The Journal Gazette
 
 
Wednesday, November 27, 2019 1:00 am

Editorial

Uncharted: State's fascination with privatization leaves taxpayers vulnerable

On Monday, an Indiana deputy attorney general asked a judge to dismiss West Lafayette schools' challenge of a law allowing charter schools to claim unused public school buildings for $1. The judge agreed and ordered the school district to notify the state that Happy Hollow Elementary School is available to potential charter operators.

Deputy Attorney General Kelly Earls argued that West Lafayette's complaint was “hypothetical” because no charter school had laid claim to the building.

What's not hypothetical is the real estate racket that has allowed charter school operators to drain millions of dollars from Indiana and other states. West Lafayette's lawsuit represents a worthy effort to protect taxpayers' investment in their communities. The state, in turn, fights to serve the interests of an industry that has long prospered at public expense.

As majority party lawmakers double down on claims the money they have allocated for schools ends up with administrators instead of teachers, an honest accounting of Indiana's charter and voucher school costs is warranted. West Lafayette Community School Corp.'s lawsuit focuses on a single example of how our elected officials support privatization at the expense of students and teachers. The charter school industry is no friend to either.

A decade ago, The Journal Gazette reported a local charter school, Imagine MASTer Academy, was using state tax dollars to pay a for-profit landowner nearly triple in rent what it could have paid to own its building outright.

No one – not the governor, attorney general or any lawmaker – stepped up to protect taxpayers from that poor deal. None showed interest in the growing number of national headlines about charter school real estate scams. In announcing last week it was getting out of the charter school business, the former property owner of Imagine MASTer Academy illustrated why West Lafayette and other public school districts must challenge Indiana law.

Admittedly, the complex shell game is tough to follow, but no one should doubt who is prospering when an out-of-state real estate investment company boasts of 10.5% returns on a charter school portfolio that just sold for $454 million. Is it any wonder Indiana teacher salaries weren't growing?

EPR Properties of Kansas City, Missouri, bought Imagine's North Wells Street campus in 2008 from Schoolhouse Finance, the real estate arm of Imagine Schools Inc., a management group hired by businessman Don Willis and other area residents to operate the local charter school. The sales price was $5.5 million. Two years earlier, Schoolhouse had bought the campus from the YWCA. EPR, a real estate investment trust, sold it back to Schoolhouse eight years later for nearly $7.4 million. Just two years later, it was sold to Wallen Baptist Church for $3.25 million.

In the interim, Indiana taxpayers made rent payments of nearly $2 million in a three-year period alone. Under a triple net lease, the public was also on the hook for the for-profit company's property taxes, insurance and maintenance. When the charter school faced closure because of poor academic performance in 2013, Imagine was converted to Horizon Christian School. State officials, under another charter-friendly law, forgave $3.6 million in loans to Imagine.

We don't know how much Horizon Christian School paid in rent during its six years at the Wells Street site.Although the school, now at3301 E. Coliseum Blvd., is supported almost entirely by taxpayer-funded vouchers, its financial affairs are not subject to public access laws.

West Lafayette Community Schools Superintendent Rocky Killion said Tuesday that his district hopes to persuade local taxpayers and school districts affected by the $1 charter school provision to join their lawsuit. Perhaps another judge can be convinced that requiring taxpayers to give the school buildings they paid for to the highly profitable charter school industry is unconstitutional.

Better yet, lawmakers truly interested in supporting Indiana students and teachers will demand the law be repealed.


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