Schools claim DeWine’s office lags in recovering lost state funds

Another area school district is expressing doubts over the Ohio Attorney General’s Office’s ability to recover funds from the failed Electronic Classroom of Tomorrow as the AG’s office is touting its track record for aggressively going after misspent public money.

In a legal filing Tuesday in Franklin County Common Pleas Court, the AG’s office argues it has obtained, or is pursuing, $66.4 million in misspent public funds paid to charter schools or their operators across Ohio.

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But Springfield City Schools is joining Dayton Public Schools and the Logan-Hocking School District in arguing in court that they don’t want the state representing them in getting money from ECOT.

The school districts argue that Attorney General Mike DeWine – the Republican candidate for governor – is soft on charter schools and has received campaign donations from ECOT founder Bill Lager. Democratic candidate Richard Cordray also received money from ECOT, though far less. Both candidates later donated the funds to charity.

The AG’s office filing says Dayton schools lacks standing to intervene in the case, that their interest is adequately represented by the state, and the AG’s office “has successfully pursued multiple cases addressing charter school fraud.”

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Dayton Public Schools estimates ECOT received $20 million that would have otherwise come to Dayton Public Schools since 2012. Springfield’s school district estimates it lost $3.7 million to ECOT.

Springfield schools Superintendent Bob Hill said the AG’s office has been slow to take action against ECOT.

“The fear is at some point, depending on what happens in the November election, that this whole lawsuit and attempt to recover money by the AG could go away,” Hill said.

DPS and Springfield are both working with the Cleveland-based law firm Cohen, Rosenthal and Kramer. The firm is working on a contingency fee, meaning it gets paid only if the districts succeed. If they do succeed, the districts could get the same amount of money as under the state’s lawsuit, minus attorney fees. But the districts are skeptical that DeWine would be as aggressive as their attorney.

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ECOT shut down earlier this year after an Ohio Department of Education review found it was inflating its enrollment and attendance numbers. By some estimates, the online charter school collected more than $591 million from the state since 2012, money that would have gone to public schools if students had stayed in their local school district.

DeWine filed a lawsuit to recoup from Lager and other former ECOT officials the $62 million the school was found to have over-billed the state, as well as profits Lager’s companies Altair Management and IQ Innovations received for work done with ECOT.

Officials with DeWine’s office have alleged the districts’ legal filings are political. Cordray often brings up ECOT as an issue on the campaign trail, alleging DeWine was slow to act. DeWine counters that it was his office that finally took action against ECOT and Lager.

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The state’s legal filing yesterday welcomes school districts to join their lawsuit instead of splitting off with their own legal action.

The state cites $8.2 million in judgments and audit findings the state has obtained since 2011, says it’s pursuing another $4.9 million related to audit findings, and obtained or is seeking another $53.3 million in judgments.

“The districts’ assertion that the Attorney General is too friendly towards charter schools is conclusively rebutted by the public record,” the filings says.


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