Wednesday, August 8, 2018

Ohio Supreme Court: ECOT can't get money for kids it doesn't educate. Really.

Well, like all courts before it, the Ohio Supreme Court came to the pretty common sense conclusion that the Electronic Classroom of Tomorrow should have to prove it's actually educating kids before taxpayers pay them to educate kids.

Really. It took an Ohio Supreme Court ruling to establish the pretty common sense idea that eschools should have to prove they are educating kids before taxpayers pay them in Ohio.


Here is the core of the Court's ruling that was handed down this morning. I remind my friends outside of Ohio that the fact the state's highest court had to write this sentence indicates just how far we need to come on eschool policy.
"We determine that R.C. 3314.08 is unambiguous and authorizes ODE to require an e-school to provide data of the duration of a student’s participation to substantiate that school’s funding."
What's more amazing is this: Two of the court's 7 Justices ... disagreed!

Ohio Supreme Court Justice Terrence O'Donnell speaking at ECOT's
2013 graduation ceremony. He was 1 of 2 Justices who ruled today
that ECOT should be paid to educate kids it couldn't prove it
was educating
Two Ohio Supreme Court Justices said it's fine for taxpayers to pay ECOT to educate kids it can't prove it educated. But we are living in Ohio. Oh, and does it surprise anyone that one of those two was Justice Terrence O'Donnell who spoke at ECOT's 2013 graduation -- in his Justice's robes no less -- and bragged about how ECOT founder and massive campaign contributor Bill Lager had a direct line to his office?

I digress.

But there are very interesting tidbits in the dissent. For example, it explains over and over again that when the Ohio General Assembly established the state's charter school system, it never intended for the Ohio Department of Education to figure out whether kids going to these schools were actually being educated in them. I swear. That's what the dissent said.
"It is telling that the legislature addressed many of the concerns motivating this litigation—i.e., that e-schools should have to maintain records documenting student participation—without expressly linking state education funding to the duration of online participation."
The dissenters are correct here: It is telling that the Ohio GA wouldn't tie any of this to funding at e-schools. In fact, it's pretty clear that the reason ECOT was ever held to account wasn't because of the Ohio General Assembly, or the Ohio Auditor of State, or the Ohio Attorney General. It was because the Ohio Department of Education asked ECOT a very simple question: Prove you're educating these kids.

When they couldn't, ODE asked for taxpayer money back.

Did ODE have statutory authority to do that? The Ohio Supreme Court ruled today that it did. But don't misconstrue this. The reason the court let ODE do this was because of common sense. As Chief Justice Maureen O'Connor said during oral arguments when ECOT claimed that the school should be paid even if kids enrolled there do no work: "How is that not absurd?"

But the dissent makes a good point, and lays bare one of the core issues with Ohio's highly political eschool policy: The politicians who have taken money from ECOT founder Bill Lager and OHDELA founder David Brennan for more than 20 years created a system where those two guys could be paid billions of dollars and never have to educate a single kid.

Absurd as it may be, that is exactly the system Ohio's politicians set up for their contributors.

And it is a system that finally may be changing as its absurdity is revealed and those enablers begin to be held to account.

Wednesday, July 11, 2018

Did State Policymakers Create Fund that ECOT Used to Pay Students to take Tests and Attend Graduation?

There's been plenty of justifiable outrage over the news that the Electronic Classroom of Tomorrow used taxpayer money to pay $25 to $50 for students to take state-mandated tests and attend its much ballyhooed graduation ceremonies, which often had powerful state politicians speaking.

However, missing in the reporting has been this little nugget: In the 2015 budget, for the first time ever, Ohio e-schools like ECOT were granted $25 a student for "facilities funding" -- funding e-schools still get, by the way. You might wonder what a school whose hallmark is that it's not in a building gets money for buildings like schools that are actually housed in buildings.

And you'd be right to wonder.

Here's what the Ohio Alliance of Public Charter Schools -- who in 2015 was the largest charter school advocacy group -- said about this change in 2015:
"Also provides a first time supplement for E-schools in each fiscal year of $25 per-pupil to aid with testing and counseling centers"
So the money was to be used to assist with finding testing and counseling centers.

That $25 sure matches with ECOT's policy to pay students $25 to take tests, doesn't it? So perhaps ECOT was simply taking the path the state legislature, who relied on campaign funds from ECOT founder Bill Lager, cleared for them with this crazy facilities funding.

Since it was passed, ECOT collected $873,281 in facilities funding. How much of that do you want to bet ended up paying for kids to take tests or attend graduation?

It was stunning, frankly to see in NBC 4's report that Ron Packard -- who has a history of funding some pretty smarmy stuff -- now says he's offended ECOT made these payments. But let's not kid each other here: the state legislature who was so dependent upon Lager's political largess did him a solid by kicking him $25 a kid for "testing facilities", which it looks like ECOT simply turned into money for students to take tests all kids in Ohio are required to take.

Imagine if a local public school district had done this. Imagine the frog marches for that district's public officials. Amazing.

Friday, June 8, 2018

The ECOT Myth that Won't Die: Money Following the Child

In the devastating aftermath of the criminal ECOT scandal, many charter proponents are saying it's not quite as simple as saying that $591 million left school districts for ECOT. That's because (as the myth goes), the district didn't have to educate those kids, so wasn't that a savings?

In a word, "No it is not." I guess that's four words. But whatever.

See, here's the thing. Generally, if kids leave a district for ECOT, the district still has the same fixed costs. They run the same number of buses to the same areas. They operate the same number of buildings. They still have the same number of teachers. They still need the same number of lunch ladies and secretaries. The costs for the district simply do not disappear because ECOT took a kid from the district.

However, they will, on average, have $7,288 fewer in state money to educate the kids who remain.

Where this may get complicated is in districts that lose a lot of students to ECOT. But even in these districts (like Columbus, for example), those students are spread across 12 grades. So Columbus may lose, perhaps, 10-12 teachers across the district to accommodate the 1,500 lost students (because those kids aren't all in one class or something). However, the other fixed costs remain the same. Same lunch ladies, buses, etc. So ECOT takes about $10 million a year from Columbus. Columbus does not realize a $10 million savings from that deduction. Maybe $1 million of that is reduced teaching staff. But the remaining costs are exactly the same. Period.

As Columbus School Board Member Dominic Paretti put it: if ECOT hadn't taken all that money from Columbus, the district would not have needed to go for its last two new money levies.

In the overwhelming majority of districts that lost money to ECOT, there were zero staffing impacts. So you have the same number of teachers, lunch ladies, buses, etc. with far less state money to do it.

The bottom line is this: Even if the "savings" were actually there, which they're NOT, but let's assume they are, it's not beneficial for districts. Because ECOT got about $3,000 more per pupil from the state (on average) than the district would have received for the same student, local districts have to use substantially more local revenue to cover those fixed costs that remain, even if the ECOT student doesn't. That means the districts become more reliant on local property taxes to pay for schools. This is unconstitutional. The Ohio Supreme Court has ruled that way four times.

Claiming that districts somehow benefit financially from having to go for more frequent and sizable property tax levies is simply not true. So don't let anyone claim it is.

Thursday, May 24, 2018

ECOT: The Scandal of All Time

I've been off for about a week. And what a week it's been. ECOT has officially become a criminal investigation. Formerly supportive Republican legislators can't give back their ECOT money fast enough, yet some remain stubbornly reluctant to do so.

In the meantime, the media have correctly identified ECOT and its more than $1 billion boondoggle as a crippling political albatross firmly wrapped around the Ohio GOP's neck.

Added to this is the outrage of the ostentatious auction of former ECOT personal property (including an outrageously opulent chair for founder Bill Lager to sit upon like a throne).

But there is one bit of misinformation floating around out there that I want to address and (hopefully) squash right away. And that is the idea that because Ohio Democrats were in charge of the Governor's mansion and House of Representatives in 2009 and ECOT continued to operate that somehow Ohio Democrats aren't clean on this scandal.

Since I was actually there during the 2009 budget process and was intimately involved, I thought I should clear up some things about what happened about 10 years ago.

It's very simple. Gov. Strickland's budget that year called for a 70 percent cut for Ohio eSchools. That's right. If Gov. Strickland's budget had passed unamended, ECOT funding would have been cut by 70 percent, effectively ending the school 10 years before it actually shut down, which would have saved Ohio taxpayers about $700 million that went to the school since then. Not to mention the lives of thousands of students ECOT failed to graduate.

By the way, of the 3,794 students who actually did graduate ECOT the first year of the 2009 budget, only 109 have college degrees today. Just by way of reference.

However, Ohio Republicans still controlled the Senate during the 2009 budget. I was in those budget negotiations and I can tell you that we were told in no uncertain terms that if the 70 percent cuts stayed in the budget, there would be no budget for the 2009 session -- severely crippling Ohio's potential economic recovery from the Great Recession.

Don't believe me? Here's what he Ohio Association for Public Charter schools said at the time about the ultimate budget package (which did pass with ECOT funding restored, in exchange for our economic recovery and the implementation of the Evidence Based Model of school funding that put us on the path to a constitutional school funding system for the first time in our state's history):
“The Ohio Alliance for Public Charter Schools is deeply grateful to policy-makers – particularly the Senate Majority leadership team – for preserving charter school funding.”
The next year, 2010, I was up for re-election. A shadowy group spent about $500,000 to defeat me. It was funded by eSchools like ECOT, who funded my opponent that year, Todd McKenney. Their tactics were so outrageous (harassing my family and 5-year-old son at his Trick or Treat trail, for example), the New York Times profiled them.  If we went so easy on eSchools, why was I targeted when, ostensibly, I restored their funding?

Because ECOT and other eSchools knew that I and others like me were onto their scam -- a scam that was allowed to grow exponentially under Gov. John Kasich (who spoke at ECOT's graduation in 2011) until the Ohio Department of Education started asking very basic questions about ECOT's enrollment in 2016 and 2017.

So please, pile on all you want. But do not for a second believe that we didn't try to fix the ECOT problem 10 years ago. Because we did. And Senate Republicans were willing to jeopardize our state's economic recovery, not to mention the funding for the 90 percent of Ohio students not in charter schools, to save this horrible school.

Wonder if they regret that stance today, given the scandal's mushrooming scale?

Monday, April 23, 2018

ECOT: Now it's criminal. Literally.

Mens Rea.

I believe it was the first (or one of the first) legal terms of art I learned in law school. It means "state of mind." In other words, in order to commit a crime, you have to have the proper state of mind to fit the requirements of the crime.

Why do I bring this up now? Because it now appears that we have a smoking gun indicating that officials at the Electronic Classroom of Tomorrow formed the necessary mens rea to be charged with crimes.

According to an Associated Press story today (which ran all over the place, but I'll link to my former employer's version), people at ECOT -- at one point the largest single school in the nation -- were ordered to deliberately inflate enrollment so the school could keep getting paid $100 million plus to "educate" children, even if those children weren't actually at ECOT.

ECOT infamously did a remarkably poor job of educating those who were, by the way. How poor? Only 109 of 3,794 ECOT graduates from 2010 earned a college degree within 6 years of graduating. But I digress.

Back to the school's potential crimes.

According to the whistleblower who made this claim and worked for the software company that handled enrollment for ECOT, "school officials ordered staff to manipulate student data with software obtained following the state’s demand that it return $60 million in overpayments for the 2015-2016 school year."

That's right. ECOT was so arrogant that it ordered people to artificially inflate enrollment ... after the state had fined the school $60 million for inflating enrollment.

That's right. No question what the offenders' states of mind were. They knew it was wrong. They had been fined for doing it the previous year. And they did it anyway. Imagine what they told people to do before they were caught???? (Though, technically, they were caught in their first year of operation and on several other previous occasions, but not for as much money.)

Why the arrogance? Because ECOT's founder, Bill Lager, and other employees had invested $2.8 million in Ohio politicians since they started operations in the 2000-2001 school year.

Current Ohio Secretary of State and Lt. Gov. Candidate Jon Husted receives only known honorary degree from ECOT as Ohio Speaker of the House in 2007. Husted was one of several prominent Ohio Republican politicians who spoke at ECOT's graduation ceremonies, including Gov. John Kasich, Ohio Auditor David Yost, disgraced House Speaker Cliff Rosenberger and Ohio Supreme Court Justice Terrence O'Donnell. 

It wasn't that long ago that people went to prison for inflating enrollment figures at Columbus City Schools. What do you want to bet that the politicians who have taken a bunch of money and kudos from ECOT will do the same thing to that school's officials?

The taxpayer money involved here, if the enrollment overinflation that's been found over the last couple years is extrapolated over the course of ECOT's entire lifespan, is north of $500 million. By way of comparison, the infamous Coingate scandal from 2005-2006 ended up costing taxpayers about $50 million.

So ECOT and Lager's ripoff could be 10 times that of Tom Noe, who spent about 2 years in federal prison.

Now that we have insiders spilling the beans on the real mission of ECOT -- making money by ripping off taxpayers -- ECOT's top bananas certainly seem much closer to taking a trip up the river.

Because we now know their state of mind.

And it sure seems criminal to me.

Wednesday, April 18, 2018

I guess Ohio's A-F Report Cards weren't that great after all

When Ohio switched to a new A-F report card system in the 2012-2013 school year, much was made of how wonderful it was.

Here's what the Ohio Department of Education said about them, veritably gushing over the Education Commission of the States' awarding the system its highest marks:
"We released the new A-F report cards with the idea that they would be easier to understand, and provide more information to both parents and educators,” ODE spokesman John Charlton said. “This report kind of validates our efforts so far, as we continue to work on this report card. The real winners are the students in Ohio. They’re going to benefit from the information in that report card, whether it’s their parents using the data, educators using it, or whether the students are looking at it themselves.”
Folks from the education reform community claimed it created a more understandable system (because, apparently, parents couldn't decipher the words "excellent with distinction", "excellent", "effective", "academic watch" and "academic emergency"). Here's how the Fordham Institute described the new report cards:
"The Buckeye State’s new A-F report card is a wonderful opportunity for parents to gain a better appreciation of how their child’s school is doing, and to take action if necessary."
But I was concerned because the new A-F system was even more reliant on test scores than the previous system. And test scores are nearly perfectly correlated with poverty rates, not educational excellence. Here's what I said after the first batch of report cards came out:
"The new Report Card is based largely on standardized tests, which are tremendously influenced by demographics. Under this new system, a building and district's ratings are even more dependent upon their demographics than the prior system, which was pretty well dependent upon demographics as well."
So imagine my surprise when a new House Bill 591 appears and does away with Ohio's much-lauded A-F report card in favor of one less influenced by test scores. I should be excited, right? Not so fast. See, here's the thing.

It would keep the A-F report card for consequential actions -- the very things that make these A-F grades so high stakes, problematic and consequential for schools, districts, parents and kids.

What's "consequential" mean? Oh, whether a district is low performing enough that a charter school can come in. Or kids qualify for private school vouchers. Or whether a charter school closes. These -- and other things -- will all still be determined by a district or school's rating on the hated A-F report card.

And the bill eliminates several transparency reports about how schools spend money and how they educate kids. One of the things Ohio does better than nearly every other state is produce meaningful and copious data points.

Other than that, though ...

Look, I appreciate the effort to undo this misguided report card. As sponsor Mike Duffy, R-Columbus, put it, "nobody likes the current Ohio school district report card."

So why won't he just do a simple bill to get rid of the current system, replace it with a more rational system and go from there? Why would he let this system he admits everyone hates continue holding its dangerous grip on students and schools?

Again, these problems were all pretty predictable from the time the A-F report card was implemented. Yet folks couldn't stop fawning over the brilliance of turning five "grade" levels into the familiar A-F scale from the less familiar Excellent with Distinction, Excellent, Effective, Academic Watch and Academic Emergency system.

Now everyone hates it.

I'm not one to say, "I told you so."

But, well ... you know.

Monday, April 2, 2018

Do Charters Spend More than Districts, Or What Do Medians Mean?

I try to steer clear of mumbo jumbo on this blog. I wish to simplify rather than complicate already dense, complicated topics. But when it comes to expenditures in charter schools and school districts, it matters whether you know what medians and means are. So please indulge a little nerdification here.

For those who need a refresher, means are averages. Medians are midpoints among a range of numbers. So, for example, the median of 1,2,3,4,5 is 3. The average of 1,2,3,4,5 is also 3. However, when there is a lot of variation in the numbers, averages (or means) can be thrown off. Sometimes to a great degree. So, for example, the mean of 1, 2, 3, 4, 3,000,000 is 600,000. The median remains 3, which is a much more accurate way to describe a typical number in the series.

So when you have a series of numbers with wide variations, you generally want to use medians because they answer the question of what is the "typical" number. If you don't have much variation between numbers, generally averages work better.

Which brings me to the question of which schools spend more in Ohio, charter schools or school districts. These two charts will tell you both, depending on whether you want to use medians or means.

 The graphic on the left shows the median expenditure per pupil for each school type. You'll see that generally, Ohio school districts spend a few hundred dollars more per pupil than charter schools.

The chart below the median chart shows that on average, charter schools spend more per pupil than Ohio school districts.

So, what gives and which numbers matter most in determining this issue?

Well, as you can see, the average per pupil expenditure varies wildly in charter schools, likely due to the much greater variation in their financial reporting competence than anything else. For example, in the 2013-2014 school year, the largest per pupil expenditure in charter schools was more than $1 million, which probably wasn't accurate. The largest per pupil expenditure in a school district that year was a little more than $20,000 (a tiny Lake Erie island district was over $30,000). So the variation among school districts was much smaller than the variation in charters that year. And pretty much every year since.

Except for this past school year of 2016-2017.

The variation between the highest and lowest spending charter school last year was $36,000 -- not far off from the school district variance of $24,000. In the 2013-2014 school year, the reported variation in per pupil spending at charter schools was $1.4 million. And even if you discount the handful of charters who likely erroneously reported spending more than $100,000 per pupil, the difference remained well north of $85,000.

So that means in order to be fair, you had to use medians to express what a "typical" charter or district spent to account for those variations. Which means charters spent less per pupil than districts. This year, though, there's a real question if using averages now is fair game. Because the wild variations in charters aren't there anymore.

In other words, the "typical" and "average" charter school are becoming far more similar than in the past.

Why does all this matter? Because we were told (and have been told) again and again that charter schools and the private sector that drives them perform the same or better academically at lower cost than Ohio's local public schools. And charter school advocates are now saying they need more money because they can't spend what they need to spend in the classroom.

Yet Ohio's charter school sector overall spends about the same and performs far worse. Even if you want to look at medians, is the few hundred dollars' savings worth the far worse graduation rates and worse overall academic performance in charter schools?

Again, this is not saying we should eliminate all charter schools. But we should take a hint from the earlier discussion of means and medians. If there are so many poor performing charter schools and a relative few high performers to skew overall performance and cost, shouldn't we eliminate the poor performers so the high performers can thrive?

The ECOT closure is a good start toward making Ohio's charter school sector more reflective of the ideal market-based education model that's focused on quality rather than enrollment, real or imagined.

Yet we still fall short of our kids and families who want options but are instead duped into believing a few slick brochures and smooth talking sales pitches selling them on the idea that choice rather than quality should drive their children's education. It is the quality of the option that should drive the choice. And it is up to policymakers to ensure that quality is what drives their desire for more educational options.

Because that whole "better and cheaper" argument for charters? In Ohio, that dog don't hunt.