We're talking about k-12 not college.
It would work the same way. Texas has charter schools which get state money and do not have to follow most state educational standards and many have closed up with no accounting of the money, paid big salaries to family and friends, attract students by requiring no work and don't used those "oppressive" grades and tests.
If you make government money available with little oversight many are going to find ways to take advantage of it (just as many other government programs).