California Virtual Academies: Bill targeting for-profit operator K12 Inc. clears first committee vote

California Virtual Academies: Bill targeting for-profit operator K12 Inc. clears first committee vote

By Jessica Calefati, jcalefati@bayareanewsgroup.com

Posted:
 
06/30/2016 05:42:09 AM PDT

SACRAMENTO — A bill that would ban online charter schools from hiring for-profit firms to provide instructional services cleared the Senate Education Committee on Wednesday on a party-line 6-2 vote after a divisive debate about the role private companies should play in public education.

Assemblywoman Susan Bonilla introduced Assembly Bill 1084 in response to this newspaper’s investigation of K12 Inc., the publicly traded Virginia company behind a profitable but low-performing network of “virtual” academies serving about 15,000 students across the state.

File photo:Assemblywoman Susan Bonilla introduced Assembly Bill 1084 in response to this newspaper’s investigation of K12 Inc., the publicly traded Virginia company behind a profitable but low-performing network of “virtual” academies serving about 15,000 students across the state.
(Kristopher Skinner/Bay Area News Group archives)

The stories revealed that the company reaps tens of millions of dollars annually in state funding while graduating fewer than half of its high school students and that kids who spend as little as one minute during a school day logged onto K12’s software may be counted as “present” in records used to calculate the amount of funding the schools get from the state.

The two-part series also showed that the online schools are not really independent from K12, as the company claims. The academies’ contracts, tax records and other financial information suggest that K12 calls the shots, operating the schools to make money by taking advantage of laws governing charter schools and nonprofit organizations.

Lawmakers’ efforts a few years ago to crack down on for-profit colleges and universities sent several of the chains into bankruptcy, and if AB 1084 is passed by the Legislature and signed into law by the governor, it would effectively put companies like K12 out of business in the Golden State, too.

Bonilla, D-Concord, says that’s fine with her.

“What my bill says is ‘Let’s just agree they don’t belong here in California,’ ” because allowing online charter schools to contract with for-profit companies creates “a perverse incentive for schools to prioritize profits over students,” said Bonilla, who referenced the newspaper’s findings in her remarks to the committee.

But parents couldn’t disagree more about whether companies like K12 should be allowed to operate charter schools in California, and a lobbyist for K12 and two other firms insisted they’re being singled out unfairly.

Two mothers who support the legislation testified that the law is needed to force schools controlled by for-profit companies to re-evaluate their priorities and begin emphasizing student achievement above all else, including profit margins and shareholder whims.

“Help us transform California Virtual Academies from an enrollment factory that piles up the money into a place that supports teachers, parents and students,” said Stacey Preach, who lives in the Sacramento area. She worked for K12’s network of online schools and briefly enrolled her child in one of them.

Opponents of the measure, including Virginia Shemansky, who lives in Leona Valley, said signing the bill into law would force some schools to close, squash parental choice and limit the ability of schools that remain open to serve troubled students who need services only specialized for-profits can provide.

“Sacramento’s special interest groups are playing politics with our students,” said Shemansky, a member of California Parents for Public Virtual Education, which advocates for access to online schools managed by K12 and its leading competitor, Connections Academy. “Parents are demanding that the assault on parent choice stop.”

Several parents and teachers who watched the hearing stood up to endorse the bill, but no parents seated in the audience spoke against it.

Before being sent to Gov. Jerry Brown, the bill will have to be approved by the full Senate, the Assembly Education Committee and the full Assembly.

The committee’s vote comes a few days after state Superintendent for Public Instruction Tom Torlakson commissioned state Controller Betty Yee to audit the K12-managed California Virtual Academies and several weeks after a bipartisan group of lawmakers called for the state auditor to do a separate probe of for-profit charter schools.

The company is also being investigated by Attorney General Kamala Harris, who launched an investigation of online charter schools last fall.

A spokesman for K12 couldn’t immediately be reached for comment on the vote.

Branche Jones, a lobbyist for K12, testified at the hearing that the intense scrutiny the company is facing is unfair because statements made about its practices and track record by Bonilla and this newspaper are incorrect. The company, however, has never disputed the factual accuracy of the newspaper’s investigative series.

“There are low-performing schools across the whole state,” Jones said, adding that it’s not fair “to focus on one industry.”

Sen. Bob Huff, R-Diamond Bar, said he voted against the bill because he doesn’t believe a “one-size-fits-all approach” is the right way to address a problem that may not apply to all online charters contracting with for-profit companies. Huff said he had visited a successful online charter school dedicated to helping dropouts earn enough credits to graduate and didn’t want to see it adversely affected by the bill.

Representatives of the California Teachers Association and the California Charter Schools Association — two powerful interest groups that oppose one another most of the time — said they agree that for-profit companies like K12 shouldn’t be allowed to run charter schools in this state. But Rand Martin, a lobbyist for the charter school group, testified that the association opposes the bill unless Bonilla adopts a more “surgical approach” to the problem and agrees to a series of amendments it has proposed.

Instead of broadly banning online charter schools from hiring for-profit companies for instructional services, the association wants to create a “firewall” between charter schools and for-profit vendors by prohibiting the companies from having any role in the selection, interview or appointment of a charter school’s board members; barring them from developing, proposing or approving a school’s annual budget or expenditures; and limiting the number of teachers the firm could employ directly.

Still, Martin said, the organization supports the spirit of the legislation.

“We actually agree with the objective of the author,” Martin said. “We should not have a for-profit operating a charter school.”

Contact Jessica Calefati at 916-441-2101. Follow her at Twitter.com/Calefati.

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