To do so, the board of education is authorizing its administration to sue ECOT — the state’s largest online school before it closed in January.
MORE: DeWine files suit for ECOT overpayments as political battle rages
“Ideally, we would get every dollar back,” Springfield City Schools Superintendent Bob Hill said.
The Springfield News-Sun reached out to ECOT. A phone number listed on ECOT’s website was disconnected and an email to Richard Kurse, a court-appointed deputy interim master for the defunct school, was not returned.
ECOT opened in 2000 as an alternative, online school where students — some of whom weren’t successful in traditional classrooms or homeschooling — could get an education using the internet. ECOT families ranged from those with young students looking for a new school to high school students left in limbo on the verge of graduation.
However, an investigation by the Ohio Department of Education found ECOT had claimed an enrollment of more than 15,000 students for 2015-16. State officials eventually challenged that figure, suggesting there were closer to 6,000 full-time students at the online charter school.
Hill said the district was losing about 200 kids a year to the online school before it closed. It’s gotten some of them back since January.
“We think we drew back anywhere between 50 and 100, but its hard to tell because it’s still early in the year,” Hill said.
ECOT and SCSD
Springfield City School Board President Ed Leventhal said he knew about ECOT because the district was losing students to it but began to notice something was wrong when state officials raised questions about ECOT’s practices.
“I don’t think we were necessarily aware of the scam they were doing until three or four years ago until finally, some stuff surfaced about misleading numbers and misuse of tax dollars.,” he said. “I’m sure they’ve had a significant negative impact on 400, 500, 600 school districts throughout the state.”
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He said the millions of dollars directed to ECOT instead of Springfield City Schools impacted the type of education Springfield students received.
“We are talking about over $3.5 million,” Leventhal said. “We certainly could have hired additional staff, we could’ve added new programming, we could’ve done some things from a facilities standpoint or a safety standpoint or could’ve increased our general fund dollars carry over.”
The board of education unanimously passed a resolution on Sept. 27 that reads in part: “authorizing the administration of the Springfield City School District to seek all legal remedies necessary to return the unlawful transfer of taxpayer dollars from the Springfield City School District by the Electronic Classroom of Tomorrow.”
It’s the loss of student opportunity that’s the biggest problem, Hill said.
“That’s really for me the unfortunate part of this whole thing because what ECOT did was fraudulently operated for years and years and years and no one did anything about it,” Hill said. “They were not educating kids, they were not tracking the hours. They were essentially billing the public school districts for students they weren’t in fact educating.”
“They took away programming and different services that we could, in fact, offer to our own students with those dollars,” Hill said.
Leventhal said what ECOT did and the system that allowed them to do it is wrong.
“I would say that if any public school board or superintendent did what the folks at ECOT did they would be legally prosecuted by the state and their administrative licenses would be taken away or revoked,” the school board president said.
Auditor of State Dave Yost’s office said they have referred their audit to the U.S. Attorney’s Office and the Franklin County Prosecutor’s Office for possible criminal prosecution.
Should the district be awarded money, the cash would go into the general fund and can be used for student achievement, Hill said.
The Resolution
The resolution passed by the board allows the school’s administration to seek legal action against both ECOT and its affiliated and contracted companies.
It also calls for the school’s administration to seek action against the individuals associated with ECOT and those companies.
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“ECOT is out of business and probably has limited if any resources to pay back the dollars,” Leventhal said. “The individuals who owned and were operating ECOT certainly took substantial salaries, dollars that should have gone into programming but instead they used to finance their own personal projects or to increase their lifestyle.”
The resolution accuses ECOT of taking $3,655,987 from the city district and its students since 2012.
“The state of Ohio removed more than $1 billion in money originally intended to educate children in local public school districts to give to the Electronic Classroom of Tomorrow since 2000,” the resolution says. “Children in Springfield City School District lost $3,655,987 since 2012 to ECOT, depriving the children in the Springfield City School District of substantial learning opportunities and a recent study from Innovation Ohio found that on average about 20 percent of the money sent to ECOT since 2000 paid for students who were never at the school.”
Leventhal said the way to resolve the ECOT issue is for the money to be put back into the school’s general fund.
“One hopeful outcome would be that we would get back substantial dollars that go back to the district where they should have been, number two it hopefully is a significant wake-up call to the state legislature and Ohio Board of Education to provide much stronger, better oversight for online and charter schools than they have traditionally done.”
The school board has a responsibility to students and taxpayers of the district, the resolution says, and it believes the district is owed money by ECOT. Leventhal said he hopes local state representatives will join the district to help them get money back.
Attorney general filings
ECOT was Ohio’s largest online charter school before state investigations showed the school’s enrollment was inflated, leading to improper funding.
And Springfield isn’t the first district or agency to seek legal remedies against ECOT in an attempt to reclaim money.
Ohio Attorney General Mike DeWine in August filed a “complaint for recovery of public funds” against individuals and companies tied to ECOT.
Dewine is running for governor against Democrat Richard Cordray.
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The Ohio Department of Education’s enrollment reviews of ECOT found the school overbilled the state by $60.35 million in 2015-16 and by $19.3 million in 2017. ECOT’s appeals were rejected by ODE and the Ohio Supreme Court, leading to DeWine’s filing. The state began clawing back millions in funding that ODE said the school should not have received, eventually leading to ECOT closing.
Court documents say ODE has collected $17.6 million of those debts, and a balance of roughly $62 million is due, plus costs and interest, with that debt, referred to the attorney general for collection.
The defendants in the lawsuit filed in Franklin County Common Pleas Court are Lager, former ECOT Superintendent Rick Teeters and Treasurer Michelle Smith, ECOT administrators Christopher Meister, Ann Barnes and Regina Lukich, Altair Learning Management I, Inc., which operated the school, IQ Innovations, LLC, which provided ECOT with curricular services, and the Travelers insurance company.
Hill said he feels like Dewine was slow to act on ECOT and that played a part in wanting his district to be added into the lawsuit.
“The contention is (the lawsuit) might be political in nature,” Hill said. “And so, the fear is at some point depending on what happens in the November election, that this whole lawsuit and trying to recover money by the AG could go away.”
A Cleveland based attorneys office wants to make sure the lawsuit continues regardless of the election results and has signed mutual understanding agreements with Dayton Public Schools and the Logan-Hocking Local Schools, Hill said.
Hill has spoken with the attorneys and plans are for Springfield schools to sign on too.
Continuing Coverage
The Springfield News-Sun covers the Springfield City Schools better than anyone else with complete coverage of its finances, policies and students. Look for more coverage in future editions of the Springfield News-Sun.
Facts and Figures
$3.6 million: Money taken by ECOT from the city schools since 2012
20 percent: Money taken by ECOT from the city schools that didn’t go to student’s education
$1 billion: Money taken by ECOT from Ohio schools
*numbers from Springfield City School District resolution passed Sept. 27
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