Future of online schools run by out-of-state companies in doubt at Capitol

DES MOINES - Two school districts that contracted with out-of-state companies to run online schools may have a harder time opening in the fall than they first anticipated.

On Thursday, a Senate oversight panel took up the question of whether the schools at Clayton Ridge Community School District and CAM Community School District were set up legally under the law.

No decision was made at the meeting, but subcommittee chair Sen. Tom Courtney, D-Burlington, said he hopes to reconvene the panel this week.

Lawmakers in House and Senate committees last week approved language that would essentially prohibit either school from operating as now planned. The provisions were part of the chambers' respective education reform proposals.

“I think that the Department of Education told them it was OK,” Courtney said of the schools' operations.“I think it was wrong for the department to do that, but they made that decision to do and it's our place to see if it was right or not.”

Clayton Ridge contracted with K12 Inc. to run its online school. CAM contracted with Connections Academy. Although specifics of the programs vary, both companies are set up in a similar manner. Each has a contract with its host district that guarantees the host a base fee of $50,000 and a certain percentage of the per-pupil state aid of $5,853 each year. This is called an administrative fee. In Clayton Ridge, the administrative fee is 3.5 percent and at CAM, it's 3 percent.

Anthony Voss, superintendent of the Hudson School District, testified at the hearing that he became concerned about the online schools when he started hearing them advertised on the radio.

“How do we know the work's getting done and by whom?” he said. “Fully online classes do not allow for students to have discussion with their peers.”

He said he was in favor of online learning, but legislators needed to take “a hard look” at the models being used in the state.

Steve Pelzer, superintendent of the CAM district, said he is first and foremost a supporter of traditional school, but for some students, online schools may be the right alternative.

Sen. Kent Sorenson, R-Milo, compared K12 and Connections Academy to companies that sell books or school supplies. Courtney didn't seem swayed.

“This is a huge amount of taxpayer dollars, we're talking $6,000 a student, we're talking potentially millions and millions of dollars going to out-of-state companies,” he said. “Now as far as the contracts they've already signed, that will be a decision that the Legislature will make. If we change the legislation, we'll have to go ahead and decide if they can finish up those contracts or what else needs to be done.”