Academica is the largest for-profit education management organization in the country. Academica Nevada, whose building is pictured here, is the biggest EMO in the state. (Photo: Hugh Jackson/Nevada Current)
Democratic Assemblymember Skip Daly is sponsoring legislation that would put an end to what he sees as a loophole that allows for-profit companies to use taxpayer dollars to build quasi-public schools while skirting Nevada’s prevailing wage laws.
But his Senate Bill 318 goes further and bans charter schools from contracting with for-profit education management organizations (EMOs) altogether.
Charter school operators and advocates are vehemently opposed to the proposal, telling lawmakers on the Senate Education Committee on Wednesday that it would “shut down the highest performing charter schools” in Nevada. But Daly said he has included provisions giving charters the length of their current contract or at least two years, whichever is longer, to figure out and execute a transition.
Charter schools were able to operate before EMOs, he said, and “they’ll be able to do it again.”
Daly made the case that prohibiting for-profit EMOs would realign Nevada with the original intent of charter schools as non-adversarial complements to the traditional public school system.
“For-profit public schools was a mistake, an experiment that hasn’t worked out,” he added.
EMOs were meant to be vendors providing certain services, like payroll and accounting, that would normally be handled by a school district’s central office, he said, “but they have evolved into “much more than a vendor.”
“They essentially own what are supposed to be public schools,” he said.
Most Nevada charter school students administered by one Florida company
Daly noted EMOs own the “brand” of the school. He singled out Pinecrest, Doral and Mater as examples of charter school chains. All three, which each have more than one location in Nevada, are affiliated with the nation’s largest EMO, Florida-based Academica. In 2022, more than half of all charter school students in Nevada were enrolled at schools contracted with Academica, according to an analysis conducted by the Nevada Current.
EMOs are often affiliated with the company that leases out the building their charter schools operate out of.
Charter schools “cannot make an independent decision under this scheme,” Daly said, because their involvement is too deeply entrenched. “These are not arm’s length transactions.”
The education committee’s Republicans were critical of the proposal. State Sen. Carrie Buck, who is the executive director of Pinecrest Academies of Nevada, told Daly he “needs to be truthful” and implied he was either misinformed or lying about how charter schools are set up and run. Minority Leader Robin Titus questioned his characterization of EMOs as running a “scheme.”
“I stick with that,” Daly responded.
Daly said the founding of many charter schools is “not grassroots” and the EMO is involved from the very beginning.
“Their motivation is to increase market share, increase their per pupil dollars, and increase their land portfolio,” he said. “They are just land companies building their portfolios through public dollars.”
Public? Private? Both.
Daly, a retired building trades union leader, was pulled into the charter school issue through what he and many in his former profession see as a skirting of Nevada prevailing wage laws.
How public charter schools in Nevada can become private when building their facilities
In Nevada, any public project with a contract price of $100,000 or greater that is wholly or partially funded by public dollars is subject to prevailing wage law. Rates for prevailing wage are set annually by the Nevada Office of the Labor Commissioner, which compares similar projects in the region.
The Nevada State Public Charter School Authority, the authorizing body for the vast majority of charter schools in the state, as well as Academica Nevada, have taken the position that prevailing wage laws don’t apply to construction projects included within lease agreements that charter schools enter into with private companies.
Daly contends that prevailing wage laws do apply because the charter school’s governing board is sponsoring the project, which is paid for by the charter school using public funds it receives from the state.
He also believes it is irrelevant that, as Buck and others routinely point out, charter schools do not receive additional dedicated facility funding. “That’s part of the bargain they signed up for,” he said. “They agreed to it.”
Daly acknowledges the issue of whether prevailing wage laws should apply to charter schools has not been definitively settled. Nevada Labor Commissioner Brett Harris confirmed, while testifying in neutral on the bill, that her office has received inquiries and complaints related to whether charter schools are subject to prevailing wage laws.
SB 318 attempts to settle the issue and clarify that such projects are indeed subject to prevailing wage laws.
Daly’s bill likely faces an uphill battle. Democrats, while generally more critical of charter schools than Republicans, in previous sessions have rejected proposals to institute moratoriums or caps, and the charter school industry argued this would shutter existing high-performing charters. Republican Gov. Joe Lombardo, who has veto power over any bills passed by the Legislature, is a staunch supporter of charter schools.