350 will lose jobs to pay $60M tab

Facing the need to repay $60.4 million from the 2015-16 school year and potentially millions more from last school year, ECOT says it will lay off 350 workers within weeks, about a quarter of its workforce.

The Electronic Classroom of Tomorrow, the giant online charter school that has been locked in a battle with the Ohio Department of Education over whether it needs to document student attendance in return for the more than $100 million in state education money that it receives annually, made

the decision after learning the state was proposing that ECOT repay the $60.4 million over two years, said its spokesman Neil Clark.

The layoffs will be made across the board: teachers, administrators and support staff, Clark said, and take place sometime in July. That likely will be followed by another round of layoffs in a few months, Clark said.

The Department of Education has offered a 24-month repayment plan “due to the magnitude” of the amount, said Aaron Rausch, director of the agency’s Office of Budget and School Funding, in a letter Friday to ECOT Superintendent Rick Teeters. The state plans to deduct $2.5 million from its monthly allocation to ECOT starting July 13, unless the school can provide an acceptable alternative by Friday.

Clark said any repayment plan shorter than five years likely will result in ECOT shutting its doors.

He said that, “it’s not our decision,” because the state Education Department is recouping the money before ECOT’s legal challenges have been exhausted. Legislation has been introduced in the Ohio House, where the ECOT founder has made hundreds of thousands of dollars worth of campaign contributions, to prevent the state from collecting until the school’s final appeal has been decided.

The state currently is reviewing how much ECOT was overpaid in the justconcluded school year.

The school has a lawsuit pending with the Franklin County Court of Appeals that likely will end up with the Ohio Supreme Court.

As the ECOT controversy grinds on, state lawmakers are taking aim at charter and nonpublic schools with a new bill meant to broaden the state auditor’s powers and increase school-funding transparency.

House Bill 220, introduced by Rep. David Leland, D-Columbus, would close a loophole and mandate that private companies contracted by the nontraditional schools are subject to audits if they were paid using state funds. Essentially, Leland said in

testimony Tuesday, the bill mandates that state funds used by private, for-profit schools be audited and have a watchdog the same way funds spent by public schools are.

“What we’re saying is that every tax dollar should be treated equal,” Leland said. “Every taxpayer should have the ability to know how their education dollars are spent.”

Leland said the bill would close a loophole that allows charter schools to spend 20 percent of their revenue on management expenses. The loophole allows charter schools to avoid state audits for expenditures that fall within this limit.

But Clark said,”for Leland to believe charter schools are not audited is ridiculous. We’re audited all the time; it’s a joke.”

During the Education and Career Readiness Committee hearing, Rep. Michael Henne, R-Clayton, pressed Leland about when exactly state funds become private.

Leland said his proposal is intentionally broad, leaving that determination up to the state auditor.

The measure has garnered a bit of bipartisan support, but Leland wouldn’t predict whether it will pass the House.

“I’m hopeful that we can do it, because it’s just common sense,” Leland said. “All it says is that schools should be treated the same. How could anybody be against that?”