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"Extensive fiscal mismanagement" at Eagle Heights



Published: Wed, May 12, 2010 @ 12:00 a.m.

By DAVID SKOLNICK

skolnick@vindy.com

YOUNGSTOWN

“Extensive fiscal mismanagement” at Eagle Heights Academy led to more than $1 million in illegal and improper financial transactions at the city’s largest charter school, according to a state audit.

The audit, issued Tuesday, is for the fiscal year between July 1, 2006, and June 30, 2007. The auditor’s office at first declared Eagle Heights “unauditable” in August 2008 because the school’s financial records for the 2006-2007 fiscal year were incomplete. The records were later updated.

The state is now auditing Eagle Height’s finances for 2007-2008 and 2008-2009 fiscal years, said Julia Debes, an auditor spokeswoman.

The problems uncovered at the school in the 2006-2007 audit include:

  • Collecting $454,381 in federal income tax and Medicare withholding from its employees but never giving the money to the IRS. That federal agency received a copy of the audit, Debes said.

  • Improperly spending $707,507 in questionable costs, or errors that caused costs to be overstated or understated on federal reports.

  • Illegally spending $33,500 on one-time payments to 29 of its employees from a federal grant. The payments weren’t approved by the school’s governing board, but were authorized by Linda Mansfield, the school’s lead administrator, and Ronald King, then the school’s business manager. The biggest payments, $5,000 each, went to Mansfield and King.

“The lack of proper financial oversight at this school allowed for the misspending of tax dollars intended to educate Ohio’s schoolchildren,” said Auditor Mary Taylor.

The state Department of Education ordered the school at 1833 Market St. on the city’s South Side to close by June because it received a rating of academic emergency on each of its last two annual state report cards.

Approval for a new charter school at the same location — the former South High School — is expected shortly, said Barry E. Savage, a Toledo attorney.

Savage represents the Ohio Council of Community Schools, which sponsors Eagle Heights and is helping to create the new charter school, South Side Academy, that is expected to open in the fall, serving the same kindergarten through grade 8 students as Eagle Heights.

On Tuesday, King couldn’t be reached by The Vindicator to comment, and Mansfield referred comment on the audit to Savage.

The Rev. Kenneth Simon, president of the Eagle Heights board, also referred comment to Savage.

But he said: “The board has some issues with the audit. We’re contesting some of the findings.”

Savage said he has documentation showing time records of employees who were paid with federal funds. He declined to discuss specifics.

Besides the Internal Revenue Service, the auditor’s office gave copies of the Eagle Heights report to the Ohio attorney general’s office and the Mahoning County prosecutor’s office, something the auditor routinely does with reports that include findings for recovery, Debes said.

The Ohio Council of Community Schools and Eagle Heights officials are working with the IRS, Savage said.

Also, failure to pay income taxes to the IRS could go back to the 2004-2005 fiscal year, he said.

“It appears to have happened in previous years,” Savage said.


EAGLE HEIGHTS ACADEMY

Audit

The Ohio auditor’s office issued a report of Eagle Heights Academy listing several financial problems at the Youngstown charter school that is going out of business next month. Here are some of the biggest problems listed in the audit:

• $33,500 in public money illegally spent that must be repaid. School personnel received one-time payments from a federal grant without receiving approval by the school’s governing board.

• The school failed to turn over to the government $333,722.34 in federal income tax withholdings and $120,658.93 in Medicare withholdings.

• $707,507 in questioned costs, or errors that caused costs to be overstated or understated on federal reports. These included undocumented payrolls, overstated expenditures and double reimbursement of federal funds.

Source: Ohio auditor’s office.


Comments

1TylerDurden(367 comments)posted 4 years, 3 months ago

Only in the fine city of Youngstown. You cannot plead ignorance when witholding $450k in payroll taxes and never sending a dime to the IRS. That is criminal.
This is what happens when you put children in charge of children.

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2WarrenRicheyKid(167 comments)posted 4 years, 3 months ago

Only in Youngstown? Let's get off the convenient "put down Youngstown" wagon.

Charter schools in many states have little regulation yet receive public monies. In the past couple of month in Philadelphia, 18 of them were found to have serious problems.

Nine of the Philadelphia charters were served with federal subpoenas requesting "all documents related to payments, agreements, and contracts with the nonprofit group that owns the school building."

Perhaps a follow up Vindicator article could point to the Eagle Heights scandal as part of a national re-examination of charter school accountability.

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3author50(1121 comments)posted 4 years, 3 months ago

If this was not funded by the taxpayers -- they would have gone belly-up months ago. I hear the rent is outrageous on this building and the landlord is a partnership of well connected people in the valley.

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4metrodawg(70 comments)posted 4 years, 3 months ago

So, where is all this "missing money?"

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5atek101(77 comments)posted 4 years, 3 months ago

Well, according to public information, the company does seem to be a private entity of some sort.

http://www.netprospex.com/company/exe...

http://ohmahoningpropertymax.governma...

A private company operating this school and charging rent to the school seems sketchy, if that's true. But I think we need to find out more information first. Does anyone know a better source?

I would be interested to see who runs, operates, and manages this 'new' charter school that replaces Eagle Heights. Will it be a fully new group of people or the same ones? Does anyone know or know how we could find out?

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6mallwalker(5 comments)posted 4 years, 3 months ago

@ Tyler- What do you mean by, "This is what happens when you put children in charge of children" The only way I could understand how their finances got this bad, is if in fact they did let the students manage the pocketbook!

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7Silence_Dogood(1333 comments)posted 4 years, 3 months ago

peggy was the other teacher in the room there to translate english to ebonics?

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8TylerDurden(367 comments)posted 4 years, 3 months ago

I was just stating that the "adults" in charge of running the school failed to exhibit many qualities we might find in mature adults in similar situations.

- Whomever was in charge of collecting payroll taxes conveniently failed to send $450k of it to the IRS?
- The administartion decided to "illegally" spend $33k on themselves.
- And finally, we'll throw in the $700k in questionable costs the audit found.

These are the acts of people who are either blatant crooks or were put in charge of something they had no idea how to operate. Might as well let the children operate the school. Could they have done worse?

The problem is that Youngstown is so convenient to put down when stories like this arise. Please feel free to post links to similar stories where this much taxpayer money and grants were involved. Reality sho' is frightening.

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9willie7(1 comment)posted 4 years, 3 months ago

For those of you who continue to bash and put down Eagle Heights Academy...you are forgetting the two most important groups affiliated with the school-the students and the teachers. The students come in everyday wide-eyed and ready to learn. This is hard at times because of their situations at home and in their neighborhoods, but they are hopeful that their futures will be bright. And it's their teachers who are trying to ensure that the students' futures will be bright. Despite the stress and uncertainty that comes with their jobs right now, the teachers remain a constant provider of education, love, and devotion to the the students at EHA. Despite what reports may say, all the teachers there are "highly qualified" and care about their students!

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10education101(1 comment)posted 4 years, 3 months ago

Well DownTownBrown it seems as though you have a lot of time on your hands and some obsession with Linda Mansfield. She has done more for Eagle Heights, the teachers, and the students then all their previous administrators. Hopefully you are not still in education because if this is how you react to something that does not concern you, then I can only imagine how you treat your own students. Berating another adult that you do not have any contact with is not only ignorant and rude but makes you sound uneducated. If anyone lacks integrity and character, it most definately would be you.

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11all4charter(1 comment)posted 4 years, 3 months ago

As I read through these posts, I was amazed how many people were jumping on the rumor bandwagon without having any actual facts. Charter schools were designed to give parents an alternative choice in free education. The result was that the students who were doing poorly or had behavioral issues that the traditional public schools couldn’t or wouldn’t address were then sent to charter schools. Race has nothing to do with it and shame on anyone for even bringing that up. And no charter schools DO NOT get to pick and choose their students. In recent years the Ohio Department of Education has set standards that all schools are having trouble meeting. How many schools are rated ‘Excellent” that you know of? Now imagine having a school full of children that aren’t your traditional honor roll students. Most charter schools are understaffed that handle these special needs children. All teachers must be “highly qualified” by ODE’s standards to teach, but if you have a classroom full of special need children then their job is much tougher than any public school district teacher’s position.
Any public school district will tell you that they are losing money to charter schools, but in reality these children are the ones they don’t want to serve and the ones that would eventually drop out so they would lose the funding for those students anyway.
As for the management, we’ve all worked with people who didn’t know their job and were able to hide it for a long period of time. So was it corruption or inadequate knowledge of their job? And did they train the person replacing them? Do that a couple of times and you’d have a big mess on your hands. I’ve also heard from a reliable source that EHA does not pay rent, they own the building. In order for them to start a new school they will have to have a management company come in and oversee the operations. They also have to have a different school board. They have a new treasurer and they have already laid off a large portion of the staff in order to trim the budget, so the new school will not have the exact same staff. How many of these rumors are being started by disgruntled staff that was let go? Has anyone looked into this or are you just going off of what the paper says? How many times have we heard that you can’t believe everything you read or hear on the news?

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12chippewa3(6 comments)posted 4 years, 3 months ago

As a former teacher at Eagle Heights I must assert that I loved my job there. I loved my students and treated them as I did my own son. I hope that I was able to instill in them the same joy of life and a desire to learn new things that I have with him. My classroom was always managed well as are most in the school. Teachers regularly gave up much of their own money to provide rewards to those students who earned them. We've also given money to a school fund to provide clothing for our kids. We gave up several Saturdays a year to attend workshops to learn the newest in teaching strategies, as well as, summer days. I know most teachers would do the same regardless of where they teach, which brings me back to my point. EHA teachers were and are well-educated and willing to improve their skills. There have been a few who were there for the wrong reasons, but look at former president George W. He had no business running a country. Even though I was one of the ones let go in April, I defer to the original intentions of the school. We had an excellent principal when the school opened, Mr.LaRiccia, and the school had so much potential. I am truly saddened by the horrible reality of the fiscal irresponsibility of the school I believed in so strongly. Those of you writing in to tear the school/staff apart are certainly intitled to your opinions, however, you cannot honestly berate us all. As a teacher, I would not punish the whole class for a few misbehaving students. That'd be unfair. Right?

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13DownTownBrown(3 comments)posted 4 years, 3 months ago

Charter schools were created by politicians for alterior motives. Religious-founded entities swooped in and got their members to follow them with their children in tow. How can anyone in their right mind say "job well done" to EHA. There performance is the worse in the state. They have a retired career-long kindergarden teacher at the helm without the proper credentials who defrauded the federal government. How dare her ! Follow the money ! It is the students and their parents who have been misled. There blind faith is an injustice. How many people got enriched in this scam? I hope they all go to jail for there sins .

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14borylie(790 comments)posted 4 years, 3 months ago

The taxpayers are practically paying young girls to have babies. Very little being done to discourage this and therefore unwed mothers,single parent homes are not prepared to prepare their kids for school. Unprepared kids start off behind the proverbial eight ball and in most cases don't have a shot. Those that have influence will continue the pc bs and the others that should be pushing these so called leaders are too scared to butt heads with the pc crowd. What the heck do you expect? And besides the liberals in this country want more and more people dependent on government. This is where it starts.

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15chippewa3(6 comments)posted 4 years, 3 months ago

paulb,what do you do for a living besides post 742 comments about things that annoy you? Here's an idea, why don't you become a teacher and go into the city schools and achieve all those things we "so called educators" failed at. I hope you have lots of patience, people skills, knowledge about every topic required of you, various strategies to go to at a moment's notice when the first 3 don't work, money to buy kids much needed clothes, supplies,and food, understanding of unusual behaviors and the ability to handle possible violent outbursts, as well as, being observant enough to detect when a child needs more than just a teacher, but a friend. Oh well, it's all in a day's work in the "cushy" role of teacher in an inner-city school.

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16Teachers(1 comment)posted 4 years, 3 months ago

I have sat back long enough to listen to all of you bash Eagle Heights Academy. Let me tell you one thing, the school has a lot of potential. I taught at Eagle Heights Academy and it has been one of the most gratifying experiences of my life. It is sad that education has come down to teaching to a test and charter schools have stipulations when other school systems can fail and remain open. Beside test scores, the school gives students numerous opportunities to become respectful citizens of their community and extra curricular opportunities as well. Children are proud of their school and it seems that we are taking that away from them. They are not the ones who managed the money and either did the teachers. There are a lot of wonderful teachers at Eagle Heights who truly care and do everything that they can to help students reach academic success. As for collecting a paycheck, that happens everywhere. After working at a Charter School, I have realized that it is a passion of mine because it is a challenge and the reward of changing lives and seeing those beautiful smiles everyday is worth way more than any paycheck. Lets forget about the money because I thought schools were about the children who attend it. Who are we; sitting here gossiping about teachers, which is really unprofessional. As for Linda Mansfield, she is a great principal. She is respected by many at that school because she is firm and the kids respect her. I don’t care about her secrets because that is none of my business and none of yours. Schools need more principals like Linda Mansfield. A degree is a piece of paper, but the skills and attributes you bring to a school is what matters. The children at that school take pride in their colors and it seems as if we are taking that away from them. We need to focus on the business aspect, not bashing the teachers or kids. Walk through the halls of Eagle Heights, sit in a classroom and watch the teachers in action, look at the faces of all those happy kids who might only have that smile on their face for the 7 hours they are at Eagle Heights Academy, than you can talk. As for teaching in a city school, it is not for everyone, and someone has to do it. If it was that bad, teachers would move where they could get a job tomorrow. I hope a new school replaces Eagle Heights and mismanagement of money does not happen again.

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17BestPractice(1 comment)posted 4 years, 3 months ago

Sadly, the local report card is the only thing that the public sees to determine the effectiveness of a school.

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18chippewa3(6 comments)posted 4 years, 3 months ago

So, what is the solution to the miseducation of our nation's inner-city youths? Homeschooling? Yeah, right. Not only is that illogical , but it's also a "lazy" response to a serious problem. I didn't get my degree from a mail-order catalog, nor did I teach myself how to be a teacher. I am not an inferior human being or educator because of my years at Eagle Heights. On the contrary, we have been provided over the years with incredible opportunities at the school to enhance our teaching abilities. Linda Mansfield was the one who made sure we received these valued lessons. Not for her benefit or gain, but for the kids and us. So be careful how and who you so freely judge, or you too will be judged in the same manner. paulb, being a "business owner" puts you in the perfect position to contribute to the education of inner-city children. Have you heard of Junior Achievement? Check it out. However, most people, not just paulb, don't honestly have a solution to this epidemic plaguing the U.S. It's not just Youngstown. We aren't "allowed" to say the parents have anything to do with their child's performance in school, right? They aren't a product of their environment? So if a kid comes to school after being up a good portion of the night due to hunger and loud activity in the home; He/she has on dirty clothes that are too small, and they had no one to care enough whether or not their homework is done. Nobody raises a fuss when he/she does well or poorly on a test or could care less if they go to school at all. Maybe they got a "smack-down" for not watching their sibling and their back has lash marks on it and they can't concentrate on their schoolwork in class. And their parents aren't responsible? Get real!! This was my reality at EHA. Oh!Go ahead and try to call a parent who doesn't want to be called. Good luck! Although to be fair, there are a fair number of well taken care of children with good parents/guadians. But guess what, those kids are the ones who perform as expected. Go figure... People who have NO KNOWLEDGE of what it's like to teach in an inner-city school need to help solve this or "back off". This is a societal problem. Not just an EHA or Youngstown City School problem. Here's the deal: if you're not part of the solution, then get out of the way.

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19chippewa3(6 comments)posted 4 years, 3 months ago

You do raise some valid points that I would have to agree with, paulb. It is a socio-economic issue that is more complicated than at first glance. I know that parents or guardians at home who themselves are responsible adults- emphasize adults- are more likely to raise children who are conscientious about their schoolwork, appearance, future, etc. Believe me I've had a good number of kids who fall into that category. Unfortunately, the behavior that too many bring, from home, is in a nutshell "off the hook". You seem to know a lot about what behavior we've dealt with at EHA as you've attended a city school? Yes, people do live off of the govt.and we do need stricter regulations for assistance. I'm currently unemployed and hoping a school system in the area will give me a chance, however, I've heard from many people that area schools won't hire city or charter school teachers. How long will it take me to find a teaching job? Until then I need unemployment... Back to the kids- Who will take the kids to the Boys/Girls club to get the food? Many children go home to no one or a house full of underage kids...And the neglect issue? Children Services are the ones we contact with any of those concerns and then it's essentially out of our hands. We at EHA did have a clothing fund where the staff would all contribute money to provide as many kids as we could with new uniforms. Most of us did and do love our students and are great teachers.. Homework is a reinforcement of material learned during the day, plus it shows parents what they are learning at school...

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20drw122(35 comments)posted 4 years, 3 months ago

paulb, While your numbers are correct comparing Eagle Heights with State scores, you forget one thing. The parents aren't comparing their options with the other State schools. Unless they choose a cyber school the options are only local. The comparison with the Youngstown City schools is the numbers that the parents need to evaluate and with that choice, Eagle Heights would be the best option, correct? As I've stated before in another post. Everyone is jumping on Eagle Heights because of mismanagement and rightfully so. Whoever is responsible should be held accountable. However the mismanagement at Eagle Heights is nothing in comparison to the mismanagement at the Youngstown government schools, not only have they wasted millions of tax payers’ dollars but their ineptness has destroyed communities and families. Their failure to educate our children will take generations to repair. My question is, where is the outrage, where are the headlines. The answer is no where; the failure continues and will for a long time. I blame the teachers union; they care more about their pocket than they do the student. I hate to paint with such a broad brush but even the good teachers won't stand up to the local union thugs.

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21Education_Voter(851 comments)posted 4 years, 3 months ago

There have been an few untrue things said here that tried to drag Youngstown City Schools into this mess.

First of all, Eagle Heights does not serve more learning disabled students or poorer students than Youngstown City Schools.

They drew off better students and got worse results, while claiming the reverse.

Ohio's charter schools are the most scandal ridden in the U.S., and when it comes to charter schools, that's saying a lot. I believe this is because they got off to a bad start: born from the corruption of legislators who traded contributions for lax charter laws( from David Brennan, a wealthy entrepreneur and lawyer,) How could you ever expect more than what we got -- poor performance?
For more examples of current scandal:
A group of 10 charter schools in Akron and Cleveland sued their for-profit management firm, White Hat Management. Besides managing other charter schools, White Hat has its own schools, the Life Skills Centers, here in the Valley, and was a former associate of Eagle Heights, before the current poor managers.
The boards of the schools allege that a 2006 state law is unconstitutional and gives the for-profit company unchecked authority - even the ability to replace the board when it doesn't agree with the company. The suit contends White Hat's interest in making a profit conflicts with the schools' educational goals. White Hat declined to comment.
http://www.cleveland.com/open/index.s...

And from even the conservative the Fordham Institute:
"Enter into this debate Imagine Schools. The company, based in Florida, is apparently structured to neuter charter school governing boards (the non-profit entities accountable to authorizers and the state for school performance), photocopy applications for school operations, and run financial systems that direct as much money as possible to its corporate office with apparently little regard for student performance. Imagine operates 11 schools in Ohio and according to a new study from Cleveland-based Policy Matters Ohio it “receives as much as 98 percent of its schools’ funding to act as superintendent, central office, principal, workforce and landlord.”
Policy Matters Ohio has long been opposed to charter schools, but they have discovered an easy target in Imagine and are hitting the Ohio charter community over the head with it. Imagine Schools’ weak performance and avarice management style has trashed the charter movement nationally and resulted in calls from some Congress to ban “for-profit operators” nationwide. Along with Ohio, the charter movements in Indiana, Florida, and Missouri have all been given a black eye by Imagine Schools."
http://www.edexcellence.net/flypaper/...

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22Education_Voter(851 comments)posted 4 years, 3 months ago

Paulb,
Let's talk about being dishonest. Here is Paulb's quote from earlier (marked 806 comments):
"Calling Eagle Heights Academy anything other than a failure is being dishonest. The academic numbers from OAT testing are very bad. Perhaps better than Youngstown's school district, but still a failure."
I can't believe the Paulb wasn't being disingenuous when he presented Eagle Heights scores, and implied the Youngstown City's were lower. He was able to look up Eagle Heights scores, so he could have checked YCS's in comparison.
In fact, when you look up the school report card at the Ohio Department of Education, the charter school scores are placed next to the comparable school district. For Eagle Heights, the comparable school district is Youngstown City. You actually have to skip over their scores to get to the state average. Out of 18 scores, YCS were lower on 3 -- by a few percentage points.
Here's the scores from last year, which seem representative. (Note: 5th grade scores are lower than other grades statewide, as the result of an extra difficult test.)
Eagle Heights 4th Grade Reading: 50.6% At YCS: 67.1%
EH 4th Grade Math:
46.8% AT YCS: 54.2%
EH 4th Grade Writing:
51.9% At YCS: 67.6%
EH 5th Grade Reading:
17.1% AT YCS: 31.1%
EH 5th Grade Math:
22.4% YCS: 22.4
Science: 26.3% YCS: 27.3%
Social Studies: 14.5% YCS: 22.4%
6th grade Reading 40.5%
YCS: 51.4%
Math 31.1%
YCS: 37.6%
For the uninitiated, these are not the student's scores, they are the percent of students reaching the year's expected number of points.
BY THE WAY, THE PARENTS ARE SENT THIS COMPARISON MARKED CLEARLY EVERY YEAR. They just don't seem to care that EH scores are lower.

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23Education_Voter(851 comments)posted 4 years, 3 months ago

By the way, Eagle Heights does not have the lowest charter school scores in Youngstown. At some charter schools, the percent of students reaching the bar in 5th grade is 0%.
That's right. Not a single student at the charter school reaches the bar, yet parents think it is a good "choice".

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24Education_Voter(851 comments)posted 4 years, 3 months ago

Chippewa, At least a half dozen city teachers switch to suburban school districts every year, so your experience of difficulty getting hired is unique.
If you are from Chippewa, maybe you should try PA schools, where the salaries are higher.

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25drw122(35 comments)posted 4 years, 3 months ago

How do the test scores at Youngstown Christian School compare to the Youngstown government schools?

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26Education_Voter(851 comments)posted 4 years, 3 months ago

Interestingly enough,
the scores of parochial and Christian schools are kept secret by the Ohio Department of Education. (Only the voucher students are required to take the test, but that is one-third of Youngstown Christian's student body.)
hmmm
Why would that be, do you think?

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27Education_Voter(851 comments)posted 4 years, 3 months ago

Here's a great promoter of Christian Schools, David Brennan, who seems to be channeling Boss Hogg from "The Dukes of Hazzard" in most pictures:

http://blog.cleveland.com/openers/200...

He started out as a voucher promoter, then switched to more profitable charter schools. Here's a history:

http://www.cleveland.com/charter/plai...

Here's his partner in crime, Allison Perz, whose mother, a former Rep. Ohio House Member sponsored the original charter bill, then went on to lobby for David Brennan, then to work for her daughter. Her daughter earns six figures as the Executive Director of Ohio Council of Community Schools, which is I believe, Eagle Heights current sponsor. Perz hires Brennan's company to manage their schools. His management company buys books from his supply company and rents his rental properties:
http://www.toledoblade.com/apps/pbcs....

Scroll down to the end of the article to see how well their schools throughout the state are doing.

Search the Toledo Blade and Columbus Dispatch archives to see regular reports on their schemes.

I would have to say the Ohio Department of Education is well aware of "community"/charter school scams and never does anything to stop it.

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28drw122(35 comments)posted 4 years, 3 months ago

Education_Voter, I really don't get your point about Brennan. Are you saying he takes taxpayer money and puts them in the Education system and some schools fail? Isn't that exactly what the Youngstown School System has done for years only on a larger scale? Also I didn't know there was a conspiracy to hide test scores from the ODE. Wow

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29Education_Voter(851 comments)posted 4 years, 3 months ago

No.
Brennan takes taxpayer money and puts it in HIS pocket and the pockets of legislators and former legislators.

You are right about the part where students fail.

I did not say that Youngstown Christian is hiding their test scores FROM the ODE. They turn voucher student scores into the ODE. The ODE hides the scores from the public. Otherwise I would be glad to look them up for you.

Let's be clear. Not because ODE employees want to do this. But because those are the rules the legislature made for them to follow. I am not picking on Youngstown Christian School. As I said, the scores from all parochial and Christian schools are kept secret.

If you are going to attempt sarcasm, be smarter about your facts first.

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30Education_Voter(851 comments)posted 4 years, 3 months ago

By the way DRW, I see you are now claiming that the charter school is the SAME as Youngstown City. (Again, I would disagree. But I thought your point was that they were BETTER.) What posters here are saying is that if they are the same or worse, why have them?

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