Josephine Lee: Mike Miles Moved Texas School Funds To Colorado
Josephine Lee reports for the Texas Observer on an Observer investigations that found “irregularities” in how Houston’s superintendent handled taxpayer dollars.
Houston Independent School District (HISD) Superintendent Mike Miles claims to be a financial wizard. But controversy has followed the former military man-turned-school administrator to nearly every Texas school district he’s served. In 2012, he was hired by the Dallas Independent School District (DISD), only to be ousted by a majority of the school board three years later after an investigation showed Miles violated district policies.
In June 2023, the Texas Education Agency took over HISD and Commissioner Mike Morath, a former DISD board member who had supported Miles, tapped Miles to serve as superintendent. All year long, Miles’ actions have drawn protests from Houston parents, teachers, and students.
But in between running two of Texas’ largest school districts, from 2016 to 2023, Miles served as CEO of a charter school nonprofit called Third Future Schools in Colorado and accumulated debts while simultaneously expanding its operations into Texas, according to nonprofit tax documents. Under Morath’s leadership, the Texas Education Agency (TEA) approved Texas Partnership applications for extra funding and waivers of accountability standards for districts who entered into charter partnerships with Miles’ nonprofit to take over three public schools otherwise subject to TEA takeover. The districts entered into agreements with a related nonprofit entity registered to do business in Texas called Third Future Schools-Texas.
Miles’ oversight of Third Future Schools’ business operations has come under scrutiny after an investigative report by Spectrum News in May raised questions about the transfer of at least $49 million in Texas public school funds to the Colorado nonprofit during his time as its CEO. Those transfers are being reviewed by the TEA, led by Morath, the state official who signed off on the Texas Partnership applications and later hired Miles to run HISD. But Morath, who did not directly respond to the Texas Observer’s requests for comment, has already come to Miles’ defense, saying that Spectrum’s report left out “significant context.”
Now, the Observer has uncovered additional irregularities in how Miles’ Colorado charter school nonprofit did business in Texas from 2020 to 2023, based on interviews with experts, reviews of contracts and related documents, and corresponding state laws and regulations. These findings raise more questions about whether Miles, as the nonprofit’s CEO, followed laws that apply to nonprofit organizations and to charter schools when he transferred money from one legal entity to another without disclosing those arrangements to Texas school officials or in Form 990 reports to the IRS, according to records and experts.