California Senate candidate Kamala Harris has kicked over a hornet’s nest in a big but contentious settlement with the nation’s largest online charter school. Not only has K12 refused to admit wrongdoing, despite Harris’s public allegations, but the organization has also disputed how Harris characterizes the size of the settlement reached. 

In a statement, Harris accused the school of bilking families and Sacramento alike. “K12 and its schools misled parents and the state of California by claiming taxpayer dollars for questionable student attendance, misstating student success and parent satisfaction and loading nonprofit charities with debt,” she said, according to the Associated Press. CEO Stuart Udell fired back with a statement of his own, denying K12 had broken any laws and claiming that Harris’s office had blown K12’s behavior — and its monetary concessions — out of proportion. “Despite our full cooperation throughout the process, the Office of the Attorney General grossly mischaracterized the value of the settlement just as it did with regard to the issues it investigated,” he said.

Protracted confrontation 

Each side swiftly traded barbs over the supposed $168.5 million settlement, which has yet to be approved by a California court and includes just $8.5 million in direct payments. “The terms of this settlement could not be more clear,” a Harris spokesperson told BuzzFeed News. “K12 must expunge the $160 million in debt it had imposed on California charter schools.” Udell, however, maintained that the $160 million could not be expunged from K12’s books because it had never been entered into them:

“On a call with investors, the company’s CEO called the $168.5 million figure ‘shameless and categorically incorrect.’ Instead, K12 put the settlement amount at $2.5 million, subtracting that $160 million of so-called debt relief and another $6 million that K12 agreed to pay the attorney general’s office for the cost of putting together the lawsuit.”

But K12 has faced scrutiny from other Golden State officials as well. “State school superintendent Tom Torlakson recently announced that the department of education had contracted with the state controller’s office to audit the California Virtual Academies,” 14 schools affiliated with K12, according to EdWeek. “The superintendent said the probe will focus on a number of areas, including whether the nonprofit California virtual academies are ‘organizationally separate’ for K12, a commercial entity; whether attendance, enrollment and dropout figures are accurate; and whether expenses are tallied accurately.” As the state attorney general’s office told the site, “That its settlement is separate from the comptroller’s probe and will have no impact on it going forward.”

Investigative journalism

Although Harris has burnished her status as Senate frontrunner by leading a broad investigation into the for-profit schooling industry, K12 first ran afoul of Sacramento because of an investigation three months ago by the Bay Area News Group focused on the company. K12 drew the group’s attention as it “raked in more than $310 million in state funding over the past 12 years operating a profitable but low-performing network of ‘virtual’ schools for about 15,000 students,” as the Mercury News observed. 

“This news organization’s investigation into K12’s California schools revealed the company reaps tens of millions of dollars annually in state funding while graduating fewer than half of its high school students. It also showed that kids who spend as little as one minute during a school day logged onto K12’s software may have been counted as ‘present’ in records used to calculate the amount of funding the schools get from the state.”

In the wake of the report, further trouble for the education behemoth has loomed on the horizon. “The California-based schools still could face action from the state Department of Education, which has brought in the state controller to conduct an audit,” the Los Angeles Times reported. “And the schools’ teachers have launched a union organizing drive.” Even the California Charter Schools Association, often a reliable ally of charters, lashed out, condemning “the predatory and dishonest practices employed by K12 Inc. to dupe parents [by] using misleading marketing schemes, siphon taxpayer dollars with inflated student attendance data, and coerce CAVA School nonprofit employees into dubious contracting arrangements,” the paper added.

By Katy Grimes

The Joint Legislative Audit Committee hearing last week was a mini civics lesson in what is going on in state politics, and what bad policy the state’s special-interest groups and labor unions are continually pushing.

When special interests and their compliant legislative counterparts don’t get their way and their bills are killed, they double down to find another way to influence and change policy. Often, the JLAC Committee is the answer for a backdoor approach at achieving the goal.

One of the gems at the hearing was an attempt by Assembly members Betsy Butler, D-Torrance, and Roger Dickinson, D-Sacramento, to push for an audit of the California State University Extension Education program. Butler and Dickinson are both darlings of the California Faculty Association, a union of 23,000 professors, lecturers, librarians, counselors and coaches who teach in the California State University system. Butler and Dickinson regularly do bidding for the CFA through the bills they author.

The fight for CSU extension

“Of all the states, one would expect that the impact of technology on the delivery of educational services would be greatest in California, home to Silicon Valley and major high-tech companies,” Lance Izumi, J.D. wrote in “Short Circuited: The Challenges Facing the Online Learning Revolution in California.” “Yet when it comes to harnessing the technological revolution as it applies to education, it turns out that California is lagging in many respects.”

Extended and Continuing Education brings education and training opportunities to people in local communities throughout the state, across the country, and even around the world, and offers flexibility for students. And, for those on a tight budget, it costs much less than University of Phoenix or the University of Southern California Extension schools.

The CSU Extension Education website reports that the program offers:

* Online and off-campus credit degree programs;

* Professional development certificate programs and courses;

* Courses for personal enrichment; and

* Access to university courses without university admission.

There are programs for working professionals, displaced workers, career changers, military and veterans, international students, stay-at-home mothers wanting to finish a degree, and many other situations.

And amazingly, CSU’s Extension education program is self-supporting; student fees cover all expenses necessary to conduct the program.

So why would the program need an audit? The answer lies in AB 2427 by Assemblywoman Betsy Butler which, if passed, would have required that CSU provide an annual report on CSU Extended Education courses on a system-wide and campus-by-campus basis, including information on student demographics, fees, the number of courses and types of courses. AB 2427 is stuck in the Senate Appropriation Committee, placed on suspense, and essentially killed, for now.

According to the California Faculty Association, which was pushing the bill, extension fees far exceed the cost of the same classes in the regular university.

Understanding something about the union,helps understand the motive for a move like this.

According to Izumi, the director of education at the Pacific Research Institute, CalWatchDog.com’s parent think tank, “the union wants to protect traditional classrooms and the teachers who staff them.”

“A key concern is that online education could lead to non-bargaining-unit members teaching courses,” Izumi wrote.

Izumi found that the California Federation of Teachers and other teacher and faculty unions oppose online education whenever and wherever they can. And Izumi pointed out that this opposition is even written in the CFT and CFA contracts:

“Contracting out bargaining work can take the form of a district contracting with an independent contractor to produce course software,” he said. A district would contract with a company to produce certain course offerings or could offer courses over the Internet that have not been developed in-house. In each case, someone else is doing the bargaining unit’s work.”

The contract specifically states that “no distance education or technology-related work shall be performed by other than members of this bargaining unit,” and “no member of the bargaining unit will be displaced because of distance learning or computer-related courses…”

“Like a medieval potentate, the union seeks to build a wall around its fiefdom and grant itself veto power over any change that would adversely affect union members,” Izumi said. “If technology is to enter the classroom, it must be under union control.”

Audit time

The audit request was granted by the JLAC Committee, and will be performed by the Bureau of State Audits, under the direction of Elaine Howle, the non-partisan and very professional California State Auditor.

It’s not difficult to find what the crux of the audit really is, buried down at the bottom of the list of issues to be investigated: “To the extent possible, determine whether Extended Education courses are replacing regular state-supported courses.”

Online education and Extension Education schools are here to stay. Extension programs with an online component thrive in other states because the goal is not union domination, but flexible education for students.

“Online learning is not just the wave of the future; it is the tidal wave of the future,” Izumi wrote. “It is past time for policy makers in California to tear down the government-made breakwaters that have diminished the full impact of this tidal surge.”