Cost of Choice: State Department of Education possibly breaking rules set up for voucher schools

Rules established for the voucher program say that for-profit schools cannot receive state money

Cost of Choice: State Department of Education breaking rules set up for voucher schools

NEW ORLEANS, La. (WVUE) - The Louisiana Department of Education is not following rules set up to oversee the state’s voucher school system, according to documents obtained by FOX 8 News.

The scholarship program funds private school vouchers for approximately 6,900 low-income families across the state. The Board of Elementary and Secondary Education, or BESE, oversees the program with the Louisiana Department of Education, LDOE, administering it.

Documents obtained through a public records request from the Louisiana Department of Education show that the department is allowing for-profit institutions to be in the scholarship program. However, a rule set up by BESE clearly states in order to benefit from state or federal funds, a school must be non-profit.

“This is very serious thing,” Joel Friedman, Tulane Law Professor, said. “I can assure you nobody in the state realizes what is going on.”

FOX 8 Investigates found at least seven private schools in the Louisiana Scholarship Program that are listed as for-profit. Documentation from the Louisiana Secretary of State’s office backs that up showing they are corporations -- companies looking to make money.

According to the Department of Education, McMillian’s First Steps Community Development Corporation receives voucher funding. The Louisiana Secretary of State lists them as a business and not a not for profit. In the 2017-18 school year, McMillian educated 156 voucher students, receiving nearly one million dollars in public money.

“They could change their rules, but they didn’t," Friedman said. “The rule is the rule and the rule has the effect of law.”

All totaled, FOX 8 found 227 students educated at for-profit schools.

“The rules are in place for solid reason. For the state to ignore their own rule is really just jaw-dropping,” Andre Perry, a fellow at the Brookings Institution, said.

In January, BESE approved four new schools in the scholarship program. On the application, two openly revealed in the paperwork sent to the state that they were for-profit institutions. BESE gave the schools the green light to start receiving public money this school year.

“The schools are in clear violation of state law,” Perry said. “[BESE] should cease funding the schools at the very minimum.”

Friedman said there is nothing in the rules that punishes departments for violating their own rules.

Several BESE members declined our request for an interview. The Louisiana Department of Education‘s Superintendent John White has refused to do an interview for our stories but the department said in an e-mail there is no requirement in state law that a school must be a nonprofit institution.

That part is true, but Friedman it should not matter because the rule adopted by BESE specifically says only nonprofits can benefit from state funds.

“Absolutely it’s against their rules which means it is against the law,” Friedman said.

He said a lawsuit could end this practice, one that has been going on for years, with officials ignoring rules.

This story is part of a series entitled, The Cost of Choice, a joint investigation by WVUE-TV, NOLA.com | The Times Picayune, WWNO and in partnership with Reveal - The Center for Investigative Reporting.

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