Home > Uncategorized > Another Pro-Charter Angle: Green cards for $$$$

Another Pro-Charter Angle: Green cards for $$$$

October 31, 2012

My step-daughter who lives in Burke, VT, recently told me that the somewhat shopworn ski resort in their community was recently acquired by “investors from China” who intended to spend lots of money to upgrade the lifts, the condominiums, and build new houses in the region. They were rewarded for their investment with a green card… which seemed like a win-win situation for everyone: the economically challenged North East Kingdom of VT would get jobs, more tourism from Boston and Montreal, and the investors would get to relocate their families to our country.

A recent article in Reuters indicates that this opportunity is also available for foreigners who invest in charter schools.(Thanks to Diane Ravitch’s blog post for this link!). As the October 12 article by Stephanie Simon reports:

Under a federal program known as EB-5, wealthy foreigners can in effect buy U.S. immigration visas for themselves and their families by investing at least $500,000 in certain development projects. In the past two decades, much of the investment has gone into commercial real-estate projects, like luxury hotels, ski resorts and even gas stations.

Lately, however, enterprising brokers have seen a golden opportunity to match cash-starved charter schools with cash-flush foreigners in investment deals that benefit both.

“The demand is massive – massive – on the school side,” said Greg Wing, an investment advisor. “On the investor side, it’s massive, too.”

Two years ago, Wing set up a venture called the Education Fund of America specifically to connect international investors with charter schools. He is currently arranging EB-5 funding for 11 schools across North Carolina, Utah and Arizona and says he has four more deals in the works.

And that’s just the start, Wing says: “It’s going to be explosive.”

Explosive indeed! What school district in this day and age can raise $500,000 for facilities without creating a firestorm in its community… and what charter investor is willing to pony up $500,000 for a specialized facility that might not make it, especially since banks are reluctant to loan funds to a start-up like a charter school. According to the article, “…the government approved 3,000 petitions from foreigners seeking to participate in the program – nearly twice as many as were approved all last year” and many investors are eager to fund charter schools because they are viewed as recession proof and somewhat altruistic. Ali Faisal, a Pakistani investor put his money in charter schools because

…he felt he’d be serving society as well as helping himself. The schools he saw impressed him with their rigorous science curriculum and he said he hoped his investment would help nurture a new generation of American entrepreneurs.

“Investing in some type of hotel will not give me that inner satisfaction.””

Investors with altruistic motives like Mr. Faisal are somehow more acceptable than investors who want to make profit from charter schools…. and those coming into our country with Mr. Faisal’s perspective seem to be seeking entry here because they believe that  upward mobility is possible in our country and they realize that education is key to achieving that advancement.

At first blush it seems that this is no different than the investment in Burke Mountain Ski Resort: it will bring improved facilities to public education, create jobs, and benefit residents in districts where the $$$ is being invested. But the dilemma is this: charters are competing against public schools and public schools cannot raise $500,000 from foreigners to enhance their facilities or buy new technology or hire additional teachers… so the field is tilted in favor of the privatizers. If we want to be the kind of country Mr. Faisal believes we are, we need to invest in our PUBLIC schools and stop relying on external funding to save the day.

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