Public school funding has been an issue in Ohio for many years since the Ohio Supreme Court determined in the DeRolph case the the Ohio Constitution requires that the state provide a “though and efficient” system of public K-12 education. The General Assembly has never fulfilled the goal.
Public school controversy in Ohio is further fueled by right wing “school choice” advocates that want privately run, or charter schools, to be the predominant type of k-12 schools in the state. In Ohio these schools can be either be profit or non profit corporations. Many of these schools have proven to be pretty worthless, and far from “though and efficient.” Some closed mid term leaving students in the lurch. The entire concept of profit based K-12 schools is questionable and creates a situation that is ripe for abuse. Many, including this site, find the entire concept of having to pay large sums of money in property tax to run schools that profit wealthy school owners offensive.
To further complicate the picture, many Ohio Public Schools, including Columbus City Schools have been caught rigging numbers data involving school enrollment that effects funding, further eroding public confidence in the entire system. Meanwhile, the state continues to fail student by not allocating sufficient funds from state coffers to cover school needs and a higher and higher percentage of school costs are being shifted to local levies and property taxes.
One of the major players in the Ohio charter school sector is White Hat Management, a company that is very connected with Ohio Republicans in the Statehouse and with Governor Kasich.
White Hat has been involved in a variety of cases involving charter issues before the Ohio Supreme Court and another one has been accepted for this term. In Hope Academy v. White Hat Management, the issue involves who owns property that is purchase by White Hat with public tax dollars as managing agent for the charter schools. Since White Hat is a profit corporation, of course they want to acquire anything of value from the taxpayers that increases their profits. The issues before the Court for review are:
Proposition of Law No. 1: Public funds paid to a private entity exercising a government function, such as the operation of a community school, retain their character as public funds even after they are in the possession and control of the private entity. Although the private entity may earn a profit out of the public funds, such profit is earned only alter the private entity has fully discharged its contractual, statutory, and fiduciary obligations.
Proposition of Law Number. 2: When a private entity uses funds designated by the Ohio Department of Education for the education of public-school students to purchase furniture, computers, software, equipment, and other personal property to operate a commtinity school, the private entity is acting as a purchasing agent and the property must be titled in the name of the commuiuty school.
Proposition of Law No. 3: A private entity that agrees to operate all functions of a community school has a fiduciary relationship with the community school. Although the private entity may earn a profit for the services it provides, it must act primarily for the benefit of the community school.
The case is just being briefed at this time and no decision is likely until next year.