A principle I have learned over the years is that when accusations mainly founded in suspicions are made, the accusers are very often guilty of the very perfidy that they allege. Of this, I have no doubt when it comes to the accusations against Epic Charter Schools, a charter school that has quite simply gotten too big and successful for the public school establishment and its enablers to ignore. Unfortunately, State Auditor Cindy Byrd has demonstrated a ready willingness to be a champion enabler, joining in a witch hunt and ignoring the basic philosophy behind charter school laws as well as the purpose of state audits in her recent hit piece masquerading as an audit.

Perhaps the single most absurd point made in the State Auditor’s report on Epic Charter Schools was on page 93 in the “Final Thoughts” chapter where there were ruminations about prohibiting any for-profit organization from obtaining a charter and prohibiting charter schools from contracting with for-profit entities for management. This was stated as if “for-profit” is, in and of itself, clearly something evil and automatically subject to corruption. Well, if that’s the case, then the traditional public schools are steeped in it.

My wife is a public school teacher and has told me of one particular consultant, well-known among teachers in the Oklahoma City area, who is paid large sums to brow-beat teachers into teaching nothing other than what’s on the standardized tests. This consultant is certainly not a non-profit. Let’s just list, for a moment, some of the many for-profit enterprises making money from public schools. There are architects, building contractors, equipment contractors, computer companies, software companies, textbook companies, bus companies, food companies, sports equipment companies, not to mention the ubiquitous consultants, and many others, all of which are for-profits, making money from public education. When was the last time any of these for-profit companies selling goods and services to school districts for a profit was audited by a state auditor, including Cindy Byrd?

The basic philosophy behind the charter school idea, of which Cindy Byrd is clearly unaware or ideologically disposed against, consists of three basic components. First, public schools have been organized as monopolies, and as such they are more costly and less productive than if they faced competition. Second, if parents had more choices concerning schools, without having to incur the transactions costs of moving from one district to another, they would likely exercise that choice to the benefit of their children. And third, not being monopolies, charter schools have to attract students by convincing parents to choose them. This competition regulates charters far better than any government agency could. But, to compete, charter schools need wider latitude to operate as they see fit. Not being monopolies, they should also not be subject to all the regulations public schools face. Traditional public schools are like other government-granted monopolies, such as utilities, which are heavily regulated due to the lack of competition. Charter schools face competition from public schools and each other the day they open.

One of the problems with charter schools is that policymakers and the general public cannot wrap their minds around the concept. Policymakers are constantly trying to shoehorn charter schools into the public education system. But, whether for-profit or nonprofit, charter schools are intended to be independent enterprises free of the heavy regulation their monopolistic public school competition faces. This is so that charter schools do not just become alternative public schools and to encourage innovation as well as efficiency through competition.

Charter schools are simply private contractors with whom the state has uniquely contracted to provide an education to the state’s children. There are three things, though, that separate charter schools from the bulk of private contractors who contract with state agencies. First, it’s not a government agency that determines which children or how many use a charter school. Parents independently make that determination apart from any agency bureaucracy. Second, most contractors’ deliverables are well-defined and it’s fairly easy to determine if they have made good on the contract. Educational outputs have always been ill-defined and debate rages to this day what constitutes a good education for every child and how best to achieve it. And third, payment to charter schools, and traditional public schools as well, is contingent only on whether a child enrolls in the school. Performance is not at issue when it comes to funding in public education, like it or not. This is true of public schools and of charter schools. But, parents can instantly move their children out of charter schools any time they wish. With public schools, they mostly have to move, lock, stock, and barrel.

Auditing charter schools’ finances is a bit like auditing a highway contractor’s books for how the contractor spends money within its enterprise. This simply is not done (the exception being for income tax purposes – not at issue with Epic). When the state contracts with a highway contractor, both parties agree to a price for a project’s completion that meets certain specifications. If the highway department is wise, its employees monitor performance carefully to make sure specifications are met, but the state is otherwise unconcerned with how much the contractor pays certain employees, what brand of equipment it buys, or how much profit the contractor nets from the project.

So if State Auditor Cindy Byrd isn’t auditing highway contractors and textbook providers, why is she auditing Epic Charter Schools? Clearly, she doesn’t like the fact that some students enrolled with Epic never show up, but Epic gets funding for them. Well guess what, this happens with every public school in the state. They’re all funded mainly on the basis of Average Daily Membership, which is a misleading term because public schools are funded based on enrollment as of exactly two different days during the school year. Epic is the same. And all schools have kids enrolled that never show up. Ask any teacher. If Cindy Byrd has a problem with it, as do I, then she should advocate for changing to an attendance-based funding system, a technical change for which she could legitimately advocate.

Auditor Byrd also doesn’t like the fact that Epic advertises. After all, public schools don’t advertise. Of course that’s because public schools automatically get enrollment on the basis of people’s addresses and geographic boundaries drawn so long ago that they have little practical meaning today. Public schools don’t have to advertise. The Auditor might be offended by the amount Epic spends on advertising, but when was the last time she ran an enterprise that had to compete against a bunch of monopolies?

No enterprise, indeed, no human being is perfect. There might be any number of bases to criticize how Epic Charter Schools are run and managed on a daily basis. But criticizing Epic for not behaving like a traditional public school is no basis for criticism at all. Cindy Byrd needs to stick with auditing state agencies and counties. You know, those government entities who get their money from coercive taxation without having to compete for it. Cindy Byrd’s office was not created so she could make non-technical policy recommendations to the legislature. In so doing, she has abused her position.

Byron Schlomach is 1889 Institute’s Director and can be contacted at bschlomach@1889institute.org.

The opinions expressed in this blog are those of the author, and do not necessarily reflect the official position of 1889 Institute.