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Another post by the tireless public school advocate Bill Phillis of the Ohio Coalition for Equity and Adequacy:

Unconscionable, far-reaching consequences intrinsic in the White Hat Management company’s claims of private ownership of school assets purchased by public funds

A lot of public school personnel in Ohio at this time are embroiled with the question of, “To have or not to have Common Core.” As important as this discussion is, it pales relative to the White Hat Management claims before the Ohio Supreme Court (oral arguments will be heard September 23). The Court is being asked to decide the question of ownership of charter school assets that are purchased with taxpayer money. This is a matter that should rankle all taxpayers, particularly those who are public education advocates.

White Hat Management company claims ownership. On the other side, ten or more of White Hat’s own school boards claim ownership. Six organizations, including the charter school advocacy group, Ohio Coalition for Quality Education, have filed amicus briefs in support of White Hat’s claims. Conspicuously absent from the fray are statewide public education associations and local public school groups. Ohio School Boards Association filed the only amicus brief against the White Hat Management claims.

When the $11 million charter school pilot project was enacted, a long time public education professional was scorned, even by associates, for saying that one day this pilot project will turn into a billion dollar per year fiasco. At this juncture, it can be predicted that a ruling in favor of White Hat Management will hasten the demise of the public common school system.

A ruling in favor of the White Hat Management claims could have eventual consequences such as:

Private companies operating public services, such as corrections, might seek and acquire ownership of existing public facilities via cozy campaign contribution-related relationships between company and state officials.

Aggressive private companies might “elect” company-friendly school district board members who in turn could transfer ownership of public facilities and equipment to private operators as one of the terms in the contract.

Transparency and accountability in the use of tax money might disappear completely. Taxation without representation is already a fact in charterland and a decision in favor of White Hat Management would worsen the situation.

The privatization of education movement would be energized by a decision in favor of White Hat Management.

William Phillis
Ohio E & A

Ohio E & A | 100 S. 3rd Street | Columbus | OH | 43215

Jan Resseger reports here on Stephen Dyer’s astute analysis of Ohio’s state budget. Dyer is a former legislator who is now an Education Policy Fellow at Innovation Ohio.

This is Dyer’s report. Read it and weep. Ohio’s rightwing Republicans care more about campaign contributors than they care about the state’s students or the quality of education.

In looking at the plums for charters and vouchers, please bear in mind that most charter schools in Ohio are low-performing and score far below public schools, even in urban districts. And remember too that a study of Ohio’s voucher program sponsored by the rightwing Thomas B. Fordham Institute concluded that students who used vouchers actually lost ground academically. So, when you see legislators increasing funding for vouchers and reducing oversight of charters, be aware that Ohio is underwriting and rewarding failure.

Resseger writes:

In the 2020-2021 biennial Ohio budget signed into law in July, lawmakers quietly embedded the radical expansion of school privatization. Rewards for charter schools and tuition voucher expansion are written into the budget in a lots of little ways, however, which means that, during the budget debate, few noticed the overall significance of exploding state support for school privatization. A new report released last week by Innovation Ohio, however, connects the dots among several measures which together will undermine oversight of charter schools and at the same time radically expand tuition vouchers. The report includes an examination of the fiscal implications for local public school districts.

The former chair of the Ohio House Education Subcommittee of Finance and now Innovation Ohio’s education policy fellow, Steve Dyer authored the report, which ought to be essential reading for legislators and a broad range of citizens—from experts to people who have not previously tracked the issue. Dyer writes a basic primer and at the same time an analysis sophisticated enough to teach experts something new.

Dyer begins: “When Governor Mike DeWine signed HB166 into law, he approved a budget that lawmakers had packed full of little-noticed gifts to those who seek to erode support for traditional public schools through a proliferation of charter and private school options funded at taxpayer expense.”  Dyer explains that the new Ohio budget:

  • weakens Ohio’s 2015 charter school oversight law that mandated automatic closure for academic failure after two years;
  • weakens standards for Ohio’s already deplorable sector of “dropout recovery” charter schools;
  • weakens Ohio’s oversight of its many charter school authorizers; and
  • increases the transfer of state and even local taxpayer dollars to private—mostly religious—schools.

Read this summary of the state’s preferential treatment of failing charters and see if you can overcome an impulse to gag:

Although in 2015, the state cracked down on academically failing charter schools by mandating their closure after two years of failing test scores, the new budget awards these schools an extra, third year to stay in business. The new budget gives 52 schools which had been preparing to close another year of life. Dyer adds: “Interestingly, of the 52 charters that were scheduled to be closed under the old standard, 34 are run by for-profit charter school operators, including almost 20 percent of the former White Hat schools now being operated by Ron Packard—the founder of K-12 Inc.—the nation’s largest (and most notorious) online charter school operator. Another big operator set to take a hit was J.C. Huizenga’s 10 Ohio-based National Heritage Academies. Six of those were on the chopping block before the legislature offered a legislative reprieve. Huizenga is an acolyte of Betsy DeVos—the controversial U.S. Secretary of Education—and his political connections have kept his schools afloat for years, despite complaints….”

The new state budget also weakens standards at a set of charter schools described by their promoters as providing opportunity for students who have dropped out of school. While the education of school dropouts is a worthy purpose, in Ohio, the state has been providing millions of dollars of support for schools that clearly fail to accomplish that stated goal: “Some graduate less than two percent of their students in four years and less than 10 percent in eight years. The state’s already lax standards only require that dropout recovery schools graduate eight percent of their students in four years.”  Before they can graduate, students in these schools must pass a state-approved test, but the new budget permits these schools, “to adopt another, easier test, and reduces the passing score.” It is predicted that the change in standards will save some of these schools from mandatory closure.

Ohio’s legislature is either bought and paid for by privatization advocates (very likely) or it is dominated by ideologues who want to reward failure regardless of how many children are miseducated.

 

 

One of the most valuable sites online is KnowYourCharter in Ohio.

This post lays out the waste of taxpayer dollars gobbled up by charters.

Time to close the spigot of money going down the drain in Ohio, leeched away from public schools to fatten charter operators.

Ohio has long been a hotbed of for-profit charter schools.

While Ohio requires that all charter schools be technically non-profit, Ohio law permits these schools to hire for-profit management companies that come in and, in essence, run the schooland take control of the school’s taxpayer funding.

For-profit charter school operators have been at the forefront of Ohio’s array of charter school scandals. From White Hat Management’s long history of dodging scrutiny while maintainingpolitical influencei, to Imagine Schools’ boondoggle on school rent agreementsii to the collapse ofWhite Hat’s political successor, Altair Learning Management, that ran the Electronic Classroom of Tomorrow – the epic collapse of which was widely reported last year and continues to generate headlines even today. It was recently reported that not one of the more than 4,666 students enrolled in ECOT’s final year actually attended the schooliii. Yet Ohio taxpayers paid ECOT to educate those kids for half a year.

But long overdue change is in the wind. Ohio House Speaker Larry Householder told assembledmedia shortly after he took the gavel that “I know they are technically nonprofit, but that secondtier, those management entities, I believe should be nonprofit.”1

The Know Your Charter website has updated the state data found on the website so parents, students, officials and media can compare the performance of charter schools and local public schools and districts. As part of that new data release, the Ohio Charter School Accountability Project examined how the 178 Ohio Charter Schools run by for-profit management firms2perform and spend money compared with the costs incurred by local public school districts.

The results are eye-opening.

  • Schools run by for-profit operators spend a hefty $1,167 more per pupil than school districts on non-instructional administrative costs3.
  • That’s 73 percent more money per pupil being spent by for-profit operators outside the classroom than the typical Ohio school district4.

Bill Phillis, retired for many years as deputy state superintendent of education in Ohio and now the state’s most outspoken critic of charter fraud, writes on his blog about the Thomas B. Fordham Institute’s lame defense of for-profit charters:

“The myth of Ohio’s ‘for-profit’ charter school system”: A Fordham Institute’s damage control effort

An August 20 Fordham article suggests the charter industry is getting a bad rap because of the cronyism of a few charter operators. The article also attempts to justify the use of for-profit management companies by charter schools.

The notion proffered is that ECOT and the White Hat Management Company are the only bad actors in the charter industry. What about the 250 or so charter schools that took state and federal money and closed or never opened leaving kids in an education lurch? What about the other charter operations that have been reported as fostering gross irregularities, such as the Gulen charters, but not appropriately investigated by state officials? What about the Imagine Schools Inc. charter school chain that requires the charter schools to pay absurdly high rent to a real estate company allied with Imagine?

Corruption in the charter industry in Ohio and elsewhere is not confined to just a few bad actors. The industry is rife with low performance, cronyism and corruption.

In the article, the author equates a charter board hiring a management company to operate its school to a school district purchasing buses, books, etc. from the private sector. An absurd stretch!

A management company that operates charter schools performs a governmental fiduciary function and thus should be subjected to the same accountability and transparency measures as school district officials. Bus and book companies don’t operate the schools to which they sell products.

The Ohio charter industry seems beyond repair but Fordham keeps defending it.

Be it noted that the NAACP report on charter schools not only called for a moratorium on them, but called for the elimination of all for-profit charters and the for-profit management organizations that manage charters.

 

Now, here is a startling and welcome development. Dennis Kucinich, who is running for Governor of Ohio, has proposed a complete ban on campaign contributions by charter operators. If charter operators couldn’t give campaign contributions, they would not be able to buy legislators or other state officials. Since public schools can’t make campaign contributions, that would level the playing field.

Are the voters of Ohio sick of charter corruption yet?

Charter school officials would be banned from making campaign contributions under a sweeping plan unveiled today by Democratic gubernatorial candidate Dennis Kucinich.

The former congressman and Cleveland mayor also wants a statewide vote on a constitutional amendment that would allow local school boards to decide whether they even want charter schools, which are privately operated but funded with taxpayer dollars.

“Ohio public educational funding has been subverted by special interest groups and for-profit charter school management companies, who through campaign contributions have, in the past decade, normalized the privatization of public education funding, creating an often substandard, for-profit system ‘education’ system, using and misusing billions of dollars in public funds,” Kucinich said.

“The normalization of what is essentially a wholly corrupt system constitutes one of the greatest scandals in the history of the state of Ohio because billions of public funds have been diverted away from public education and have enriched private, for-profit enterprises.”

He pointed to the founder of ECOT, the online charter school forced to close last month, who gave hundreds of thousands of dollars to state lawmakers who enabled lax oversight and the diversion of money from local school districts to charter schools.

“Any local school board member, member of the General Assembly, or employee of the Ohio Department of Education who accepts any payment, gratuity, or campaign contribution with a value of more than one dollar, or any pecuniary benefit in excess of one dollar from the operator of a charter school or on behalf of such entities will be subject to forfeiting any state benefit, including salary and pension,” Kucinich said.

He said he will ask the legislature to return to the public election of all members of the state school board, which was the case from 1956 to 1996, when governors were given the power to appoint several board members. Ironically, just two days ago Gov. John Kasich pushed to allow the governor to choose the entire board, because voters have no idea of for whom they are voting.

Kucinich pledged to “shine a light on the corrupt system that allows millions of taxpayer dollars to flow into the pockets of profiteering private charter operators, and then, into the political campaign coffers of politicians, all at the expense of local taxpayers, Ohio’s children, and quality public education.”

His running mate, Akron City Councilwoman Tara Samples, worked as a paralegal and board liaison for White Hat Management, long one of the state’s leading charter-school operators under Akron industrialist and major Republican campaign donor David Brennan.

Former Congressman Dennis Kucinich, who may be thinking of a run for Governor of Ohio, launched a four-city speaking tour across the state, castigating the corruption in the charter industry at every stop.

Kucinich understands that every dollar that goes to a charter is taken away from a public school. He is the first politician who understands the shell game. Defund public schools while funding a dual system.


“Former U.S. Rep. Dennis Kucinich launched a four-city, anti-charter school tour in Columbus, Ohio on Monday, telling attendees at a press conference that “public education’s financial base is being destroyed by private, for-profit corporate interests.”

Kucinich, who served 16 years in Congress, was Cleveland mayor in the late 1970s, and ran for president in 2004 and 2008, plans to hold town hall-style forums across the state in Centerville, Columbus, Parma, and Elyria Monday through Thursday. He kicked it off by talking to reporters at the Ohio statehouse.

“When state revenue for public schools decreases because of money which goes to private for-profit charters, public school officials must make up the difference by asking local property taxpayers for more money,” Kucinich said. “It represents a deliberate, destructive undermining of the public education of Ohio’s children. What is our educational philosophy today? Let for-profit corporations exploit the mass of children by controlling the state government?”

“With that last line, he was referring to state legislators “who have accepted millions of dollars in campaign contributions from charter-school operators, notably William Lager of the Electronic Classroom of Tomorrow and David Brennan of White Hat Management,” according to the Columbus Dispatch….

According to a report released in advance of DeVos’ visit, since the 2012-2013 school year, $3,744,988 in state funding originally meant for children attending Van Wert County’s local public schools “has instead gone to privately run brick-and-mortar and online charter schools.” In turn, said the report from Innovation Ohio, “local taxpayers in Van Wert…have had to subsidize these larger state payments to charter schools to the tune of $1.4 million—money that should have supplemented the larger state aid amount but is now being used to subsidize poorer performing, privately run charter schools.”

Supporting Kucinich’s criticism, the report pointed out that indeed, “local property taxpayers in Van Wert County schools are paying $3 million more in property taxes in 2015 (the most recent available data from the Ohio Department of Taxation) than they did in 2013, which is increasing those communities’ reliance on property taxes to pay for education—a result deemed unconstitutional four times by the Ohio Supreme Court.”

According to a report released in advance of DeVos’ visit, since the 2012-2013 school year, $3,744,988 in state funding originally meant for children attending Van Wert County’s local public schools “has instead gone to privately run brick-and-mortar and online charter schools.” In turn, said the report from Innovation Ohio, “local taxpayers in Van Wert…have had to subsidize these larger state payments to charter schools to the tune of $1.4 million—money that should have supplemented the larger state aid amount but is now being used to subsidize poorer performing, privately run charter schools.”

Supporting Kucinich’s criticism, the report pointed out that indeed, “local property taxpayers in Van Wert County schools are paying $3 million more in property taxes in 2015 (the most recent available data from the Ohio Department of Taxation) than they did in 2013, which is increasing those communities’ reliance on property taxes to pay for education—a result deemed unconstitutional four times by the Ohio Supreme Court.”

A recent article in the Akron Beacon Journal raises the question of whether Ohio has the worst charter sector in the nation.

 

Reporter Doug Livingston delves into the charterindustry and what he finds is a nearly unbroken record of failure. Does anyone in the state government care?

 

He summarizes:

 

Ohio’s charter schools …

 

Drawing state dollars from local school districts, charter schools presented a cheaper, market-driven alternative to government-run schools.

 

■ Ohio law allowed for the first charter schools in 1998.

 

■ Nearly 40 percent of the 595 charter schools that ever opened in Ohio have closed. Financial difficulty is cited three times as often as academic failure. More than half the time, closure is voluntary, according to a state directory of shuttered charter schools.

 

■ Ohio’s charter schools rank among the lowest in the nation in advancing student learning.

 

He describes the intricate financing deals that enables charter operators to make a profit. Those who haven’t mastered the financing and political games are not likely to survive.

 

The financial transactions are complex:

 

“Through a public records request, the Beacon Journal reviewed hundreds of invoices, property lease and purchase agreements, vendor contracts, board minutes, court filings and other financial documents detailing how Cambridge spends much of the more than $30 million in state funding its managed schools will receive this academic year.

 

The paper also toured the company’s flagship school — Towpath Trail High School — and attended its latest board meeting to question the board and its legal counsel about their contract with Cambridge.

 

The company was born in 2012, founded by Marcus May, a former White Hat executive. Cambridge’s first three customers — dropout recovery high schools, like Towpath Trail, which is geared toward struggling 16- to 21-year-old students — had rebelled against White Hat after persistently low test scores and failing to get answers about how money was spent.

 

May saw unrest between White Hat and 10 schools over the next year as an opportunity. Without another company to help the breakaway schools acquire buildings and staff, “they would have drowned,” the schools’ attorney said.

 

May tapped friendships fostered through the years. School Warehouse, a Cincinnati business formed by Steve Kunkemoeller, a business associate of May’s, became the preferred vendor to furnish the schools. Most school boards sign no contract with School Warehouse, which holds a gentlemen’s agreement with Cambridge (enforced by May) to be the one-stop shop for all things furniture. The company serves as a middle man, marking up the price of desks and chairs in exchange for favorable financing terms that are hard to come by. Many banks, noting the high failure rate of charter schools, consider it too risky to lend them money. So Cambridge and Ohio charter schools find themselves turning to familiar faces or independent lenders that inflate interest rates to cover riskier loans.

 

Searching for vendors when the boards asked for bids, May took matters into his own hands. He founded Rearden Capital and d’Anconia Development to provide financing and line up private investors to purchase school property, often with an option for the schools to buy the property later.

 

“Rearden” and “d’Anconia” are the neoliberal protagonists in Atlas Shrugged, Ayn Rand’s ode to an unfettered free-market capitalism. Such is the philosophy May and others bring to public education.

 

For technology, a key component to deliver curriculum in dropout recovery schools, May turned to Suranjan Shome, who he met while launching a marketing firm named Mindgrab in the Akron Business Incubator. Shome built Epiphany Management Group (EMG) then bought May’s marketing firm. EMG now outfits Cambridge managed schools with technology.

 

Despite having an office in Fairlawn, the hub of activity for Cambridge is Towpath Trail at 275 W. Market St. May helped board members acquire and turn the old office building into a modern school. At the time of the property transfer, Donald Cureton, a board member at other Cambridge managed schools, was a part owner of the property through Bee Investments, according to records at the Summit County Fiscal Office.

 

A similar inside deal, involving unknown investors wrangled by May, was behind the purchase and opening of Wright Preparatory School in Canton this school year. The new Canton school board, which borrows members from sister schools, had no capital to buy the property. It turned to Cambridge, which called May for help.

 

These close-knit arrangements involving transactions that often lead back to May smack of self-dealing, so much so that a grand jury in Florida indicted School Warehouse and Newpoint Education Partners, May’s version of Cambridge in Florida, on charges of grand theft, money laundering and aggravated white-collar crime. A court filing details $40,000 in timed withdrawals and deposits that bounce between unknown bank accounts. The source and destination of the transactions remain a mystery as stakeholders in Ohio, including the schools’ boards, keep a close eye on the Florida case.”

 

 

 

 

 

 

 

A new study based on publicly available data on the state’s website finds that the state has wasted millions of federal dollars designated for charter schools. Of the state’s federally funded charter schools, 37% either never opened or were among the state’s lowest performing schools. Only recently, the U.S. Department of Education decided to award another $71 million to expand the charter industry in Ohio, but the new funding has been delayed because of outrage over scandals in the state’s charters. The study was conducted by the Ohio Charter School Accountability Project.

 

 
New Study Shows Millions Intended for High-Performing Charter Schools
Went to Some of Ohio’s Worst – and Others That Never Even Opened

 

 

For Immediate Release: May 26, 2106

 

 

COLUMBUS – The federal government has sent more money to Ohio to expand “high-performing” charter schools than all but two other states, but Ohio spent millions on some of the lowest-performing schools. And nearly $4 million went to schools that never opened, according to a new analysis.

 

 

The Ohio Charter School Accountability Project did the analysis to determine how a state with so many of America’s worst-performing charter schools could be in line for so much federal money intended to help the best ones.

 

 

Ohio ranks third nationally in total money received during the program’s 21-year history. During that time, the U.S. Department of Education did just one assessment of the grants’ success in Ohio. Although it raised serious questions about the Ohio Department of Education’s ability to properly distribute the money, nothing appears to have changed as a result.

 

 

“As Ohio takes steps to make charter school sponsors more accountable under the reform law passed last year, it’s important that policy makers understand the past,” said OEA President Becky Higgins. “Together with our colleagues at Innovation Ohio and ProgressOhio, we examined how these Charter School Program (CSP) grants have been awarded, and tried to identify the shortfalls along the way. Ohio cannot afford to waste money on failing charter schools. It needs to invest in the good ones.’’

 

 

The new analysis, Belly Up: A Review of Federal Charter School Grants, shows how state and federal education departments ignored warning signs, systemically wasted tax dollars and made learning more difficult for many Ohio students.

 

 

Among the main findings:

 

 

· Of the 292 Ohio charter schools that have received federal CSP funding since 2006, 108 (37 percent) have closed or never opened, totaling nearly $30 million. Meanwhile, barely 2 percent of all companies nationwide that have received any federal grants or incentives since 2000 have failed.

 

 

· The Ohio tally includes 26 charter schools that received nearly $4 million in CSP funding but never opened. There are no records to indicate whether any of these public funds was returned.

 

 

· Ohio charters that received past CSP funding and State Report Card grades in the 2014-2015 school year had a median Performance Index score that was lower than all but 15 of Ohio’s 613 school districts.

 

 

· Since the federal grant program began 21 years ago, its lone assessment – conducted by WestEd – identified material weaknesses that appear to have been ignored by federal grant makers. In one instance, a potential grant reviewer even told the Ohio Department of Education that she was unqualified for the job and asked to be excluded from its reviewers’ list. Instead, the department thanked her for “agreeing to participate as a community school grant reader.”

 

 

· Paolo DeMaria, recently appointed Ohio Superintendent of Public Instruction, was Associate Superintendent of Finance and School Options at the time WestEd raised concerns about Ohio’s processes for distributing the federal money to charter schools.

 

 

Of the 44 Ohio charter schools where State Auditor David Yost conducted surprise attendance audits recently, 17 had received federal CSP funding. One of them – the London Academy – only had 10 of the 270 students ODE thought it had in attendance the day Yost’s investigators showed up. All told, these audited schools received about $6.6 million in federal funding.
Last September, federal officials stunned education experts by announcing that Ohio would receive $71 million in CSP grants – more than any other state. Ohio’s large award came in spite of its reputation as one the worst charter states in the country, according to national charter advocates. The swift and severe criticism that followed prompted USDOE to put Ohio’s award on hold.

 

 

“We urge federal regulators to revamp the way in which it makes grants so that the money goes to the best performing charter schools,” said Innovation Ohio President Keary McCarthy. “The mistakes of the past should not be repeated in the awarding of future grants.”

 

 

Those mistakes include giving millions to the state’s most notorious charter school scofflaws, including:

 

 

· Horizon Science Academies and Noble Academies: Total CSP Grants: 7.6 million

 

 

Linked to a Muslim cleric exiled in Pennsylvania, the chain is the subject of an ongoing FBI investigation, and WikiLeaks revealed cables showing the U.S. State Department notified the CIA about suspicious visas for teachers and administrators. In June 2014, 19 of its schools were raided by the FBI, including four in Ohio. The Ohio schools also have been dogged by allegations of test-tampering, teachers using racial slurs in the classroom, unqualified teachers, sexual misconduct in the classroom. ODE investigated allegations raised by teachers who witnessed the problems but found no wrongdoing.

 

 

· Imagine Schools: Total CSP Grants: $5.9 million

 

 

The chain has been under fire nationally for saddling schools with exorbitant leases paid to its subsidiary, SchoolHouse Finance. Imagine recently lost lawsuits in Indiana and Missouri over the same type of abusive leases seen in Ohio. A federal judge in Missouri ordered Imagine to pay $1 million and called the lease arrangement “self-dealing.’’ One of the chain’s worst-performing Ohio schools, Romig Road in Akron, is among the charters that closed – but received federal grant money. All of Imagine’s Ohio schools received a D or F on the most recent state report cards.

 

 

· White Hat Management: Total CSP Grants: $1.4 million
Owner David Brennan has been the most powerful and influential of Ohio’s charter school operators since state money started flowing to them. Brennan’s schools also are routinely among the lowest performing. While Ohio’s historically lax regulations make it difficult to close even the worst schools, several of Brennan’s schools have been shut down for academic reasons or contractual non-compliance. Staffers for GOP state Auditor David Yost made surprise visits to charters to see if they are padding attendance records and concluded that White Hat’s dropout recovery schools were among the worst.

 

 

It’s been well documented that ODE’s grant application for the $71 million was inaccurate and misleading, prompting state officials to revise the number of poor-performing charter schools in Ohio from six on its initial application to 57 – a tenfold increase. The author of the application, David Hansen, was forced to resign as head of ODE’s office of school choice and community schools after getting caught illegally cooking the state’s accountability system to benefit Ohio’s politically connected eSchool operators.

 

 

It is unclear when or if federal regulators will release the $71 million.

 

 

The Ohio Charter School Accountability Project is a joint venture of the Ohio Education Association, Innovation Ohio and ProgressOhio. OEA and IO host the website, knowyourcharter.com, which provides data from the Ohio Department of Education on how the state’s charter schools are faring compared to local public schools.

 

 

For More Information, contact:

 

 

Stephen Dyer, Innovation Ohio Education Fellow, 330-338-1486
Keary McCarthy, Innovation Ohio President, 614-425-9163

Bill Phillis of the Ohio Equity and Adequacy Coalition reports on a court case that would relieve charter corporations of any obligations to pay property taxes.

 

He writes:
“Case before the Ohio Supreme Court: Is a non-profit real estate company that leases property to a Dayton charter school and is owned by a charter school corporation eligible for a property tax exemption?

“The tangled web of Ohio charter school policy is fertile ground for the weeds of inefficiencies; crafty, convoluted and intertwined contracts; corrupt financial arrangements and duplication of programs and facilities.
“Recently, the Ohio Supreme Court ruled that White Hat Management, an operator of charters, owns the publicly-funded physical assets of the charter operation. Now, a charter operative wants the Court to grant the bonus of a property tax exemption for property leased to a charter.
“The Court will hear this case (250 Shoup Mill LLC v. Joseph W. Testa, Tax Commissioner of Ohio et. al.) on April 19. Public school advocates will be very interested in the decision.
“The Ohio charter school experiment, that was supposed to be an incubator of innovation and creativity, continues to waste tax dollars on mostly poor-performing charters. The charter plaintiffs in the 250 Shoup Mill case seek to compound the harm to taxpayers by a request to shift their tax burden to other taxpayers.”

 

Is there any doubt that a court that would turn over real property purchased with public funds to a private charter entrepreneur would give charters property tax relief?
William Phillis
Ohio E & A

 

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After a year or more of wrangling, the Ohio legislature finally approved a bill to reform their scandal-ridden charter schools.

The bill passed with bipartisan support. Even charter school critics endorsed the changes.

The report in Cleveland.com says:

As we reported yesterday, the bill makes several small changes that, as a whole, will tighten operations of the $1 billion charter school industry that lags behind traditional public schools and is the subject of national ridicule, even from charter school advocates.

Among items adjusted or added to the final version on Tuesday are a “White Hat rule” that prevents private charter operators from keeping equipment bought with state tax money; a cautious approach to study, not adopt, a new way of rating schools; and modest adjustments to how ratings of charter school oversight agencies are calculated.

Still intact, with only minor adjustments, are changes designed to distance the often-cozy relationships between for-profit charter school operating companies and the school boards that govern the schools.

Charter supporters realized that the outrageous profiteering of a few well-connected charter founders had created a massive embarrassment for all the charters. In addition, charters are among the lowest performing schools in the state.

The Fordham Institute was a major player in developing the law, partly through its sponsorship of two studies that informed the debate — analysis of the academic performance of Ohio charter schools by Stanford’s Center for Research of Education Outcomes (CREDO) and a separate study by Bellwether Education Partners of what gaps Ohio had in its charter laws and support system.