ECOT warns it may close midyear


COLUMBUS — One of the nation’s largest online charter schools said it will close within four months, in the middle of the school year, if Ohio’s efforts to recoup $60 million or more in disputed funding aren’t halted.

Such a closure would affect almost 12,000 students from the Electronic Classroom of Tomorrow — leaving many scrambling to switch to a new school — and eliminate over 800 jobs, the e-school’s attorneys said in a court filing Thursday with the Ohio Supreme Court.

The school asked the court to block the state from recouping funding until the case is settled, or to expedite hearing the case before the potential closure.

The virtual school said in the request that the state’s moves to recoup money put ECOT in a financial “death spiral” and that “the existence of ECOT is completely dependent upon relief from this court.”

At issue is how the Ohio Department of Education tallied student logins to determine what funding the school deserved. The state said ECOT didn’t sufficiently document student participation to justify its full funding. But the school has contended that the state wrongly changed reporting criteria for recent years, an argument that was unsuccessful in lower courts.

The state already reduced monthly funding to ECOT to start recouping $60 million from the 2015-16 school year, and it’s withholding an additional portion over concerns about whether the school is getting funding for more students than it actually has for the current year. Officials also recently said the school could owe nearly $20 million more from 2016-17, though ECOT can appeal that finding.

If the state starts withholding more funding as a result of the latest findings, the virtual school said it anticipates having a negative cash balance by January and being unable to continue operations. It noted that it relies on that funding because it doesn’t get local tax dollars like brick-and-mortar public schools.

ECOT’s attorneys argue that halting any repayments for now wouldn’t hurt the state and would simply amount to a delay if the school ends up losing its case.

But state officials have raised concerns about whether Ohio will get its money back if the school closes or runs out of funds.

ECOT has said the outcome of its case could affect Ohio’s whole online charter industry, and several smaller e-schools have filed briefs with the Supreme Court in support of ECOT.

By Kantele Franko

Associated Press

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