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K12 Inc Investors Conference Call: You Are There!

By dianeravitch
October 15, 2014 //
58

K12 Inc. is a for-profit virtual charter school chain that trades on the New York Stock Exchange. It was founded by Michael Milken and Lloyd Milken. It is funded with taxpayer dollars. It advertises and recruits heavily to keep enrollment up. It has a high attrition rate.

Its cash-cow operation is the Ohio Virtual Academy. Look for significant lobbying in New Jersey, Illinois, Connecticut, Kentucky and New York, according to the investor conference call.

I don’t know about you, but I had a hard time reading this transcript. They might just as well have been discussing a corporation that sells tires, toothpaste, bundled mortgages, or manure. These guys are profiting from taxpayer dollars that are supposed. To pay for public schools, for bands, for nurses, for guidance counselors, for reduced class sizes, for libraries. They are taking money away from real instruction, real children, real schools. Have they no sense of shame? Would any of the investors on this call put their own children in a K12 virtual charter school? Bet not. Bet their kids are in really nice suburban schools or elite private schools.Not sitting in front of a computer and calling it a “school.” It’s not. It’s a business, and the kids it recruits don’t get an education.

NOTE: I just learned that I am allowed to quote only 400 words from the transcript, so accordingly, I will count 400 words and delete what remains.

http://investors.k12.com/phoenix.zhtml?c=214389&p=irol-reportsannual

RISK FACTORS (Page 33-48)

Page 42

“We generate significant revenues from two virtual public schools, and the termination, revocation, expiration or modification of our contracts with these virtual public schools could adversely affect our business, financial condition and results of operation.

“In fiscal year 2013, we derived approximately 11% and 14% of our revenues, respectively, from the Ohio Virtual Academy and the Agora Cyber Charter School in Pennsylvania. In aggregate, these schools accounted for approximately 25% of our total revenues. If our contracts with either of these virtual public schools are terminated, the charters to operate either of these schools are not renewed or are revoked, enrollments decline substantially, funding is reduced, or more restrictive legislation is enacted, our business, financial condition and results of operations could be adversely affected.

“Note at a k12, inc investor conference call on 10/9 the company addressed the loss of the management agreement for Agora Cyber Charter School in PA. http://www.huffingtonpost.com/2014/10/01/charter-schools-k12_n_5914580.html

“The school will continue to use the k12, inc curriculum, but will self-manage.
http://www.marketwatch.com/story/k12-inc-awarded-contract-to-be-curriculum-provider-for-agora-cyber-charter-school-2014-10-09”

Here is the transcript of the investor conference call. Grab your vomit bag.

http://seekingalpha.com/article/2559155-k12-inc-2015-guidance-update-call-oct-09-2014?part=single

K12, Inc., 2015 Guidance/Update Call, Oct 09, 2014

Oct. 9, 2014 3:30 PM ET | About: K12 Inc. (LRN)

K12 Inc. (NYSE:LRN)

October 09, 2014 8:30 am ET

Executives

Mike Kraft – Vice President of Investor Relations

Nathaniel Alonzo Davis – Executive Chairman and Chief Executive Officer

James J. Rhyu – Chief Financial Officer and Executive Vice President

Timothy L. Murray – President and Chief Operating Officer

Analysts
Jeffrey P. Meuler – Robert W. Baird & Co. Incorporated, Research Division
Corey Greendale – First Analysis Securities Corporation, Research Division
Jason P. Anderson – Stifel, Nicolaus & Company, Incorporated, Research Division
Trace A. Urdan – Wells Fargo Securities, LLC, Research Division
Sou Chien – BMO Capital Markets Canada

Operator

Greetings, and welcome to the K12 Inc. Guidance Conference Call for Fiscal Year 2015. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mike Kraft, Vice President of Finance. Please go ahead, sir.

Mike Kraft – Vice President of Investor Relations

Thank you, and good morning. Welcome to K12’s Fiscal Year 2015 Guidance Conference Call. Before we begin, I would like to remind you that in addition to historical information, certain comments made during this conference call may be considered forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 and should be considered in conjunction with cautionary statements contained in our guidance release in the company’s periodic filings with the SEC.

Forward-looking statements involve risks and uncertainties that may cause actual performance or results to differ materially from those expressed or implied by such statements.

In addition, this conference call contains time-sensitive information that reflects management’s best analysis only as of the day of this live call. K12 does not undertake any obligation to publicly update or revise any forward-looking statements.

For further information concerning risks and uncertainties that could materially affect financial and operating performance and results, please refer to our reports filed with the SEC, including, without limitation, cautionary statements made in K12’s 2014 Annual Report on Form 10-K. These filings can be found on the Investor Relations section of our website at http://www.k12.com.

This call is open to the public and is being webcast. The call will be available for replay on our website for 60 days.

With me on today’s call is Nate Davis, Chief Executive Officer and Chairman; Tim Murray, President and Chief Operating Officer; and James Rhyu, Chief Financial Officer. Following our prepared remarks, we will answer any questions you may have.
I would now like to turn the call over to Nate. Nate?

Nathaniel Alonzo Davis – Executive Chairman and Chief Executive Officer

Thank you, Mike. Good morning, everyone. Thanks for joining us on the call today. We wanted to provide you with an update on our fiscal year 2015 count date enrollment as well as a guidance for the first quarter and for the full year.

Today’s guidance is a reflection of the trends in the markets that I outlined during our fourth quarter earnings call. Specifically, we saw a couple of our charter schools deciding to self manage their online learning programs. We’re also seeing more traditional school districts offering their own full-time online programs, along with supplemental learning options and online summer courses.
Education is evolving for the better, and families today have more choices in choosing full-time or part time virtual programs for their child. We believe that overall demand for virtual options in education is increasing, and this is translated into stronger demand for our institutional group, Fuel Education or FuelEd, which provides content and curriculum to school districts as well as private and charter school operators. At the same time, these market dynamics have also created a challenge to enrolling students in our traditional managed programs. And to help you understand this transition, we’re providing new guidance on student enrollment and revenue to clearly outline how K12 is participating in the growth of online learning use in public school classrooms.

Student enrollment and revenue data will now be provided for Managed and Non-managed Programs. Managed Programs are where K12 provides substantially all of the administration and education program management for an online program. Non-managed Programs include schools where K12 is the primary provider of content and technology and we may even provide instruction, management or other educational services, but K12 is not providing primary administrative oversight for the virtual school program.
And as you can see from the data we provided in this morning’s release, the 4.7% reduction in student enrollment from managed schools reflects this new market dynamic. It also reflects the events in Tennessee, where the state imposed an arbitrary enrollment cap midway through the enrollment season; and in Colorado, where our school partner took longer than expected to finalize their charter and subsequently, the curriculum contract with K12. We believe that enrollment in these 2 states were impacted by over 4,000 students this season. Also, this year, K12, in collaboration with the school boards we serve, made a concerted effort to keep students enrolled only if they were truly engaged and ready to learn, which also affected Managed Program enrollments.

Our partners are serious about running high-quality charter schools, with students who realize this is hard work. And they want to succeed by putting in the work. And while this is slow to growth in the near term, it better matches students to our core curriculum strengths and improves our reputation as a firm who is serious about providing high-quality education.

Even with the market evolution that’s beginning to unfold, we continue to see strong demand in Managed Public Schools. This year, we saw solid growth in select markets, including Texas, Michigan, Florida and Georgia. And at some point, we believe states like New Jersey, Illinois, Connecticut, Kentucky and New York will become states that allow online charter schools, although these states could take quite some time before opening up.

We will also attempt to be one of the educational management organizations chosen in North Carolina as that market commences an online charter trial next year.

[NOTE: I deleted the remainder of the conference call to abide by the guidelines of the company that supplied the transcript. It was hard to know which words count towards the 400 permissible, like instructions, the operator’s comments, the names of participants, etc. I cut copiously.]

Categories Education Industry, For-Profit, K12 Inc., U.S. education, Virtual Charter Schools

Gary Rubinstein: Louisiana Near the Bottom on AP tests

By dianeravitch
October 15, 2014 //
9

John White has done some heavy-duty boasting since he became State Superintendent of Louisiana in 2012. It seems to be a characteristic of the reformer class that they project dramatic improvement on their watch. Michelle Rhee promised the moon when she was chancellor in DC, and as G.F. Brandenburg has shown on his blog, achieved about 1.5% of what she promised.

As Gary Rubinstein shows in this post, John White made bold claims about AP courses. It is true that participation rates went up but passing rates went down. White had an explanation for that: higher participation caused a drop in pass rates.

But what White could not explain was that only 4.1% of all juniors and seniors in Louisiana earned a 3 or higher on an AP exam. That is next to last in the nation, just above Mississippi.

Really, people should not boast ever, but it is surely a bad idea to boast before the results are in.

Categories Louisiana, Scandals Fraud and Hoaxes, Testing

Myra Blackmon: Testing Insanity in Georgia

By dianeravitch
October 15, 2014 //
5

Politicians these days just can’t spend enough on testing. They will starve the schools of money for the arts, librarians, and nurses, while throwing millions and millions for more tests. They seem to be under the delusion that kids will learn more if they take more tests but there’s no evidence for that. (My wish: the people who commission these tests should be required to take the tests and post their scores.)

Case in point: Georgia.

In this superb article, journalist Myra Blackmon writes in OnlineAthens about the testing madness that has caused the state to shell out more than $100 million to McGraw-Hill for five years of tests. At the end of five years, state officials won’t know anything different from what they know now. And then they will buy more tests.

She writes:

“More insanity came largely from the Georgia General Assembly and an unelected Georgia State Board of Education. I’ve lost track of how many education bills have been passed the last few years, many of them mandating testing for teacher evaluation or school “grades.” Other legislation has piled on the paperwork that eats up instructional time. The testing and textbook companies have made out like bandits here, though.

“Everyone professes to hate testing, with the exception, perhaps, of the billionaires and their companies who make more money the more we test.

“Oh, yes, U.S. Secretary of Education Arne Duncan sees high-stakes testing as fundamental, and President Obama — whose daughters are exempt from the nightmare — doesn’t seem to care.

“If high-stakes testing is so great, why do the Obama children, as well as the children of Bill and Melinda Gates, whose foundation funds education “reform” initiatives, and the children of other wealthy elites go to private schools that don’t use such tests? If it’s so great for evaluating school performance, why aren’t private schools all over the country adopting the same practice and touting their test scores?”

And she adds:

“Testing has become absurd. Clarke County teachers have had to spend hours developing tests based on Student Learning Objectives that are not covered by the limited state Milestone and Criterion-Referenced Competency Tests. According to Clarke County Schools Superintendent Philip Lanoue, district teachers have been required to develop, administer (often several times a year), score and enter the data for some 60 tests beyond what the state provides. But the state doesn’t look at the data beyond the summary data in the cover sheet.

“Contemplating the costs of staff time, lost instruction and implementation is mind-boggling. Little data from the required testing is practically useful to teachers, parents or administrators…..

“High-stakes testing is not about measuring “student growth” or helping teachers do a better job. It is actually a new blunt instrument, used to bludgeon schools to spend limited funds for no good reason, to beat teachers until they are ready to quit and to abuse millions of school children who have little choice.

“We must contain this lunacy before it cripples our nation for generations.”

Categories Georgia, Standardized Testing

This Blog Just Reached 15 Million Page Views! Thank You, Readers!

By dianeravitch
October 15, 2014 //
29

I just noticed that the blog has had 15,000,050 page views since its inception on April 26, 2012.

 

I am amazed and gratified.

 

Thank you to the readers who are here everyday, commenting, sending articles from your town, city  or state.

 

Thank for for engaging in thoughtful dialogue in the comment section.

 

Some of the best-read blogs have been written not by me, but by you.

 

The blog has become a hub of the resistance to high-stakes testing and privatization. I will continue to highlight the hard work you do to strengthen your public schools, to stand up for children, and to defend real education, as opposed to the massive machinery of data collection that is now promoted by the U.S. Department of Education and the Gates Foundation. I will continue to honor those parents, students, and educators who speak out for real education and for treating students and teachers with dignity. I will continue to support those who fight politically motivated budget cuts that hurt children.

 

Together we will do what now seems impossible. We will one day restore sanity to education policy, which is now completely off-track and determined to tag and label each of us as though we were cattle. The policies that govern federal policy are written for the benefit of the education industry, not for the education of our children. Our policies bear no meaningful relationship to love of learning. We will put a stop to it, because it is absurd. Not today, not tomorrow, but in due time, the cyborgs who now control education policy will return to the planet from which they came and allow us once again to educate our children for meaningful lives, not as pawns of the testing industry, not as consumers of tech products, not as data points, but as full human beings.

Categories Accountability, Corporate Reformers, Education Industry, Education Reform, Privatization, Testing

Steven Singer: The Best Evidence Against Common Core

By dianeravitch
October 15, 2014 //
35

Steven Singer is a teacher. This post comes from his blog. It was tweeted by the Badass Teachers Association.

He writes that the best evidence against the Common Core can be found in the classroom. The Common Core is based on close reading and the “New Criticism,” which discounts the thoughts, feelings, and life experiences of the reader.

Visit Singer’s classroom in this post and find out how his students interact with what they read. Close reading is meaningless to them. They react from their heart and their gut. They think and they feel, and that is how reading comes alive for them.

Singer leads a Socratic Seminar for troubled teens.

He writes:

“If Coleman and the architects of Common Core could be in my classroom, they might see the error of their ways.

“Allowing students ownership of the text – allowing them to take their proper place as part of a complex relationship between the text, author and the world – is so much more engaging an experience than just being an authorial archeologist.

“When we insist on strict adherence to the author’s message – and only that – we create a false objectivity. Language Arts is a subject that is at most times open to interpretation. But Coleman makes it a guessing game to get the “right answer.”

“Literature is not math. We shouldn’t try to turn it into something it isn’t.

“This is why at the beginning of the year, my students take my innocent questions about the meaning of a text as an affront. They see me as just another adult trying to trick them. They assume I’m trying to get them to guess what I’m thinking – about what the author was thinking. There has to be only one true answer, they suppose, and if they haven’t been good at guessing it in the past, why try now?

“It takes a while, but through lessons like the Socratic Seminar, I try to broaden their horizons, to show them that they have a vital place in this dynamic. Without a reader, a text is nothing but words on paper. Without a larger societal context, those words lack their full meaning……

“Coleman and the Common Core designers would know that if they had ever led a classroom of students. But hardly any of them are educators. They’re bureaucrats, politicians and millionaire philanthropists.

“They’re missing the true picture.

“Because the best evidence against Common Core is denied them.

“Because the best evidence against Common Core is in the classroom.”

Categories Coleman, David, Common Core

Peter Greene: Charter Bait and Switch

By dianeravitch
October 15, 2014 //
88

Do you remember when the charter school idea was first circulated in 1988? Do you remember how the idea was sold in the 1990s? We were told that charters would save the taxpayers millions or billions because they would be lean and efficient: no central bureaucracy.

Surprise! Now charters are suing in Néw York and DC for the same funding as real public schools, you know, the ones that are required to accept English language learners, kids with disabilities, and unmotivated kids.

And guess who is siding with them to drain more money out of the public schools: the U.S. Department of Education’s Office of Civil Rights.

Peter Greene says this is classic bait and switch.

The bait? Charters will save money and get dramatic results for the neediest kids.

Says Greene::

“So here comes the switch. We pitched charter schools as more economical, more efficient, lower-cost alternatives. Now that we’ve got them up and running, we want more money. This is simply a continuation of the policy goal, adored and nurtured from corporate boardrooms to federal offices– the policy goal of shoving public schools aside and replacing them with charter schools. I don’t imagine that public schools will ever be completely done away with, because the charters will need some place to send the students that they refuse to educate, but those public schools will be stripped of resources and filled with the students that nobody wants.

“It is really one of the oldest business tricks in the book, used by everyone from John D. Rockefeller to Jeff Bezos– undercut your competition, and once you’ve bled them dry, boost your price as much as the market will bear. Charters just refine the technique by having federal and state government serve as the vampiric mechanism by which the competition is sucked dry.”

Categories Charter Schools, Education Industry, Funding, Scandals Fraud and Hoaxes

Last Word on This Subject: This is Very, Very Sad

By dianeravitch
October 14, 2014 //
58

This is very sad. It was written in response to this post. This is a report on the technocratic data collection about preschool readiness of children with disabilities 0-3. There is not a whiff of humanity in this data collection. What are they thinking in the Tennessee State Department of Education? Does any of this help children? Is it part of Race to the Top? What is the point? What benefit to the children? What am I missing? A reader writes: “Tennessee has been using this measure for 4 years. (I am in no way condoning this) Target Data and Actual Data for FFY 2012-13: FFY 2012-13 was the third full year in which Early Childhood Outcomes (ECO) data (entrance and exit) were collected from all nine TEIS Point of Entry offices (TEIS-POEs). Since FFY 2010, ECO data have been collected in the Tennessee Early Intervention Data System (TEIDS) based upon the seven-point scale of the ECO Child Outcomes Summary Form (COSF). The Lead Agency calculates and reports only on children that have been in TEIS a minimum of 6 months (defined as 183 calendar days between entry [ECO entrance date] and exit [ECO exit date]). Outcome entrance ratings are made by the IFSP team using assessment/evaluation, eligibility, and parent information at the initial IFSP meeting. Statewide, assessment/evaluation information is obtained from the Battelle Developmental Inventory-2 (BDI-2). Outcome exit ratings are made by the IFSP team at a review change or transition meeting for children who have been in early intervention services for a minimum of 6 months prior to exit or at three years of age. Exit data from Part C are utilized by several Local Education Agencies (LEAs) as entry data for children who are determined eligible for Part B, preschool special education services. http://www.tn.gov/education/early_learning/doc/TN_PartC_APR_FFY_2012-13.pdf

Categories Data and Data Mining, Special Education, Tennessee

Laura H. Chapman: This is the Point of Collecting Data on Children from 0-3

By dianeravitch
October 14, 2014 //
25

In response to an earlier post about the U.S. Department of Education setting “measurable and rigorous targets” for children with disabilities, ages 0-3, Laura H. Chapman writes:

“This is nothing more than an extension of the Data Quality campaign that Bill Gates has funded since 2005 along with USDE– initially limited to Pre-K through college, but now clearly starting at birth, and likely in a race to get as much data into “the cloud” on each cohort of kids ASAP along with some hard-wired policies such as do this or we will gut the health and human services funding and IDEA funding for your state.

“Comply or else.

“Of course, closing the achievement gap will be easy enough if you just demand more of the parents and hand over all of the “evidence-based interventions” to instant experts. They will have conjured all of the necessary and sufficient measures for ratings of “infant and toddler and parent effectiveness.”

“Don’t forget checklists for observation, with rubrics for properly identifying all-purpose and specialized remedies for every condition, Instant experts on “disabilities” are sure to be ready (for a fee) to share their power points and modules for corrective action.

“Let’s see, let’s have some infant and toddler SLOs with targets to reach every three months, so quarterly reports can be filed at the state level. Or some VAM calculations with grand inferential leaps from scores on cognitive function, locomotion, eye-hand coordination, new scores for versions of the old Piaget experiments. Add some body sensors to pick up rigorous data on pee and poop and tantrum control, a measure of infant and toddler grit in retaining gas or vomit.

“Perhaps the real aim is to privatize the US Census, the National Institutes of Health, the Department of Health and Human Services, etc., etc., etc.

“I think that Arne Duncan and Bill Gates have never been in the presence of infants and toddlers and adults who are struggling to make sense out of the booming buzzing confusion that marks you as alive and human and doing your best even if you are not blessed from birth with “the right stuff,” plenty of money and connections with people who give you a bunch of tax dollars and discretionary authority to spend these at will..

“I hope the over-reach on this idiotic plan makes big news.

“My fear is that it will not.”

Categories Data and Data Mining, Duncan, Arne, Gates Foundation, Bill Gates, Special Education

Mr. Duncan, Pre-School Readiness for Babies with Disabilities is a Bad Idea

By dianeravitch
October 14, 2014 //
20

This comment from a reader in response to a post about “pre-school readiness” for children 0-3 with special needs, with “measurable and rigorous targets.”

The reader writes:

“I spent 19 years in infant special education- even before we even called it early intervention, I was teaching children in the 0-3 age range. Yes- I visited mothers the week their babies came home from the hospital because because they sought and wanted that support. I was in that first group of teachers in the nation earning a MS Ed in Early Childhood Special Education right after the passage of PL 94-142. My program was home-based and holistic- the goal was to help the parent(s) understand how their child’s medical condition/syndrome/extreme prematurity/ brain damage/sensory disorder impacts development, and to help that parent care for the baby’s physical, sensory, cognitive and social needs.

“I went to homes twice a week where there was no heat, no food security, overcrowding, broken windows, little furniture or toys, vermin infestation, poor lighting and broken cribs. And sometimes also there was abuse and domestic violence. I also went to homes with maids and luxury cars- any everything in between. My expertise and support made a difference for those families- but how much more of a long term difference would there be if all the children had prenatal care, safe and secure shelter, food security and access to needed medical and dental care?

“As a teacher, my job was to help the child and parent move from one step to the next developmental step, and celebrate each milestone, whenever it came, with joy. It was about attunement, attachment, engagement and play- not testing, pressure and grit. That is how babies learn- though touch and interaction and play. My job was to help the parent see a child as lovable and capable which might sound unnecessary, but learning that your child has a significant problem is a crushing blow to many parents- it is traumatic, it is a shock, and a nightmare. But yes. I recorded new milestones on a checklist of developmental skills to help the parent understand and delight in the sequence of skills as they developed- not to quantify and get a “score.”

“Rigor? Does Duncan realize we are talking about babies with poor oral-motor tone learning how to suck on a nipple? Or a baby having hundreds of seizures a day learning how to make eye contact with her mother? Or a baby with cerebral palsy lifting his head to see himself in a mirror? What Duncan is proposing is clueless, but also despicable and sinister. Is there anything in this world he cannot reduce to a data point? Grief? Laughter? Love? Acceptance? Health? Comfort? Pride? What is YOUR score Mr. Duncan?”

Categories Childhood, Duncan, Arne, Special Education

Mike Klonsky: Keep the Struggle Alive

By dianeravitch
October 14, 2014 //
1

Education activist Mike Klonsky reminds everyone that what Karen Lewis wanted most was to drive Rahm Emanuel out of power. Her friends must now unite to realize her goal.

He brings news of a new study by Myron Orfield showing that charters in Chicago are intensifying segregation.

And he reminds us that Arne Duncan supported Indiana’s Tea Party Governor Mitch Daniels. Add him to a long list of anti-public school figures that Arne has praised, including John White in Louisiana and Hanna Skandera in Néw Mexico.

Categories Chicago
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