The Ohio Department of Education is siding, in part, with a group of
tax-funded charter schools
that is trying to break free of the state's largest for-profit school
management company, White Hat Management Co., the Akron-based firm of David L.
Yesterday Attorney General Richard Cordray - on behalf of the Ohio Department of Education - filed motion for summary judgment in favor of the charter schools.
The AG argues White Hat's management agreements with the schools are invalid because the public charter schools handed over nearly all funding - 96 percent - to White Hat and were given essentially no accountability or transparency as to how the funds were spent. As is clear from the Motion's Summary of Argument, Cordray believes the law doesn't allow a public entity, like a public charter school, to give away most or all of its authority and funding to a private company without accountability.
This video shows the story of how one man profits from Ohio's under-performing charter schools and how this money is used to back Republican candidates.
This motion asks the Court to help a group of public schools break free from dominance by private interests. The Plaintiffs are charter schools. They are public schools, funded entirely by tax funds, but a group of corporations have appropriated them to the corporations' private interests. Those corporations (collectively "White Hat") have done so through management agreements that give them control of more than 96% of the Schools' funding and all their personnel, academics, and purchasing decisions. White Hat also claims ownership of the property bought with the public funding that flowed to it through the Schools.
The public received very little in return for that outlay of tax dollars. Most of the schools have received the equivalent of D's and F's on their State report cards and their performance has declined during the term of the agreements.
The Schools tried to change that by changing their relationship with White Hat. They sought an accounting of how it spent their public funding and changes to the agreements. White Hat refused to provide anything but generalized financial disclosures and declined to make significant changes to the agreements. It also claimed title to the property purchased with the Schools' public funds and sought to remove the Schools' boards by invoking R.C. 3314.026. The Schools sued to obtain relief. This motion presents two issues for decision.
1. The first is whether the management agreements can validly delegate the Schools' decision making authority to White Hat. Ohio law prohibits government bodies from delegating such authority unless a statute authorizes them to do so. That bars public bodies from delegating decisions about personnel, academics, and purchasing. The Schools are public bodies, and no statute authorizes them to delegate decisions about those matters. The agreements purport to delegate those matters to White Hat. The provisions to that effect are invalid.
2. The second is whether R.C. 3314.026 can be applied to oust the School's boards. That statute provides that a management company can challenge a school's decision to not renew a management agreement and have the school's board removed if its challenge succeeds. It says nothing about its application to agreements that predate its enactment, and R.C. 1.48 prohibits a statute's application based on pre-enactment matters absent explicit legislative direction. R.C. 1.48 therefore prohibits R.C. 3314.026's application here.