ECOT: $2.1 million in donations to Ohio politicians, $1 billion in charter school contracts

ECOT founder Bill Lager at a Statehouse rally for ECOT in 2017.

ECOT stands for the Electronic Classroom of Tomorrow. It is a charter school founded in Ohio in 2000 by businessman William Lager and is a story that hasn’t received nearly enough media attention. Probably because it highlights everything that’s wrong with for-profit charter school entities delivering public services.

From 2001 to 2016 Lager’s ECOT received more than $1 billion from Ohio taxpayers to deliver an appalling graduation rate. In 2014, the graduation rate was under 39 percent. For the 2016-17 school year, it was up to a little over 40 percent in four years.This ranks as worst in the nation.

The state of Ohio is working to recover $80 million in overbilled state funds. In 2016, an Ohio audit estimates the school was paid for 9,000 more students than ECOT could document for the 2015-16 school year. In 2018, the state is still working to recover the money, which has since increased to $80 million.

Dave Yost, the Ohio auditor who has himself spoken at past ECOT graduations, said:

With the level of incompetence displayed by both the school and (the Education Department), the regulator, it’s amazing that any money went to education whatsoever.

Over this same period of time, William Lager has donated more than $2.1 million to influential Ohio politicians including several speakers of the Ohio House and Andrew Brenner, the chair of the House Education Committee.

Because much of the news coverage in Ohio only focuses on small pieces of this story at a time, here’s the full story of how ECOT scammed Ohio.

Benefits to Lager and ECOT

First, the benefits that we know about to Lager and ECOT. As mentioned from 2001-2016, Lager’s Electronic Classroom of Tomorrow received more than $1 billion from Ohio taxpayers.

• $170 million of this money went to Lager’s other companies (Altair Management and IQ Innovations) to run day-to-day operations and provide software to ECOT.
• Over this period of time, Lager purchased the following real estate properties:
  • $300,000 condominium in the Waterford Tower Downtown in Columbus, OH
  • $433,000 Senecaville Lake property
  • $995,000 house in Upper Arlington for his daughter
  • $3.7 million Key West property
• Facing public pressure on ECOT, Lager funneled $250,000 of public funds into television commercials to attack the Ohio Department of Education through Third Wave Communications, a company run by his daughter that provided communication services to ECOT.
• ECOT closes in January of 2018, citing financial hardship. Ohio is still looking to pursue other options to recover as much of the $80 million as possible

Here’s one of the advertisements paid for with taxpayer funds that ECOT used to try to lobby the Ohio Department of Education.

Donations from Lager to influential Ohio politicians

Second, the political donations that we know about. In a 2014 article, journalists at Plunderbund put together this excellent table of donations to ECOT from 2001-2014:

Lager also allegedly gave money to employees to make donations to politicians. The Ohio Republican Party recently returned a $36,000 donation from Melissa Vasil, director of operations at ECOT.

Here is the full dataset of known donations from William Lager through 2015. The politicians and political organizations Lager donated to during this time were:

• Ohio House Republican Organizational Committee
• Ohio Republican State Central and Executive Committee
• Republican Senate Campaign Committee
• Mike DeWine (R-Attorney General, 2011-present)
• Bill Batchelder, (Republican, Speaker of the Ohio House, 2011-2014)
• Cliff Rosenberger (Republican, speaker of the Ohio House until 2018 when he resigned under investigation)
• Kirk Schuring (R-Canton, Speaker of the House, 2018 interim)
• Ryan Smith (R-Granville, Speaker of the House, 2018-present)
• Andrew Brenner (Republican, Chair of the House Education Committee, 2011-present)
• David Yost (R-State Auditor, 2011-present)
• Brian Hill (R-Zanesville, State Rep, 2011-present)
• Ron Amstutz (R-Wayne County, State Rep, 1983-2000, 2009-2016)
• Louis Blessing III (R-Colerain, State Rep, 2013-present)
• Jim Buchy, (former state representative R-Greenville, 1983-2000, 2011-2016)
• Jamie Callender (R-Lake County, State Rep, 1997-2004)
• Cheryl Grossman (R-Grove City, State Rep, 2009-2016)
• Mike Duffey (R-Columbus, State Rep, 2011-present)
• Randy Gardner (R-2^nd District, State Senator, 2013-present)
• Rob McColley (R-1^st District, State Senator, 2017-present)
• Mike Dovilla (R-Olmsted, State Rep, 2012-2016)
• Larry Obhof (R-22^nd District, State Senator, 2011-present)
• Jeff Rezabek (R-Clayton, State Rep, 2015-2018)
• Scott Ryan (R-Granville, 2015-present)
• Barbara Sears (R-Toledo, 2008-2016)
• Stephanie Kunze (R-24^th district, State Senator, 2017-present)
• Michael Stinziano (D-Columbus, City Councilman, 2017-present, former Ohio House rep, 2011-16)
• Kyle Koehler (R-Springfield, State Rep, 2015-present)
• Tony Burkley (R-Paulding, State Rep, 2013-2016)
• Jim Hughes (R-Columbus, State Rep, 2017-present)
• Chris Widener (R-10^th district, State Senator, 2009-2016)
• Doug Green (R-Mt. Orab, State Rep, 2013-present)
• Jeff McClain (R-Sandusky, State Rep, 2009-2016)
• John Adams (R-Sydney, State Rep, 2007-2014)
• Peter Stautberg (R-Cincinnati, State Rep, 2008-2012)
• Anthony DeVitis (R-Canton, 2011-present)
• William Coley II (R-4^th district, State Senator, 2011-present)
• Bill Reineke (R-Toledo, State Rep, 2015-present)
• Keith Faber (R-Mercer, State Rep, 2017-present)
• Marlene Anielski (R-Chagrin, State Rep, 2013-present)
• Tim Derickson (R- Cincinnati, State Rep, 2009-2016)
• Tom Patton (R-Olmsted, State Rep, 2017-present)
• Frank LaRose (R-27^th district, State Senator, 2011-present)
• Matt Huffman (R-12^th district, State Senator, 2017-present)
• Scott Oelslager (R-29^th district, State Senator, 2011-present)
• Dorothy Pelanda (R-Marysville, State Rep, 2011-present)
• Terrence O’Donnell (Ohio Supreme Court Judge, 2003-present)
• Mark Romanchuk (R-Richaland, State Rep, 2013-present)
• Dave Burke (R-26^th district, State Senator, 2011-present)
• Cliff Hite (R-1^st district, State Senator, 2011-2017)
• Tim Ginter (R-Liverpool, State Rep, 2015-present)
• Troy Balderson (R-20^th district, State Senate, 2011-present)

Here’s Dave Yost, Ohio state auditor, speaking at the 2014 ECOT graduation ceremony.

Guess his opinion changed when he figured out Ohio was being overbilled for students who weren’t actually attending ECOT.

Student results at ECOT

• A recent study on online charter schools by Stanford University’s Center for Research on Education and Outcomes and the Center on Reinventing Public Education (both typically pro charter school advocates where they work) found that:
  • Students in online charters lost an average of about 72 days of learning in reading.
  • The average student in an online charter had lower reading scores than students in traditional schools everywhere except Wisconsin and Georgia, and had lower math scores everywhere except in Illinois, Michigan and Wisconsin.
  • Students in online charters lost 180 days of learning in math during the course of a 180-day school year.
• According to Margaret E. Raymond, project director at CREDO:
  • “There’s still some possibility that there’s positive learning, but it’s so statistically significantly different from the average, it is literally as if the kid did not go to school for an entire year.”
• More ECOT students either leave or fail to finish high school within four years than at any other school in the nation.
• The last reported graduation rate within four years was 40.3 percent. 

How did this go on for so long?

According to Sandy Theis, executive director of ProgressOhio, a leading public interest group:

ECOT usually gets what ECOT wants. But it’s become very difficult to ignore its poor performance.

As I’ve written previously about education in Ohio, writing the rules for the charter school companies looks like:

• Charter schools get the contracts
• There is no oversight
• Oversight is used to try to “regulate” public schools out of existence by putting in place impossible standards for them to meet

In 2015, Ohio revised code exempted charter schools from over 150 public school regulations:

3314.04 Exemption from state laws and rules. Except as otherwise specified in this chapter and in the contract between a community school and a sponsor, such school is exempt from all state laws and rules pertaining to schools, school districts, and boards of education, except those laws and rules that grant certain rights to parents.

The idea we’ve all heard is that the “market” would somehow regulate itself. This idea comes from corporate special interests that want to privatize government for profit.

The problem with this thinking is that the primary purpose of charter schools is noteducation. The primary purpose of these companies is to return profit to owners and shareholders.

This creates a conflict of interest where these companies try to figure out the cheapest way possible to achieve some goal, usually test scores. In some cases this is tampering with test scores, in other cases it’s simply getting rid of potentially low-scoring students.

Incentives do matter. In the case of charter schools like ECOT, there’s no incentive to actually provide an education to students, especially if you can purchase enough politicians. This isn’t a first for Ohio either. We’ve gone through similar scandals with corrupt charter school operators like White Hat Management and Horizon Science Academy. And it’s not just the operators either. We’ve seen corruption in the Ohio Department of Education with a director of school choice resigning after altering evaluations for charter school operators.

Call to Action

Now that you have the story, I’d like to ask you to do two things.

First, share the ECOT story with the people you know. I don’t believe the ECOT scandal has received nearly the media attention it deserves in Ohio, especially in terms of the overall culture and beliefs of the politicians at the top who’ve created this mess.

Second, contact your state representative and/or state senator and ask them where they stand on charter schools, especially online charter schools. If your representative or senator took money from ECOT, ask them what ECOT wanted in return. Also ask them why Andrew Brenner is still chair of the House Education Committee.

Third, elect politicians who believe in education over corporate special interests.

The problem isn’t just these charter operators and it isn’t just the Ohio Department of Education. It starts at the top with the people in charge.

What we want are politicians who prioritize education over corporate special interests. This November, use education as a litmus test for politicians because these are the people in charge. As long as you still have the corrupt culture in place, White Hat will just be replaced by Horizon Science Academy which will be replaced by ECOT ad infinitum. The Ohio Department of Education (DOE) will throw the charter school operators under the bus and the charter operators will blame the DOE, using publicly funded commercials if they have to, and nothing will change.

Investigate your state representatives and senators and elect politicians who believe in education and a strong investment in education this Fall.

Cross posted at Daily Kos.

David Akadjian is the author of The Little Book of Revolution: A Distributive Strategy for Democracy (ebook now available).