Private Surety for Projects with Public Funding?

July 16, 2012 10:46 am

by Bridget Cantrell · 10 comments

One of our very own frequent commenters John Konop made the AJC.  The gist of his comments are: “Let’s agree on fiscally rational financial requirements of these projects before we debate the politics behind them.”

Let’s start with the Cherokee Charter Academy. I support charter schools, if they are properly funded. But before we debate the viability of charter schools, we should first understand the liabilities put on taxpayers.

From what is reported, it is obvious that we have discrepancies about the financial viability of the school. Taxpayers would not only lose their initial investment, but the quality of our school system will be shaken as it struggles to absorb close to 1,000 students from a failed charter school mid-year.

We, as a community, can prevent these kinds of financial losses in the future by requiring a surety bond (or some other form of security) from the private company receiving public funds.

Being in the construction industry I tend to agree  that “If no financial institution will provide a reasonable rate for guaranteeing a particular public/private venture, that should be a red flag that the project scope and financing needs to be restructured or not implemented.”

Good post, John.

Painterman July 16, 2012 at 1:00 pm

As Charter Schools are public schools, how is this going to be a problem, and especially if they were to actually let the money follow the child, there would be no problem at all, as I would be pretty sure all of the kids did not come from the same zip code that locks them to their usual PS. So one PS would not have to make room for all of them if a Charter were to fail.
I expect that if we held out traditional public schools to the same criteria we would have many of them closing their doors as they are not succeeding in educating our kids!

John Konop July 16, 2012 at 2:15 pm

In all due respect, we used 2 million dollars of tax payer money to open up the school plus have ongoing liability issues. This has nothing to do with the politics it is about irresponsible use of tax payers money. I support solar technology, but I do not support tax payers on the hook at an irrational level even if I like the concept or not. We cannot afford fiscally liberal funding process you support.

….Obama Touted $400 Million Loan to Another Solar Company Now Declaring Bankruptcy….

http://www.weeklystandard.com/blogs/solyndra-ii-obama-touted-400-million-loan-solar-company-now-declaring-bankruptcy_647977.html

ryanhawk July 16, 2012 at 1:10 pm

What a load of horse $hit. I absolutely loathe people who say they support charter schools, or any other school of choice, and then proceed to condition that support with so many onerous burdens that no such schools could possibly open or survive. This “solution” is directed at a “problem” that exists primarily in John’s head. There are any number of problems that we could discuss with our system of schooling, but this “idea” ranks somewhere near the bottom of any list.

John Konop July 16, 2012 at 2:07 pm

http://www.ajc.com/news/cherokee/ball-ground-recycling-to-1472030.html

In Cherokee county we have already been the repo people on a 18 million dollar recycling plant and counting, 2 million and counting on a golf course………… I am businessman that thinks with his head not his heart

ryanhawk July 16, 2012 at 2:56 pm

Apparently you think very little at all. Every charter school in Georgia goes through a rigorous vetting process before it is approved. Be sure and let me know when a public charter school in Georgia starts imposing extra costs on taxpayers. Meanwhile why don’t you spend a little time examining waste and fraud in the traditional public schools.

John Konop July 16, 2012 at 3:03 pm

http://www.peachpundit.com/2012/06/06/ajc-fulton-fails-to-watch-over-charter-school-therefore-charter-school-amendment-must-fail/

The above link demonstrates why I do not trust the current system for charter schools. BTW I have been clear this problem goes way beyond Charter schools.

Also I have made the following proposal to my school board members in my county and in public in various forums for years.
1) Let students who participate in a sport in high school replace it with a gym credit requirement
2) Create a home school/public school option for students and allow the students to participate in extracurricular activities. We have a model that is working today across the country with home school charter school today
3) Ask for waivers for elimination of some of the end of the year testing. We know the best countries in the world in education test way less than us
4) Increase opportunities via joint enrollment for vocational kids as well. This would lower the drop-out rate, increase tax revenue via trained qualified graduates and lower the cost of repeat classes taken.
5) Create joint educational opportunities for public schools at night with colleges and or job training. This would save money via building cost and cross utilization of talent.

bowersville July 16, 2012 at 2:24 pm

Here is a recent TV report from coastal NC. It is reported that recently the NC State School Board closed one charter school in Morehead City due to financial reasons and two others for academic reasons. The reporter goes on to say that 4 dozen charter schools have been closed since the 1990s.

http://www2.wnct.com/news/2012/jul/12/doors-to-close-for-3-failing-charter-sch-55244-vi-49381/

It’s not unreasonable for GA to take steps to protect the taxpayer.

ryanhawk July 16, 2012 at 2:58 pm

Imagine how many “traditional” public schools would be closed if they used the same criteria to evaluate them. And of course it’s not unreasonable to protect taxpayers. What is unreasonable is to apply one set of standards to “charter” schools and another set to traditional public schools. Which public school pays your salary by the way? Or is that your buddy Howard Roark that is on the public school payroll?

John Konop July 16, 2012 at 3:05 pm

This is the issue.

……….protecting taxpayers against unreasonable risk should be a top priority. When a private company receives public money, it is irrational for the private company to receive all the upside of success and the taxpayers left on hook if the venture fails………..

bowersville July 16, 2012 at 3:06 pm

You always try to make it personal. Are you still sore? Why don’t you explain the rigorous process that protects the GA taxpayer. That would be reasonable.

And instead of bait and switch, make a proposal on how to protect the tax payer on funding public schools if you wish instead of the weak “imagine?”

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