Arizona Has No Concept of a "Conflict of Interest"

Last Friday, Oregon Governor John Kitzhaber resigned from office because of allegations that he used his influence to get employment for his fiancee. In Arizona, such conflicts of interest would not even raise an eyebrow. A few years back, Arizonans saw the Chairperson of the State Charter School Board award a charter to a non-profit foundation (which was really K12 Inc., the online school provider), then be hired by the foundation to head the Arizona Virtual Academy, and then be hired by K12 Inc. as a vice-president for something-or-other. She continues to occupy the latter two posts.

Arizona simply doesn't recognize things called conflicts of interest. I could list dozens concerning public education. A staff member the Board of Regents once told me that in Arizona if you declare your connections, then you can no longer be accused of having a conflict of interest. Perhaps this qualifies as some minimal level of ethical behavior.

A new flagrant conflict of interest has just become apparent to me. A man named Greg Miller is president of the Arizona State Board of Education. There is also a man named Greg Miller who is CEO of Challenge Charter School in Glendale, AZ, a suburb of Phoenix. Matching up photos of the Board president and the charter CEO leaves no doubt that these two individuals are one in the same Greg Miller. Mr. Miller, a civil engineer for 25 years, founded Challenge Charter School in the late 1990s and for a while served as principal. His current title is CEO. Mrs. Pam Miller, his wife, once served on a school board; the Challenge Charter Schools website lists no current duties for Mrs. Miller. But daughter Wendy Miller was appointed Principal of Challenge Charter School the same year in which she earned her MBA.

Challenge Charter School Inc. is registered as a non-profit organization so it must file an IRS 990 form, which is publicly available. Here's what that form shows as salaries of the top management for 2013.

Greg Miller, the CEO of a school "system" with about 650 students, is being compensated to the tune of $145,000 annually. His wife receives the same salary, though her duties are never enumerated at the website and her position is only described as "Executive Director/Vice-PR," whatever Vice-PR is. The Miller's daughter Wendy, who has degrees in Public Administration and Business, receives a salary of more than $120,000 for acting as Principal/Secretary. Basically, the Miller family, while working assiduously 60 hours a week each as reported on their IRS form, is taking about $425,000 a year out of the coffers for salary. This nepotism and "business" attitude of the founders has not been lost on the disgruntled parents who have reviewed the school online.

Challenge Charter School portrays itself as a highly academic school, claiming to be Arizona's first official Core Knowledge school. Like many charter schools of its ilk, the appeal of this heavy academic focus seems to wane quickly in the eyes of parents. Enrollments drop from more than 100 in 1st grade to fewer than 50 in grade 6. As with many charter schools advertising themselves as "academic" in diverse communities, Challenge Charter School is contributing to racial and socio-economic segregation in the Glendale community. The enrollment of Challenge Charter is almost 85% White and Asian, where as the enrollment of Canyon Elementary, a traditional public school just 12 blocks distant, is 70% White and Asian. But more strikingly, Canyon Elementary has 40% of its 400 student eligible for Free/Reduced Price Lunch, while Challenge Charter has less than half that percentage.

Crony capitalism, conflicts of interest, charter schools lining the pockets of amateur entrepreneurs, "quasi-private" schools being operated at public expense, an increasingly segregated state school system ... it's just education reform Arizona style.

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Gene V Glass
Arizona State University
National Education Policy Center
University of Colorado Boulder

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The opinions expressed here are those of the authors and do not represent the official position of the National Education Policy Center, Arizona State University, nor the University of Colorado Boulder.