Father of Ohio School Privatization, David Brennan, Dies

David Brennan, the Akron industrialist and businessman who died last Sunday, was the father of Ohio school privatization.

The Plain Dealer‘s education reporter Patrick O’Donnell reports: “David Brennan, the Akron industrialist who helped create tuition vouchers and charter schools in Ohio but whose low-performing White Hat charter schools became a lightning rod for critics, has died at 87.  Throughout more than 23 years of leading voucher and charter school efforts in Ohio, Brennan played a major role in shaping school choice.  Admirers said he opened doors to educational opportunity by removing legal barriers to how public-school dollars could be spent. Critics saw him as a profiteer who used political donations to limit quality controls on charters…. The White Hat schools managed by his company were some of the lowest scoring in the state.”

O’Donnell explains concisely just how Brennan abandoned the idea of vouchers when he realized charter schools would be a far more lucrative investment: “Brennan was central to Ohio starting its first private school tuition vouchers—the Cleveland Scholarship voucher program in 1995—after chairing a commission on school choice created by George Voinovich, the former governor and former Cleveland mayor.  Brennan created private schools in Cleveland to use the vouchers. Two years later, he converted them to charter schools after the state offered more money to charters, partially at his urging.  White Hat expanded rapidly, and was soon Ohio’s largest charter chain.  It eventually included Hope Academy charters, Life Skills dropout recovery schools, and the OHDELA online school.”

In early August 2018, the Akron Beacon Journal‘s Doug Livingston traced the history of David Brennan’s profit-making venture into the privatization of public education: “Brennan made millions buying and selling manufacturing companies in Akron.  In the 1990s, he promised to unleash the private market on what he demonized as failing government schools. His tactics included $1 million in political contributions to elected GOP officials… Then Gov. George Voinovich put Brennan in charge of crafting Ohio’s private voucher program, which would eventually bring Brennan’s private schools more state funding per pupil than was flowing to 85 percent of Ohio’s traditional public schools.”

Later, writes Livingston, Brennan realized that operating charter schools would be far more profitable—under what had become, through the lobbying maneuvers of Brennan and his friends, extremely lax oversight laws: “The Akron Beacon Journal reported that flipping the switch from private to charter school on just one White Hat operation in Akron would generate $285,000 more a year for a mere 75 students. The school, reconstituted to get around a state law that banned converting private schools to charter schools,… was called Hope University Campus.  It would be the first of dozens of K-8 schools bearing the Hope Academy moniker. Brennan’s charter schools, ranking among the lowest performers in the state, were plagued from the start with allegations of padded enrollment and skirting accountability. Amid the bad publicity, White Hat lobbyists pushed for exemptions… In 2010, fed up with not knowing how White Hat was spending 97 percent of the tax dollars sent to each academically failing school, 10 (of Brennan’s White Hat) school boards sued the operator.  White Hat fought them to keep ownership of all the desks, computers, and assets bought over the years with public money.”

That lawsuit, which was eventually decided by the Ohio Supreme Court in White Hat’s favor by allowing the management company to keep all equipment, helped drive the Ohio Legislature to improve charter school oversight.  White Hat contracted with the boards of its charter schools to provide operations under what are known as sweeps contracts, by which the school turns over more than 90 percent of the state’s per pupil charter school dollars to the management company and permits the company to run the school without much input by the charter school board. There were a number of complications in White Hat’s case. For example, conflicts of interest arose when members of the charter school boards that are supposed to oversee the management company contracts also turned out to be associated with White Hat or to have been recruited by White Hat. The questionable operations of White Hat and the 2010 lawsuit about who gets to keep the equipment when charter schools close or switch management companies finally stimulated modestly improved charter school oversight by the Ohio Legislature.

One might wish that with the exit of David Brennan ‘s White Hat empire, the state would step in to reduce the influence of the for-profit charter school sector in Ohio. But sales this year of Brennan’s Ohio charter schools have expanded Ron Packard’s education management organization—the for-profit Accel Schools. Ron Packard has a long history.  Packard founded and, until 2014, served as CEO of K12 Inc., the nation’s giant operator of for-profit, online charter schools.

In July 2018, the Plain Dealer‘s Patrick O’Donnell reported: “The once-mighty White Hat charter school empire continues being dismantled, with its longtime e-school—the Ohio Distance Learning Academy (OHDELA)—being turned over to the fast-growing Accel charter school network. The move puts Accel founder Ron Packard, the founder and former CEO of the giant national e-school company K12 Inc., back in the online education business after four years away… As White Hat’s presence shrinks, Packard’s is growing incredibly quickly. After resigning as K12 CEO in early 2014, Packard has been taking over operations of charter schools across Ohio, usually by negotiating to assume management of financially-struggling schools. He snagged several strong schools from the Mosaica network first, then more than a dozen low-performing White Hat schools. When Cleveland’s I Can charter network had financial trouble in early 2017, he took over those schools. And earlier this year, he added several more previously run by Cambridge Education Group, a company with White Hat ties.  Even before the OHDELA transfer, Packard and Accel were running 37 charter schools across Ohio with about 10,700 students…. OHDELA adds another 1,100 students. Accel is also starting new schools this fall in Cincinnati, Dayton, and Lorain. That combined enrollment makes Accel bigger than all but 13 school districts in Ohio.”

Ohio’s for-profit charter school sector has outlived its founder, David Brennan.

Bill Lager, David Brennan, and Ron Packard: Swindlers Stealing Tax Dollars from Ohio Public Schools

While the Ohio Department of Education and the Ohio Supreme Court have finally ended the career of William Lager, the founder of Ohio’s huge, notorious online Electronic Classroom of Tomorrow, Ohio’s legislature has never passed adequate laws to protect taxpayers and students from unscrupulous swindlers operating charter schools.  Besides Bill Lager, another notorious charter school czar has disappeared from the scene this year.  David Brennan, founder of White Hat Management, a huge and shady for-profit Education Management Organization (EMO), has sold off all of his Ohio schools.  But it seems sales of Brennan’s Ohio schools are expanding Ron Packard’s EMO—the for-profit Accel Schools. Packard founded and, until 2014, served as CEO of K12 Inc., the nation’s biggest operator of for-profit, online charter schools.

From the very beginning, Ohio’s biggest charter schools have been run by con men. They paid off  legislators to allow them to cheat the public at the expense of the public schools. This story traces all the way back to 1991, and it is helpful to be reminded of the history. David Brennan, father of Ohio school privatization, was first and foremost a business entrepreneur, reports the Akron Beacon Journal‘s Doug Livingston: “Brennan made millions buying and selling manufacturing companies in Akron.  In the 1990s, he promised to unleash the private market on what he demonized as failing government schools. His tactics included $1 million in political contributions to elected GOP officials… Then Gov. George Voinovich put Brennan in charge of crafting Ohio’s private voucher program, which would eventually bring Brennan’s private schools more state funding per pupil than was flowing to 85 percent of Ohio’s traditional public schools.”

But when Brennan realized that operating charter schools would be far more profitable—under what had become, through the lobbying maneuvers of Brennan and his friends, extremely lax oversight laws—Brennan immediately switched his empire’s mission and became a charter school operator. Livingston continues: “The Akron Beacon Journal reported that flipping the switch from private to charter school on just one White Hat operation in Akron would generate $285,000 more a year for a mere 75 students. The school, reconstituted to get around a state law that banned converting private schools to charter schools,… was called Hope University Campus.  It would be the first of dozens of K-8 schools bearing the Hope Academy moniker. Brennan’s charter schools, ranking among the lowest performers in the state, were plagued from the start with allegations of padded enrollment and skirting accountability. Amid the bad publicity, White Hat lobbyists pushed for exemptions… In 2010, fed up with not knowing how White Hat was spending 97 percent of the tax dollars sent to each academically failing school, 10 (of Brennan’s White Hat) school boards sued the operator.  White Hat fought them to keep ownership of all the desks, computers, and assets bought over the years with public money.”

Livingston explains that White Hat’s Hope Academy (K-8) schools and his Life Skills Academy dropout recovery high schools, among the worst-rated in the state, have been losing ground as charters have expanded across Ohio. Now Brennan has closed or sold off the last of White Hat Management Company’s Ohio charter schools: “By June of this year, White Hat’s once prolific presence in Ohio had shriveled to a single online school—Ohio Distance and Electronic Learning Academy (OHDELA)—and 10 ‘Life Skills’ centers, which deliver computer-based GED courses to academically faltering teens and young adults.”  Over the summer, the Life Skills Academies have either been sold to other operators or shut down.

Now that swindlers, Bill Lager and David Brennan, have left the Ohio charter school scene, one wishes Ohioans could be reassured that unscrupulous online schools and shady dropout recovery academies are gone for good.  But Ron Packard, a former banker, knows a lucrative opportunity when he sees one. The Plain Dealer‘s Patrick O’Donnell reports: “The once-mighty White Hat charter school empire continues being dismantled, with its longtime e-school—the Ohio Distance Learning Academy (OHDELA)—being turned over to the fast-growing Accel charter school network. The move puts Accel founder Ron Packard, the founder and former CEO of the giant national e-school company K12 Inc., back in the online education business after four years away… As White Hat’s presence shrinks, Packard’s is growing incredibly quickly. After resigning as K12 CEO in early 2014, Packard has been taking over operations of charter schools across Ohio, usually by negotiating to assume management of financially-struggling schools. He snagged several strong schools from the Mosaica network first, then more than a dozen low-performing White Hat schools. When Cleveland’s I Can charter network had financial trouble in early 2017, he took over those schools. And earlier this year, he added several more previously run by Cambridge Education Group, a company with White Hat ties.  Even before the OHDELA transfer, Packard and Accel were running 37 charter schools across Ohio with about 10,700– students…. OHDELA adds another 1,100 students.  Accel is also starting new schools this fall in Cincinnati, Dayton, and Lorain. That combined enrollment makes Accel bigger than all but 13 school districts in Ohio…”

In a follow-up report, O’Donnell explains that Packard claims to have learned from the problems of K12 Inc. online schools. Packard says he plans to require more in-person meetings between students at OHDELA to keep online students engaged, to reduce the kind of advertising that pushed enrollment growth at K12 over academic priorities, and to make a a greater effort to engage students who are not self-motivated.  However, as O’Donnell interviews Packard, it is clear that while Packard admits there were failings at K12 Inc., the corrections in his Accel network will be limited. Packard tells O’Donnell: “The overwhelming majority of kids were coming in way behind grade level… and they didn’t have support of households. The model needed to change to reflect that.” But O’Donnell continues, paraphrasing Packard: “Those students, he said, need far more help from the school. That’s why to have students meet with staff more often. It won’t be at the level of ‘blended’ schools, which have students take lessons in person a couple days a week, while working online other days. He envisions monthly visits or having students come to a school for tutoring and to take ongoing tests of their progress.”

As his for-profit Accel management company takes over the Ohio Distance and Electronic Learning Academy, I guess Packard expects to provide students with at least a bit more personal attention.

I hope the recent explosion of Ohio’s ECOT scandal will motivate Ohio’s legislators to enact more than just a bit of added oversight to try to reign in swindlers who continue to figure out ways to suck tax dollars out of state coffers and the budgets of Ohio’s more than 600 local public school districts.

William Lager, Charter Czar, Makes the Drop to Ensure Lack of Regulation of Ohio Charters

It is no longer acceptable to deprecate women as Mike Royko does in his 1978 column “Bucking Hard for the Equal Rights Amendment,” but just for today I am going let Mike Royko’s references to “do gooder ladies” go.  Royko was the very savvy and funny longtime Chicago newspaper columnist. We will focus on his intended topic: the role of money in politics:

“I was talking to an ERA lady recently.  She was fretting that the (Equal Rights) amendment might again fail in Illinois, after all of her hard work… I said, ‘Make the drop.’  She looked puzzled and asked: ‘Make the what?’  ‘The drop. Give them some money.’ She still didn’t understand. ‘Money? For what?’  ‘Bribes.’…  That’s the trouble with the ERA crowd and most do-gooders.  They are earnest, diligent, and energetic.  But they don’t have much sense.  Throughout the history of this state, sly people have been getting what they want out of Springfield.  They haven’t done it by being honest, earnest, diligent, and energetic… They have done it by throwing a shoebox full of money through the transom of a Springfield hotel room.”  (The essay appears on pages 109-111 of One More Time: The Best of Mike Royko.)

What we used to think was the way things were done in Chicago has come to dominate politics everywhere in America.  The result is that the powerful are regularly buying the policies that affect the rest of us, and nowhere is that clearer than in the policies that shape our public schools, the quintessential institution of the 99 Percent.

As with Royko’s column, the subject today is state government, not in Illinois but in my state, Ohio, whose legislature, after a year of crafting some relatively weak oversight of charter schools, went home at the end of June without passing even a weak bill.  Late last month, Patrick O’Donnell of the Plain Dealer reported, “The Ohio House will head off on summer break without voting on the new accountability and financial reporting rules for Ohio’s $1 billion charter school industry that have been in the works for months.  House leaders skipped a vote on the package late last week and have left it off the schedule for Tuesday, the last session before leaving for recess.” “Republican leaders say the delay is to clear up some issues with the just-revised bill.  Others call it an attempt to buy time to water down the bill to please charter school operators who donate to Republican candidates.”  Rep. Teresa Fedor, a Democrat, interpreted the move: “They never will call a vote, which means the tax dollars will continue on the ripoff train.”

As the legislature adjourned for its summer break without doing anything about charters, Doug Livingston clarified the meaning of all this in the Akron Beacon-Journal: “Though there are only 24 online schools among the more than 380 charter schools in Ohio, they receive nearly one in three state dollars set aside (each year) for charter schools or $267 million… The two largest—the Electronic Classroom of Tomorrow (ECOT) and Ohio Virtual Academy—received $185 million in state funding.  Two are run by influential for-profit companies.  White Hat Management, which operates Ohio Distance and Electronic Learning academy founded by Akron industrialist David Brennan, and Altair Learning, which operates ECOT and is owned by Bill Lager.  Brennan and Lager have given more than $1.4 million in political contributions to state lawmakers since 2009….”  It is worth noting as well that recently term-limited Ohio House Speaker William Batchelder, when he left the legislature in January of this year, revolved directly into a lobbying job and took on a very powerful and influential client: William Lager.

On Saturday, in his 10th Period blog, Stephen Dyer published the next chapter in the story of Ohio’s failure to regulate charters.  Dyer shows how William Lager of ECOT and Altair Management knows Mike Royko’s rule about ‘making the drop’: “Just a few days after the Speaker of the Ohio House of Representatives declined to take up House Bill 2… the campaign committee meant to re-elect his members got a familiar maximum level check (as permitted by law) from William Lager, who runs the Electronic Classroom of Tomorrow (ECOT).  Not to be undone, so did the Ohio Senate’s campaign committee.  Both were for $18,798.51.”

Dyer continues:  “Last year, the state of Ohio paid ECOT $104 million to educate the 15,088 students it received from Ohio’s local public schools.  That $6,921 per pupil is nearly $2,500 more than the average Ohio school district received last year from the state before charters, vouchers and open enrollment were deducted.  ECOT’s per pupil state funding is larger than all but 52 of Ohio’s 613 school districts.  And this is for an electronic school without buildings, custodians, buses, heating, cooling, sports teams, etc… The question now is this: Will the contributions keep House Bill 2 from moving this fall?”

Mike Royko clearly understood the rules in Springfield back in the 1970s.  William Lager clearly understands the same quid pro quo politics today around charter schools.  It used to be called “buying votes.”  Today this is just the way things are in Ohio and, I suspect, most other places.

In Ohio, Political Contributions Yield Budget Gift for White Hat’s David Brennan

Here’s what happened in Ohio’s mid-biennium budget review bill, signed into law on Monday by Governor John Kasich.  The governor and the legislature rewarded David Brennan, who runs the White Hat Life Skills Academy “dropout recovery” schools.  According to Brent Larkin in the Cleveland Plain Dealer, David Brennan “has poured more than $4 million into the coffers of Republican candidates in Ohio during the past decade.”

Recently this blog covered the scandal of Ohio’s so-called “dropout-recovery” charter schools, a scandal that has been exposed by Doug Livingston of the Akron Beacon Journal.  These schools offer students who have dropped out or are in danger of dropping out the opportunity to sit in a cubicle with a computer for four hours each day to recover enough credits to graduate from high school.  The state pays the dropout-recovery schools for all the students who are supposedly enrolled, but the dropout rate at these schools is higher than at any other secondary schools in the state, and the state keeps on paying for several weeks after the students stop attending.  Livingston has demonstrated that these schools are, in fact, driving up Ohio’s high school dropout rate.

Livingston writes, “Absenteeism tops the reasons why students drop out; charter schools continue to collect tax dollars for more than a month while they are gone.” “Administrators call it churning’ or ‘school hopping’—when student drop out, disappear for months and then return.”  “The state requires that students who are absent or truant for more than 23 days be taken off school rolls, but during that 23 days, the state reimburses the school. Livingston explains: “There were more than 11,000 removals for truancy last year, meaning taxpayers paid for perhaps 253,000 days of no student instruction, or the equivalent of 1,400 empty desks for an entire school year.”

So, what happened in the new mid-biennium budget review bill signed by the governor this week?  The state, according to the Plain Dealer‘s Larkin, has already been wasting money paying for students up to age 22 to attend “dropout recovery” charters that themselves account for 66 percent of Ohio’s high school dropouts.  The new bill allows such students to continue at White Hat Life Skills Academies and the state’s other designated “dropout recovery schools,” at state expense, until they are nearly 30 years old.  While this may sound like a good way to give young adults a second chance, it is far from the ideal plan.  Governor Kasich himself had already proposed a better state program that would, at state expense, enable community colleges and career-technical schools more suited for adults to begin serving Ohio’s adult high school dropouts who have already earned at least ten credits toward high school graduation.

Here is how the Plain Dealer‘s Larkin describes the story of what happened as the legislation was crafted: “The House approved paying White Hat and other schools $5,000 per student to attend schools that have ‘already failed’ those students.  Recognizing this as a total scam, the Ohio Senate removed that language from the bill.  Unfortunately, when legislators met to reconcile the differences, the House version resurfaced.”  On Monday, when Governor Kasich failed to use the line-item veto he is permitted in a budget bill, he preserved the House’s reward for David Brennan.

In a short editorial update, the Akron Beacon Journal comments: “The Republican majority in the House, led by Speaker William Batchelder, pushed for the provision, the item resurfacing in the conference committee.  What explains its presence, if not the merits?  The speaker invites the impression of his team doing the bidding of David Brennan, an influential donor to Republicans whose White Hat Management includes in its portfolio the operation of dropout recovery programs.  So a set of charter schools with a lousy record of achievement now has an additional avenue to public money.”

Akron Beacon Journal Launches Investigation of Ohio’s Charter Schools

On Sunday, a long article appeared in the print edition of Cleveland Plain Dealer, the launch of an investigation of Ohio’s 393 charter schools.  The reporters phoned or faxed each of the state’s charter schools to begin to create a data base.  Reporters asked: Who runs the building? Who is that person’s supervisor? Is there a management company and what company is it? Who serves on the school’s school board? How can we contact the school board?  When does the board meet?   (The full story appears in Sunday’s Akron Beacon Journal, though its printing cannot be traced to the Plain Dealer, because cleveland.com, the newspaper’s on-line edition, does not post all articles that have appeared in print.)

The reporters identified themselves as representing NewsOutlet.org, a journalism collaborative of the University of Akron, Youngstown State University, and Cuyahoga Community College with the Akron Beacon Journal, the Youngstown Vindicator, WYSU-FM Radio (Youngstown State), and Rubber City Radio (Akron).  Why did the print-edition of Cleveland’s Plain Dealer pick up the story?  Some of the journalists at NewsOutlet.org are studying journalism here in Cleveland at Cuyahoga Community College.  And not only did Rubber City Radio and WYSU carry it, but so did WKSU (Kent) and public radio’s State Impact Ohio news service.

The new investigation is clearly a creative strategy of  Ohio’s most progressive newspaper on matters that affect public schools.  Doug Oplinger and his partner Dennis Willard were the top investigative reporters on Ohio school vouchers and on the DeRolph school funding case all through the 1990s.  Oplinger is now the Beacon Journal‘s managing editor.  In an interview Monday with WKSU (Kent State), Oplinger said that the data base being created by NewsOutlet.org will be “used by parents, researchers, policy makers and reporters to track the performance of the publicly financed, but privately run, schools statewide.”

Oplinger predicts NewsOutlet.org will be looking at conflicts of interest when the members of school boards supposedly overseeing charter schools are being recruited by officials at the management companies—a violation of federal law.  According to WKSU,  “Oplinger says the next step in the series will include examining who owns the property in which many charter schools operate.”

The Beacon Journal followed up on Monday with an in-depth report from its excellent education reporter, Doug Livingston, on the recruiting and functioning of school board members at David Brennan’s charter schools, managed by his private White Hat Management Company, a for-profit with 32 Ohio schools.  Privately held White Hat collects over 95.5 percent of the funding, leaving a very small percentage of the state’s money under the oversight of the board.  Livingston points out that under federal law schools managed by not-for-profits are supposed to be run independently of any management company the board sees fit to hire: “If the board is not independent of the company, the IRS is supposed to throw up a red flag.  But (Ohio) state law allows private companies to throw out nonprofit boards that challenge them.”  One White Hat school board member reported to Livingston that Nancy Brennan, daughter of David Brennan had “asked him and his wife to serve.”  When ten members of the board of one White Hat school tried to change management companies: “Because White Hat had trademarked school names and bought up real estate through affiliate companies, the renegade boards couldn’t force White Hat out of the building.”

Again in this morning’s Beacon Journal, Livingston takes up another problem with the laws that govern Ohio charter schools: transportation. Public school districts are required to transport children to charter schools.  Because children in charters are picked up from their homes and delivered  to schools all around the city (without the possibility for normal neighborhood bus routes): “State officials have forced traditional public schools to crisscross their cities to pick up and deliver children to privately run charter schools, often while cutting transportation to their own kids…  A child attending a traditional pubic school and transported on a district bus cost on average $4.30 per day in 2012. The average cost for a charter-school student: $6.18, or $1.88 more per day.”  Livingston continues: “A private contractor on average charged districts $5.45 per child to go to a traditional school and $12 to go to a charter school.”

The NewsOutlet.org investigation itself remains at a very early stage.  Student reporters have been making calls and sending faxed requests to the state’s nearly 400 charter schools.  While they report that Governor Kasich told the Ohio Newspaper Association, “We’ll work with you any way we can.  I’m not going to hide from you,” the student reporters did not encounter a spirit of cooperation from many of the charter schools they contacted.  Sixty-nine, 25 percent, provided the information requested by reporters.  At other schools students were treated rudely, messages on answering machines never answered, promised materials forgotten. Reporters were frequently referred to websites where the requested information was not posted.  At Imagine Akron Academy, “office manager Jeanette Twitty wanted to know, ‘What do you do with this information?’  She put the reporter on hold, and upon returning, said school superintendent Wendy Hubbard ‘would not like to give out any information because that’s something she hasn’t heard of.’  When the reporter asked if he could send a fax with the list of questions, Twitty responded: ‘OK, you can fax it over.  If she’s interested, she’ll give you a call back or fax it back.  If she’s not interested, you won’t hear anything from her.'”