California ‘virtual’ academies: Bill targets for-profit operator K12 Inc.

By Jessica Calefati, jcalefati@bayareanewsgroup.com

Posted:
 
06/10/2016 05:42:47 PM PDT |Updated:   about 22 hours ago

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SACRAMENTO — Online charter schools would be prohibited from hiring for-profit firms to provide instructional services under a new bill that the author says is a direct response to this newspaper’s investigation of the company behind a profitable but low-performing network of “virtual” academies.

That company is K12 Inc., a publicly traded Virginia firm that allows students who spend as little as one minute during a school day logged onto its software to be counted as “present,” as it reaps tens of millions of dollars annually in state funding while graduating fewer than half of its high school students. Students who live almost anywhere south of Humboldt County may sign up for one of the company’s schools.

File photo:Former California Virtual Academies student Elizabeth Novak-Galloway, 12, plays a video game on her laptop in her San Francisco home on Feb. 18, 2016. (Dai Sugano/Staff archives)

Assembly Bill 1084, authored by Assemblywoman Susan Bonilla, D-Concord, would prevent charter schools that do more than 80 percent of their teaching online from being operated by for-profit companies or hiring them to facilitate instruction. If passed and signed into law by Gov. Jerry Brown, the legislation would effectively put companies like K12 out of business in the Golden State.

“Our taxpayer dollars should be spent in the classroom to help our students, not used to enrich a company’s shareholders or drive up its profits,” Bonilla said in an interview.

But K12 spokesman Mike Kraft railed against the proposal, calling it “another cynical effort to take away the rights of parents to choose the way their kids are educated.”

“This bill is nothing more than a PR effort designed to appease big money special interests that hide in the shadows, harming California families,” Kraft wrote in an email, alluding to the support teachers unions have given to similar legislation in the past.

“Today, more than 14,000 California children attend virtual public charter schools, many in the Assemblymember’s own district,” Kraft added. “How many of their families has she spoken with before deciding to try to take away their choice?”

Before the newspaper’s two-part investigative series was published in April, Bonilla said, she didn’t know how wide the achievement gap was between students enrolled in K12’s California Virtual Academies and those who attend other public schools. But the more she learned about the company’s track record, the more she felt motivated to act.

The series highlighted research that shows online schools’ hands-off learning model isn’t appropriate for most children and found that accountability for student performance is sorely lacking. In fact, the districts tasked with overseeing K12’s California schools have a strong financial incentive to turn a blind eye to problems because they receive a cut of California Virtual Academies’ revenue to oversee them.

The stories 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.

Earlier this month, another bipartisan group of lawmakers responded to the newspaper’s findings by calling for a wide-ranging state audit of for-profit charter schools.

“We’re already more than half way through the legislative session, so I knew we had to act quickly,” Bonilla said. “This bill is focused, targeted and designed to get through the legislative process this year.”

Because deadlines for introducing new legislation have already passed, Bonilla had to “gut and amend” another bill so that her new measure could move forward as soon as possible.

For the measure to advance, it must be approved by the Senate Education Committee before lawmakers break for the summer in early July. After they return in August, the bill would need to clear a floor vote in the Senate, a policy committee in the Assembly and an Assembly floor vote within a matter of weeks.

Assemblyman Roger Hernandez, D-West Covina, authored similar legislation last year, but Brown rejected Assembly Bill 787, writing in his veto message: “I don’t believe the case has been made to eliminate for-profit charter schools in California.”

The governor went on to state that “the somewhat ambiguous terms used in this bill could be interpreted to restrict the ability of nonprofit charter schools to continue using for-profit vendors” such as textbook publishers or transportation providers.

Bonilla said she doesn’t know if Brown will support AB1084 — he typically doesn’t reveal his views on pending legislation before squashing it or signing it into law. But Bonilla said she attempted to address the governor’s concern about ambiguity by specifying in her bill that online charter schools can’t hire for-profit companies for instructional services. So the schools could still contract with publishers and private transportation companies.

“Profit doesn’t belong in public education, and taxpayer dollars shouldn’t be spent on for-profit instruction,” said Bonilla, who will be termed out in December. “This has been going on here for years, and it has to stop.”

To reach the governor’s desk by the end of August, AB1084 will likely need support from powerful interest groups such as the California Teachers Association and the California Charter Schools Association. The CTA sponsored Hernandez’s bill, and while spokeswoman Claudia Briggs said the union would need more time to review Bonilla’s bill before taking a formal position, she said it sounded like “a bill we could get behind.”

Emily Bertelli, a California Charter Schools Association spokeswoman, has previously said the organization would support legislation that bans for-profit companies such as K12 from operating charter schools.

Asked to comment on AB1084, Colin Miller, the association’s acting senior vice president for government affairs, said the group is still evaluating the impact of the proposal’s language.

“The association has been committed to operational transparency, authorizer accountability and quality academic performance for all charter schools,” Miller said. “But we also want to ensure that optimal flexibility is maintained. We hope to work with the author to find the right solution.”

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

K12 Inc. statement about investigation of California schools

Bay Area News Group

Posted:
 
04/18/2016 08:34:44 PM PDT Updated:   about a month ago

K12 Inc. released the following statement Monday in response to a Bay Area News Group investigation published Sunday and Monday into the Virginia company’s network of online charter schools in California.

HERNDON, Va., — This week, The San Jose Mercury News published two articles about K12 Inc. and the California Virtual Academies (CAVA) — eleven independent public charter schools — that are inaccurate, incompletely researched, and missing the balanced input of many parents whose children have attended and been served by these schools.

Most concerning, these stories cite several politically-driven claims about the CAVA schools that are substantially similar, and in some cases identical, to allegations made by the California Teachers Association (CTA) in their multi-year campaign to unionize the CAVA schools. These issues have been addressed and in many instances roundly refuted. The paper fails to disclose that the few teachers quoted in the article represent a small subset of CAVA teachers organizing on behalf of CTA. The union opposes charter schools, and has also lobbied for legislation aimed at shutting down CAVA schools and other similar public schools of choice.

Parents of children with a variety of educational needs choose CAVA schools: students with special needs who are not receiving the services they require at their local schools; children who struggle in traditional schools; students who are bullied; academically gifted children; and many more. We believe parents know their children best, and we respect the choices they make.

The Mercury News articles are inconsistent with the positive experiences of thousands of California parents who thoughtfully choose CAVA schools for their children. They ignore the experience of the majority of CAVA teachers and educators who are passionate about their work, committed to these schools, and who reject the self-serving goals of the CTA. And they fail to represent fairly the volunteers–many of whom are themselves parents of CAVA students–who serve on the independent, nonprofit CAVA schools’ boards. The Mercury News should have considered the input of a wider sample of parents and teachers.

K-12 public schools are highly regulated entities, and as a services provider to public schools across the U.S. we take compliance very seriously. Each CAVA school is governed by a separate and independent charter school board. Each school follows state and federal regulations, and operates under California’s Independent Study program designed for non-classroom-based educational programs. These schools are open, transparent, and accountable. They operate under multiple layers of oversight at the state and local levels, undergo annual independent financial and programmatic audits, and have strong records of compliance.

K12’s mission is to serve our school partners and to assist them in making student achievement the first goal. Where there are deficiencies, we make improvements. If mistakes are made, we correct them. We work constantly to enhance our products and academic services–and, in turn, to facilitate student success. K12 is an organization of educators, teachers, and professionals who are dedicated to providing quality services to the schools and students we are privileged to serve. Unfortunately, these articles do not fairly tell that side of the story.

K12 Inc. statement about investigation of California schools

Bay Area News Group

Posted:
 
04/18/2016 08:34:44 PM PDT Updated:   about a month ago

K12 Inc. released the following statement Monday in response to a Bay Area News Group investigation published Sunday and Monday into the Virginia company’s network of online charter schools in California.

HERNDON, Va., — This week, The San Jose Mercury News published two articles about K12 Inc. and the California Virtual Academies (CAVA) — eleven independent public charter schools — that are inaccurate, incompletely researched, and missing the balanced input of many parents whose children have attended and been served by these schools.

Most concerning, these stories cite several politically-driven claims about the CAVA schools that are substantially similar, and in some cases identical, to allegations made by the California Teachers Association (CTA) in their multi-year campaign to unionize the CAVA schools. These issues have been addressed and in many instances roundly refuted. The paper fails to disclose that the few teachers quoted in the article represent a small subset of CAVA teachers organizing on behalf of CTA. The union opposes charter schools, and has also lobbied for legislation aimed at shutting down CAVA schools and other similar public schools of choice.

Parents of children with a variety of educational needs choose CAVA schools: students with special needs who are not receiving the services they require at their local schools; children who struggle in traditional schools; students who are bullied; academically gifted children; and many more. We believe parents know their children best, and we respect the choices they make.

The Mercury News articles are inconsistent with the positive experiences of thousands of California parents who thoughtfully choose CAVA schools for their children. They ignore the experience of the majority of CAVA teachers and educators who are passionate about their work, committed to these schools, and who reject the self-serving goals of the CTA. And they fail to represent fairly the volunteers–many of whom are themselves parents of CAVA students–who serve on the independent, nonprofit CAVA schools’ boards. The Mercury News should have considered the input of a wider sample of parents and teachers.

K-12 public schools are highly regulated entities, and as a services provider to public schools across the U.S. we take compliance very seriously. Each CAVA school is governed by a separate and independent charter school board. Each school follows state and federal regulations, and operates under California’s Independent Study program designed for non-classroom-based educational programs. These schools are open, transparent, and accountable. They operate under multiple layers of oversight at the state and local levels, undergo annual independent financial and programmatic audits, and have strong records of compliance.

K12’s mission is to serve our school partners and to assist them in making student achievement the first goal. Where there are deficiencies, we make improvements. If mistakes are made, we correct them. We work constantly to enhance our products and academic services–and, in turn, to facilitate student success. K12 is an organization of educators, teachers, and professionals who are dedicated to providing quality services to the schools and students we are privileged to serve. Unfortunately, these articles do not fairly tell that side of the story.

California Virtual Academy: San Mateo board’s statement about investigation

Bay Area News Group

Posted:
 
04/18/2016 03:12:14 PM PDT Updated:   about a month ago

The board of directors from the California Virtual Academy at San Mateo issued the following statement Monday in response to a Bay Area News Group investigation published Sunday and Monday into the online charter and its partner schools run by for-profit K12 Inc.

Recent articles in The Mercury News are a gross misrepresentation of our school and its operations, and the independence of our nonprofit charter school board.

We are members of the California Virtual Academy @ San Mateo public charter school board. Our school is part of one of the CAVA public charter schools, each governed independently by their nonprofit school boards made up of California residents, including parents, educators, and local community leaders who are committed to providing families with educational options for their children.

Alleging that we have any other interest except for our children and the CAVA families is both wrong and insulting. We take our role as governing board members very seriously. We are volunteers. We are not paid. Many of us have children in the CAVA schools. We have experience serving on other nonprofit boards. Our school has its own independent attorneys who guide us to ensure we are in compliance with state charter school regulations. We provide input and work together with our school administrators, just like other charter schools.

The allegations made in these articles about our schools are inaccurate. They are the same attacks made repeatedly by opponents of public charter schools, including by the California Teachers Association, an organization that has been aggressively attempting to unionize all eleven of the CAVA network of schools. The union has disparaged our schools and lobbied for legislation directly aimed at shutting our schools down and taking these options away from our parents, students, and teachers.

Our parents are extremely thankful that CAVA is an option for their children. Thousands of families choose CAVA schools. Many students are succeeding. We see hundreds of students graduating from CAVA schools each year. Unfortunately, the paper all but dismissed the successes. Further, the paper never asked why parents are leaving their local schools and choosing CAVA schools. Parents would not choose alternatives if their local school was working for their child. Sadly, the paper completely ignores the positive experiences of the vast majority of CAVA families and teachers, electing instead to quote a small handful of critical voices. It is exactly what opponents of charter schools have done for years. This is classic case of unfair and biased journalism.

Parents want choice in education. Students deserve options, because one size does not fit all. We love our school. We are proud to represent and stand with CAVA’s educators and families. We are proud of the achievements and the hard work of our students, staff, and volunteer board members.

— Don Burbulys, President, CAVA @ San Mateo

Erin Wong, Board Member, CAVA @ San Mateo

Christa Enns, Board Member, CAVA @ San Mateo

Stephen Warren, Board Member, CAVA @ San Mateo

Insolvent school's charter sized up for revocation




By




POSTED: LAST UPDATED: 04:57 p.m. HST, Jan 08, 2015












BRUCE ASATO / JULY 28, 2014

Kilinahe Nahoi, a parent, and Laara Allbrett, Halau Lokahi Public Charter School director, walk to South Beretania Street for a sign waving event on July 28 to garner public support for Halau Lokahi. “We are fighting for education,” said Allbrett.

The commission overseeing public charter schools moved Thursday to begin shutting down the financially strapped Halau Lokahi Public Charter School Thursday, ending a months-long struggle to keep the Hawaiian-focused school afloat.

The nine-member Charter School Commission voted 6-2 to issue a notice of revocation to the Kalihi school, representing the first step toward closing the school. The school will have a 30-day window to appeal. If upheld, it would be the first time a Hawaii charter has been revoked.

Tom Hutton, the commission's executive director, said staff will immediately begin reaching out to parents of the school's 114 students in kindergarten through high school to help find alternatives.

Students were scheduled to return from winter break Tuesday.

The commission had asked Halau Lokahi's governing board to come up with a financial sustainability plan over winter break before deciding whether to release another round of per-pupil funds to the school.

Elizabeth Blake, a school improvement consultant who was named acting director of the school, presented a plan to bring on a mainland curriculum provider to deliver instruction online for secondary students, taught by certified K12 Inc. teachers.

Under that plan, the company, K12 Inc., also would provide $150,000 to help fund operations through the end of the school year – if a proposed memorandum of understanding was signed to pay the company a percentage of future revenues for the remaining 2.5 years of Halau Lokahi's charter contract.

“Give us a chance to go through this semester and show you that we will turn this school around,” Blake told the commission. “I feel like were being nailed to the wall for other past practices.”

The school had run out of money before the end of the last school year, and stopped paying its rent and staff. It ended that year with a $502,000 debt. The school has about $90,000 in estimated outstanding debts.

In June, the commission required the school to replace its governing board and longtime director and founder, Laara Allbrett, and come up with a financial plan that would carry it through the school year, before they allowed it to reopen. But the campus again faced a shortfall, as enrollment fell below projections.

Some commission members viewed the proposed online component with K12 Inc. as too big of a shift from Halau Lokahi's approved academic plan.

Hutton called the plan a risky undertaking, even for a school that wasn't insolvent.

“This is a very different way of doing education in this school. … This discussion started two days ago, and school starts next week. That is, from our standpoint, pretty risky when you're talking about kids,” he said. “This would be a big challenge for a very highly functioning school. This school is not a highly functioning school. This is a severely challenged school on all levels and it's being asked to do a very, very ambitious change in how it does everything.”

Amid the financial scrutiny, the school has come under investigation by the state Attorney General's office, which executed a search warrant at the school in November, seizing financial and personnel records as well as computers. Soon after, school co-director Callei Allbrett, Laara Albrett's daughter, was put on administrative leave.

Two apply to run virtual public charter schools | Under the Dome Blog | NewsObserver.com

Two apply to run virtual public charter schools

Posted by Lynn Bonner on October 22, 2014

2014-10-22T22:40:57Z

The legislature ordered two virtual charter schools be approved for pilot programs beginning next year. The State Board of Education put out the call for applicants and got two responses.

The North Carolina Virtual Academy, which would contract with the for-profit company K12, and North Carolina Connections Academy applied.

Like traditional charters, the virtual charters would be public schools using taxpayer money to educate students. But class work would be done online.

K12 has tried to get a foothold in the state for years. NC Learns, a nonprofit that would have used K12’s curriculum, had a lawsuit to force the state to let it operate. K12 has been controversial other states.

The Tennessee Education Commissioner ordered the Tennessee Virtual Academy run by K12 to close next year because of low student growth.

North Carolina Connections Academy has tried to gain approval through the traditional State Board process. The board rejected its application this year, but there was some talk among members that it might make sense for the Connections Academy to apply as a pilot project.

An education consultant with the charter school office in the state Department of Public Instruction, said the board would still go through its applicant reviews even though there are only two applicants.

The board is scheduled to talk about the applicants in December and vote in January. The approved schools are scheduled to open in August.

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Do Charter School Students Have First Amendment Rights? – Of, By, For: In Search of the Civic Mission of K-12 Schools – Education Week

Do Charter School Students Have First Amendment Rights?

By Sam Chaltain on September 5, 2013 12:59 PM | 2 Comments

Seven-year-old Tiana Parker is attending a new school in Tulsa this week – and the rest of us would be wise to understand why.

Tiana's father pulled her out of Deborah Brown Community Charter School earlier this week when school officials barred his dreadlocked daughter from entry because of a policy that forbids “faddish hair styles.”

Can a public school do that? And does it matter that they're a public charter school?

Historically, when it comes to issues of student expression in public schools, courts have employed a variety of tests to determine whether restrictions on student dress violate First Amendment rights. Some courts apply a two-part test taken from the Supreme Court's flag-burning cases. Under this test, a court will ask two questions: Did the student intend to convey a particularized message? And is that particularized message one that a reasonable observer would understand?

As an example, a federal court in New Mexico applied this legal test to determine that a student did not have a First Amendment right to wear sagging pants. The student argued that his wearing of the sagging pants conveyed the particular message of African American heritage in the hip-hop fashion and lifestyle. But in Bivens v. Albuquerque Public Schools, the court rejected the student's First Amendment claim, finding that a reasonable observer would not find a particularized message in his conduct. “Sagging is not necessarily associated with a single racial or cultural group, and sagging is seen by some merely as a fashion trend followed by many adolescents all over the United States,” the judge wrote.

Other courts will apply the standard from the famous 1969 case, Tinker v. Des Moines Independent School District, which states school officials cannot regulate student expression unless they can reasonably forecast that the expression will cause a material interference or substantial disruption of the school environment. Or a court could apply the more deferential standard from the 1986 decision in Bethel v. Fraser, in which the U.S. Supreme Court deemed that school officials had greater leeway to regulate student speech that was indecent and lewd. And finally, some courts will analyze student dress challenges under the so-called O'Brien standard. Under the O'Brien test, which is based on a case from 1968, a dress code or uniform policy will be constitutional if the policy is authorized under state law; furthers an important governmental interest; is unrelated to the suppression of free expression; and requires incidental restrictions on First Amendment freedoms that go no further than necessary to further the governmental interest.

So does Tiana Parker's family have a basis for saying that her First Amendment rights were violated?

As it turns out, if she were enrolled in a traditional public school the answer would still be no better than “Maybe,” and, because her reasons for wearing dreadlocks were not motivated by political or religious interests, a more likely answer is “Probably Not.”

But Tiana wasn't enrolled in a traditional public school. She was enrolled in a public charter school. And although the case law for free-expression claims is still emerging when it comes to charter schools – which receive public money but are, in effect, private organizations – the early returns would suggest that the answer there is a more definitive “No.”

Consider the story of Michael Caviness[1], a teacher at a public charter school in Arizona who was fired, and who then sued his former employer for depriving him of his constitutional rights. According to Caviness, the Horizon Community Learning Center was a state actor for all purposes because of its statutory characterization as a “public school,” and because it performed a public function in providing public education.

But the Ninth Circuit Court of Appeals disagreed. “This case presents the special situation of a private non-profit corporation running a charter school that is defined as a public school by state law,” the court explained, before ruling that “a state's statutory characterization of a private entity as a public actor for some purposes is not necessarily dispositive with respect to all of that entity's conduct. Rather, a private entity may be designated a state actor for some purposes but still function as a private actor in other respects. Merely because Horizon is a private entity performing a function which serves the public does not make its acts state action.” The court's ruling added that “except as otherwise specified in Arizona statutes regulating charter schools, or in the school's own charter, a charter school is exempt from all statutes and rules relating to schools, governing boards and school districts.”

Say what? You mean public charter schools are, for purposes of the law, still private entities in many regards? Like, say, student (or teacher) free-speech rights?

Alarmingly, early rulings suggest that the answer is yes. Indeed, in the Caviness opinion the Ninth Circuit cited a 1996 case of its own, George v. Pacific-CSC Work Furlough, in which it reviewed the complaint of a custodial staff employee of a private entity which operated a correctional facility for the state of California. “After the custodial employee was terminated,” Judge Sandra Ikuta explained, “he sued the private company, alleging that his First Amendment rights were violated because he was terminated for speaking out about safety and security problems.”

Ikuta and her colleagues rejected the employee's theory that Pacific was a state actor because it was performing and fulfilling a traditional state and government function. “The relevant inquiry,” they ruled, “is whether [Pacific's] role as an employer was state action” in the employee's case, and noted that “[a]n entity may be a state actor for some purposes but not for others.” We concluded that while “Pacific ha[d] been granted certain powers and privileges under the law to allow it to function adequately as a prison,” the plaintiff failed to show state action because the “complaint offer[ed] no indication Pacific ha[d] become the government for employment purposes.”

Ikuta went on to add that the U.S. Supreme Court, “as well as case law in this and our sister circuits, permits the state to subsidize the operating and capital costs of a private entity without converting its acts into those of the state. Ultimately, Horizon's actions and personnel decisions were made by concededly private parties, and turned on judgments made by private parties without standards established by the State.”

In other words, public charter schools are not, under the law at least, full-blown public schools. That means that even if she had wanted to try, Tania Parker would have had no First Amendment standing. And it means that the two million students in the country currently enrolled in public charter schools – approximately 4% of the total student population, and growing – may have no free expression rights whatsoever.

Follow Sam on Twitter[2].

Do Charter School Students Have First Amendment Rights? – Of, By, For: In Search of the Civic Mission of K-12 Schools – Education Week

Do Charter School Students Have First Amendment Rights?

By Sam Chaltain on September 5, 2013 12:59 PM | 2 Comments

Seven-year-old Tiana Parker is attending a new school in Tulsa this week – and the rest of us would be wise to understand why.

Tiana's father pulled her out of Deborah Brown Community Charter School earlier this week when school officials barred his dreadlocked daughter from entry because of a policy that forbids “faddish hair styles.”

Can a public school do that? And does it matter that they're a public charter school?

Historically, when it comes to issues of student expression in public schools, courts have employed a variety of tests to determine whether restrictions on student dress violate First Amendment rights. Some courts apply a two-part test taken from the Supreme Court's flag-burning cases. Under this test, a court will ask two questions: Did the student intend to convey a particularized message? And is that particularized message one that a reasonable observer would understand?

As an example, a federal court in New Mexico applied this legal test to determine that a student did not have a First Amendment right to wear sagging pants. The student argued that his wearing of the sagging pants conveyed the particular message of African American heritage in the hip-hop fashion and lifestyle. But in Bivens v. Albuquerque Public Schools, the court rejected the student's First Amendment claim, finding that a reasonable observer would not find a particularized message in his conduct. “Sagging is not necessarily associated with a single racial or cultural group, and sagging is seen by some merely as a fashion trend followed by many adolescents all over the United States,” the judge wrote.

Other courts will apply the standard from the famous 1969 case, Tinker v. Des Moines Independent School District, which states school officials cannot regulate student expression unless they can reasonably forecast that the expression will cause a material interference or substantial disruption of the school environment. Or a court could apply the more deferential standard from the 1986 decision in Bethel v. Fraser, in which the U.S. Supreme Court deemed that school officials had greater leeway to regulate student speech that was indecent and lewd. And finally, some courts will analyze student dress challenges under the so-called O'Brien standard. Under the O'Brien test, which is based on a case from 1968, a dress code or uniform policy will be constitutional if the policy is authorized under state law; furthers an important governmental interest; is unrelated to the suppression of free expression; and requires incidental restrictions on First Amendment freedoms that go no further than necessary to further the governmental interest.

So does Tiana Parker's family have a basis for saying that her First Amendment rights were violated?

As it turns out, if she were enrolled in a traditional public school the answer would still be no better than “Maybe,” and, because her reasons for wearing dreadlocks were not motivated by political or religious interests, a more likely answer is “Probably Not.”

But Tiana wasn't enrolled in a traditional public school. She was enrolled in a public charter school. And although the case law for free-expression claims is still emerging when it comes to charter schools – which receive public money but are, in effect, private organizations – the early returns would suggest that the answer there is a more definitive “No.”

Consider the story of Michael Caviness[1], a teacher at a public charter school in Arizona who was fired, and who then sued his former employer for depriving him of his constitutional rights. According to Caviness, the Horizon Community Learning Center was a state actor for all purposes because of its statutory characterization as a “public school,” and because it performed a public function in providing public education.

But the Ninth Circuit Court of Appeals disagreed. “This case presents the special situation of a private non-profit corporation running a charter school that is defined as a public school by state law,” the court explained, before ruling that “a state's statutory characterization of a private entity as a public actor for some purposes is not necessarily dispositive with respect to all of that entity's conduct. Rather, a private entity may be designated a state actor for some purposes but still function as a private actor in other respects. Merely because Horizon is a private entity performing a function which serves the public does not make its acts state action.” The court's ruling added that “except as otherwise specified in Arizona statutes regulating charter schools, or in the school's own charter, a charter school is exempt from all statutes and rules relating to schools, governing boards and school districts.”

Say what? You mean public charter schools are, for purposes of the law, still private entities in many regards? Like, say, student (or teacher) free-speech rights?

Alarmingly, early rulings suggest that the answer is yes. Indeed, in the Caviness opinion the Ninth Circuit cited a 1996 case of its own, George v. Pacific-CSC Work Furlough, in which it reviewed the complaint of a custodial staff employee of a private entity which operated a correctional facility for the state of California. “After the custodial employee was terminated,” Judge Sandra Ikuta explained, “he sued the private company, alleging that his First Amendment rights were violated because he was terminated for speaking out about safety and security problems.”

Ikuta and her colleagues rejected the employee's theory that Pacific was a state actor because it was performing and fulfilling a traditional state and government function. “The relevant inquiry,” they ruled, “is whether [Pacific's] role as an employer was state action” in the employee's case, and noted that “[a]n entity may be a state actor for some purposes but not for others.” We concluded that while “Pacific ha[d] been granted certain powers and privileges under the law to allow it to function adequately as a prison,” the plaintiff failed to show state action because the “complaint offer[ed] no indication Pacific ha[d] become the government for employment purposes.”

Ikuta went on to add that the U.S. Supreme Court, “as well as case law in this and our sister circuits, permits the state to subsidize the operating and capital costs of a private entity without converting its acts into those of the state. Ultimately, Horizon's actions and personnel decisions were made by concededly private parties, and turned on judgments made by private parties without standards established by the State.”

In other words, public charter schools are not, under the law at least, full-blown public schools. That means that even if she had wanted to try, Tania Parker would have had no First Amendment standing. And it means that the two million students in the country currently enrolled in public charter schools – approximately 4% of the total student population, and growing – may have no free expression rights whatsoever.

Follow Sam on Twitter[2].

Here’s A Money Idea For Charter Schools | The Range: The Tucson Weekly’s Daily Dispatch | Tucson Weekly

Monday, February 3, 2014

Education Here’s A Money Idea For Charter Schools

Posted by David Safier on Mon, Feb 3, 2014 at 4:00 PM

It’s been said before in greater depth, complete with facts and figures, but the Weekly's Tom Danehy cuts right to the chase, as usual, in this week’s column.


Records show that charter schools spend public money like drunken sailors with almost no official oversight, with protection from having to make full financial disclosure almost gleefully provided by the Legislature, and virtually no public outcry from those who claim to give a crap about where taxpayer money is going. It's hypocrisy, plain and simple.

Charter schools say they’re not getting as much money as district schools, and they’ve gone to court to get what they think is their fair share. It would make it a whole lot easier to figure out if charters are getting what they should if we knew the specifics of where and how they spend their money the taxpayers’ money.

I’ve done my damndest to sort out the funding equity issue for charters and district schools. I’m pretty good with numbers. I’ve listened to the arguments. I’ve looked at the spread sheets. But I haven’t found anyone who has sorted this thing out to my satisfaction. The problem is, there are too many slippery variables: providing transportation for students or not; providing food services or not; providing adequate special ed and ELL programs or not. Then there’s the different types of bonding charters and districts have available to them. This isn’t just a problem of trying to compare apples and oranges. We’re trying to compare a couple of banquet-sized financial smorgasbords here.

For this old classroom teacher, the money issue boils to one question. How much is being spent to educate that average kid in the average classroom? That’s got be the starting point for any discussion of funding equity. If the money allocated to charters for educating that middle-of-the-pack kid is significantly more or less than what district schools get, we should look at making some adjustments. But if the amount is close to the same, then we can leave that discussion aside and shift to other questions about special needs education, outside-of-class services and the like, while districts and charters get together and lobby the legislature to bring our education funding out of the cellar for all public schools, district and charter.

Someone with enough determination and endurance can find reasonably specific figures about how school districts spend their money. That’s the way it should be. It’s our money, so we should have some idea of how it’s being spent. But charters? All you’ll find in their financial reports are large dollar amounts divided into vague, unhelpful categories. Like Danehy said, we don’t know where taxpayer money is going when it’s handed to charter schools, so there’s no good way to figure out how much money goes directly to the student in the classroom.

As hard as it is to ferret out financial data on independent nonprofit charters, it’s flat out impossible when the schools are run by for-profit Charter Management Organizations. An impenetrable, free-enterprise firewall hides how taxpayer money is being spent. Prime examples: BASIS charters are run by the for-profit BASIS.ed; More than a dozen Imagine Schools in Arizona are run by Imagine Schools Inc. based in Virginia; Arizona Virtual Academy is run by the publicly traded K12 Inc. (currently trading at $21.84 on the NY Stock Exchange, down from $37.85 in September). These for-profit companies suck up 70% or more of their schools’ funding, then spend it with no transparency or accountability.

Arizona charter school laws were created to give the schools as much latitude and as little oversight as possible. It was all about letting the invisible hand of the marketplace sort things out. That free market ideology has led to uncompetitive no bid contracts, not to mention incestuous financial and employment relationships that would make a cutthroat capitalist blush. If public charter schools want to argue they’re not getting as much money as they deserve, they should let We The People know how they’re spending our money. Then let’s talk.

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Tags: Charter Schools, Charter Management Organizations, BASIS Schools, Imagine Schools, Arizona Virtual Academy, K12 Inc.

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K12's CEO Discusses F3Q 2014 Results – Earnings Call Transcript

Apr. 29, 2014 2:44 PM ET | About: LRN

K12 Inc. (LRN) F3Q 2014 Earnings Conference Call April 29, 2014 8:30 AM ET

Operator

Good day, ladies and gentlemen and welcome to the K12 Third Quarter Earnings Conference Call. My name is Wanda, and I will be your coordinator for today. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the conference over to your host, Mr. Mike Kraft, President of Investor Relations. Please proceed sir.

Mike Kraft – Vice President, Investor Relations

Thank you, and good morning. Welcome to K12’s third quarter fiscal 2014 earnings conference call. Before we begin, the company would like to remind you that the statements made during this conference call that are not historical facts maybe considered forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties that could cause actual events or results to differ materially early from those expressed or implied. In addition, this conference call contains time-sensitive information that reflects management’s best analysis only as of the day of this live call. K12 does not undertake any obligation to publicly update or revise any forward-looking statements.

For further information concerning issues that could materially affect financial performance related to forward-looking statements, please refer to our filings with the SEC. These files can be found on the Investor Relations section of our website at www.k12.com.

In addition to disclosing results in accordance with Generally Accepted Accounting Principles in the U.S., or GAAP, we will discuss certain information that is considered non-GAAP financial information. A reconciliation of this non-GAAP financial information to the most closely comparable GAAP information was included in our earnings release and is also posted on our website. This call is open to the public and is being webcast. The call will be available for replay on our website for 60 days.

With me on today’s call is Nate Davis, Chief Executive Officer and Chairman; Tim Murray, President and Chief Operating Officer; and James Rhyu, Chief Financial Officer. Following our prepared remarks, we will answer any questions you may have. I’d like to turn the call over to Nate. Nate?

Nate Davis – Chairman and Chief Executive Officer

Good morning, everyone and thanks for joining us on the call today. As you saw in our release this morning, we delivered solid results for the third quarter. Revenue was $235.2 million increasing 7.9% year-over-year and our operating income was $27.4 million increasing 41.2% year-over-year. Both revenue and operating income are well within the line, in line with the guidance that we provided last quarter.

This performance is a result of our strategy that were better balanced between growth and profitability. To get this balance we need to be still more disciplined in the assignment of resources, but I want to be clear that we will continue to invest in the content, systems and tool as our students and teachers need. We won’t slow down our investment in a better curriculum and better systems. Going forward, we believe our growth will come from increasing enrollment in our current schools, developing new counties as we announced last quarter with the two new public charter schools in Florida and by opening new schools within our current state footprint. While I also believe we will see growth in new states, it will not be at the pace you have seen in previous years.

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