By Jessica Calefati/The Star-Ledger

NEWARK— Newark Prep Charter School opened last year with 150 students, a dozen teachers and big ambitions to become among the first schools in the state to offer classes taught online.

It hired K12 Inc., a for-profit online learning giant, to handle the start-up and offer many of the services the high school would provide.

A contract obtained by The Star-Ledger shows the publicly traded company — which operates charter schools for thousands of students in 27 states and made $30 million in the last school year — selected Newark Prep’s principal, drafted its budget and leased it furniture and equipment.

In return, Newark Prep paid the company nearly half a million dollars, or 17 percent of the $2.8 million it received last school year to educate students, according to financial data provided by the school’s board of trustees. This year, as the student body grows, the fees could take up to 40 percent of the school’s revenue, according to the contract.

New Jersey law allows for-profit companies to play a big role in public schools.

One thing they can’t do is run the place.

But charter school experts and one lawmaker said it’s sometime hard to tell if the rules are being followed, and K12’s involvement with Newark Prep is one of those instances.

“Technically, on the books, K12 is just a contractor hired by Newark Prep Charter School, but in reality it is running the school, soup to nuts,” said Luis Huerta, a Columbia University Teachers College professor who studies the impact of virtual charter schools across the country.

In addition, Assembly Education Committee Chairman Patrick Deignan (D-Middlesex) called the steep fees and the terms of the contract “deeply troubling.”


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