Online schools: Susan Bonilla shelves bill after interest groups water it down

Former California Virtual Academies student Elizabeth Novak-Galloway, 12, plays a video game on her laptop in her home in San Francisco on.
Dai Sugano — Bay Area News Group

By Jessica Calefati, Bay Area News Group

Posted:
08/30/16, 8:09 PM PDT

Updated: 4 hrs ago

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California Virtual Academies teacher Julianne Knapp teaches her students during her online class on at a public library in San Jose.
Dai Sugano — Bay Area News Group

SACRAMENTO >> Legislation that originally sought to ban online charter schools from hiring for-profit firms to provide management or instructional services stalled Wednesday in the state Senate almost two weeks after the author substantially amended and watered down the measure.

Assemblywoman Susan Bonilla, a Concord Democrat, introduced Assembly Bill 1084 in response to the Mercury News’ 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.

The legislation cleared the Senate Education Committee in June on a party line 6-2 vote after a spirited debate about the role private companies should play in public education.

But substantial opposition from the company whose operations she sought to rein in and disagreement between the state’s largest teachers union and an influential charter schools advocacy group about the bill’s goals forced Bonilla to modify its language, removing all references to rules for online schools.

In an interview Tuesday, Bonilla said she carried the bill to ensure that public money for schools is used to educate students, not to enrich corporate shareholders. She said she also had hoped the legislation would boost online schools’ accountability. In the end, however, even the stripped-down version drew unexpected opposition from a school employees union and Republican lawmakers and had to be shelved.

“The bill started out targeting online charter schools because that is where we have witnessed this problem most,” said Bonilla, who is leaving the Legislature this year because of term limits. But “as we delved deeper into the details, it became apparent that because of the complex structures of these organizations, getting to the bad actors would be challenging.”

The newspaper’s stories revealed that K12 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.

In the months since the newspaper published its findings, state Controller Betty Yee launched an audit of the K12-managed California Virtual Academies. And following a probe by the state Attorney General’s Office, K12 agreed to a $168.5 million settlement with the state over claims it manipulated attendance records and overstated its students’ success.

A spokesman for K12 could not be reached for comment on Bonilla’s decision to shelve AB 1084. But an analysis of the legislation prepared by Senate staff members shows the company didn’t oppose the latest version of the measure, which would have required all charter schools to operate as nonprofits.

The reason is that since K12 is technically a “vendor” of the schools it controls, its operations in California wouldn’t have been impacted by the measure at all.

In the weeks since the Senate Education Committee’s hearing on the bill, Bonilla had been working closely with the California Teachers Association and the California Charter Schools Association to craft bill language that satisfied both powerful interest groups. And although the groups agree that for-profit companies like K12 shouldn’t be allowed to run charter schools in this state, they disagreed on strategy.

“We tried for weeks to negotiate something with Ms. Bonilla,” said Jed Wallace, the charter group’s executive director. “What we were trying to do was related, but different.”

The union wanted to keep Bonilla’s original concept of a broad ban. But the charter group supported a more “surgical approach” that would have prohibited companies from having any role in the selection, interview or appointment of a charter school’s board members; barred them from developing, proposing or approving a school’s annual budget or expenditures; and limited the number of teachers the firm could employ or manage directly.

The version of the legislation Bonilla abandoned Wednesday was the result of “compromise” between the two groups, she said, adding that she hopes another lawmaker committed to charter school accountability picks up next year where she left off.

“(My work) sets a firm baseline from which to pursue further legislative fixes in the future,” Bonilla said.

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Online schools: Bay Area Assemblywoman shelves bill after interest groups water it down

By Jessica Calefati, jcalefati@bayareanewsgroup.com

Posted:
 
08/31/2016 04:29:04 AM PDT

SACRAMENTO — Legislation that originally sought to ban online charter schools from hiring for-profit firms to provide management or instructional services stalled Wednesday in the state Senate almost two weeks after the author substantially amended and watered down the measure.

Assemblywoman Susan Bonilla, a Concord Democrat, 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.

The legislation cleared the Senate Education Committee in June on a party line 6-2 vote after a spirited debate about the role private companies should play in public education.

File photo: Assemblywoman Susan Bonilla, a Concord Democrat, introduced Assembly Bill 1084 in response to this newspaper’s investigation of K12 Inc. (Bay Area News Group archives)

But substantial opposition from the company whose operations she sought to rein in and disagreement between the state’s largest teachers union and an influential charter schools advocacy group about the bill’s goals forced Bonilla to modify its language, removing all references to rules for online schools.

In an interview Tuesday, Bonilla said she carried the bill to ensure that public money for schools is used to educate students, not to enrich corporate shareholders. She said she also had hoped the legislation would boost online schools’ accountability. In the end, however, even the stripped-down version drew unexpected opposition from a school employees union and Republican lawmakers and had to be shelved.

“The bill started out targeting online charter schools because that is where we have witnessed this problem most,” said Bonilla, who is leaving the Legislature this year because of term limits. But “as we delved deeper into the details, it became apparent that because of the complex structures of these organizations, getting to the bad actors would be challenging.”

The newspaper’s stories revealed that K12 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.

In the months since the newspaper published its findings, state Controller Betty Yee launched an audit of the K12-managed California Virtual Academies. And following a probe by the state attorney general’s office, K12 agreed to a $168.5 million settlement with the state over claims it manipulated attendance records and overstated its students’ success.

A spokesman for K12 could not be reached for comment on Bonilla’s decision to shelve AB 1084. But an analysis of the legislation prepared by Senate staff shows the company didn’t oppose the latest version of the measure, which would have required all charter schools to operate as nonprofits.

The reason is that since K12 is technically a “vendor” of the schools it controls, its operations in California wouldn’t have been impacted by the measure at all.

In the weeks since the Senate Education Committee’s hearing on the bill, Bonilla had been working closely with the California Teachers Association and the California Charter Schools Association to craft bill language that satisfied both powerful interest groups. And although the groups agree that for-profit companies like K12 shouldn’t be allowed to run charter schools in this state, they disagreed on strategy.

“We tried for weeks to negotiate something with Ms. Bonilla,” said Jed Wallace, the charter group’s executive director. “What we were trying to do was related but different.”

The union wanted to keep Bonilla’s original concept of a broad ban. But the charter group supported a more “surgical approach” that would have prohibited companies from having any role in the selection, interview or appointment of a charter school’s board members; barred them from developing, proposing or approving a school’s annual budget or expenditures; and limited the number of teachers the firm could employ or manage directly.

The version of the legislation Bonilla abandoned Wednesday was the result of “compromise” between the two groups, she said, adding that she hopes another lawmaker committed to charter school accountability picks up next year where she left off.

“(My work) sets a firm baseline from which to pursue further legislative fixes in the future,” Bonilla said.

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

Odd commentary considering the writer is working for the company who screws up kids. 

An election year when school choice is ignored

By Nate Davis, contributor    

Getty Images

It’s bad enough that during two straight weeks of Republican and Democratic conventions, we never really grasped a true sense of what newly nominated presidential contenders would do to improve the uncertain state of K-12 education in America.

Worse — especially since then — is that we have yet to see a solid reform-driven or innovation-focused commitment from candidates as the solution to our education crisis. A sorely needed exchange on parental choice and access to creative online learning platforms is, perhaps, the most significant missing policy deep-dive since the presidential cycle began in earnest over a year ago. For the most part, presidential candidates have steered clear of any focus on choice in K-12 as a main prescription to constant problems plaguing our school systems and challenging our kids.

That’s unfortunate, since parents are voters, too.

It is rather mysterious considering the sheer size, cost and long-term destructive impact of the K-12 crisis. Yet, as candidates on the campaign trail bludgeoned each other over everything from salacious tweets, badly placed emails and hand sizes, little is said on how policymakers could intervene to save the nation’s struggling elementary, middle and high-school students. The intervention is clearly found in school districts embracing new, progressive education models that meet the needs of future societies and workforces — models such as blended experiential and online learning in and, yes, outside the conventional classroom. Models, such as charter schools, that offer parents the options they need to ensure their child’s success in an increasingly competitive global environment.

That battle is no more urgent for any group than it is for our nation’s most underserved and historically distressed: from black and Latino youth to low-income and struggling working-class communities already battered by the effects (and after-effects) of recession. The last thing already economically challenged black or brown students and their parents should worry about is the quality of their education.

Likewise, those high-achieving students, rural students, bullied students and others are desperate for choices that allow them to excel in their education. For example: I met a student from West Virginia last week who enrolled in online courses that she could not take in her local, excellent but small neighborhood school. She and her parents were told by the guidance counselor that the courses she wanted were unavailable. The eventual valedictorian for her class, she took additional courses from a for-profit online provider that allowed her to achieve higher SAT scores and take courses otherwise unavailable to her. There were even language courses available that she would otherwise only take in college. Without choice, this high-achieving student — like hundreds of thousands of others — would not continue to excel and would be limited in what local schools could offer.

Clearly, you can’t have a conversation about improving the quality of life for underserved, diverse populations or high-achieving students unless you pose workable ideas on education. You can’t pose workable ideas on education or expect the condition of underserved youth to improve if you refuse to put school choice and access to new modes of learning in the mix.

Major openings for the presidential candidates to discuss choice and online education as a primary learning tool are either conveniently dismissed, lost in political posturing or altogether forgotten. We clearly can’t rely on the articulation of a policy vision from the Republican nominee (for obvious reasons). But when we look to Democratic nominee Hillary ClintonHillary Rodham ClintonEx-GM CEO: I’ve always voted Republican until now Election reveals Paul Ryan to be worst speaker in U.S. history Dem Senate candidate knocks Rubio for Trump support MORE for a thoughtful approach on issues such as parental choice, we find her either taking the side of unionized teachers (even if it contradicts earlier, steadfast support for charter schools) or completely missing those grand opportunities to present it as a viable long-term beacon of educational hope.

Nowhere was that unfortunate oversight on vivid display than at her recent appearance before a joint meeting of the National Association of Black Journalists and the National Association of Hispanic Journalists. When offered a few moments to lay out her policy vision for black and brown progress in America, Clinton left out school choice and relegated digital learning to merely PCs in the classroom.

Nor did the assemblage of esteemed African-American and Latino reporters, talk-show hosts, editors and producers ask her about it.

Unfortunately, online, radio and cable outlets are so focused on the latest campaign gaffe or doubled down faux pas that the plight of school children gets left behind in the political dust-up.

Still, campaigns refuse any raised or sustained debate on choice as a tangible way to address our ongoing K-12 crisis with any tangible solutions. Few want to take a firm position supporting parental preference in education, despite the vast number of voting parents who want (and need) it. Most seem oblivious to the need for expanded and innovative options for K-12 students, despite an abundance of evidence suggesting online learning, blended classrooms and access to multifaceted educational environments are exactly what’s essential for an increasingly diverse American landscape.

Yet, when examining many of the larger national polls, parents — especially black and Latino parents — are demanding more choice and creative, digital learning in and outside the classroom. In a National Alliance for Public Charter Schools poll released this year, 80 percent of parents supported some form of educational choice, including 63 percent of black parents and 55 percent of Hispanic parents. A Pathways/YouGov survey on school preferences found that black and Hispanic parents were "more likely" to consider "integrated use of technology" when education options were available.

For these population groups, education is perceived as the most effective pathway to upward socioeconomic mobility. The Pew Research Center shows that 66 percent of Americans identify education as a top 10 issue motivating choices this election cycle. In the most recent weekly YouGov/Economist survey, education still ranks among the top-five issues (out of 15), with more African-Americans and Latinos placing it as a "most important issue" than whites. For voters under 30, education is the top concern (partly out of struggles over student debt, and partly out of recent experiences with troubled school systems). That aligns with a recent GenForward joint poll where education was a top-three concern for voters ages 18 to 30, especially voters of color.

This is not much of a surprise. Education is a greater priority to individuals who find themselves historically disadvantaged or farther down the income ladder. To those faced with fewer resources and access to wealth, education is increasingly respected as the ultimate driver of future success — and choice is a chief path to that goal. Yet, presidential nominees and their parties have failed to promote a vision of what will make K-12 education better, even as the shifting demographic environment continues to demand such.

That school choice is not a headlining issue of our time rests not on the shoulders of voters. Elected officials, policymakers, pundits and those who constitute the rest of our active political and media class must aggressively tackle that discussion. We need a debate and movement where educational options are plentiful and innovation in (and outside) the classroom is the norm rather than the exception.

Davis is executive chairman of K12 Inc., a technology-based education company and leading provider of online learning programs to schools across the U.S.

The views expressed by contributors are their own and not the views of The Hill.

K12 Inc. Tries to Pivot from Virtual School Failures to Profit from "Non-Managed" Schools

Submitted by Dustin Beilke on January 7, 2016 – 9:01am

If you were a public school and Wall Street didn’t like you that might not seem like such a big deal. What do financiers know about educating children? It’s a big deal, however, if you are K12, Inc., and enticing investors to buy into your low-cost, high yield "cyber school" idea is key to your bottom line.

At K12, Inc.’s stockholder meeting in December, its own investors criticized the schools’ lamentable academic performance and voted down its executives’ proposed salary increases. This is just the latest piece of bad news, which has been coming in rafts for K12 since 2013.

As K12’s executives were being rebuffed by stockholders inside the law offices of Latham & Watkins, in Washington, D.C., outside K12 was picketed by members of the California Teachers Association for more or less the same list of educational shortcomings, as Diane Ravitch noted.

Some editorial boards crow when they receive criticism from two opposing sides of a controversial issue. "If both sides are unhappy we must be doing something right" is the familiar refrain, as if there are only ever two sides to an issue or the sides have equal merit.

In the case of K12, however, it is hard not to wonder how much longer the company can withstand this loud unanimity of animus–even a firm Wall Street insiders like convicted fraudster Michael Milken helped launch, as the Center for Media and Democracy (CMD) detailed in "From Junk Bonds to Junk Schools: Cyber Schools Fleece Taxpayers with Phantom Students and Failing Grades."

No major supporters have yet publicly called for pulling the plug, but anti-public education zealots like the billionaire Walton family and the Koch brothers have plenty of other places to invest in to try to bring down "government schools."

Big, Big Payouts to Execs at Taxpayer Expense

In its recommendation that shareholders vote against the pay proposal, the advisory firm Glass Lewis & Co. said K12 exemplifies a "substantial disconnect between compensation and performance results." Glass Lewis gave the company an "F" for how it paid its executives compared to peers.

In 2015, K12 CEO Nathaniel Davis was making $5.3 million and CFO James Rhyu was making $3.6 million. Their base salaries were $700,000 and $478,500, respectively, which were dwarfed by additional pay and stock for their "performance." (See more details on their total compensation in the pdf uploaded below.)

In all, K12’s five highest paid executives received a total of more than $12 million in compensation last year. That’s one of the reasons CMD has called K12 Inc.’s former CEO, Ron Packard, the highest paid elementary and secondary school educator in the nation.

Nearly 90% of K12’s revenues–and thus its huge pay for executives</a–<comes from Americans' state or federal tax dollars.

K12 Inc. also pays each member of its Board of Directors between $155,000 and $216,000 annually for a few hours of work each year—far more than local school board members make for much more time spent in general. (See uploaded K12 proxy filings below for the details.)

While K12’s promoters love to mention that it is a publicly traded company, it is also trading at its lowest stock price since 2010, down 75 percent from its September 2013 peak.

Meanwhile, a new report from Stanford University’s Center for Research of Education Outcomes (CREDO) found that online charters do a very poor job of educating children. In general, students in online charters lose 42 days of reading in a year, and 180 days of instruction in math. And there are only 180 days of instruction in most public school years.

Enrollment has also dropped almost 5 percent from its peak. No less a business authority than Bloomberg Business investigative reporter John Hechinger presented grim prospects for K12 as of late 2014, and no one has revised them upward.

Millions in K12 Ads at Taxpayer Expense Too

This decrease in business has come despite massive advertising and marketing expenditures by the virtual schools industry. K12 has spent untold millions in public funds on ads—a luxury budget item that traditional public schools are not permitted even when competing with K12 for students.

It spent at least $20 million on ads in 2012 alone, but it has not publicly disclosed ad spending in recent years even as its ads have become more ubiquitous in markets like Wisconsin and Arizona, for example. K12 does not disclose its ad budget in its public annual report.

Plus Taxpayer Money Helps K12 Pay to Play with ALEC Politicians

K12 also spends taxpayer money lobbying state and federal officials. It recently got a seat, for example, on the corporate board of the American Legislative Exchange Council (ALEC), where for years it has also paid for a seat and vote on ALEC’s "Education and Workforce Development" Task Force, which advances a "cash for kids" lobbying agenda.

ALEC corporations spend tens of thousands of dollars each year for such access to lawmakers, and K12 has also paid many thousands of dollars to underwrite some of ALEC’s docket of events for legislators and lobbyists.

Through the ALEC Task Force, K12 has actually had an equal vote with state legislators on so-called "model" bills to divert taxpayer funds away from traditional public schools toward the objectives of ALEC’s private sector funders, to help their bottom-lines and/or legislative agenda.

ALEC’s "Virtual Public Schools Act," for example, even allows virtual schools to be paid the same amount per pupil as traditional public schools even though operations like K12 have no bricks and mortar school house or desks or air-conditioning or gyms, etc., to maintain.

As CMD’s SourceWatch has documented:

"In 2004 when the ‘model’ bill was drafted and approved, both K12 Inc. and Connections Academy were part of the ‘School Choice Subcommittee of ALEC’s Education Task Force, according to an archived version of ALEC’s website from February 2005. The subcommittee recommended six bills for adoption, including the ‘Virtual Public Schools Act.’ According to ALEC, the bill was drafted by Bryan Flood of K12 along with Mickey Revenaugh of Connections Academy, then-Colorado Representative Don Lee (now a lobbyist for K12, see [below]), ‘and the rest of the Subcommittee.’" (Connections is now part of Pearson PLC, a British mega-corporation headquartered in London.)

K12’s reps at ALEC Education Task Force meetings have been its Senior VP for Government Affairs (lobbying), Bryan Flood, along with its VP for Government Affairs, Don Lee, and its Senior Director of Government Affairs, Bob Fairbank.

ALEC’s Education Task Force is co-chaired by Utah state Sen. Howard Stephenson (R-11). Through the ALEC corporate bill mill, Stephenson has even done a roadshow with K12’s Don Lee to drive more business to K12 through legislation. Given his advocacy of efforts to divert tax dollars from traditional public schools to charters and virtual schools, some press in Utah have questioned whether Stephenson is a public servant or a lobbyist for outside interests. (There is no way to independently verify whether Stephenson has actually ever invested in K12 or Pearson, or not.)

Notably, Lee and Fairbank are both former Colorado state legislators who took the revolving door out of public service into well-paid gigs, like peddling what K12 is selling to legislatures across the country. And, the head of their lobbying shop, Flood, is the former flack for then-Gov. John Engler of Michigan, who is now pulling down big bucks for sitting on K12’s Board of Directors: $55,000 in cash plus $100,000 in K12 stock for a few hours of his time last year.

Making "Friends" Everywhere K12 Goes….

Utah, Arizona, and Wisconsin are not the only states where K12 is active and facing criticism. The "Ohio Virtual Academy," for example, which accounted for 10 percent of K12’s revenue in 2014, received failing grades on a state report card for student test-score progress and graduation rates. A state analysis found that only 37 percent of K12’s Ohio ninth graders earned diplomas within four years.

K12’s operations in California have produced similar results, as In the Public Interest (ITPI) has documented, despite K12’s efforts to blame the state. (CMD has partnered with ITPI on research previously.)

Several online charters have cancelled their contracts with K12, and in Tennessee, education commissioner Kevin Huffman called for shuttering the Tennessee Virtual Academy because it had test results "in the bottom of the bottom tier" and is an "abject failure."

Altogether, K12 has lost management contracts or been threatened with school shutdowns in five states.

The National Collegiate Athletic Association (NCAA) also ruled last April that prospective students from 24 K12 Inc. high schools can no longer count credits toward athletic scholarships.

A pro-union decision by the California Public Employment Relations Board no doubt came as more bad news for K12’s brass. The board ruled that the California Teachers Association (CTA) is the exclusive bargaining agent of the more than 750 teachers at the Simi Valley-based California Virtual Academies (CAVA). Teachers have been seeking a stronger voice in improving working conditions and student learning for CAVA’s 15,000 students.

CAVA teachers had been calling for improvements for years. In March 2015 a study of CAVA by ITPI called for better oversight. In June 2015, CTA filed complaints with school districts that authorized CAVA charters throughout California.

K12 Hoping "Non-Managed" Schools Will Save It?

While no one is publicly calling for K12 to shut down, K12 itself is "diversifying its portfolio" in an apparent effort to ease out of the online charter school business.

K12 has built its brand by operating "managed schools" in which K12 runs and profits from all of the programs at a particular K12 school. In a managed school, the company does all of the teaching, curriculum, assessment for the customers—er, students—who choose it over attending a public school or participating in a traditional home-schooling arrangement.

The new revenue stream K12 is pioneering is in what it is now calling "non-managed schools" in which K12 sells the digital content and platform for a school for some other company or entity to run (and be responsible for the results). Non-managed programs have been growing by leaps and bounds as managed virtual schools have fallen on hard times.

The only problem with this model is that managed schools still bring in much more money than the non-managed kind. Some managed schools, for example, bring in $1,849 per student while non-managed schools bring in only $462 per pupil on average.

But, getting some revenue without being responsible for results may be the way for the future of K12: an analysis of K12 figures comparing September 2015 to the prior year showed that enrollment at "managed" virtual schools was declining 12 percent while it is increasing 34.5 percent at "non-managed" schools.

Non-management could take profiting from taking money out of traditional public schools without real accountability to a new level for K12.

CMD’s Executive Director Lisa Graves contributed research to this report.

k12inc 2.pdf

K12 Inc. Deploys D2L’s Brightspace Across High School, Middle School and Fuel Education

KITCHENER, ON–(Marketwired – August 11, 2016) – D2L, a global learning technology leader, today announced that K12 Inc., one of the largest virtual schools in the U.S., is continuing to expand the use of the Brightspace LMS. Following a successful rollout to thousands of students across the country enrolled in K12’s high school, K12 is now making Brightspace available to thousands more middle school students.

In addition, K12’s Fuel Education will use Brightspace for the distribution of its curriculum. Fuel Education will begin rolling out Brightspace in December with a full rollout scheduled for the first half of 2017.

D2L’s Brightspace platform was embraced by K12 due to a fundamental distinction: Brightspace delivers a personalized learning experience, not the one-size-fits-all model utilized by traditional LMS offerings. Brightspace was designed with modern students in mind and offers a clean, responsive user experience as well as integrated social media, game-based learning, chat and advanced video features. The new Brightspace Daylight experience lets students and teachers use smartphones, tablets or any browser-enabled device, eliminating barriers to learning. Teachers also favor Brightspace because engagement data — offered via real-time learning analytics </strong–< can help them improve student outcomes.

“D2L’s customers such as K12 Inc. care deeply about the educational experience and want a more personalized, engaging learning platform to help each learner learn their own way,” said John Baker, CEO of D2L. “Brightspace is an easy, flexible and smart LMS that was built from the ground up to do exactly that. We are very pleased that K12 and Fuel Education learners will benefit from this personalized approach and learn on their own terms to achieve their academic goals. We look forward to continuing to broaden the scope of our partnership.”

“Our goal in considering a new LMS was to improve student engagement, retention and outcomes while advancing our effort to deliver a more mobile-ready curriculum,” explained Lynda Cloud, Executive Vice President of Products at K12 Inc. “After thorough evaluation, K12 chose D2L to power K12’s next-generation online high school and middle school. The Brightspace platform has enabled us to provide students, learning coaches, and teachers with an innovative, engaging and collaborative learning experience that puts tools and resources right at their fingertips. Parents find that both they and their students have better visibility into what students need to do each day, allowing them to spend more time learning.”

D2L’s track record of innovation has been widely recognized. In March, Fast Company ranked D2L #6 on the Most Innovative Companies of 2016 list in the Data Science Category, amongst Google, IBM, Spotify, Costco, and Blue Cross Blue Shield. eLearning Magazine recently rated D2L as #1 in Adaptive Learning, and Brightspace was recently named the #1 LMS in Higher Ed by Ovum Research.

To learn more about Brightspace, visit http://www.d2l.com/products/learning-environment/.

ABOUT K12 INC.

K12 Inc. (LRN) is driving innovation and advancing the quality of education by delivering state-of-the-art, digital learning platforms and technology to students and school districts across the globe. K12’s award winning curriculum serves over 2,000 schools and school districts and has delivered more than four million courses over the past decade. K12 is a company of educators with the nation’s largest network of K-12 online school teachers, providing instruction, academic services, and learning solutions to public schools and districts, traditional classrooms, blended school programs, and directly to families. The K12 program is offered through K12 partner public schools in approximately two-thirds of the states and the District of Columbia, and through private schools serving students in all 50 states and more than 100 countries. More information can be found at K12.com.

ABOUT FUEL EDUCATION

Fuel Education™ partners with school districts to fuel personalized learning and transform the education experience inside and outside the classroom. The company provides innovative solutions for pre-K through 12th grade that empower districts to implement successful online and blended learning programs. Its open, easy-to-use Personalized Learning Platform, PEAK™, enables teachers to customize courses using their own content, FuelEd courses and titles, third-party content, and open educational resources. Fuel Education offers one of the industry’s largest catalogs of K–12 digital curriculum, certified instruction, professional development, and educational services. FuelEd has helped 2,000 school districts to improve student outcomes and better serve diverse student populations. To learn more, visit getfueled.com and Twitter.

ABOUT BRIGHTSPACE

D2L’s Brightspace is a digital learning platform that helps schools and institutions deliver personalized learning experiences in a classroom or online to people anywhere in the world. Created for the digital learner, Brightspace is cloud-based, runs on mobile devices, and offers rich multimedia to increase engagement, productivity and knowledge retention. The platform makes it easy to design courses, create content, and grade assignments, giving instructors more time to focus on what’s most important – greater teaching and learning. At the same time, analytics reports track and deliver insights into the performance levels of departments, courses, or individuals.

ABOUT D2L

D2L is the software leader that makes learning experiences better. The company’s cloud-based platform, Brightspace, is easy to use, flexible, and smart. With Brightspace, organizations can personalize the experience for every learner to deliver real results. The company is a world leader in learning analytics: its platform predicts learner performance so that organizations can take action in real-time to keep learners on track. Brightspace is used by learners in higher education, K-12, and the enterprise sector, including the Fortune 1000. D2L has operations in the United States, Canada, Europe, Australia, Brazil, and Singapore. www.d2l.com

© 2016 D2L Corporation.

The D2L family of companies includes D2L Corporation, D2L Ltd, D2L Australia Pty Ltd, D2L Europe Ltd, D2L Asia Pte Ltd, and D2L Brasil Soluções de Tecnologia para Educação Ltda.

All D2L marks are trademarks of D2L Corporation. Please visit D2L.com/trademarks for a list of D2L marks.

K12 (LRN) Regains Footing After Massive Sell-off

Stephen L Kanaval

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Wednesday, 10 August 2016 15:26 (EST)

K12 (LRN)), a technology-based education provider,is now involved in multiple class action lawsuits alleging that the company lied about its student success rates, parent satisfaction, class size, graduates’ eligibility for the University of California and California State University, among other modes of data that was used in press releases and advertisements.

The class action lawsuits stem from a San Jose Mercury News investigation from April this year that looked to expose K12 as a fraudulent moneymaking enterprise that fabricated a wide variety of claims (summarized above).The investigation aimed to demonstrate how K12, a Virginia-based company, took advantage of California education law that have no specific rule about for-profit firms running charter schools in the state. Initially, K12 established online schools with individual, separate names so that the school and the corporation seemed unlinked for tax-exempt purposes because Federal Tax Laws prohibit charitable organizations from working to benefit a company. However, the report alleges that K12 employees started online schools posing as a “group of parents.” The company tried later to open a brick and mortar school in Contra Costa County, but was denied on the grounds that the Virginia administrative entity would be running day-today decision making. In addition, the report found that teachers lied about attendance to keep taxpayer dollars coming, very few online students earned diplomas, the company has reaped $312 million in profits over the last twelve years, schools that oversee the online academies get a cut of revenues and are inclined to turn the other way when they see inaccuracies, and many students test well-below state standards in reading and math.

Now, that being said, the company has rallied since April and many analysts were buying the stock to capitalize on the lower cost. In its most recent press release this Tuesday, the company saw earnings per share fall and revenues slumped by 9%. Following that, the stock was sliding but rallied again this morning. During the same press release, the company also said that they have settled with the Attorney General of California and no wrongdoing was admitted. The company logged a $7.1 million settlement for 4Q as a net charge that will go to taxpayers and government expenses accrued in the probe. The volatility of LRN is well documented and many buyers will stay away as more lawsuits are coming, but the truth is that the company is still enrolling students in public school areas and at-home.

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Companies

Symbol Name Price Change % Volume
 Follow LRN K12 Inc 11.70 154,769

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K12 upgraded to Overweight By First Analysis

August 10, 2016 10:01 am

Writer: Camille Ainsworth

Posted In:

US Broker Ratings

In an analyst rating update on Wednesday shares of K12 (NYSE:LRN) had their rating upgraded by analysts at First Analysis.

The broker said it has now set a ‘Overweight’ rating on shares of K12 with a price target of 14. The price target according to the broker shows a possible increase of 23.35% from the current stock price of 11.35.

Over the last twelve months K12’s share price has decreased from 14.88 to 11.35, changing by -23.72%.

The companies 50 day moving average is 12.68 and its 200 day moving average is 11.16. The 52 week high K12’s shares have peaked at is 15 whilst the 52 week low for the company’s shares is 7.11.

K12 has 37,492,000 shares which are currently outstanding with a price of 11.35 calculating K12’s market capitalisation to 425.53M USD .

K12 Inc. (K12) is a technology-based education company. The Company offers curriculum, software systems and educational services designed to facilitate individualized learning for students in kindergarten through 12th grade (K-12). It provides a range of technology-based educational products and solutions to public school districts, public schools, virtual charter schools, private schools and families. The Company offers a set of products and services primarily to three lines of business, which include public school programs, which consists of managed programs and non-managed programs, Institutional Sales, which includes educational products and services sold to school districts, public schools and other educational institutions that it does not manage and international and private pay schools, which consists of private schools. The Company offers a range of learning applications, which include mobile learning, interactive games, virtual labs, e-book and digital book distribution.

Trading Review: Looking at Unusual Volume for K12, Inc. (NYSE:LRN)

by Engelwood Staff August 9, 2016

Shares of K12, Inc. (NYSE:LRN) are experiencing unusual volume during today’s trading.  While the stock price moved along with the volume change, shares are touching $11.04 at the time of writing.  The day’s total volume of 365438 this morning is in contrast from the three-month daily average of 153.50K.  When we divide the current volume by the three-month average volume, we get a relative volume of 4.15.

The difference between yesterday’s closing price and today’s opening price was -6.86%.  

Why is this important?

Trading volume is a hugely important consideration for any investor.  By watching how many shares are trading hands and looking for any changes in that activity, trading opportunities can be spotted along with a deeper understanding of the reliability of other indicators on the stock.  A significant increase in trading volume means that more than double the average amount of stocks are moving.  When volume is decreased significantly, it may indicate there is an issue that shareholders should watch out for.  It’s also important to take into consideration how long the unusual volume sustains for.  If it’s only the one trading day, it can be dismissed as an anomaly.

Looking Back

K12, Inc. (NYSE:LRN)‘s market capital, the total dollar value of all of their outstanding shares, is 509.09m.  Including today’s unusual volume, K12, Inc.‘s stock is performing at 45.80% on the year.  For the week, the stock is performing -1.53%.  Over the past month the firm’s stock is -1.00%, 7.18% for the last quarter, 33.09% for the past six-months and -9.77% for the last year.

Current levels places the company’s stock about -20.59% from the 50-day high and 0.16% away from the 50-day low.  

Disclaimer: The views, opinions, and information expressed in this article are those of the authors and do not necessarily reflect the official policy or position of any company stakeholders, financial professionals, or analysts. Examples of analysis performed within this article are only examples. They should not be utilized to make stock portfolio or financial decisions as they are based only on limited and open source information. Assumptions made within the analysis are not reflective of the position of any analysts or financial professionals.

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K12 Inc. (LRN) Releases Quarterly Earnings Results

Posted by Andrew Walz on Aug 9th, 2016 // 0 Comments

K12 Inc. (NYSE:LRN) announced its quarterly earnings results on Tuesday. The company reported $0.09 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.13 by $0.04. The business earned $221.30 million during the quarter, compared to the consensus estimate of $210.13 million. During the same period in the prior year, the business earned $0.18 EPS. K12’s quarterly revenue was down 6.1% on a year-over-year basis.

K12 (NYSE:LRN) opened at 12.83 on Tuesday. The company’s market capitalization is $481.02 million. The company’s 50 day moving average price is $12.70 and its 200-day moving average price is $11.13. K12 has a 12-month low of $7.11 and a 12-month high of $15.00.

Several equities research analysts have issued reports on LRN shares. Barrington Research restated a “market perform” rating on shares of K12 in a report on Friday, July 15th. TheStreet upgraded K12 from a “sell” rating to a “hold” rating in a report on Friday, July 8th.

K12 Inc (K12) is a technology-based education company. The Company offers curriculum, software systems and educational services designed to facilitate individualized learning for students in kindergarten through 12th grade (K-12). It provides a range of technology-based educational products and solutions to public school districts, public schools, virtual charter schools, private schools and families.

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K12 education company settles case with Calif.

Local Education

By Ty Tagami


The Atlanta Journal-Constitution

Updated: 5:08 p.m. Thursday, July 28, 2016Posted: 2:47 p.m. Thursday, July 28, 2016

A company that is paid tens of millions of dollars to provide educational services in Georgia has settled a legal case in California after a state investigation into allegations of improper billing there.

There’ve been no public allegations of impropriety in Georgia, where the company, K12 helps operate Georgia Cyber Academy. The academy has come in for criticism over student results: in 2015, the school earned a D for its academic performance with more than 13,000 Georgia students, as reported by The Atlanta Journal-Constitution.

The Georgia academy is among the five biggest schools managed by K12, officials said. The company educates about as many students at a collection of 14 schools in California called the California Virtual Academies, or CAVA.

K12 was the target of a civil investigation by California Attorney General Kamala D. Harris, whose office alleged that K12 exploited weak charter school oversight in her state to excessively bill CAVA schools by pressuring teachers to sign “doctored” attendance records. Her office also accused the school of telling people it thought were prospective parents that classes were smaller than they really were.

On July 8, K12 agreed to settle for millions of dollars, without admitting to the alleged facts or to wrongdoing. Harris issued a statement saying the company had agreed to a settlement of $168.5 million, which K12 CEO Stuart Udell characterized as “shameless and categorically incorrect” in a conference call afterward with financial analysts.

The company did agree to pay $2.5 million to the state and $6 million to the attorney general’s office. But K12 objects to the way Harris described the other $160 million.

She called it “debt relief to the non-profit schools it manages.” Udell called it “the difference between K12’s contractual price and what the schools can afford to pay” based on their state funding.

“While K12 has a contractual right to recover these balanced budget credits, in all the years that K12 has worked with the CAVA boards we have never sought to recover those amounts,” Udell said on that conference call, according to a transcript provided by K12.

The final judgment in the case describes the $160 million agreement this way: an expungement of a decade’s worth of “credits against amounts otherwise due under managed school contracts.”

Neither the conference call nor the attorney general’s news release addressed another payment: $80,000 to a former CAVA teacher turned whistleblower. She alleged she was fired because she complained about the way K12 changed the attendance records she had submitted. The attorney general intervened in her case and K12 agreed to give her $50,000 to settle her employment-related claims and $30,000 for her legal fees.

Udell told the analysts that the company settled with the attorney general to avoid a “multiyear distraction” and litigation costs that would have been many times what it agreed to pay. He also said the company plans to fight legislation in California that would prohibit charter schools from using for-profit companies like his. And he said K12, which runs some 80 schools in 33 states, has plans to expand, going statewide in Alabama and Virginia and adding schools in other states, including Indiana, Michigan, Nevada and Maine.