Indiana Gov. Mike Pence takes a question during a news conference, Tuesday, March 31, 2015, in Indianapolis. Pence is now the U.S. vice president. (AP Photo/Darron Cummings)

This is the second of three pieces about school “reform” in Indiana, where Vice President Pence was governor from 2013 to 2017 and pushed policies to expand school choice.

The choice program started in 2011, when Mitch Daniels was governor, and continued under Pence, who drove an effort to expand charter schools and loosen eligibility requirements to expand the voucher program’s reach. A Washington Post story on Indiana’s voucher program, published in December 2016, said in part:

Indiana lawmakers originally promoted the state’s school voucher program as a way to make good on America’s promise of equal opportunity, offering children from poor and lower-middle-class families an escape from public schools that failed to meet their needs.

But five years after the program was established, more than half of the state’s voucher recipients have never attended Indiana public schools, meaning that taxpayers are now covering private and religious school tuition for children whose parents had previously footed that bill. Many vouchers also are going to wealthier families, those earning up to $90,000 for a household of four.

The first post looked at the roots of the reform program in Indiana under then-Gov. Mitch Daniels, and this one discusses Pence’s role in the expansion of vouchers, as well as the misuse of public tax dollars in Indiana’s charter and voucher sector. Pence’s support for vouchers and other school choice programs is shared by President Trump and Education Secretary Betsy DeVos.

This post was written by Carol Burris, a former award-winning New York high school principal who is executive director of the Network for Public Education, a nonprofit advocacy group that supports public education. Burris was named the 2010 Educator of the Year by the School Administrators Association of New York State, and in 2013 the same organization named her the New York State High School Principal of the Year. Burris has been chronicling problems with modern school reform and school choice for years on this blog. She has previously written about problems with charter schools in California and several other states.

By Carol Burris

The Rev. Jake Runyon of St. Jude Church in Fort Wayne, Indiana, opened a meeting with his parishioners four years ago with a prayer. After ending with the sign of the cross, a Power Point presentation went up for his “Parish Subsidy Reconfiguration Plan 2014-15,” and he shared his plan on how to better fund the church by taking advantage of the state’s taxpayer-funded school voucher program.

“The Indiana school scholarship fund is a great benefit for parents, but not necessarily a great benefit for the parish because it’s not extra money,” he said.

Nevertheless, he said he had a way to turn that around. By taking greater advantage of school vouchers, he would be able “to do some things on the church side of things like fix the steeple, paint the roof and maybe grow the ministries we can do, you know, on the church side of things.”

The priest then described the plan. The annual tuition of St. Jude parish school would rise from $3,000 a student to $4,300 a student because the voucher limit was much higher than the present tuition amount. He told the parents not to worry because they would not see a bigger bill. He would “restructure” tuition.

St. Jude Elementary School, like nearly all Catholic parish schools, is partially subsidized by charitable donations from donors, as well as the Sunday collection plate. The cost of education without the donation subsidy would now become the tuition. This would maximize the money the school could get from vouchers and reduce what the church kicks in. All of the charitable scholarship donations would then become subsidies for the wealthier families not eligible for the voucher program.

He told the parish, with a chuckle, that the state could not tell them where to set subsidy limits so he had a plan that would subsidize nearly every parent. Full financial assistance would go to families making up to $180,000 a year. Fifty percent would go to the few families who made up to $270,000. Families who made more, he joked, should “go to the chapel and ask Jesus what to do about that.” He then made it clear that even those families were also free to ask for assistance if they needed it, and he did not care what assets families had.

St. Jude is one of many religious schools throughout Indiana that is receiving dramatically increased revenue from the state. Last year, the taxpayers of Indiana paid out $146.1 million to voucher schools, with most of it going to families who would have sent their children to private school anyway.

Indiana’s voucher program and its radical roots

Indiana’s 2011 voucher program began literally with a kiss when then Gov. Mitch Daniels picked up the bill and brought it to his lips. Daniels and his allies did more than just begin the nation’s largest voucher program. As the bill made its way through the statehouse, a $1,000 tax deduction for homeschoolers and private school families was also added. This allowed private school parents and homeschoolers to deduct costs above tuition, such as school supplies.

Daniels also expanded the already existing Scholarship Tax Credit Program that gives tax credits to companies and individuals who make donations to “scholarship” organizations that, in turn, provide vouchers. Those taking the credit get 50 percent of what they donate back.

The passage of the voucher bills and tax write-offs were hailed then by  Betsy DeVos, then a school choice advocate and now U.S. education secretary, who said, “We thank Governor Daniels and the Indiana Legislature for working so hard to make widespread school choice a reality across the state.”

Since 2011, the political action committees (PACs) of the American Federation for Children, which she co- founded, have contributed $1,040,540 to Republican pro-voucher Hoosiers and PACs. DeVos family members, including Betsy and her husband Dick, have personally contributed $1,525,000 to Indiana candidates or PACs since the voucher law was put in place. Their prior contributions (1998 to 2010) in that state totaled only $62,000.

The passage of the voucher bill was also praised by Robert Enlow, president and chief executive officer of the Milton and Rose Friedman Foundation for Educational Choice, which changed its name in 2016 to EdChoice. The chairman of the EdChoice board is the CEO of Overstock.com., Patrick M. Byrne. A Utah resident, Byrne contributed $465,000 to Indiana candidates and PACs beginning with Mitch Daniels’s campaign. He and his family financed over $4 million of the $5 million raised by Families for Choice, a PAC formed to support vouchers in a 2007 Utah referendum. Upon realizing that vouchers were rejected by 62 percent of voters, Byrne referred to the referendum as a “statewide IQ test that Utah voters failed. “

Located in Indianapolis, EdChoice has a strong influence on the policies and politics of the state. For that reason, it is worth understanding the foundation’s roots.

The founder, libertarian economist Milton Friedman, had proposed the idea of school vouchers in 1955. Although some of Friedman’s policy ideas have been adopted, many are well outside of the mainstream. For example, Friedman believed that Social Security should be shut down because it created welfare dependency, that the Food and Drug Administration (FDA) should be abolished, and that the licensing of doctors should be eliminated because the American Medical Association was “a monopoly.”

In this video entitled “The Enemies of School Choice,” Friedman begins by boldly claiming that vouchers “would solve all of the critical problems” faced by schools. According to Friedman, school vouchers would eliminate discipline problems, reduce segregation and solve the problem of school busing. He presents no evidence, just claims based on his disdain for government regulation.

Privatization and Mike Pence

When the end of Mitch Daniels’ last term as governor was nearing, the money to sustain and expand school privatization in Indiana moved to gubernatorial candidate Mike Pence.

The DeVos family contributed directly and indirectly through contributions to their AFC PACs, which in turn contributed to Hoosiers for a Quality Education, a pro-voucher PAC that was started by Fred Klipsch. Klipsch, an EdChoice board member who bragged to the Catholic Business Exchange that his PAC had created a Republican super-majority in the state which supports school choice, was the treasurer of the Mike Pence for Indiana Political Action Committee.

Pence, as governor,  did everything he could to expand school choice. He grew the number of charter schools by creating a $50 million, low-interest loan program for technology and transportation as well as a $500 per student charter increase, which the legislature had scaled back from his original $1,500 ask.

The greatest growth, however, was in the state’s voucher program. Pence, who describes his religious beliefs as evangelical, removed the cap on the number of students who could qualify for a voucher to a private school, increased the limits on qualifying family income, and removed Daniel’s stipulation that the student had to try the public school first.

No longer was money being saved as a small number of students transferred from public to private schools. Now middle-income families already using private schools were having their tuition paid for, at least partially, by the state.

Discrimination and disturbing curriculum

Nearly all of the 300-plus Indiana private schools that receive vouchers are religious schools. Although they may not discriminate in admissions based race, color, national origin or disability, they can require attendance in a designated church, mosque or synagogue and they may select students based on other factors such as test scores, discipline records and the lifestyle of their parents.

The Lighthouse Christian Academy in Bloomington received national attention during the January 2017 confirmation hearings of Betsy DeVos when it was revealed that the admission’s brochure for the school said that the school can refuse to admit or expel students living in a home that includes “homosexual or bisexual activity” or “practicing alternate gender identity.”

The Lighthouse Christian Academy received over $665,000 in state funds to enroll 152 students, which represent more than half of its total enrollment.

Concerns regarding fundamentalist Christian voucher schools go beyond their exclusionary practices. Religious ideology often supplants facts in many of the history and science texts that are used by these schools.

A 2017 analysis of the texts used by Indiana private schools that receive vouchers by the Huffington Post found that many of the Christian fundamentalist schools receiving vouchers used texts from either A Beka Books, which is associated with the ultra-conservative Pensacola Christian College, or Bob Jones University Press.

The Huffington Post said the A Beka Books’s middle-school history text blames Satan for both the theory of evolution and modern psychology. It uncovered a history text that claimed that God used the Trail of Tears to bring Native Americans to Christ. The texts from Bob Jones University Press are equally questionable. They instruct that most slaveholders were good to their slaves, the Klu Klux Klan used the burning cross to fight moral depravity, and that “dinosaurs and humans were definitely on the earth at the same time and may have even lived side by side within the past few thousand years.”

Accountability

Even if we were to put concerns about discrimination and biased curricula aside, questions regarding how tax dollars are used (and misused) remain. Voucher advocates say that Indiana has the strongest charter and voucher accountability laws in the nation. While on the books that may be true, reality tells a different story.

Voucher schools with grades of ‘D’ or ‘F’ for two years in a row are prohibited from taking on new voucher students until they raise performance. This law cost private schools with poor test scores considerable funding. To keep the voucher money flowing, last summer the legislature passed a new law that allows voucher schools to appeal to the State Board of Education, whose members are appointed by the governor. As soon as the law was passed, four religious schools applied for a waiver and all four were approved to take on new voucher students despite their failing grades.

The Indiana voucher program has also been an escape hatch for failing charter schools. The Padua Academy, a charter school in Indianapolis, had two years of consecutive failing ratings. Instead of shutting down, Padua became St. Anthony’s Catholic School.  The same principal who led the failing charter stayed on as the leader of the replacement voucher school, which received $1.2 million in tax dollars.

Failing charters flipping to voucher schools is not limited to Padua. Imagine Schools is the largest charter management corporation in the United States. Imagine was founded and operated by Dennis Bakke, the former CEO of an energy company, AES, which merged with the Indianapolis Power and Light Company (IPALCO) in 2001. That merger would quickly become a disaster for IPALCO stockholders and workers. Stock price plummeted and many lost their jobs and their retirement savings.

When Bakke was ousted from AES in 2002 after its stock crashed, he moved into the charter  management business. Imagine quickly expanded and became notorious for the real estate deals of its subsidiary company, SchoolHouse Finance. SchoolHouse Finance buys properties, often selling them for twice or three times the purchase to a buyer, and then leases them back from the buyer in order to then lease them to Imagine charter schools at exorbitant rates. Investigations of Imagine Charters in Ohio and Florida found charters paying leases that amounted, in some cases, to half of the schools’ revenue from tax dollars. Imagine was fined $1 million by Missouri for self-dealing.

Ball State University, the authorizer of two of Indiana’s Imagine charters, refused, based on poor performance, to continue to sponsor the schools when they came up for renewal. Those two schools, Imagine MASTer Academy and Imagine Schools on Broadway, responded by merging and transforming into the Horizon Christian Academy. By doing so, the for-profit Imagine chain was off the hook for the $3.6 million in loans it owed the state of Indiana. Horizon Christian, which is also struggling, collected  $2.4 million in public funds in 2016.

Last year, the Todd Academy was under investigation from the state attorney general and the state Education Department, yet voucher money kept on rolling in.  According to the Indianpolis Star, the judge “soon dissolved Todd Academy’s nonprofit status, saying Todd was ‘entirely unaware’ of how to run a nonprofit, and it was in the public interest for the school never to be allowed to operate again.”

A 2014 study found that 80 of the 300 voucher schools were overpaid a total of $4 million, money that was not repaid to the state.

At the end of his presentation on how to maximize taxpayer dollars, Runyon, the priest at St. Jude, said that he did not expect that tuition would rise at the school, but rise it did.  In three years, tuition costs increased at St. Jude’s from $4,300 per pupil to $5,280.

The voucher dollars received by the Catholic elementary school of fewer than 600 students jumped from $660,000 the year before Runyon’s speech, to over $937,000 the year that the restructured tuition went into place. Last year, the school received $1.13 million in taxpayer money, even with a slight drop in its enrollment. The steeple is in outstanding condition.