 schools between the 2022-23 and 2023-24 school years. (Decline Page 8)
Even as charter schools are losing their appeal, Secretary of Education Linda McMahon, in conformity to Trump’s anti-public education agenda, pushed the CSP funding to a half billion dollars. It appears lying comes easy to billionaires. In defending this indefensible action, McMahon claimed, “We’ve got about a million students on charter school waiting lists.”
This is a very old lie. In a 2014 policy brief titled “Wait, Wait. Don’t Mislead Me“ scholars Kevin Welner and Gary Miron of the National Education Policy Center identified at least nine reasons to be skeptical of such numbers. Among them: the absence of standardized data, duplicate counting, and self-reported, unaudited figures from charter operators themselves. Texas — one of the few states with detailed charter enrollment data — reported in 2025 that its charter schools had 120,826 vacant seats. (Decline Page 10)
In 2023, NPE produced Doomed to Fail: An Analysis of Charter Closures from 1998–2022, which found that 47% of charter school closures were due to insufficient enrollment. Of the 50 charter schools that announced closures in the first half of this year, 27 (54%) cited low enrollment as the primary reason. (Decline Page 10)
Disillusionment
The second part of the three-part series, “Charter School Reckoning: Disillusionment” was released in December.
For-profit charter school management corporation, Leona Group, founded by William Coats, opened in Michigan in 1996 then rapidly expanded to Arizona where most of its 28 schools are today. Jon Hage founded Charter Schools USA soon after Florida passed its charter law, creating a related real estate company, Red Apple Development. Red Apple builds charter schools and collects the rents. The nation’s largest for-profit management company, Academica, opened its first school inside a real estate development owned by the Zulueta brothers, its founders and owners. (Disillusionment Page 4)
The makeup of boards for some of America’s largest charter school companies include many billionaires who would never consider sending their children to one of these schools. For example, KIPP board members include Emma Bloomberg, daughter of billionaire Michael Bloomberg; Reed Hastings, the billionaire founder of Netflix; and Carrie Walton Penner, the billionaire heiress to the Walmart fortune. (Disillusionment Page 5)
When scandals came to light at the Texas Idea charter chain, CEO Tom Torkelson was fired but still rewarded with a $900,000 buyout. His successor, Joann Gama, was soon ousted as well and she walked away with a nearly half a million dollar golden parachute. (Disillusionment Page 6)
In 2023, Eva Moskowitz, who runs New York City’s Success Academy schools, took home $1,018,977 in compensation. With 15,500 students under her management, Moskowitz took in more than twice that of the Chancellor of the city’s public schools with almost a million students. (Disillusionment Page 6)
The Center for Media and Democracy (CMD) reported this year that the nation’s largest charter chain, KIPP, disclosed over $52 million in unexplained spending in its 2023 IRS filings. The disclosure was buried in the vague category of “all other expenses.” (Disillusionment Page 6)
This Disillusionment paper asserts, “Corruption and mismanagement in charter schools have cost taxpayers nearly one billion dollars in the past few years alone.” By collecting data from news reports between September 2023 and September 2025, the National Center for Charter School Accountability found $858 million that disappeared due to fraud, theft, profiteering or incompetence. (Disillusionment Page 8)
A related-party transaction is a financial transaction between either individuals or corporations with a preexisting business relationship. Public school boards and managements are strictly prohibited from entering into these transactions and they are monitored. In the charter industries these kinds of business practices are common place and mostly legal. (Disillusionment Page 10)
To cite one example, Charter Schools USA (CSUSA) has a complex web of related nonprofit and for-profit entities, including its affiliated real estate arm. It employs Red Apple Development to manage schools and extract profits. By controlling both school operations and property leases, CSUSA sets lease terms, charges inflated rents, and structures agreements that benefit Red Apple and CSUSA. These practices should be illegal but the charter school lobby has so far fended off most common-sense legal oversight. (Disillusionment Page 11)
Final Words
The conclusion of NPE’s three-part series coming in 2026 is called “Charter School Reckoning: Cost.” I am guessing the costs exposed will include monetary, emotional and educational costs.
My personal opinion is that there are some good charter schools out there but their governance should include democratic control by communities. All charter schools within a public-school district’s boundaries should be governed by that elected school district board. Profiteering, theft of public tax dollars, huge management salaries and self-dealing is costing too much for this failed education experiment to continue under its present structure.
tultican 
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