Keep Your Eye on the School Funding Ball

As you begin hearing more about the Patterson-Cupp committee's proposals for fixing school funding -- ideas that as of now hold much promise -- I want to make sure everyone is aware of what funding numbers matter as we consider future funding levels.

There are several pots of state money that go to schools. The largest is from the state's General Revenue Fund (GRF). The next largest is the Lottery Fund, which has been a problem since the beginning because all that fund did is allow state lawmakers to cut GRF funding and replace that cut with lottery money. Lottery money doesn't increase commitment to education; it just changes what percentage of that money comes from the GRF.

However, there are others that used to not be considered part of state funding, but now are (for reasons I'll explain in a bit).

The first is Property Tax Relief. This is state money that has been set aside to offset property taxes since the income tax passed in the 1970s. The deal was if schools supported the income tax, a portion of it would be used to reduce local property taxes. That's why Ohioans have, in the past, only paid $0.875 cents for every $1 of property tax raised.

However, in 2013, Gov. John Kasich eliminated this property tax relief on all future, new money levies. So while Ohioans continue to pay about 88 cents on the dollar for old and renewed levies, for new ones, they pay the full freight.

Whenever this pot of money has been used by governors to claim that the state provides about $1 billion in school funding through property tax relief, it generally has been dismissed by any serious Ohio school funding analyst. Why? Because that money doesn't go directly to school districts and kids; it goes to property taxpayers (who don't even notice the property tax cut is there, if they even know it exists at all).

The next big pot is reimbursements for Tangible Personal Property (TPP) and Utility (KWH) taxes. Prior to 2011, this payment also wasn't considered part of state support for public education, for much the same reason as the property tax relief. The reimbursement payments were created to get the support of schools during the massive tax reform included in 2005's House Bill 66. One of the reforms was eliminating the taxes on tangible personal property, or inventory. This hammered our traditional manufacturing plants, who invested heavily in equipment and inventory. However, the locally derived tax provided sometimes substantial revenue to schools and kids, so eliminating it would cause a huge cut to kids in many school districts.

So when the state created the Commercial Activity Tax (CAT) to replace TPP, the deal was it would make up for the lost TPP revenue with CAT revenue. And that was how schools ended up being OK with losing TPP. The idea was eventually that reimbursement would be replaced with something else, but until then, the state would uphold its word to schools and make the payments. So because this was simply a state reimbursement, school funding analysts also didn't count this payment as state support because the state chose to eliminate locally derived revenue with a state figure.

Until 2011.

That's when Gov. John Kasich eliminated the TPP and KWH taxes (gradually), all but eliminating what had been a $1.2 billion line item in the 2010-2011 school year. So now local districts lost state funding, so TPP and KWH reimbursements were now considered school funding cuts (as they would have been in 2005 if the state hadn't agreed to the CAT payments).

Finally, during the 2009-2010 and 2010-2011 school years, the federal stimulus gave Ohio about $450 million a year (on average) to help make up for lost state revenue due to the Great Recession. The idea was states would replace the stimulus money with state money once revenues returned post-Recession. So because this money flowed through Ohio's school funding formula, it's been considered part of the state's school funding commitment.

This is a long-winded way of getting to the issue: Beware of state leaders who claim that certain pots of money should be included as part of the state's school funding commitment, for comparison's sake.

I mention this because the Ohio Department of Education has produced a truly misleading graphic on its website (which I have posted at left) dubbed "Primary and Secondary Education Funding FY 2009 - FY 2019". In it, they try to show that Ohio's greatly boosted school funding during the last 8 years. While the political implications of that timeline are obvious, I'll just discuss the policy problems with their assertion.

First of all, the period is long enough that inflation matters.

For example, according to the Bureau of Labor Statistics, a dollar in 2009 is worth $1.16 today.

In addition, it includes the property tax reimbursement as state education funding -- a figure that the vast majority of analysts would never include because it doesn't go to kids; it goes to adults who are property taxpayers.

Finally, the amount includes Lottery money, which is OK, except the amount has increased by more than 50 percent. Why? Because of VLTs and other gambling opportunities that have increased since 2011.

So if you wanted to look at money that went directly to kids (and didn't supplant GRF the way the lottery does), then you need to look at GRF, TPP reimbursement and stimulus. Those are the funds that directly fund schools.

When you do that, and build in the inflationary adjustments for each year, you'll see quite a drop in state funding for Primary and Secondary Education since the 2009-2010 school year -- $863 million, in fact.

Even if you include all the so-called funding pots ODE includes, it's a $664 million inflationary cut to Primary and Secondary Education.

Which points out the challenge for Reps. Patterson and Cupp. In order to keep pace with the Great Recession spending on education, they have to boost funding by nearly $1 billion. And they have to do it with a new Governor whose only stated K-12 initiative was to boost some poverty funding and provide a more "equitable system" (the problems with equity minus adequacy, I've discussed before).

But that doesn't mean what these state reps are doing isn't important. What it does mean is we citizens must insist that the rest of the state's leadership follows through on their good work.

And above all, it means that we all keep our collective eyes on that pesky school funding ball.

Brenner School Funding "Fix" Gets Courtesy Hearing

Within the first couple months of the 2017-2018 legislative session, state Rep. Andrew Brenner, R-Powell, introduced a new Ohio school funding plan.

As chairman of the House Education Committee, people logically thought this might be a serious attempt to fix Ohio's long-broken school funding system. And while I pointed out how absurd the plan was -- essentially giving huge influxes of cash to privately run charter and largely religious private schools while cutting funding to most local public school districts -- the plan's introduction was treated seriously be many in the media.

However, the bill -- HJR 3 -- had zero co-sponsors.

Not a one.

I thought that would be a big tell about this plan's viability and quality.

Then, in an embarrassing rebuke of the House Education Chairman's authority, the bill was sent to the House Finance and Appropriations Committee, not Brenner's committee. School funding bills should generally go to finance. But out of respect for the committee chair, one would think his big school funding bill would be sent to his committee.

Yet it wasn't.

What does all this inside baseball mean?

Well, it means that instead of being able to talk about his school funding plan for nearly two years in his own committee, drumming up support, Brenner will be given a single hearing tomorrow in the Finance committee -- a hearing that's required by House rules for all pieces of legislation filed prior to July of even years. Even the crazy bills that have zero chances of passing.

So the House Education Committee Chairman can only get a single, required hearing for an overhaul of the state's school funding system, which has been declared unconstitutional four different times.

That, my friends, is a legislator with zero clout.

Data Suggests Far Worse Fake Student Problem at ECOT

New state funding reports indicate that ECOT had nearly 8,000 fake students in its last full year of operation. According to the Ohio Department of Education, its last year of operation, ECOT couldn't account for about 20 percent of its students. However, the monthly finance reports ODE puts out suggests the number may have been closer to 55 percent.

First of all, the last year ECOT was fully operational was in the 2016-2017 school year. So I'm using that as a baseline for comparison.

In the 16-17 school year, ECOT received $103.6 million for 14,208 students. This year, it's zero dollars. A lot of news stories have tried to figure out what happened to all those students. One of the challenges appears to be that they may not have actually had all those students.

Follow me here.

Looking at the changes in charter school funding and enrollment between the 16-17 year and the most recent funding report available from the Ohio Department of Education from this month shows that Ohio e-school enrollment is down 9,851 students. However, enrollment in Ohio's brick and mortar charter schools is up 2,060 students.

So overall enrollment in Ohio's charter sector is down 7,791 students.

Assuming the vast majority of those students came from ECOT, perhaps those 7,791 students may not have actually ever been there.

Why?

Because school district enrollment is down 21,860 students from 2016-2017. If those 7,791 students returned to school districts -- the most likely landing spot -- one would expect school district enrollment to have showed an increase. But it's dropped a good deal.

To be fair, without seeing actual head counts, it's tough to explain why. Was there a big graduating class in Ohio school districts in 2016-2017 that would help explain this?

ECOT graduated about 2,000 students in 2017, but even subtracting out those students from the 7,791 "missing" students means 40 percent of the ECOT total is unaccounted for -- about double the rate that was found by ODE.

So there seems to be something going on here.

I would sure like to know how many, if any of the 7,791 students ECOT claimed it had in 2016-2017 that aren't in charter schools anymore were actually ever there to begin with. Because it looks like the state's 20 percent assessment may be significantly lower than first thought.

ECOT gets an A in Achievement because kids weren't chronically absent. Huh?

The new state report cards just came out with overall grades being issued for the first time. And outside of telling us what every report card has told us over the years -- namely that Ohio's school districts and buildings perform far better overall on state report card measures than charter schools -- there's an interesting outcome for the Electronic Classroom of Tomorrow (ECOT).

ECOT has never done well on the state report card. Of the 53 possible grades it could have received through the 2016-2017 report card, it got 46 Fs. It was especially bad in the components that make up the overall achievement component. The overall grade is determined by merging the six categorical grades (Achievement, Growth, Graduation, Cap Closing, Improving at-risk K-3 Readers, and Prepared for Success).

This year, ECOT got an A in the Achievement Component.

How can this be when ECOT has historically been the worst performing school in the state? The answer lies in the fact that ECOT closed half way through the year. So the school did not get graded on several components that it traditionally bombed. The only Achievement category indicator it was graded on was meeting state indicators -- raw test score information. Schools can be graded on up to 26 different indicators, depending on how many students the schools tested that are in each category. For example, if a school doesn't have high school students, it won't be graded on the performance of high school students.

Last year, ECOT met 0 of the 23 indicators it was measured on. This year it met one indicator. And it was only measured based on one indicator. What was that indicator?

I kid you not. It was chronic absenteeism.

Last year, 13.5% of ECOT's kids were listed as chronically absent. This year, it was 7.5%, which met the indicator and qualified as an A.

That's right. The school that ripped off taxpayers by at least $200 million because it charged for kids who were never there, or were absent for whole months and seasons of time got an A from the Ohio Department of Education because kids weren't chronically absent.

Absolutely incredible.

So when you see that ECOT got an A in Achievement on the state report card, let's perhaps take that with a grain of salt.

DeWine-Husted Education Plan: We'll Fix our Failures. Trust Us.

Mike DeWine and Jon Husted have had a heavy hand in determining the Ohio's current state of public education policy.

DeWine was on the conference committee that determined what the final version of the No Child Left Behind Act would look like in 2001. That law ended up creating the high-stakes testing structure we have in place and has received a lot of recent pushback from nearly everyone in the education community as incentivizing test taking over critical thinking.

Likewise, in 2001, then state Rep. Jon Husted served as the Vice Chairman of the Primary and Secondary Education Subcommittee on the House Finance and Appropriations Committee -- the most important committee of any sort at that time. In 2003, he became chairman of that subcommittee -- a position I would hold 6 years later.

When Husted was Vice Chair, the P&S subcommittee was the most important committee of any type in the legislature because it was the committee handling school funding. At the time, the Ohio Supreme Court had ruled twice that the way the state funded schools was unconstitutional because it didn't equitably or adequately provide a thorough and efficient education for our children. After Husted's attempts to fix the system during the 2001 biennial budget, the Court ruled not one, but two more times that the way Husted's system provided funding for students was unconstitutional.

So it was kind of surprising to me to read DeWine and Husted's education plan, which was just released today as part of their gubernatorial campaign. In it, DeWine and Husted said they want to reduce testing and find an equitable funding system.

Here's what it said about testing: "Standardized tests are limiting educator’s creativity and forcing them to a teach to a test."

Here's what it said about Ohio's school funding system: They "will create a more equitable funding system that directs state resources toward supportive services for children most in need."

So, the architects of the nation's high-stakes testing regime and Ohio's unconstitutional funding systems want to fix their previous failures.

I swear.

That's what they're saying.

Not only that, but there is almost zero detail about how they plan on doing this. On the testing, the Ohio Department of Education and State Board of Education have presented a promising change in Ohio's report card system that would de-emphasize testing. Are DeWine and Husted saying they want to do that? Will they get rid of certain tests? Will they eliminate the test-dependent accountability system?

Who knows?

On funding, it looks like they will be putting more money into support services for economically disadvantaged students. But will that be additional revenue? Or will it be taking money from somewhere else to fulfill that obligation? Will this be additional money for wraparound services? Or will it mean more teachers and smaller classes? Will it mean a dedicated element of the school funding formula dedicated to psychologists or other support staff?

Again, who knows?

But I find it awfully interesting that one of the key architects of the law that created our high-stakes testing system now wants to de-emphasize tests (as opponents of NCLB have said for years). And the architect of our unconstitutional funding system now wants more equity in the funding system (using the same language I and others have used for years).

I'm glad that these two men are now acknowledging that the last 17 years in which they have led Ohio and America down their education policy paths has essentially failed. But it sure seems like they're saying, "I know we tried this before and screwed it up, but trust us, we won't screw it up again."

Fool me once...

Feds Say Ohio Has No Plan to Improve Educationally Challenged Student Performance in Charter Schools

Today, I was looking at the Ohio Department of Education's (ODE) website and out of curiosity decided to check in on the state's implementation of that much-ballyhooed $71 million grant -- the nation's largest -- it received to grow high-performing charter schools here.

Later, it was discovered that David Hansen -- the husband of Ohio Gov. John Kasich's Chief of Staff -- who oversaw Ohio's charter school program rigged the application by hiding the performance of the Electronic Classroom of Tomorrow from the federal government, breaking state law.

That got Hansen resigned (fired), and was probably the moment that swung the pendulum against ECOT among Ohio's ruling political elite for the first time. That school year was when ODE started asking ECOT whether it actually had the kids it was charging taxpayers to educate.

But it also got Ohio in a pickle and twisting through about 2 years of haranguing with the U.S. Department of Education over the state's notoriously poor oversight of charter schools. Finally, last year, the state gave out a staggeringly low $1 million of that $71 million to just three of Ohio's about 400 charter schools.

Then the state just gave back $22 million of the $71 million, saying it just didn't have enough good oversight agencies running charter schools. A fine admission. But that was the case in 2015 when Hansen lied to the feds and said the state actually did have good oversight.

Well not much has happened since April 2017 in the media about this, so I decided to check up on the grant's progress. And it's not good. At all.

In its assessment of ODE done for the federal Department of Education last October, WestEd -- a consulting firm -- wrote this staggering paragraph:

"During interviews with the site visit team, ODE did not articulate a plan for the OCS (Ohio's Office of Community Schools) to disseminate best practices for recruiting, enrolling, serving, or retaining educationally-disadvantaged students."

What? This wasn't ODE forgetting to fill out a form. ODE officials sat down with evaluators and failed to articulate how educationally challenged kids would be helped by the federal grant. I mean, WTF? Isn't that the whole point of charter schools? I mean, that's the one I hear all the time.

Oh, but that's not all.

"At the time of the site visit, the grantee’s draft monitoring protocol did not include plans to ensure compliance with Federal and State laws related to educational equity, nondiscrimination, and access to public schools for educationally-disadvantaged students."

Seriously, WTF?

Is it too much to ask that Ohio have a plan to ensure that charter schools follow state and federal anti-discrimination laws? Or that they have a plan to make sure disadvantaged students get what they need in charter schools? 

One more:

"The draft RFA does not include plans for awarding subgrants based on innovativeness. Applicants are asked to explain the effectiveness of their proposed educational program, but not the program’s innovativeness. 

There are. No words.

Nor does there seem to be much independent oversight of this program now. The state had created an advisory committee made up of several experts meant to help the state navigate the program. According to the ODE website, "The Committee shall meet on at least semi-annual basis with the first meeting occurring thirty days prior to the department publishing its first request for application for the CSP Grant.  Thereafter the Committee shall meet in June and December of each year."

Yet, the only meeting minutes (which are quite scant, by the way. But I digress.) posted on the website are from March and April 2017. The last line of the April minutes says they were slated to meet in July 2017. No minutes from July, though. And no indication this group has met since April 2017.

Yet the state apparently took applications for grants for this coming school year. No word about whether they've been granted.

So after three years and constant communication with the feds, the $71 million charter grant Ohio got in 2015 amid much fanfare has been sent to 3 of Ohio's nearly 400 charter schools for $350,000 each.

And ODE still has no plan to ensure charters better serve at-risk kids or implement innovative learning, which was the whole point of the grant in the first place.

Look, I know federal grants are a pain. I know that David Hansen's lies to benefit Bill Lager's now disgraced ECOT put Ohio behind the 8 ball. But good Lord this is awful. And it speaks once again to just how far behind we are as a state on this issue and why the country still considers us the Wild, Wild West of charter schools.

We must do better. And we must demand better. This is embarrassing.

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.

Amazing.

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.

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.

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.

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?

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.

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.

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.

John the Vindictive: How HB 512 Shows John Kasich Hasn't Changed

The image of Ohio Gov. John Kasich has shall we say "evolved" since he first took office. Within days of his 2010 election, he gave a famous speech where he warned Columbus lobbyists that his agenda would be unstoppable. He summed it up this way:

"If you’re not on the bus, we’ll run over you with the bus. And I’m not kidding."

Two months later, he told a room full of people about a story of being pulled over for not giving a passing ambulance the right of way. He called the officer who dared pull him over an "idiot."

A few months later, he passed Senate Bill 5 -- the most direct and serious attack on union rights mounted in the state for generations. But when organizers collected more than 1 million signatures and voters roundly defeated his legislation at the ballot box almost a year after his election, he started "mellowing".

And running for President.

As the last man standing against Donald Trump in the 2016 Republican primary, Kasich turned into a bit of a fuzzy warm reminder for some of what "reasonable" Republicans were -- hearkening to a time when Eisenhower could carry the Republican banner without being drummed out of office. His latest book "Two Paths" is supposed to be the marker for all reasonable Republicans who want to get things done.

But John the Vindictive has not really changed. And House Bill 512 proves it. According to a Plain Dealer story yesterday, John Kasich and current Superintendent for Public Instruction Paolo DeMaria have not met since DeMaria was named Superintendent in 2016. Nearly two years and the Governor hasn't met with the man responsible for the education of 1.8 million Ohio children?

That's weird.

It makes one wonder if Kasich wasn't happy with DeMaria's selection as State Superintendent. And maybe explains why he wants more control over the pick. DeMaria, after all, was a late addition to the finalists list for State Superintendent, indicating he wasn't Kasich's first choice.

As Kasich recently told a forum last month:

"What I really want...I want to be able to run the Department of Education," Kasich said an at Associated Press forum February 2.  "I don't think we should have this elected school board."

Could it be that Kasich instead supported Reynoldsburg Superintendent Tina Thomas-Manning, who famously put in scab teachers to fight the Reynoldsburg teacher strike? In a Plain Dealer story that reviewed the strike, her relationship with Kasich was described this way:

"Some even view Thomas-Manning, superintendent of the Reynoldsburg school district, as a puppet of Gov. John Kasich and former state Superintendent Richard Ross."

Trouble was, at the time the board was considering Thomas-Manning, the Reynoldsburg Superintendent was in a full out war with her Board of Education, with members calling for her to step down in the aftermath of the strike that tore apart the Reynoldsburg community. Not a good look if you're asking another board to hire you.

Thomas-Manning eventually did not have her contract renewed and received a $100,000 golden parachute from the Reynoldsburg Board of Education. Yet she continued to do consulting work for the district as recently as last fall.

Whatever the backroom dealings, it's clear that Kasich is pushing HB 512 to punish the department for something, or some things. One is clearly the board and superintendent's role in closing down the Electronic Classroom of Tomorrow -- a huge, online charter school run by major political donor Bill Lager.

Kasich's first high school graduation address was to ECOT in 2011.

But it appears that Kasich's indifference to the State Superintendent of Public Instruction may have additional roots in DeMaria's unanimous selection as Superintendent by the State Board. And reveal Kasich's real desire to get a more divisive, loyal, union-busting figure at the department. This was the guy who tried to destroy the teachers unions with Senate Bill 5, after all.

But the bottom line is this: With HB 512, it appears that the State Board of Education -- and the voters who put 11 of them in office -- are the latest to be run over by John the Vindictive's bus.

House Bill 512: ECOT's Revenge

Last week, I testified against House Bill 512 -- the political takeover of the state's education system. During that testimony, I mentioned how HB 512 seems an awful lot like payback against the Ohio Department of Education for forcing the Electronic Classroom of Tomorrow to return about $80 million to Ohio taxpayers for kids the former virtual school giant charged taxpayers for educating, but they couldn't prove actually participated.

It reminded me of when you buy an embarrassing item at a store and try to hide the purchase with a bunch of other, innocuous things. Yeah, you might be buying 50 things. But you're really just buying the one thing.

So, I decided to look at the political contributions from ECOT founder Bill Lager and other ECOT-affiliated people to co-sponsors of the legislation. And you'll never guess what I found. ECOT people gave 5 of the 8 HB 512 co-sponsors more than $74,000 in campaign contributions in the 2014 and 2016 election cycles.

Reineke is the primary sponsor of the bill. Blessing is the chairman of the Government Accountability and Oversight committee, which is holding hearings on the bill.

Interestingly, Koehler just announced he is no longer supporting HB 512, even though he is currently listed as a co-sponsor -- never a good sign for your legislation.

If you are trying to argue that this is a bill about kids and not punishing adults, it becomes increasingly more incredible to say that once you see just how supportive ECOT has been to the adults sponsoring this legislation.

ECOT Bills State for Students ... AFTER IT CLOSES

The Electronic Classroom of Tomorrow told the Ohio Department of Education on Jan. 23 that it still had 5,580 students, and the state should pay them for educating those students. Trouble was, the school closed Jan. 19 -- four days before that payment was sent to the department.

That's right. It appears ECOT wanted to be paid for students it said it was educating after the school had closed.

To the Department's credit, they issued no taxpayer money to the state's once largest virtual school based on their Jan. 23 request. But the fact that ECOT, even after the end had come, demanded taxpayer money for educating kids everyone knew weren't there because the school had closed, put a rather tight, ironic bow on this school's sordid history.

Remember, it was the fact they couldn't prove they educated $80 million worth of students over the last two years, which then the state demanded they repay, that led to the school's abrupt closing last month.

But that closure didn't stop ECOT from continuing to demand taxpayers give them money. According to department reports, ECOT's February monthly payment to charter schools is based on data received by the state Jan. 23 -- four days after the school officially shut down. 

Fortunately for taxpayers, the school only billed the state for 5,580 students -- not the 11,876 students the school claimed it had enrolled on Dec. 24, 2017 -- the last date ODE looked at prior to the school's closure.

So that meant that the school, if it only had 5,580 students, had been overpaid by about $11 million because the state had paid the school for educating about twice as many students for the first half of the school year. So the school only needed $41.3 million to educate those students all year. However, the state had already paid the school $52 million through January based on the larger enrollment.

And that doesn't include the $30 million payment the school was supposed to cough up in return for charging taxpayers $60 million for students the school couldn't prove it actually educated in the 2015-2016 school year (another $20 million in overpayments was discovered later by ODE for last school year).

So while the state did its job and didn't pay ECOT for kids it claimed it educated while it was closed, the fact that ECOT actually charged taxpayers for this is incredible.

What a scandal. 

ECOT argues in Supreme Court tomorrow that it should be paid for educating kids it can't prove it educated. Really.

Tomorrow, ECOT will argue before the Ohio Supreme Court that even though it can't demonstrate that more than 60 percent of the students it charged taxpayers for educating actually engaged in educational activity, it should still receive taxpayer money because they could have been educated by them. 

The state forcing the school to re-pay taxpayers $80 million for kids it can't prove ever engaged in any learning experiences at ECOT is eventually what led to the Educational Service Center of Lake Erie West to drop the mega-virtual school last month, forcing the school to close and leaving hundreds of staff and thousands of families in a lurch -- a lurch caused by ECOT founder Bill Lager's love of money and fancy houses (owned under the name NestEgg Development, LLC. I can't make this up)

And while it appears that finances will be what shuts down the state's first and largest online school (though in a welcome departure from pure finances, apparently the Insight School of Ohio, run by K-12, Inc., which also runs the Ohio Virtual Academy -- currently the state's largest online school -- will be shut down for failing kids rather than accountants), ECOT's academic performance for the kids it actually did educate was not much better than those it didn't.

According to state data from the 2016-2017 school year, every penny sent from a school district to ECOT last year (which was more than $100 million) came from a district that outperformed the online giant by at least 4 of 13 state report card categories. And an astonishing 1 out of every 4 dollars sent to ECOT came from a district that outperformed ECOT on every comparable measure.

This is not to say there weren't success stories at ECOT. There were. But in the vast, overwhelming majority of cases, ECOT simply did not provide a better academic option for students than the districts they left.

And while they did graduate large numbers of students, they failed to graduate about twice as many as they actually graduated. Some of ECOT's paid supporters like posting impressive photos of their Schottenstein Center graduations. They never post a filled Fenway Park, which holds about the number of students ECOT failed to graduate since its opening.

One telling metric of the school's long-term impact on kids is how many ECOT graduates have a college degree within six years of graduation. 

When coupled with the fact that ECOT was charging taxpayers tens of millions of dollars to educate kids that never participated in learning at the school, it's clear that this school was not living up to expectations academically or financially.

As I wrote before, ECOT has generally not performed well on state metrics and have been unable to account for the children's learning experiences, but they have until recently been protected by powerful friends in the Ohio General Assembly and state government who benefited from ECOT founder Bill Lager's political largess.

And now the Supreme Court will decide, essentially, whether the school should be paid for educating kids it can't prove it educated and therefore remain open forever. 

ECOT's political patrons are many and vast

Now that the Electronic Classroom of Tomorrow (ECOT) is closed, it pays to step back and understand why a school that the Ohio Department of Education didn't approve in 1999 because it didn't think ECOT could effectively account for its students was shut down 18 years later because ... it couldn't effectively account for its students.

A major reason that this 18 year, more than $1 billion in state taxpayer funded operation was allowed to continue, despite repeated signs they weren't keeping track of their students. (One of those signs included an audit by then-Auditor Betty Montgomery that showed ECOT had overbilled taxpayers every year between 2001 and 2005.)

A big reason was ECOT founder William Lager's political contributions, primarily to powerful Republican lawmakers. According to www.followthemoney.org (which tracks state and local campaign contributions from the early 1990s to present), Lager himself gave more than $1.2 million to primarily legislative candidates since 2000, less than 5 percent of which went to Democrats.

Included in those contributions are current Attorney General Mike DeWine and Secretary of State Jon Husted. They are now running for Governor and Lieutenant Governor. 

Another recipient has been current Auditor Dave Yost, who is running for Attorney General. Another is Keith Faber, who is running for Auditor.

The list includes Speakers of the House, Presidents of the Senate and chairmen and chairwomen of powerful legislative committees.

And while the school is now shut down, what is clear is that the reason it remained open as long as it was was because the school had powerful allies and protectors in state government. In fact, Lager often complimented the recipients of his largess at ECOT graduations (where many of the largest recipients spoke) and thanked them for stopping efforts to close or "harm" the school. 

Here is a list of the recipients who received more than $10,000 from Lager: