Charter school transparency rules: clear as mud but changing

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If you ask charter school leaders, they are treated exactly the same as public schools when it comes to legal requirements for public records and open meetings.

Charter foes and transparency advocates agree that charter schools are indeed subject to the state’s transparency laws – except when they’re not.

If that’s confusing, it’s an accurate portrayal of evolving interpretations of open-government laws for the state’s 700-plus charter schools, which last year received around $3 billion in state funding.

Texas law seems clear on charter schools: They are government entities in almost every respect.

“Charter schools are subject to all open-meetings and open-records laws,” said Starlee Coleman, CEO of the Texas Charters Schools Association. Her group in 2017 created a document for schools to refer to regarding obligations under the state’s transparency laws.

“There is plenty of case law that shows that for almost all purposes, both larger groups and smaller [ones] are government entities and their records or completely open,” Coleman said.

Yet the issue continues to arise. Legislative measures for the last three sessions have addressed disparities in the law, where small carve-outs give charters what some perceive as an edge in keeping secrets.

There are also spending liberties that charter operators, many of which receiving funding from both private and public sources, can take that public schools cannot.

IDEA Public Schools, for example, allows first class air travel for its employees and is looking into the lease of a private jet. But as long as it insists that the perks are being paid for with private funds, the expenditures are free from oversight, discovered only through deep dives into IDEA’s tax returns.

Charter schools and open records are “an enormous can of worms,” said Joe Larsen, a Houston public records lawyer. “It’s neither dog nor wolf — it’s kind of private and kind of public. The courts and the legislature keep grappling with it, as they want charters to have the advantage of a private entity to make more efficient choices.”

But, he said, the effort to allow charters the freedom to innovate also gives them more room to operate on the margins of transparency.

A public records dispute between a Pharr newspaper and IDEA, one of the state’s biggest charter operators, shows the divide.

In 2017, the Advance News Journal in Pharr asked for details of IPS Enterprises, a business created by IDEA. Charter officials refused to provide details and referred the request to the state attorney general’s office for a ruling. 

When that office said IDEA had to provide the records, the nonprofit sued AG Ken Paxton, citing a 2015 state Supreme Court ruling that found a nonprofit need only provide records related to businesses funded with public money.  And, IDEA said, IPS Enterprises is unrelated to the $400 million in public funding it receives.

IDEA won the lawsuit, and today no one knows much about IPS Enterprises, a for-profit entity that state records show is based at the same tax-exempt Weslaco address as IDEA. Records show IPS in 2017 received a $4.7 million contract from the U.S. Department of Education.

The newspaper never even considered suing IDEA for the records.

“We didn’t even get involved after they sued the AG,” said Advance Publishing publisher Gregg Wendorf. “They have way more money than us anyway.”

In court documents, IDEA argued that its charter school operations and anything paid for with public money was subject to open records requests. But IPS was separate and privately paid for, IDEA lawyers said, comparing the situation to the Greater Houston Partnership case, in which the Texas Supreme Court ruled that only specific operations of a mostly public nonprofit were subject to open records.

“There are many charter operators where the school is just a part of what they do,” said Joe Hoffer, the San Antonio attorney who represented IDEA. While not speaking directly to the case, he said some charter operators run charities and business endeavors that are not funded by public money.

“And their employees are not public employees,” he said.

The case left Wendorf thinking that charter school operators have a convenient “out” when it comes to public records.  He’s sure that laws regarding transparency among charters are hardly settled.

“Actually, it’s more settled than not,” insisted Hoffer.

He said that in the past several years, other litigation has helped ensure charters are held to the same open records and open meetings laws as public schools.

 “Twenty years ago, charter schools were the wild west,” said Hoffer, who is also a member of the board of directors at the state charter association. “But now, charter schools are more regulated than any of the other governmental entities that I represent.”

He said charters can have their licenses pulled and be shut down if they are found to have violated conflict-of-interest rules or if a board member fails to properly abstain from a vote, whereas public schools are given a longer leash.

“Charters are not a political subdivision because we don’t have taxing ability,” Hoffer said. “But they are a unit of government controlled by the state.”

There remain arguable differences. Among other things, charters don’t have to file a form, required of most other government entities, to report all contracts approved by a governing board or that are worth more than $1 million.

Like some of the other gaps in the law, “I expect this will be changed soon,” Hoffer said.

During the last legislative session, a measure seeking to require that charter boards meet in the areas they serve never got off the ground. That means, for example, that parents of students in an El Paso charter run by Houston-based Harmony Public Schools have to travel for about 10 hours if they want to attend or speak at a board meeting.

In cases of larger charter operators, the arrangement is similar to how regents’ meetings are handled for any of the state’s several university systems, each with numerous campuses, some spread around the state.

The state supreme court last year ruled that charter schools could not be sued under the Whistleblower Act. Hoffer said that this session’s omnibus charter finance bill included a provision that would allow charter employees to sue under the Texas Whistleblower Act.

Every session, lawmakers spend hours refereeing the disagreements between public school advocates and charters.

“There are still accountability concerns and quality of service concerns,” said Donnis Baggett, executive vice president of the Texas Press Association, which advocates for transparency measures. He said that when charters began operating in Texas in 1995, there was little accountability.

That’s changed over the years, he said, “and it will continue to change. There are still loopholes that need to be closed. It will just take time.” 

Steve Miller can be reached at [email protected].

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