Wednesday, September 30, 2015

BASIS Charter Schools make fraudulent use of Special Education designation

Arizonans for Charter School Accountability is an amazing organization that is exposing malfeasance and fraud in one of the worst charter school states in the nation. We have opined here in the past that Arizona has no concept of a conflict of interest and allows the starkest, most absurd entanglements of financial interests one can imagine.

Now, Arizonans for Charter School Accountability has exposed a crass and cynical manipulation of the charter school financing system. Cynical and crass because it exploits money designated for special needs students to increase its already considerable profits. You can read the details at ACSC's website or jump to the story immediately that has been reproduced below:

Special Education Fraud II: BASIS Inc.

BASIS Inc. does everything possible to game Arizona’s financial system. They received Federal start up funds, designed for new charter holders, to build their 12th school. They charter each school individually and claim they are “small” schools to receive additional funding, even though they have over 8000 total students. Now we find that in 2013-14 they claimed to have 19 severely handicapped students in eight schools. Hearing Impaired, Visually Impaired, Multiple Disabilities, Autism, Intellectual Disability - all students that require a great deal of support to achieve in school. These students generate four to six times the revenue per pupil of a regular education child to pay for the extensive services they require. These 19 students netted an additional $350,000 in state assistance for BASIS Inc. (Data is on the ADE Finance site: Charter Equalization Report (CHAR55-1) 2014)

The problem? According to their 2014 Annual Financial Report, BASIS expended ZERO dollars on special education in all of its 12 schools, except for $244,800 for “general administration” that went straight to BASIS Inc. Worse yet, every BASIS school claims to have spent an identical amount, exactly $20,400, for special education general administration, whether they had education students or not.

It is hard to image 19 severely handicapped students being able to navigate one of the most rigorous curriculums in the country without assistance. There are three possibilities:

  • First is the possibility that BASIS is collecting $350,000 for special education students that don’t exist. That is fraud on both a state and federal level. Or maybe BASIS legitimately has 19 handicapped students and is not providing them appropriate services. That would prompt a huge investigation from Federal officials with I.D.E.A., the ADE Special Education Unit, and maybe the Office of Civil Rights.
  • This is exactly what happened at the new BASIS school in Washington D.C. Special education students were simply placed in remedial programs that all struggling students attended. BASIS was forced by OCR to make major changes in dealing with special education students.
  • Or finally, maybe BASIS has identified these students correctly and is providing stellar programs to meet their individual needs - hey just are not reporting spending money for any special education personnel, materials, or outside services. The identical $20,400 each BASIS school supposedly spends on special education administration indicates that the figures are made up. What else is fabricated?
At the least, special education students need to be reevaluated every three years. But BASIS shows no expenditures for special education purchase services, the code they would use to pay for a psychologist perform the testing. Why would they show no special education expenditures?

Arrogance. The same arrogance that cons parents out of millions of dollars every year for workbooks, art supplies, extra curricular activities, and even funds to compensate their underpaid teachers and to build new schools. The same arrogance that makes it OK to take startup funds or pretend their school are “small” to get more funding. The total lack of oversight in Arizona breeds arrogance. BASIS is building a national chain at the expense of taxpayers and parents, and high needs special education students.

We filed formal complaints with state and federal officials today. The complaints can be viewed at out website:

Public education. Always.

Visit the Arizonans for Charter School Accountability website and support their work if you can. At present, all this effort is coming out of the hide of one man. Share on Facebook; Tweet out this article.